WASHINGTON — After more than two years, the USDA Office of Inspector General determined the Cattlemen’s Beef Promotion and Research Board and the National Cattlemen’s Beef Association are complying with federal legislation when it comes to spending funds generated by the beef checkoff.
In July 2010, an audit was brought forth by the Cattlemen’s Beef Board on the financial records of the NCBA.
The audit covered the fiscal years 2008, 2009 and through February 2010.
The NCBA ended up deciding to pay back $217,000 for discrepancies involving how money from the beef checkoff program was spent during 2008 through February 2010.
Some of the issues raised as a reason for the audit was how employees’ time is recorded, travel costs and other expenses charged to the beef checkoff program and not through the NCBA. The funds in question have now been repaid to the beef checkoff and instead paid for through the NCBA policy division.
One example noted in the audit are travel expenses charged for a trip to New Zealand and Texas.
A senior staff member expensed travel costs totaling $3,592 related to his spouse’s travel to New Zealand for the Five Nations Beef Conference. It also noted his spouse and child’s travel to San Antonio, Texas, were charged to the overhead cost pool.
According to the audit’s findings, since these expenses relate to the spouse and child, the expenses should be recorded to the policy division. Checkoff funds cannot be used for spouse’s travel per the Agriculture Marketing Service guidelines.
The NCBA pointed out in its response that the employee’s employment agreement provides for the spouse to travel to two industry meetings per year. The terms of the employment agreement will be revised so that the trips will not be charged to the checkoff division.
In compliance, but… Although the NCBA and Cattlemen’s Beef Promotion and Research Board are found to comply with federal legislation, the Office of Inspector General did issue a notice.
The OIG determined the Agricultural Marketing Service needs to strengthen its procedures for providing oversight to the beef research and promotion program.
“As part of our audit, we determined that assessed funds were collected, distributed and expended in accordance with legislation. However, we found that AMS had not previously made these determinations itself because AMS had not conducted periodic management reviews of the beef board and the agency’s procedures for conducting these reviews could be improved,” the OIG stated in the report.
“For example,” the report continued, “AMS had not identified weaknesses in the beef board’s internal controls over project implementation costs. Sensitivity to these controls is important because the costs are incurred by the national marketing body the beef board is required to use.
“With AMS’ independent oversight, it may not be clear to beef producers, importers, and the public that beef checkoff funds are collected, dispersed and expended in accordance with legislation,” the OIG stated.
Checkoff opponent R-Calf USA showed displeasure with the OIG Beef Checkoff Program report in an issued statement.
“After taking longer than two years to complete, R-Calf USA could not be more disappointed in the absurd, incomplete and trivial report…”
The statement went on to say, “Only within an agency fraught with corruption and cronyism can a conclusive finding that the NCBA had improperly charged the beef checkoff fund hundreds of thousands of dollars nevertheless result in a conclusion by USDA that NCBA is guilty of no wrong doing. The agency’s pronouncement that such is the case defies any semblance of logic, impartiality and credibility.”
Chase Adams, NCBA director of communications, said the OIG report stands on its own.
“If you don’t agree with an unbiased, non-partisan report, then I don’t know what to say,” said Adams.