USAID OIG Afghanistan and Pakistan Oversight Report, April-June ...

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The mission’s monitoring and documentation were inadequate. Mission staff had not made anydocumented site visits after the program’s inception. In fact, both Mercy Corp and DAI projectdirectors commented that the OIG auditors were the first USAID staff who had ever visited theproject. Further, although the program agreement officer’s representative was receivingquarterly and annual progress reports, he was neither analyzing those reports nor confirmingthe accuracy of reported data. The progress reports submitted by DAI included mathematicalerrors and other inconsistencies that could have been identified by basic checks. The financialstatus of the subawards was also not monitored. For example, Mercy Corp had spent 86percent of its program budget with more than 2 years left in the program.Involvement of the host government in planning is an important component of fosteringsustainability; however, officials in several of Afghanistan’s Directorate of Agriculture,Irrigation, and Livestock offices said that they were not asked for their input into the designand planning of projects. In addition, activities had a disproportionate number of men,demonstrating that a gender balance was not maintained as required.The program’s cash-for-work projects lacked policies on worker hours, ages, and safety.Minors were illegally performing heavy labor—including one 13-year-old who weinterviewed—and implementers confirmed that hiring minors is a common practice. Further,implementing partners did not consistently provide basic personal safety equipment to theworkers.OIG made 18 recommendations to address these problems. Management decisions have beenmade on 14 recommendations, and final action has been taken on 4.Audit of USAID/Afghanistan’s Internal Controls in the Administration of the InvoluntarySeparate Maintenance Allowance (Report No. F-306-12-003-P, June 25, 2012). Theseparate maintenance allowance is a nontaxable cost-of-living allowance that USAID mayprovide to “assist an employee to meet the additional expenses of maintaining members offamily elsewhere than at the employee’s foreign post of assignment.” 1 In 2011,USAID/Afghanistan paid more than $2 million in involuntary separate maintenance allowance(ISMA) 2 to 212 people.OIG determined that the mission had not established internal controls to help ensure that ISMAapplications complied with applicable laws and regulations and that compliance wasdocumented. Staff members responsible for reviewing and approving ISMA applicationsadmitted they did not have a defined set of internal controls to apply when reviewing ISMA1 Department of State Standardized Regulations, Section 260, “Separate Maintenance Allowance.”2 Involuntary separate maintenance allowance is used when the employee is assigned to a post where he or she isunable to bring family members.USAID OIG Afghanistan and Pakistan Oversight Report 9
applications. In fact, the former supervisory executive officer said she assumed someone hadreviewed ISMA applications before sending them to her for approval.OIG also determined that although the mission had established internal controls to help ensurethat ISMA payments complied with applicable laws and regulations, those controls did notprevent improper payments. In several cases, the mission made ISMA payments fordependents who had reached or passed the age of 21 and who were not eligible for thosepayments. In addition, the mission incorrectly underpaid one employee and delayed a $13,000payment by more than 20 months. These incorrect payments occurred because the mission didnot have written procedures or tools, such as checklists, to guide its staff and becauseemployees involved in the payment process were not familiar with the ISMA guide.OIG made eight recommendations to correct these problems. Management decisions have beenreached on five recommendations, and final action has been taken on two.Three additional OIG performance reviews and audits were under way on June 30, 2012:Review of USAID/Afghanistan’s Use of the Commander’s Emergency Response Program(CERP) Funds for Selected Projects. The objectives of this review are to determine(1) whether CERP funds provided to USAID by U.S. Forces-Afghanistan for specific projectswere used for their intended purposes and in compliance with applicable laws and regulations,and (2) whether costs charged to CERP-funded projects were reasonable, allowable, andallocable.Review of USAID/Afghanistan’s Monitoring and Evaluation System. This review willassess whether the USAID mission in Afghanistan has a monitoring and evaluation system inplace to manage program activities effectively.Audit of USAID/Afghanistan’s Kandahar Power Initiative. This audit will determinewhether the Kandahar Power Initiative is meeting its goal of increasing the supply anddistribution of electrical power from Afghanistan's South East Power System.In addition to these performance audits, OIG has six others planned for FY 2012. They will addressthe following topics:The Regional Afghan Municipalities Program for Urban Populations for Regional PlatformsTransition plansInternal controls for payrollContracts and cooperative agreementsUse of third-country national employeesFollow-up on selected OIG recommendations10 USAID OIG Afghanistan and Pakistan Oversight Report
Page 1 and 2: April - June 2012
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Page 7 and 8: Audit ProgramOIG auditors, certifie
Page 9 and 10: Most OIG investigations are conduct
Page 11 and 12: site visits. In the past, building
Page 13: In recent years, OIG has covered a
Page 17 and 18: Financial Audit of Costs Incurred b
Page 19 and 20: investigation. While the employee h
Page 21 and 22: This field was cultivated under USA
Page 23 and 24: eceived payments. OIG’s review of
Page 25 and 26: program is improving the capacity o
Page 27 and 28: Under Cooperative Agreement No. 391
Page 29 and 30: Financial Audit of USAID Funds Mana
Page 31 and 32: OIG Investigation Results in Employ
Page 33 and 34: A billboard advertises the Anti-Fra
Page 35 and 36: Other ExclusionsWalker, Scott Antho
Page 37 and 38: ReportDateReport Title*Recommendati
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Page 41 and 42: Date Report Recommendation TargetAc
Page 43 and 44: Date Report Recommendation TargetAc
Page 45 and 46: DateReport Title and NumberAmountAu
Page 61 and 62: 10/10/11 F-306-12-002-N Financial A
Page 63 and 64: 02/25/10 5-306-10-002-NFinancial Au
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08/10/06 5-306-06-004-D Financial A
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03/26/04 5-306-04-003-N Financial A
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06/23/11 G-391-11-003-Q Quality Con
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04/30/09 5-391-09-008-R Financial A
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09/26/06 5-391-06-003-Q Quality Con
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The project had many successes, inc
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complicated process, and OIG could
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The objective of the audit was to d
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According to information provided b
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OIG’s audit found that the univer
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Audit of USAID/Afghanistan's Altern
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and DOD PSCs in Afghanistan because
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Afghanistan has one of the highest
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contractor estimated that cost over
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Audit of USAID/Pakistan’s Energy
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Audit of USAID/Pakistan’s Road Re
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establishing a distribution policy,
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planned results was hindered by a s
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Although USAID carried out numerous
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AbbreviationsAACCAEDATVIAUAfCERPDAB
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USAID Office of Inspector General13
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