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Inter-American Foundation: Better Compliance With Some Key Procedures Needed

NSIAD-00-235 Published: Sep 28, 2000. Publicly Released: Sep 28, 2000.
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Highlights

Pursuant to a congressional request, GAO provided information on the: (1) Inter-American Foundation's key procedures for selecting organizations to receive grants, monitoring grantee organizations' compliance with grant agreements, and auditing grantees' use of funds; (2) extent to which the Foundation complied with these procedures; and (3) extent to which the Foundation provides grants to organizations that also receive financial support from the Agency for International Development.

Recommendations

Recommendations for Executive Action

Agency Affected Recommendation Status
Inter-American Foundation In order to effectively oversee and monitor grantee activities, the President of the Inter-American Foundation should, with the board of directors' approval, develop a management control mechanism to provide oversight of compliance with monitoring and auditing procedures designed to ensure that the appropriate organizations receive grants and grant activities are carried out as intended.
Closed – Implemented
During its review of the Inter-American Foundation's (IAF) management controls and oversight practices, GAO noted that the IAF internal auditor reported to the Vice President of Financial Management and Systems instead of to the head or deputy head of the organization in accordance with Government Auditing (yellow book) standards. Also, his sole role was managing and reviewing the audits of grants performed by contractors. After GAO's inquiry into this matter, IAF expanded the auditor's role to include monitoring the effectiveness of the Foundation's operations, policies, and controls, and transferred his reporting responsibility to the Office of the President. This provides the Foundation with a key monitoring method to ensure compliance with its operating policies, procedures, and controls. Also, this provided the auditor with the organizational independence required by yellow book standards.

Full Report

Full Report (42 pages)

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Topics

International Affairs
Auditing proceduresEconomic developmentForeign economic assistanceForeign governmentsGrant monitoringInternal controlsEmbassiesInternational relationsCompliance oversightGrant programs