 |
Summary of Management Challenges Identified by OIG
Financial Management Challenges
Management Challenge/
Significant Issue |
Actions Taken in
FY 2006 |
Actions Remaining and/or
Expected Completion Date |
| Accrual Accounting and Reporting |
USAID no longer uses the Accruals Reporting System (ARS) to record quarterly
accruals information. Beginning in September 2006, users enter their accrual data directly
into the primary accounting system via the Accrual Query. |
A reconciliation report has been developed to track accruals in the system.
Action completed on October 30, 2006. |
| Reconciliations of USAID’s Fund balance with the U.S. Treasury |
Due to Operating Expense (OE) budget cuts and a tight Phoenix budget, a cash reconciliation
tool was being considered, but was not developed and implemented before the end of this fiscal
year. Reports, however, were developed that assist in tracking cash disbursement differences.
Based on these reports, management can identify large discrepancies and address them. |
The cash reconciliation tool will be completed by September 30, 2007. |
| Extensive Use of Manual Processes Limits Agency Compliance with Federal Financial
Management System Requirements. |
Due to the use of Phoenix at headquarters in some missions and Mission Accounting and Control
System (MACS) in other missions, and the migration of financial data between MACS and Phoenix,
adjustments had to be made to reconcile the data in two separate systems. The CFO believes that
the use of manual processes will decrease now that the Phoenix integrated financial management
system has been implemented Agency-wide. Action complete. |
|
Managing For Results
Management Challenge/
Significant Issue |
Actions Taken in
FY 2006 |
Actions Remaining and/or
Expected Completion Date |
USAID’s Performance Management and
Reporting System |
As part of foreign assistance reform and to improve upon USAID’s performance management
and reporting system, the Office of the Director of Foreign Assistance began development of the
Foreign Assistance Coordination and Tracking System (FACTS) in FY 2006. FACTS is a database that
will combine USAID and Department of State foreign assistance budget and performance planning and
activity reporting data into one central system. |
USAID and State’s new FACTS system will be tested in November 2006 and will begin initial
implementation by the end of CY 2006. This system will facilitate all levels of agency planning,
monitoring, and data management. It will enable a more comprehensive reporting and monitoring of
foreign assistance than was available with USAID’s Annual Report system and will facilitate
analyses of integrated budget and performance information. FACTS will be subjected to all of the
internal controls necessary to ensure the integrity and confidentiality of the data. Data needed for
the PAR will be reported annually by field missions and Washington offices. The reports will contain
both planned and actual performance data against specific targets for the year. |
Acquisition and Assistance
Management Challenge/
Significant Issue |
Actions Taken in
FY 2006 |
Actions Remaining and/or
Expected Completion Date |
| The PMA scorecard rated the status of USAID’s competitive
sourcing as “red” or unsatisfactory. |
On May 16, 2006, USAID successfully completed its first outsourcing
competition under the PMA. This streamlined competition encompassed facilities management functions
conducted by four government employees and related contractor support. These responsibilities included
space planning, answering maintenance calls, maintenance coordination, and general office support and
coordination for facilities located in Washington, DC.
The Agency began its second streamlined competition at the end of FY 2006 and initiated
feasibility studies for two other possible competitions. |
USAID looks forward to achieving a “Yellow”
in competitive sourcing status by March 31,2007.
During FY 2007, USAID would like to make business process improvements in Washington and
identify additional activities during Washington management assessments where competition may
produce increased efficiency and cost savings. |
| Scopes of work for sampled field support task orders under
Indefinite Quantity Contracts (IQCs) did not clearly define the specific goods and services being
procured. |
USAID developed and issued improved policies and procedures to
govern the purpose, content, and use of field support task orders issued under small USAID/W IQCs.
Action completed on May 17, 2006. |
|
| USAID’s evaluations of its procurement operations did
not verify and ensure that USAID effectively implemented an Executive Order on Federal
Procurement Reform. |
USAID developed an action plan that includes implementation of the
new Balanced Scorecard business model which will verify and ensure that USAID is effectively
implementing Executive Order 12931 (Federal Procurement Reform). Action completed on May 11, 2006. |
USAID will issue a policy requiring missions to implement
recommendations made by evaluation teams. There is a built-in mechanism in the web-based scorecard
that requires missions to address each recommendation from the previous year and how it has been
implemented. This is in addition to the regular web-based scorecard information which will be
certified and submitted by each mission on a yearly basis. Target completion date: December 31, 2006. |
| USAID needs to make further improvements in
its financial audit program, particularly overseas. |
USAID/South Africa developed and implemented an audit tracking
system to monitor the recipient financial audit process to ensure timely submission of reports.
