Report Contents
What OIG Audited
Since 2003, the Bureau of International Narcotics and Law Enforcement Affairs (INL) has worked with the Government of Afghanistan to reform law enforcement in an effort to build and sustain legal institutions and increase the government’s ability to enforce the rule of law. INL uses a number of contracts to support this effort. As of December 2016, INL had nine active contracts supporting Afghanistan with a combined value of approximately $202 million.
The Office of Inspector General (OIG) conducted this audit to determine whether (1) INL was following Federal regulations, Department of State (Department) guidance, and its own Standard Operating Procedures (SOP) when reviewing Afghanistan contract invoices; (2) INL assigned a sufficient number of Contracting Officer’s Representatives (COR) to oversee the contracts; and (3) contractor performance was documented in accordance with requirements.
What OIG Recommends
OIG made six recommendations that are meant to improve the invoice review process, including ensuring that INL has a sufficient number of CORs to oversee its Afghanistan contracts and is properly documenting contract oversight activities. INL agreed with all six recommendations offered. A synopsis of INL’s response to each recommendation and OIG’s reply is presented in the Audit Results section of this report. INL’s response to a draft of this report is reprinted in Appendix B.
What OIG Found
INL followed Federal regulations, Department guidance, and its own SOP when reviewing contract invoices supporting operations in Afghanistan. Specifically, OIG reviewed 81 invoices processed by INL between May and November 2016 and found that INL followed processes that complied with invoice review requirements and that the assigned COR had appropriately rejected invoices when they contained unallowable costs.
OIG also found that during the same time period, INL had a sufficient number of CORs in Afghanistan. According to INL, a minimum of three CORs are needed to review contract invoices and provide contract oversight. However, the number of CORs in Afghanistan available to support INL decreased through much of 2017 and INL faced challenges filling these positions. According to INL, this decrease in CORs has, in turn, created oversight challenges for the Afghanistan contracts. To compensate, INL temporarily assigned CORs from other locations to Afghanistan but recognizes that this is not a long-term solution. Without dedicated and experienced CORs in Afghanistan, the risk that contract oversight will suffer and inadequate contractor performance could go undetected increases.
In addition, OIG found that COR documentation of contractor performance was not completed in accordance with requirements. Specifically, inspection reports prepared by INL were often incomplete, with no indication that the CORs had reviewed contractor-prepared reports to verify that the contractor was performing in accordance with contract terms and conditions. For example, quality assurance inspection reports maintained by the CORs did not identify the contracts inspected or the inspection period; nor did they contain evidence showing that identified deficiencies had been resolved. In addition, evidence was limited that the CORs had independently verified contractor-reported information to ensure it was accurate and complete. Without ensuring that contractor performance is fully documented, INL will not have a complete depiction of performance on its contracts and may be unable to hold its contractors accountable when performance is questioned.
Report Terms
Report Recommendations
OIG recommends that the Bureau of International Narcotics and Law Enforcement Affairs fill the permanent Contracting Officer’s Representative vacancies in Kabul, Afghanistan, to ensure adequate oversight of its Afghanistan contracts.
OIG recommends that the Bureau of International Narcotics and Law Enforcement Affairs develop and implement invoice review training for its oversight staff with a focus on its Afghanistan contracts to ensure that newly assigned Contracting Officer’s Representatives charged with reviewing invoices are fully prepared and familiar with the specific features of these contracts.
OIG recommends that the Bureau of International Narcotics and Law Enforcement Affairs develop and implement procedures to verify that the Quality Assurance Surveillance Plan inspection reports for its Afghanistan contracts are completed in accordance with Department requirements, including specifying the period covered by the report and identifying the actions taken by the contractor to correct previously identified deficiencies to afford the Contracting Officer and succeeding Contracting Officer’s Representatives a complete history of contract implementation.
OIG recommends that the Bureau of International Narcotics and Law Enforcement Affairs include, in the Kabul-specific Standard Operating Procedures it is developing, clarification of the role of contract assistants in contributing to the Quality Assurance Surveillance Plan inspections reports for its Afghanistan contracts and procedures for the Contracting Officer’s Representatives to review, verify, and document the inspection reports.
OIG recommends that the Bureau of International Narcotics and Law Enforcement Affairs implement procedures requiring Contracting Officer’s Representatives for its Afghanistan contracts to formally document their review and acceptance of contractor progress and status reports in compliance with the Foreign Affairs Handbook and INL’s Standard Operating Policy/Procedures for Contracting Officer’s Representative Working File Maintenance.
OIG recommends that the Bureau of International Narcotics and Law Enforcement Affairs incorporate, in the Kabul-specific Standard Operating Procedures it is developing, control steps (a) for the Contracting Officer’s Representatives to maintain quality assurance records in accordance with Department requirements and (b) verify that Contracting Officer’s Representatives follow INL’s Standard Operating Policy/Procedures for Contracting Officer’s Representative Working File Maintenance.