Audit of the agroindustrial plan and the program for food distribution with the Cooperative for American Relief Everywhere/Costa Rica : Public Law 480, Title I funds

480 Title I program. Audit, conducted by Price Waterhouse of Costa Rica, covers the period 3/83-9/85 and is based on a review of accounting records and other standard auditing procedures. CARE/CR"s financial management was deficient in several regards. Most seriously, CARE/CR did not maintain separate accounting records for funds received through P.L. 480 Title I, making it impossible for the auditors to review CARE/CR"s income and expenditures. Second, CARE/CR"s internal control system was inadequate for A.I.D."s purposes. In addition to the lack of separate accounting records for Title I-financed transactions, CARE/CR lacked: (1) the budgetary and cash flow systems needed for the efficient use of available funds; and (2) proper vouchers for checks issued from revolving funds. These problems greatly increase the possibility that substantial errors or irregularities could occur and not be detected within a timely period. Third, CARE/CR"s did not comply with all applicable funding laws, regulations, and agreements. CARE/CR did not prepare periodic reports on the financial position and management of P.L. 480 contributions for the Ministry for National Planning and Economic Policy (MIDEPLAN), the Costa Rican agency in charge of coordinating the P.L. 480 Title I program. No proposal was prepared by CARE/CR for transferring the Costa Rican Food Producer Plant (PROCOA) to a Costa Rican institution. Finally, P.L. 480 funds were used to finance expenses related to other projects. Seven recommendations are made to improve CARE/CR"s financial management. The Mission was in basic agreement with this audit.