Action completed on March 30, 2006. |
USAID/Tanzania developed and implemented an audit tracking system
to monitor the recipient financial audit process to ensure timely submission of reports.
Action completed on October 2, 2006. |
| USAID/REDSO/ESA developed and implemented an audit tracking
system to monitor the recipient financial audit process to ensure timely submission of reports.
Action completed on May 22, 2006. |
USAID/Tanzania obtained and submitted audit reports for all
recipients with delinquent audits. Action completed on October 2, 2006. |
| USAID/REDSO/ESA obtained and submitted all delinquent audit
reports. Action completed on May 22, 2006. |
USAID/Malawi developed and implemented an audit tracking system
to monitor the recipient financial audit process to ensure timely submission of reports.
Action completed on October 30, 2006. |
| USAID/REDSO/ESA developed and implemented a system to ensure
that the Mission reviews, approves, and maintains a copy of an audit agreement containing a
standard statement of work that incorporates USAID’s audit requirements for every
recipient audit. Action completed on May 22, 2006. |
USAID/Malawi developed and implemented a system to ensure that
the Mission reviews, approves, and maintains a copy of an audit agreement containing a standard
statement of work that incorporates USAID’s audit requirements for every recipient’s
audit covering each individual fiscal year. Action completed on October 30, 2006. |
| USAID/REDSO/ESA obtained and submitted audit reports for all
expired awards requiring closeout audits. Action completed on May 22, 2006. |
USAID/REDSO/ESA amended its Mission Order to ensure that
closeout audits of expiring awards in excess of $500,000 are included in future audit plans and
performed as required. Action completed on November 11, 2006. |
| USAID/Ethiopia included all host country contracts in its award
inventory for fiscal year 2006. Action completed on May 31, 2006. |
USAID/Ethiopia will obtain and submit all delinquent audit
reports. Target completion date: November 30, 2006. |
| USAID/Ethiopia amended its Mission Order to add procedures for
including host country contracts in award inventories and annual audit plans, as appropriate.
Action completed on May 31, 2006. |
USAID/Mozambique will amend its Mission Order to ensure that
closeout audits of expiring awards in excess of $500,000 are included in future audit plans and
performed as required. Target completion date: December 31, 2006. |
| USAID/Malawi obtained and submitted audit reports for recipients
with delinquent audits. Action completed on July 31, 2006. |
USAID/Mozambique will include all identified host country
contracts in its award inventory for fiscal year 2006. Target completion date: December 31, 2006. |
| USAID/Ethiopia developed and implemented an audit tracking system
to monitor the recipient financial audit process to ensure timely submission of reports.
Action completed on August 31, 2006. |
USAID/Mozambique will amend its Mission Order to include procedures
for including host country contracts in award inventories and annual audit plans, as appropriate.
Target completion date: December 31, 2006. |
| USAID/Ethiopia developed and implemented a system to ensure that
the Mission reviews, approves, and maintains a copy of an audit agreement containing a standard
statement of work that incorporates USAID’s audit requirements for every recipient audit
covering each individual fiscal year. Action completed on August 31, 2006. |
USAID/Kenya will develop and implement an audit tracking system
to monitor the recipient financial audit process to ensure timely submission of reports. Target completion date: December 31, 2006. |
| USAID/Ethiopia obtained and submitted audit reports
in accordance with requirements for all expired awards. Action completed on August 31, 2006. |
USAID/Kenya will develop and implement a system to verify and
document that the Mission reviews, approves, and maintains a copy of an audit agreement containing
a standard statement of work that incorporates USAID’s audit requirements for every
recipient audit. Target completion date: December 31, 2006. |
| USAID/Kenya will amend its Mission Order to document that
closeout audits of expiring awards in excess of $500,000 are included in future audit plans
and performed as required. Target completion date: December 31, 2006. |
| USAID/Kenya will amend its Mission Order to provide procedures for
including host country contracts in award inventories and annual audit plans, as appropriate. Target completion date: December 31, 2006. |
| USAID/South Africa will obtain and submit all delinquent audit reports. Target completion date: March 31, 2007. |
| USAID/South Africa will develop and implement a system to ensure
that the Mission reviews, approves, and maintains a copy of an audit agreement containing a
standard statement of work that incorporates USAID’s audit requirements for every recipient audit.
