Inspector General Finds No Faults in Beef Checkoff Administration

Inspector General Finds No Faults in Beef Checkoff Administration

OIG report examines beef checkoff program for funding compliance

The Office of the Inspector General this week released the findings of its investigation into claims of fund misappropriation by the Beef Checkoff, finding no compliance issues.

The audit comes after allegations that checkoff funds – which are collected for every beef or product sold or imported in the U.S. – were being filtered into lobbying causes by the National Cattlemen's Beef Association.

A Montana-based cattle group in October, 2012 sent a letter to Agriculture Secretary Tom Vilsack asking for an audit on concerns of abuse.

OIG report examines beef checkoff program for funding compliance

However, the audit found that the Beef Board – the manager of checkoff funds – is in compliance with legislation that authorizes the checkoff and dictates acceptable use of funds.

"The relationships between the Cattlemen's Beef Promotion and Research Board and other industry-related organizations including … the National Cattlemen's Beef Association, complied with the (Act and Order). Funds were collected, distributed and expended in accordance with the legislation," the report said.

The checkoff amasses about $36 million in producer assessments and $6 million in importer assessments – funds that are used for beef marketing and promotion activities.

Weldon Wynn, Cattlemen's Beef Board Chairman, said even with OIG's confirmation that the Beef Board's oversight of fund use is effective, and that its relationships with contractors such as the National Cattlemen's Beef Association are in compliance, "the Beef Board maintains a mission toward continual improvement in our responsibility to producers."

Wynn said since 2010, CBB has operated under a stronger review and verification process, along with expanded and specific guidelines for contractors. CBB also requires contractors to provide additional information about implementation costs as they prepare funding requests, which provides decision-makers with a more detailed understanding of project costs before approving them.

The OIG report did find some recommendations, however, that were accepted by the Agricultural Marketing Service. Those include stronger controls and records on project costs and development of standard operating procedure for management reviews specific to the beef board.

Click here to read the report.

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