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constitutes official action.  See MCI v. FCC. 515 F 2d 385 (D.C. Circ 1974).
FOR IMMEDIATE RELEASE:  CONTACT: kent.nilsson@fcc.gov                                                                                                                                    
October 3, 2007      
INSPECTOR GENERAL RELEASES STATISTICAL ANALYSES 
OF AUDITS OF UNIVERSAL SERVICE FUND
Washington DC – The Federal Communications Commission's Office of Inspector General (FCC-OIG) 
released its initial analysis of audits of the Universal Service Fund (USF). The USF is administered by the 
Universal Service Administrative Company (USAC) on the Commission’s behalf.  The FCC-OIG reports 
contain statistical analyses of 459 audits of USF program participants.  
In general, the audits indicated compliance with the Commission's rules, although erroneous payment 
rates exceeded 9% in most USF program segments.  
The participants represent entities that received funds from, or contributed funds to, the USF program.  
All USF programs were audited: Contributors payments; Low Income, Schools and Libraries, High 
Cost, and Rural Health care. The audits were performed by commercial audit firms contracted and 
managed by USAC with FCC-OIG oversight.  The audits were initiated to determine whether 
contributions to the Universal Service Fund, and distributions from that fund, were being made in 
accordance with the Commission's rules, and to produce data that would provide a basis for statistical 
estimates of erroneous payment rates as required by the Improper Payments Information Act ("IPIA").   
The audits resulted in the following erroneous payments rates:  Contributors payments - 5.5%, Low 
Income - 9.5%; Schools and Libraries - 12.9%; High Cost Fund - 16.6%; and Rural Health Care - 20.6%.
An "erroneous payment" is defined by the Office of Management and Budget under the IPIA to be "any 
payment that should not have been made or that was made in an incorrect amount under statutory, 
contractual, administrative, or other legally applicable requirements.  Incorrect amounts are overpayments 
and underpayments (including inappropriate denial of payment or service).  An improper payment 
includes any payment that was made to an ineligible recipient or for an ineligible service, duplicate 
payments, payments for services not received, and payments that are for the incorrect amount.  In 
addition, when an agency's review is unable to discern whether a payment was proper as a result of 
insufficient or lack of documentation, this payment must also be considered an error."  
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