Summary: GAO examined aspects of project activities financed by the Agency for International Development (AID) and implemented under contracts awarded by host countries. In addition, it identified issues which it believed AID should be aware of.
GAO found that: (1) a centralized inventory of host country contracts recommended by AID management in 1977 and 1979 had not been developed; (2) the idea of a centralized inventory had all but been abandoned, and a substitute data system had not been established; and (3) AID overseas missions continually ignored the requirement to provide certain data on host country contracts to AID. GAO believes certain actions are needed to correct identified management weaknesses and improve AID operational capabilities. Information on host country contracts would: (1) assist AID managers in general oversight and policy examination; (2) enable AID to readily inform Congress and the public on foreign aid contract expenditures and how they benefit the United States; (3) assist auditors in obtaining more complete audit coverage; and (4) provide a basis for exchanging contract cost information and alert AID officials on problem contractors. When the AID study of host country contracting problems is completed, it may be determined that further actions are needed to improve internal control and oversight of these activities.