Target completion date: March 31, 2007. |
| USAID/South Africa will amend its Mission Order to ensure that
closeout audits of expiring awards in excess of $500,000 are included in future audit plans and
performed as required. Target completion date: March 31, 2007. |
| USAID/South Africa will complete and submit audit reports for
all expired awards requiring closeout audits. Target completion date: March 31, 2007. |
| USAID/South Africa will include all identified host country
contracts in its award inventory for fiscal year 2006. Target completion date: March 31, 2007. |
| USAID/South Africa will amend its Mission Order to include
procedures for including host country contracts in award inventories and annual audit plans,
as appropriate. Target completion date: March 31, 2007. |
| USAID/South Africa will complete and submit closeout audits
for the two expired host country contracts with expenditures over $500,000.
Target completion date: March 31, 2007. |
| USAID/Mozambique will obtain and submit audit reports for all
expired awards requiring closeout audits. Target completion date: March 31, 2007. |
| USAID/Mozambique will obtain and submit closeout audits for
the 11 implementing instruments of the host country contracts in excess of $500,000. Target completion date: March 31, 2007. |
| USAID/Mozambique will obtain and submit audit reports for all
recipients with delinquent annual audits. Target completion date: June 30, 2007. |
| USAID/Kenya will obtain and submit audits for the two host country
contracts that expended in excess of $300,000 in one fiscal year. Target completion date: June 30, 2007. |
| USAID/Mozambique will develop and implement an effective audit
tracking system to monitor the recipient financial audit process to ensure timely submission of reports.
Target completion date: September 30, 2007. |
| USAID/Kenya will obtain and submit audit reports for all
expired awards requiring closeout audits.
Target completion date: October 30, 2007. |
Human Capital Management
Management Challenge/
Significant Issue |
Actions Taken in
FY 2006 |
Actions Remaining and/or
Expected Completion Date |
| USAID must demonstrate that staffing is being realigned to support implementation of the
new Foreign Assistance Framework prior to moving to green status on the PMA scorecard. |
The President’s Management Agenda (PMA) identifies strategic management of
Human Capital (HC) as one of the five government-wide areas needing improvement. At the end of FY 2006,
USAID received a ‘yellow’ status rating and a ‘green’ progress rating for
strategic HC management. In FY 2006, the Agency continued its major efforts to improve its HC management
with its first ever HC Strategic Plan, FY 2004- 2008 as a road map. USAID refined its first ever
workforce planning model down to specific missions and then to reflect the new Foreign Assistance
Framework. As a result of a further enhancement undertaken in FY 2006, the model can now cost out
alternative workforce scenarios and was used to guide the FY 2008 budget formulation process. |
- Make final decisions on restructuring Washington and field and how we are going to do business.
- Update the Workforce Planning Model (WPM) to reflect the new organizational structures
and business model and realign staff based on WPM results.
- Target completion date: June 30, 2007.
|
| USAID needs to continue to implement its workforce planning to close skills gaps through
recruitment, retention, training, succession planning and other strategies. |
USAID began implementing its Learning Management System (LMS), an automated tool that will link
workforce competency needs to appropriate training and developmental activities required to achieve
and/or retain optimal workforce functionality. The Agency started automating its official personnel
files (OPFs). This action will allow employees to access their own OPF via their desktop and will
eliminate paper transaction records. The Agency also completed the Manage-to-Budget Pilots;
implemented an OPM certified HC Accountability System; updated its leadership succession plan and
further closed critical gaps with the aid of some short-term hiring mechanisms. It should be noted
that all this was accomplished in a scarce Operating Expense (OE) budget resource environment that
resulted in a temporary hiring freeze beginning in the second quarter of the fiscal year and a 50%
cut in the training budget. Training was focused, almost exclusively, on meeting Agency and other
federal mandates, e.g., Cognizant Technical Officer (CTO) certification, language training, and core
business training needs. New courses were developed for new initiatives such as Operational Plans
and the Manage to Budget process, to align our core business courses with the new Agency direction. |
- Complete the roll out of all modules of the Learning Management System.
