What does OMB Circular A-123 define?

• A. Management responsibilities for internal controls in Federal agencies
• B. Privacy rights of individuals in federal systems
• C. Acquisition and contract guidelines for federal agencies
• D. Standards for financial reporting in government programs

Answer: (A)

OMB Circular A-123 defines management's responsibility for internal controls in Federal agencies. It establishes that agency leadership must design, implement, and continuously evaluate internal controls to provide reasonable assurance that objectives are met in operations, financial reporting, and compliance with laws and regulations. The guidance requires documenting controls, assessing risks, and annually evaluating whether controls operate effectively, with findings and corrective actions reported to oversight bodies. This focus on how controls are organized, monitored, and improved distinguishes A-123 from topics like privacy rights, procurement guidelines, or general financial reporting standards, which are addressed by other laws, policies, or standards.