The Board's Currency Shipment Process Is Generally Effective but Can Be Enhanced to Gain Efficiencies and to Improve Contract Administration

As the issuing authority for Federal Reserve notes, the Board forecasts the demand for currency and plans and executes the issuance of currency to the Federal Reserve Banks, which then fulfill currency orders from depository institutions. To carry out its issuance responsibilities, the Board contracts with armored carriers to transport currency to and between the Federal Reserve Banks. During 2017, the Board executed 3,361 currency shipments, with transportation costs totaling $21.2 million. We assessed the Board's management of the currency and shipment process and the related contracting activities.

The Board's currency shipment process is generally effective. However, streamlining the currency forecasting process could save time and minimize the potential for human error. Selecting different transportation modes and evaluating alternatives to transporting shipping equipment could yield savings. The Board can also take measures in administering armored carrier contracts to guard against currency loss or damage and ensure that carriers adequately protect Board data and provide expected levels of service.

This report contains recommendations.