Target completion date: September 30, 2007.
- Continue to improve hiring processes quality and timeliness. Target completion date: March 31, 2007.
- Meet competency gap targets by March 30, 2007.
- Conduct first annual self-audit (accountability assessment) of Agency’s HC management. Target completion date: September 30, 2007.
- Update Management and Leadership Strategic Succession Plan in accordance with new government-wide guidance from OPM.
Target completion date: September 30, 2007.
|
Information Technology Management
Management Challenge/
Significant Issue |
Actions Taken in
FY 2006 |
Actions Remaining and/or
Expected Completion Date |
| Implement Homeland Security Presidential Directive – 12 (HSPD-12) |
- Developed processes and procedures to meet PIV II requirements for new employees and new contractors.
- Trained appropriate personnel on new processes and procedures.
- Purchased some of the components required to begin issuing PIV Cards.
- Drafted agreement between USAID and Department of State.
- Issued a Policy Directive to incorporate
HSPD-12 FAR clause in USAID contracts.
|
- Issue new PIV Cards to all existing employees and contractors domestically by October 27, 2008.
- Work with Department of State to implement and issue PIV Cards overseas by October 27, 2008.
- Management Decision for Identity Management System is pending funding for engineering study.
- Inability to phase in physical access requirements of PIV Card by October 27, 2007 due to lack of funding.
- Inability to meet phase-in logical access requirements of PIV Card by October 27, 2007 due to lack of funding.
- Expect to begin implementation enrollment and issuance of PIV Cards to new employees and new contractors October 30, 2007.
*USAID is currently utilizing the Department of State’s HSPD-12 solution in order to
meet October 27, 2006 deadline. USAID’s schedule for issuing PIV Cards is dependent on
State. Future milestones to meet the physical and logical access requirements are contingent
upon the availability of funding and human resources. Funding issues are being discussed with
senior leadership and a decision is expected for FY 2007 funding by November 2006 and FY 2008
funding by January 2007, which will allow basic planning and engineering to commence. |
| Information Technology Governance |
|
|
| IT Strategic Planning |
USAID and the Department of State drafted a Joint IT Strategic Plan that is currently undergoing
the clearance process in both organizations. |
Discussions are being held with Department of State concerning the degree of integration with
State’s intranet and other USAID infrastructure requirements and costs. A decision is expected
by December 2006 and a revised plan should be cleared and published shortly after that. |
| Enterprise Architecture (EA) |
USAID published the Data Architecture for Program Management and Results Reporting in August 2006.
It is being used as a resource by the working group that is mapping existing data and supporting the
Strategic Objective to the new Foreign Assistance Strategic Framework. The Joint USAID and Department
of State Enterprise Architecture (JEA) Team provided Business Analysts to work with Joint Management
Council (JMC) Working Groups to define transition opportunities in such areas as staff alignment,
investment consolidation, regionalization and centralization of services, joint field operations,
and network and IT alignment. |
With the exception of the Data Reference Model, all other models have been completed as joint
models with Department of State. A USAID Data Reference Model is being finalized and should be
cleared and published by December 2006. |
| IT Policy and Practice Standards |
USAID published an IT Project Life Cycle Methodology standard that describes the recommended
project baselines and government reviews. Phase gate review checklists and phase artifact quality
factor guidelines have been developed. USAID also defined an IT Project Work Breakdown Structure
(WBS) standard to assist Project Managers in ensuring that full life cycle costs for investments
are identified. |
The CIO will move to provide project funding allotments to projects based upon successful
phase gate reviews, completion of engineering and management activities, and supporting documentation.
All major IT development policies, standards, and procedures are being rolled out as they become
available; completion is expected by September 30, 2007. |
| Institutionalizing Governance |
Responding to deficiencies and gaps identified in various audits and the Management Bureau
Assessment, the Acting CIO conducted an organizational assessment and redefined a restructuring
that combined the Office of Information Resources Management and the Program Management Office.
IT Governance policy and process definition responsibility is explicitly called out, as are
portfolio and project performance management responsibilities. |
IT policies, standards, and procedures are being published and training is occurring for all
IT stakeholders. The CIO is developing a portfolio management process that is tied to an updated
Capital Planning and Investment Control (CPIC) process. By September 30, 2007 the processes
should be fully institutionalized. |
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