Audit of U.S. Embassy Kabul, Afghanistan, Public Affairs Section Administration of Grants and Cooperative Agreements

What OIG Audited
From FY 2017 to FY 2020, the Public Affairs Section (PAS) at U.S. Embassy Kabul, Afghanistan, administered approximately $197.1 million in awards to support civil society, free media, and regional integration; counterterrorism efforts; and to promote professional, educational, and cultural ties between Afghanistan and the United States.

The Office of Inspector General (OIG) conducted this audit to determine whether Embassy Kabul PAS administered selected grants and cooperative agreements in accordance with Federal and Department of State (Department) requirements. Specifically, OIG focused on three areas: due diligence and vetting; risk assessment, mitigation, and monitoring; and award monitoring and evaluation. To perform the audit, OIG judgmentally selected 20 awards (10 grants and 10 cooperative agreements) administered by the PAS between FY 2017 and FY 2020.

What OIG Recommends
OIG made six recommendations to U.S. Embassy Kabul and the Bureau of South and Central Asian Affairs to improve the oversight and administration of future overseas Federal assistance awards. Embassy and bureau officials stated that they could not respond to a draft of this report due to their focus on the evacuation of staff and special immigrant visa applicants from Kabul, Afghanistan. OIG recognizes the challenges posed by the situation in Afghanistan and will work with the Department through the audit compliance process to ensure that the Department designs and implements corrective actions sufficient to address the recommendations offered, which will be categorized as unresolved for now.

What OIG Found
Embassy Kabul PAS adhered to some Federal and Department requirements in the administration of grants and cooperative agreements. For example, with respect to due diligence and vetting, PAS verified that recipients were not previously suspended or debarred from receiving Federal funds but did not verify whether some recipients had ties to corruption, human rights violations, or illicit narcotics production or trafficking. PAS officials stated they did not conduct this type of vetting because procedures had not been developed at the time the awards were made.

With respect to assessing, mitigating, and monitoring risks, PAS conducted risk assessments prior to providing funds but did not document annual reviews of risks for 16 of 20 (80 percent) of the awards reviewed. Moreover, while officials identified risks in the risk assessments performed and recommended that mitigation measures be put in place, they did not provide documentation showing that the Grants Officers or Grants Officer’s Representatives (GOR) established mitigation measures for 12 awards for which officials had identified high programmatic and organizational risks. Officials stated that Grants Officers and GORs likely discussed mitigation measures in-person or on the phone but did not document discussions in the award file.

With respect to monitoring and evaluating performance, PAS developed initial monitoring plans and reviewed these plans annually except in 2020 due to the COVID-19 pandemic. PAS also obtained performance and financial reports for most awards, but six awards were missing at least one performance report, and three awards were missing one or more financial reports. Lastly, PAS conducted evaluations of some of its awards but did not comply with requirements to assess whether all of its awards met the Department’s definition of “large” programs and required evaluations.

Officials cited the security environment, staff turnover, and the COVID-19 pandemic as challenges in administering the awards. Nevertheless, OIG concludes that weak internal controls also contributed to the deficiencies. Until these deficiencies are addressed, PAS will have limited assurance that the award funds that it is administering are being used as intended and program goals and objectives are being achieved.