The Universal Service Administrative Company should “examine, identify, explain and...

The audits, released in a final report in December, found, among other problems, “inadequate/missing” documents, “inaccurate line count/loop data,” accounting problems, errors in subscriber lists, eligibility problems and revenue reporting errors. VanRoekel said “we recognize and appreciate USAC’s efforts to date in indentifying and reducing improper payments under the high-cost program,” but a tighter review is “critical in further reducing improper payments and improving the efficiency and effectiveness of administration for the high-cost program.” In a separate letter published Thursday, VanRoekel asked USAC to explain why it wants to put furniture and other “fixed assets” purchased with Universal Service Fund cash on USAC’s own books. For “several years,” USF was “billed based upon USF profit and loss expenses rather than USAC’s actual cash disbursements,” VanRoekel said. But USAC has claimed that “this methodology understated USF expenses and resulted in a cumulative adjustment to USAC’s administrative expenses and a reduction in USAC’s Due To/Due From balance.” USAC has said it wants to modify its bookkeeping so the $16.5 million that USF spent on furniture, computers and other fixed assets should be chalked up to USAC’s accounts. “Given USAC’s past accounting practices for USF fixed assets and to further consider USAC’s proposal, we are requesting that USAC provide us with a legal and accounting justification for recording all fixed assets,” VanRoekel said. Finally, VanRoekel ordered USAC to conduct disaster recovery tests “of all its major applications and general support systems” at least once per year, to re-authorize “all systems under USAC control” every three years “or when a significant change to the information system occurs” and to “document a security authorization letter for the USAC General Support System that includes the authorization decision, terms and conditions.” An FCC official described the directives as a housecleaning necessary to help the FCC in its proposed overhaul of the Universal Service Fund and intercarrier compensation regime.