Audit of the project for the support for extension, endowment and improvement of non-formal education

Non-Federal financial and compliance audit, prepared by Arthur Andersen and Co., covers the period through 10/30/86 and is based on document review, site visits, and interviews with Mission and host country officials. The audit examined fund accountability statement balances, internal accounting controls, and compliance with agreement terms. An opinion could not be issued on fund accountability statements due to: (1) the inadequacy of the JNEE"s accounting subsidiary records; (2) the lack of confirming and supporting documentation on GOG counterpart contribution; and (3) lack of complete access to the original documentation held by the GOG Treasury Department. Also, the JNEE system of internal accounting controls was found inadequate for USAID/G purposes, and the JNEE had not complied with the terms of its agreement with USAID/G regarding counterpart contributions, audits and evaluations, and project outputs and documentation. Other particular findings are that: (1) the JNEE had Q329,000 in questionable costs as a result of missing inventories and inadequately controlled equipment, material, and supplies; (2) contrary to Guatemalan law, the JNEE used personal instead of official license plates on two official vehicles, which lowered the control and public visibility of these vehicles; and (3) the JNEE was not in compliance with its agreement with A.I.D. in ten areas. The audit recommends the suspension of further funding of the JNEE until a subsequent audit demonstrates that the JNEE has: implemented adequate internal accounting controls; appropriately documented or reimbursed USAID/G for the questionable costs; and either complied with agreement terms or negotiated waivers. (Author abstract, modified)