The GAO recommended that the FSOC and the OFR strengthen transparency and accountability by collecting and sharing financial risk indicators, keeping detailed records of closed-door sessions and developing forward-looking plans to help “prioritize the threats.”

The report prompted two reactions. As part of the report, Mary Miller, Treasury undersecretary for domestic finance, said that Treasury supports the recommendations.

She also said that the FSOC has already “moved quickly to fulfill its statutory mission” and “promote greater collaboration among its members.”

Rep. Spencer Bachus, R-Ala., chairman of the House Financial Services Committee, asked that the FSOC and the OFR “operate transparently and efficiently, without imposing an undue burden on the nation's financial system.”

Bachus's letter was sent to Timothy Geithner, secretary of the Treasury Department. Under the Dodd-Frank Act provision which established the two agencies, the Treasury secretary heads the FSOC.

Bachus also demanded additional information.

The letter said that the OFR has not filled three of its top eight leadership positions, and asked what steps the Treasury Department is taking to fill those spots.

He also said that the GAO report found that the FSOC has no strategic plan and uses its annual report as the only documentation for its strategic framework. Moreover, the report found that the FSOC's annual reports are “vague with regard to recommendations and fail to identify entities responsible for implementing—and the timeframes for completing—the recommendations.”

“Will the FSOC commit to making more detailed and specific recommendations in its annual reports that specify which member-agencies are responsible for the implementations of the recommendations and the timeframes for implementing them?”

“If not, please state with specificity the FSOC's reasons for not doing so,” Bachus said.

The report acknowledged that the FSOC and the OFR face “challenges” in doing their jobs.

The GAO said that is because the key FSOC missions are identifying risks and responses to emerging threats to financial stability.

However, the report said, risks to financial stability do not develop in precisely the same way in successive crises.

It also acknowledges that collaboration among FSOC members can also be challenging at times, as almost all of them represent independent agencies that retained existing authorities.

For its part, the GAO said in the report that the OFR “faces the challenge of trying to establish and build a world-class research organization while meeting shorter-term goals and responsibilities.”

The FSOC needs a more systematic approach, and it needs to provide comprehensive information to the FSOC member agencies, the GAO said.

That's because, on their own, the member agencies “may not be well positioned to judge which potential threats will benefit from interagency discussions.”

To better accomplish its task, the GAO recommends that the FSOC collect and share key financial risk indicators as part of a systematic approach to help identify potential threats to financial stability.

This article was originall posted at LifeHealthPro.com, a sister site of Credit Union Times.