CAGW: End IRS Mismanagement of Software Assets | Citizens Against Government Waste

CAGW: End IRS Mismanagement of Software Assets

Press Release

For Immediate Release Contact: Alexandra Booze 202-467-5318
April 10, 2014  


(Washington, D.C.) – Today, Citizens Against Government Waste (CAGW) reacted to the Treasury Inspector General for Tax Administration (TIGTA) final audit report on the Internal Revenue Service’s (IRS) management of its software licenses.  The report found that the IRS spent $235 million on software licenses in 2011 and accounted poorly for those assets.  Despite the availability of private sector software asset management tools, the IRS continues to insist it should develop its own system. 

The 2014 report was preceded by TIGTA’s fiscal year 2013 audit report on IRS software licensing.  The 2013 report noted that the agency’s dysfunctional and inefficient inventory of software records caused licenses to be both overused and underused, including many that were not utilized in a cost-effective manner because far fewer licenses were deployed than the IRS had purchased.  This 2014 report cited $11.6 million spent for unused software assets and $1.5 million for license and software subscription support fees. 

CAGW has been tracking software license management in the federal government for several years. A May 10, 2013 educational briefing hosted by CAGW noted that off-the-shelf software asset management tools are used extensively in the private sector, state and local governments, and at federal agencies.  The FY 2014 National Defense Authorization Act requires the Department of Defense to update its software license inventory, including a comparison of licenses purchased with licenses being used.  H.R. 1232, the Federal Information Acquisition Reform Act, which has passed the House twice but not the Senate, includes similar language on software asset management that would apply to all federal agencies.

The TIGTA recommended in both the 2013 and 2014 reports that the IRS should utilize a software license tool that would discover, track, and manage software license deployment and usage, as well as efficiently maintain software inventory.  In its response, the IRS indicated it would do so, but only by developing its own software inventory system, rather than using private sector software asset management that is readily available from companies such as Aspera, Eracent, Flexera, and Snow Software. 

“There is no excuse for mismanagement of software licenses.  Sophisticated software asset management tools are prevalent throughout the private sector and at all levels of government,” said CAGW Director of Technology and Telecommunications Policy Deb Collier.  “Despite indicating a willingness to accept most of TIGTA’s recommendations, the IRS continues to deny that software management solutions exist outside of its own system, the building of which will both use up scarce taxpayers dollars and likely fail to function effectively.  The IRS has enough problems; more of them do not need to be unnecessarily created.”

Citizens Against Government Waste is the nation’s largest taxpayer watchdog dedicated to eliminating, waste, fraud, and abuse in government.