Independent Auditor's Report – Appendix III: Status of Prior Year Findings and Recommendations
OMB Circular A-50 states that a management decision on audit recommendations shall be made within a maximum of six months after a final report is issued. Corrective action should proceed as rapidly as possible. Several audit recommendations directed to USAID from prior audits either have not been corrected or final action has not been completed as of September 30, 2006. We have also noted where final action was taken subsequent to fiscal year-end but prior to the date of this report.
Status of 2005 Findings and Recommendations
Audit of USAID’s Financial Statements for Fiscal Years 2005 and 2004,
Audit Report No. 0-000-06-001-C, November 14, 2005
Recommendation No. 1: We recommend that USAID’s Office of the Chief Financial Officer modify USAID’s interface between the Accruals Reporting System and the USAID accounting system general ledger so that it correctly calculates and posts accrual information and that it establishes a review mechanism in the Accruals Reporting System to review accrual information for propriety before it is posted to the general ledger.
This recommendation is closed. We have issued an updated finding and recommendation related to the new Phoenix Accruals System.
Recommendation No. 2: We recommend that the Office of the Chief Financial Officer ensure that USAID financial managers and mission controllers implement the reconciliation guidelines specified by Chief Financial Officer Bulletin No. 06-1001, Reconciliation with U. S. Treasury, dated October 2005 to ensure Fund Balance with Treasury accounts are reconciled in a timely manner, reconciling items are investigated and resolved, and that adequate documentation is retained to support
the reconciliation procedures performed.
This recommendation is pending final action by USAID.
Recommendation No 3: We recommend that USAID’s Office of the Chief Financial Officer develop a system for reviewing transactions reported under Trading Partner 99 to ensure that they are properly classified and appropriately reported, as recommended by section 4706.30 of TFM 2-4700, “Agency Reporting Requirements for the Financial Report of the United States Government.”
This recommendation is closed.
USAID’s Process for Recognizing and Reporting Its Overseas Accounts Receivable Needs Improvement (No recommendation)
This finding was not reported in 2006.
Federal Financial Management Improvement Act Noncompliance (No recommendations)
- Phoenix is Not Fully Deployed, but Progress is Being Made
- Legacy Financial Systems at Overseas Missions Did Not Comply With U.S. Government Standard General Ledger at the Transaction Level
- Financial Reporting Capabilities Need Improvement
In 2006, Phoenix was fully deployed as USAID’s worldwide accounting system. Accounting transactions entered by overseas missions now comply with U.S. Standard General Ledger requirements at the transaction level. USAID has also increased the
number of standard reports now available to users through its Business Objects software.
Unresolved Prior Year Findings and Recommendations
Report on USAID’s Consolidated Financial Statements, Internal Controls and Compliance for Fiscal-Year 2002, Audit Report No. 0-000-03-001-C, January 24, 2003
Recommendation No. 2: We recommend that the Chief Financial Officer:
2.2 Reconcile the mission adjustment account in the general ledger to the cumulative amounts in the mission ledgers and resolve differences between the general ledger and the mission ledgers.
This recommendation is pending final action by USAID.
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