Report Contents
What OIG Inspected
OIG inspected the Bureau of Democracy, Human Rights, and Labor’s foreign assistance program management.
What OIG Recommended
OIG made 6 recommendations to improve the Bureau of Democracy, Human Rights, and Labor’s management of foreign assistance, including recommendations to strengthen grants management and improve the bureau’s financial management practices related to foreign assistance. In its comments on the draft report, the Bureau of Democracy, Human Rights, and Labor concurred with all 6 recommendations. OIG considers all 6 recommendations resolved. The bureau’s response to each recommendation, and OIG’s reply, can be found in the Recommendations section of this report. The bureau’s formal written response is reprinted in its entirety in Appendix B.
What OIG Found
- The Bureau of Democracy, Human Rights, and Labor took steps to strengthen internal controls as bureau-managed assistance funds nearly doubled since 2013. However, 11 of 26 direct-hire positions in the Office of Global Programming, which manages the bureau’s foreign assistance, were vacant at the time of the inspection.
- The bureau did not update risk assessments and monitoring plans annually for 7 of the 13 grant files reviewed during the inspection. Moreover, the bureau did not systematically conduct and document site visits in accordance with monitoring plans.
- The Bureau of Democracy, Human Rights, and Labor returned $6.6 million in canceled funds to the U.S. Treasury in FY 2016 and FY 2017, despite having a statutory reclassification authority to extend the period of availability for most foreign assistance appropriations.
- Expenditures on the bureau’s foreign assistance grants were not accurately recorded in the Department of State’s financial system, creating the potential for violations of the Anti-Deficiency Act.
- Spotlight on Success: Through an innovative program, the Bureau of Democracy, Human Rights, and Labor delivered financial compliance training to its grant recipients.
Report Terms
Report Recommendations
The Bureau of Democracy, Human Rights, and Labor should implement quality control procedures to regularly update risk assessments and monitoring plans in accordance with the Federal Assistance Directive.
The Bureau of Democracy, Human Rights, and Labor should implement quality control procedures to plan, conduct, and document site visits in accordance with grant monitoring plans and the Federal Assistance Directive.
The Bureau of Democracy, Human Rights, and Labor, in coordination with the Bureau of Administration, should finalize a service level agreement clarifying the Bureau of Administration’s responsibilities for grants support.
The Bureau of Democracy, Human Rights, and Labor should implement a process to identify and reclassify foreign assistance funds before they cancel that includes a review of obligations on unexpired awards.
The Bureau of Democracy, Human Rights, and Labor should modify its grants processes to accurately record expenditures in the Department’s financial system.
The Bureau of Democracy, Human Rights, and Labor, in coordination with the Bureau of the Comptroller and Global Financial Services and the Office of the Legal Adviser, should determine whether grants payment irregularities identified for award number S-LMAQM-17-CA-1232 constitute a violation of the Anti-Deficiency Act and, if so, report the violation.