IRS CIO improperly delegated key IT spending responsibilities, watchdog says

A Treasury Department watchdog found that the IRS is not complying with key elements of FITARA, the 2014 law that put agency CIOs in charge of IT management and purchasing decisions.

According to a July 27 report from the Treasury Inspector General for Tax Administration (TITGA), the IRS CIO has not been involved in some of the agency’s major IT spending decisions. The CIO was instead delegating responsibilities to subordinates, following IRS rules that predate and conflict with FITARA.

In accordance with FITARA, agency CIOs have to be actively involved in the decision-making and review process for major IT contracts and acquisitions.

TITGA noted that the IRS CIO “does not review the acquisition and contract sections in the business cases” for major investments. Instead, an associate CIO presents information about these business proposals to the CIO annually, according to the report. But TITGA found that these annual presentations are scant in key information that the IRS CIO would need to know to meet FITARA requirements.

“However, these high-level acquisition data do not include vendors’ names, the purpose of the contracts, or contract dollar amounts,” TITGA reported, adding that it doesn’t believe this satisfies the CIO’s duties under FITARA.

In addition, the report said the CIO “broadly delegated” responsibilities for approving major IT acquisitions at the IRS. Instead of the CIO being actively involved in these decisions, the deputy CIOs and associate CIOs have been given the authority. Even some executives who report to those officials have some authority to approve IT purchases. TITGA says this flies in the face of FITARA.

“This delegation of authority as it relates to major information technology acquisitions is contrary to the basic principles of the FITARA,” the report says.

According to TITGA, the IRS’s current procedures for who in the agency has authority to make final decisions about IT spending date back to 2011. The IRS told TITGA that it plans to update the delegation order, according to the report.

In its report, TITGA recommended that the IRS comply with the Treasury Department’s FITARA guidance. That means that the responsibility to review IT acquisition and contract sections in IRS business cases goes to the CIO. The watchdog also recommended that the IRS establish a process for the approval of IT acquisitions that is in line with FITARA. The IRS agreed to the recommendations.