Foreign Relations: Better Accountability Needed Over U.S. Assistance to Micronesia and the Marshall Islands
RCED-00-67
Published: May 31, 2000. Publicly Released: May 31, 2000.
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Highlights
Pursuant to a congressional request, GAO reviewed the federal assistance the United States provides to the Federated States of Micronesia and the Republic of the Marshall Islands, focusing on the: (1) cost to the United States of providing assistance to Micronesia and the Marshall Islands in accordance with the existing Compact of Free Association from fiscal year (FY) 1987 through FY 1999; (2) funds provided prior to the Compact (earlier than FY 1987) for the effects of nuclear weapons testing to what is now the Marshall Islands; and (3) accuracy and reliability of the data the Department of the Interior uses to monitor and supervise the federal assistance programs.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of the Interior | In the event Interior retains monitoring and coordination oversight as a result of the current negotiations, the Secretary of the Interior should direct the Office of Insular Affairs to develop a system to obtain and maintain data on all U.S. financial and program assistance provided to Micronesia and the Marshall Islands. Such a system might include making agreements with other agencies to regularly report assistance provided and making use of the annual audit reports from Micronesia and the Marshall Islands to help identify how funds are allocated. |
The decision as to who, if anyone, has monitoring responsibility for all Federal programs will be outlined in a new executive order, which, as of May 14, 2004, is currently being drafted by the Department of State.
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| Department of the Interior | The Secretary of the Interior should direct the Office of Insular Affairs to reconcile the amounts reimbursed to other agencies shown in the budget justification table to the amounts reported by the agencies that receive reimbursements from Interior. |
The Department of Interior's Office of Insular Affairs adjusted their budget justification tables to reflect a consolidated request covering Federal services and single audits. Also, the actual financial information about amounts obligated in reimbursable agreements and the amounts paid as reimbursements are retained in the official accounting records of the Department.
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| Department of State | Given that negotiations are under way on provisions of the Compact that expire in 2001, the Secretary of State should negotiate provisions that require that reliable data be maintained to ensure better accountability of the assistance provided. Requiring periodic reconciliation of accounts between Interior, the other agencies providing assistance, and the Islands is one means to achieve this objective. |
The Department of State fully concurred with the recommendation, and reported that the Department has negotiated provisions with the Island governments that will require that reliable data be maintained to ensure better accountability of assistance provided by the U.S. government. Currently, a formal proposal with the negotiated provisions has been made to the Federated States of Micronesia and an informal proposal has been made to the Republic of the Marshall Islands. The Department of State predicts that the provisions will be finalized by approximately August 2002.
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Topics
AccountabilityData integrityFederal agency accounting systemsFinancial managementForeign economic assistanceForeign governmentsInternal controlsInternational agreementsInternational relationsEnvironmental monitoring