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‘Auditcations’-Why Are E-rate Audits Taking So Long?

We've all dreamt of the European-style, month-long vacation. In these tough economic times, people have invented the staycation. When the FCC takes as long as four weeks on site for an audit, should these be called "auditcations?"

In a recent blog post "Where's the Fraud?", I waxed poetic about the rising costs of FCC audits. One reason that these E-rate audits are becoming so expensive is that it takes a considerable amount of money to send auditors to a school site, where in some cases they can spend upwards of four weeks on site. When you factor in daily lodging, per diem costs for each day worked and travel back home on the weekends; one can see how the costs quickly begin to escalate.

Ironically, the document discovery process is conducted almost exclusively by the schools themselves. School staff locates the documents and then provide copies of these documents to the auditors in hard copy or in electronic images. In fact, most of the heavy lifting is done before the auditors even arrive on-site. Can the review of these documents not be done remotely? In many cases, auditors would need only a 2-3 day site visit for issues that require on-site inspection and face-to-face discussion. When you consider that many large corporations have slashed their travel budgets by resorting to electronic web-based meetings and electronic document exchange, it is unbelievable that the FCC can justify spending an entire month at a school site.

These costs aren't just relegated to the FCC. The schools and libraries being audited also incur costs, in terms of manpower and resources. As we all know, many small school districts and consortiums do not have a dedicated E-rate staff. With audit teams on-site for extended periods of time, school personnel is stretched, trying to maintain regular school business and availing themselves to the auditors. In addition to the strain on the cadre, the school must also provide the audit team with facilities and often times equipment (i.e. copiers, Internet access, printers, etc.). For schools with already limited space, this may mean using classrooms or other areas normally reserved for students or other staff.

With the average cost of an audit climbing to $110,000, doesn't it make more sense to limit discretionary spending on travel, particularly when the majority of the work can be done via email correspondence? I'm not implying that auditors should never travel to an applicant's location. In fact, there are some issues that require the physical presence of an auditor on site. However, spending multiple weeks on site is just ridiculous and an enormous strain on USAC's already limited budget. Instead of spending hundreds of thousands of dollars on these audits the FCC should take that money and increase the percentage available for Priority 2 services.

I hope we can minimize these "auditcations" and redirect our focus on the primary issue; getting our schools wired.

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