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

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U.S.-based nonprofit organizations that receive federal awards and expend $500,000 or moreannually under the awards are required to be audited under the provisions of the Single Audit Act,Public Law 98-502 (October 19, 1984), as amended, and Office of Management and Budget CircularA-133. These A-133 audits cover a sample of expenditures under federal awards.For-profit entities that receive awards are also subject to financial audits. USAID conducts annualrisk assessments of for-profit entities to decide when a for-profit entity should be audited.Financial audits of for-profit organizations examine the direct and indirect costs incurred underFraud ReportingUSAID implementing partners are responsiblefor reporting allegations of fraud related toUSAID projects pursuant to the Federal AcquisitionRegulation and USAID requirements.USAID award recipients can use this form onUSAID OIG’s Web site to satisfy the requirementthat they notify OIG whenever they have credibleevidence that a principal, employee, agent,or subcontractor of USAID has violated the CivilFalse Claims Act or a federal criminal law involvingfraud, conflict of interest, bribery, orgratuity violations in connection with a federalaward or the performance or closeout of a contractor any related subcontract.Members of the public, USAID employees, andemployees of USAID contractors and grantees areencouraged to use the OIG hotline to report fraud,waste, or abuse in USAID programs or activities:E-mail: IG.Hotline@usaid.govPhone: 1-800-230-6539 or202-712-1023Web form: transition.usaid.gov/oig/hotline/hotline.htmthe awards to determine the allowable directcosts and recommend indirect cost rates. Theseaudits are performed by the Defense ContractAudit Agency (DCAA) or a public accountingfirm.Audits often identify questioned costs andsometimes recommend that funds be put tobetter use. Auditors question as ineligible anycosts that are not reasonable, allowable underthe terms of the underlying contract or grant,or allocable to the program to which they werecharged. They question as unsupported anycosts that lack evidence, such as bidding documents,invoices, or receiving reports, that theauditors would need to examine to determinewhether the costs are reasonable, allowable,and allocable. USAID contracting or agreementofficers make final determinations on questionedcosts and seek reimbursement for anysustained questioned costs. Funds recommendedto be put to better use are funds thatcould be used more efficiently if managers takeaction to implement OIG recommendations.Unnecessary expenditures that can be avoidedin the future and costs that will not be incurredif operational changes are made in response to OIG recommendations are examples of funds put tobetter use.InvestigationsOIG conducts investigations into possible violations of federal laws, rules, and regulations topreserve and protect the integrity of the programs and activities we oversee. OIG investigations ofcriminal, civil, and administrative violations cover all facets of USAID programs and operations.USAID OIG Afghanistan and Pakistan Oversight Report 3
Most OIG investigations are conducted in response to reported allegations of wrongdoing on thepart of Agency personnel or implementing partners. However, OIG also conducts proactiveinvestigations into programs and activitiesvulnerable to fraud.Whistleblower ProtectionsComplaints regarding USAID programs and activitiesmay be made through the OIG hotline orin person to OIG personnel. Contractor reportsof credible allegations of fraud mad in accordancewith Federal Acquisition Regulation requirementsmay be made through the OIG Website.In order to promote fraud reporting, OIG worksto establish or link to existing country-specifichotlines in high-risk environments such as conflictand postcrisis settings. Recently establishedhotlines like the Anti-Fraud Hotline in Pakistanare supported by local marketing efforts, translationservices, and top-of-the-line security controls,vetting, and analytical capabilities.Whistleblower protections are available tofederal employees and applicants who reportinformation that is reasonably believed to provideevidence of violations of law, rule, or regulation;gross mismanagement; gross waste offunds; abuse of authority; or a substantial andspecific danger to public health or safety (unlessdisclosure of such information is specificallyprohibited by law and such information is specificallyrequired by executive order to be keptsecret in the interest of national defense or theconduct of foreign affairs). Retaliation againstan employee or applicant for making a protecteddisclosure is prohibited by law. Managersare strictly prohibited from taking, failing totake, or threatening to take or not take a personnelaction on an employee or applicant becauseof the employee’s or applicant’s disclosureof covered information.When our investigations confirm allegations ofwrongdoing, OIG special agents collaborate withU.S. and local law enforcement and prosecutors,other federal agencies and offices, and implementingpartners to put a stop to the prohibitedactivity. OIG special agents are sworn law enforcementofficers with the authority to carryfirearms, execute search warrants, and makearrests.OIG protects the confidentiality of complainants’identity pursuant to Section 7(b) of theInspector General Act. This provision prohibitsthe disclosure of the identity of an employeewho reports an allegation without first obtainingthe employee’s consent unless OIG determinesthat disclosure is unavoidable during thecourse of the investigation.Outreach and CoordinationOutreach and coordination are important elements of the oversight process, and OIG extensivelyengages in these activities. OIG investigators conduct fraud awareness briefings to alertparticipants to fraudulent practices and schemes and to provide guidance on how to report fraud ifit is encountered. OIG auditors provide training to Agency personnel, host-government auditauthorities, and local audit firms on cost principles and federal audit and accountabilityprocedures and requirements.4 USAID OIG Afghanistan and Pakistan Oversight Report
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Page 7: Audit ProgramOIG auditors, certifie
Page 11 and 12: site visits. In the past, building
Page 13 and 14: In recent years, OIG has covered a
Page 15 and 16: applications. In fact, the former s
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
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Page 45 and 46: DateReport Title and NumberAmountAu
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DateReport Title and NumberAmountAu
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10/10/11 F-306-12-002-N Financial A
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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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