Index to functions proposed to be abolished by Sec. 3 Labor beyond usual daylinght hours. 3 (a) (5). Collector. Surveyor Vacancies; how filled. Description of duties. Surveyor Keep accurate accounts of receipts and expenditures; send to General Accounting Office.. Collector. Comptroller. R. S. 2621; 19 U. S. C. 33. R. S. 2626; 19 U. S. C. 39. Surveyor. Render list of clerks employed; account for contingent expenses. Render accounting for performance of duty for another collector. Post table of rates of fees and duties. Examine books and accounts of depositaries and collectors. To receive and record manifests, documents, entries, moneys, etc. Perform alone the comptroller's and surveyor's duties if no comptroller or surveyor. Mr. GRAHAM. In summarizing the accounting features of the plan, we wish to emphasize: (1) Customs will continue to have an internal audit program, but it will be more flexible and useful, as well as less costly; (2) the Comptroller General will continue to provide the external audit program, including a check upon the effectiveness of our accounting system and internal audit and control. The Comptroller General has been very helpful in giving us advice and counsel with respect to that portion of the plan which covers the accounting provisions. At that point, Mr. Chairman, if I may interpolate, we have received a letter from the Comptroller General and with your permission we would like to have photostat copies of the letter made part of the record. The CHAIRMAN. That is the letter of May 9? Mr. GRAHAM. That is the letter of May 9. The CHAIRMAN. We have a copy of it here. It will be made a part of the record. Mr. GRAHAM. Thank you, sir. The CHAIRMAN. You have there also comments of the General Accounting Office on this plan? Mr. GRAHAM. That is the letter of May 9, sir. The CHAIRMAN. We have another memorandum here. This memorandum which I have is attached to that letter of May 9 from the Comptroller General to the Secretary of the Treasury. That will be made a part of the record at this point. (The letter referred to is as follows:) GENERAL ACCOUNTING OFFICE, COMPTROLLER GENERAL OF THE UNITED STATES, Washington, May 9, 1952 The honorable the SECRETARY OF THE TREASURY. MY DEAR MR. SNYDER: I have your letter of May 5, 1952, with reference to Reorganization Plan No. 3 of 1952 for the Bureau of Customs, particularly to the provisions of section 3 of the plan dealing with the proposed abolition of certain statutory accounting functions. Your letter requests my comments regarding the plan as finally presented to the Congress in the President's message of April 10, 1952. I am glad to give you my comments on the reorganization plan which relate only to section 3 of the plan, since the remaining sections involve questions of policy for the consideration of the Congress. As indicated in the President's message and in your letter, the accounting and auditing procedures of the Bureau of Customs have been reviewed by the Bureau of the Budget, the General Accounting Office, and the Treasury Department under the joint program for improving Government accounting. Staff of the General Accounting Office in cooperation with the Bureau of Accounts and the Bureau of Customs of the Treasury Department conducted an extensive survey of the fiscal operations of the latter Bureau in 1949 and early 1950. As a result of this survey, it became evident that certain processes required by statute are archaic and obsolete. Statutory requirements that certain functions be performed by specific officials have resulted in restrictive and rigid procedures and practically precluded adoption of the more efficient modern accounting and fiscal practices envisioned by the Budget and Accounting Procedures Act of 1950. In addition, the existence of statutory requirements for repetitive performance of some detailed functions by two officials necessarily results in duplication. Other provisions which define the scope and extent of checks and reviews prevent the exercise of sound judgment and application of more economical and efficient auditing practices based on effective accounting procedures. Much of the resulting detailed work now done by the Bureau can be eliminated through the development of an appropriate accounting system incorporating adequate internal control and an effective internal-audit staff. The abolition of the statutory functions as proposed in section 3 of Reorganization Plan No. 3 of 1952 would clear the way for the modernization of customs accounting and auditing procedures under the authority contained in the Budget and Accounting Procedures Act of 1950 and in accordance with the intent of Congress as stated in that act. I have been assured that the complete accounting improvement program for the Bureau of Customs contemplates, in lieu of the procedures and functions abolished, the development and installation of more economical and efficient procedures by the Secretary of the Treasury in close cooperation with the General Accounting Office and in accordance with principles and standards established by the Comptroller General. It is believed that this will result in improved control of customs revenue and the elimination of much unnecessary or ineffective documentation and dual record-keeping now required. In addition, a more adequate system of accounting and internal control will permit the General Accounting Office to discharge its audit responsibility to the Congress with a minimum of cost and effort. I appreciate your reference to the cooperation of members of my Accounting Systems Division and other officials of the General Accounting Office with the Bureau of Customs and other Treasury officials in assisting in the formulation of plans for improving customs accounting and auditing. It has been a pleasure for our staff to work with yours in this area. The work which has been done and is continuing is another example