Audit Management
The Office of Inspector General (OIG) uses the audit process
to help USAID managers improve the efficiency and effectiveness
of operations and programs. USAID management and OIG staff
work in partnership to ensure timely and appropriate responses
to audit recommendations. The OIG contracts with the Defense
Contract Audit Agency (DCAA) to audit U.S.-based contractors
and relies on nonfederal auditors to audit U.S.-based grant
recipients. Overseas, local auditing firms or the supreme
audit institutions (SAI) of host countries audit foreign-based
organizations. OIG staff conduct audits of USAID programs
and operations, including the Agency’s financial statements,
related systems and procedures, and Agency performance in
implementing programs, activities, or functions.
During FY 2006, USAID received 464 audit reports; 404 of
these reports covered financial audits of contractors and
recipients and 60 covered Agency programs or operations.
During FY 2006, the Agency closed 603 audit recommendations.
Of these, 218 were from audits performed by OIG staff and
385 were from financial audits of contractors or grant recipients.
USAID collected $7.1 million in disallowed costs, and
$7.4 million was put to better use during the fiscal year.
At the end of FY 2006, there were 429 open audit recommendations,
11 less than at the end of FY 2005. Of the 429 audit recommendations
open at the end of FY 2006, only 22 or 5% have been open for
more than one year.
Of the 22 recommendations open for more than one year, USAID
must collect funds from contractors or recipients to complete
actions for three recommendations. Contacting Officer final
determinations for ten recommendations are currently in litigation
or have been appealed before the Armed Forces Court of Appeals
or the USAID Procurement Executive. Four recommendations require
recipients to make extensive corrections to accounting systems
or internal controls. The remaining five recommendations are
related to Agency programs and operations, including improving
information systems and development activities; complying
with federal regulations for awarding contracts in Iraq; and
reconciling financial management information.
Management Action on Recommendation that Funds be Put to Better Use
| |
Recommendations |
Dollar Value ($000) |
| Beginning balance 10/1/05 |
6 |
$214,818 |
| Management decisions during the fiscal year |
12 |
16,315 |
| Final action |
8 |
7,416 |
| Recommendations implemented |
8 |
7,416 |
| Recommendations not implemented |
0 |
– |
| Ending Balance 9/30/06 |
10 |
$223,717 |
Management Action on Audits with Disallowed Costs
| |
Recommendations |
Dollar Value ($000) |
| Beginning balance 10/1/05 |
146 |
$24,908 |
| Management decisions during the fiscal year |
181 |
25,589 |
| Final action |
196 |
7,111 |
| Collections/Offsets/Other |
195 |
7,097 |
| Write-offs |
1 |
14 |
| Ending Balance 9/30/06 |
131 |
$43,386 |
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