of what can be accomplished for better government through the cooperative approach. Please feel free to submit this reply for the record of congressional hearings on Reorganization Plan No. 3 if you so desire. Sincerely yours, -LINDSAY C. WARREN, Comptroller General of the United States. COMMENTS OF THE GENERAL ACCOUNTING OFFICE ON REORGANIZATION PLAN No. 3 OF 1952 Comments herein on Reorganization Plan No. 3 relate only to section 3 of the plan since the remaining sections of the plan involve questions of policy for the consideration of the Congress. Staff of the General Accounting Office in cooperation with the Bureau of Accounts and the Bureau of Customs of the Treasury Department conducted an extensive survey of the fiscal operations of the latter Bureau in 1949 and early 1950. As a result of this survey, it became evident that certain processes required by statue are achaic and obsolete. Satutory requirements that certain functions be performed by specific officials have resulted in restrictive and rigid procedures and practically precluded adoption of the more efficient modern accounting and fiscal practices envisioned by the Budget and Accounting Procedures Act of 1950. In addition, the existence of statutory requirements for repetitive performance of some detailed functions by two officials necessarily results in duplication. Other provisions which define the scope and extent of checks and reviews prevent the exercise of sound judgment and application of more economical and efficient auditing practices based on effective accounting procedures. Much of the resulting detailed work now done by the Bureau can be eliminated through the development of an appropriate accounting system incorporating adequate internal control and an effective internal audit staff. The abolition of the statutory functions as proposed in section 3 of Reorganization Plan No. 3 of 1952 would clear the way for the modernization of customs accounting and auditing procedures under the authority contained in the Budget and Accounting Procedures Act of 1950 and in accordance with the intent of Congress as stated in that act. I have been assured that the complete accounting improvement program for the Bureau of Customs contemplates in lieu of the procedures and functions abolished the development and installation of more economical and efficient procedures by the Secretary of the Treasury in close cooperation with the General Accounting Office and in accordance with principles and standards established by the Comptroller General. It is believed that this will result in improved control of customs revenue and the elimination of much unnecessary or ineffective documentation and dual record keeping now required. In addition, a more adequate system of accounting and internal control will permit the General Accounting Office to discharge its audit responsibility to the Congress with a minimum of cost and effort. Mr. GRAHAM. Thank you, Mr. Chairman. The third important feature of the plan provides for the establishment of new offices in the Bureau of Customs. The effect of the language is simply to authorize the compensation of certain key departmental and field officials at the so-called super-grade rates of pay if they are found by the Civil Service Commission to qualify therefor in accordance with the standards of the Classification Act of 1949. The CHAIRMAN. Do I understand that some of these salaries are now fixed by law, that is, for some of these offices that you are abolishing? Mr. GRAHAM. I understand, sir, that up until 1949 there was the collector of customs in New York whose salary had been established by law but that was changed, The CHAIRMAN. Do I understand that under this plan, if the Civil Service Commission certifies that the duties are of a high-grade nature or such as to entitle them to higher rating, they will be rated higher and therefore their salaries would be increased accordingly? Mr. GRAHAM. That is correct. The CHAIRMAN. According to the Civil Service Classification Act? Mr. GRAHAM. Yes, sir. The CHAIRMAN. In other words, some now may have such duties in line with the pay they are receiving but if they consolidate or transfer other functions to them, their responsibilities may increase and of course whoever is found competent under civil-service standards to fill that position would be entitled to have a higher civil-service rating? Mr. GRAHAM. That is correct, sir. The plan provides for 20 additional positions in these grades. These would be warranted in view of the nature and responsibility of the work to be assigned. Of course, the allocation of grades will be made by the Civil Service Commission. The CHAIRMAN. That does not necessarily mean that the 20 new positions being created would be an additional personnel expense? Mr. GRAHAM. As I understand it, Mr. Chairman, the Classification Act of 1949 created 400 supergrade positions throughout the Government. The CHAIRMAN. Some have been allocated to this Bureau? Mr. GRAHAM. And five have been allocated to customs, and this would give them 20 more if, as you point out, the civil service found that the consolidated positions and the responsibilities warranted that. The CHAIRMAN. I am not complaining about it particularly, but Congress set a limit on those high positions to be distributed throughout the executive branch of the Government. Yet in every one of these reorganization plans coming in to reorganize a department, we give them some extra and keep therefore increasing that limitation which Congress has previously set. If Congress was right to begin with, I do not think that can be justified unless you can show that actually you are making consolidations which eliminate other personnel expenses and justify the establishment of these higher-classified positions. Mr. GRAHAM. That is the general concept in here, Mr. Chairman. The CHAIRMAN. That is the theory of this? |