Audit of USAID/Bosnia-Herzegovina"s municipal infrastructure and services program for the period April 1 through June 30, 1997

Audit covers the period 4/1-6/30/97. During the reporting period, the Mission identified and approved 48 major projects, in five public sector areas, with an overall value of $43.7 million, and 41 small Community Infrastructure Rehabilitation Projects (CIRPs) with an overall value of $2 million. Of the 48 major projects, construction was in progress for 10 and completed for 1 during the reporting period. Of the 41 CIRPS, subcontractors had begun work on 28 of the 41 projects approved. The auditors visited 20 of the 165 projects funded to date under the MIS program, finding no major problems. However, 2 of the 18 CIRPs -- a health center project in Kalesija, completed in March 1997 at a cost of $44,600 (vs. the projected $30,948), and a four-grade primary school in Vukosavje, completed in November 1996 for $47,126 -- were not being used as intended due to lack of equipment. The Mission"s project manager stated that the project will be working with the U.S. sector of the Stabilization Force (SFOR), local officials, and nongovernmental organizations to get the facilities equipped and functioning. Also, the central heating of a school in a CIRP, NORD-025, is not functioning. In sum, program funds are being used for the purposes authorized. Furthermore, the implementation of the MIS Program continues at a rate that, if maintained, should complete the construction targets well in advance of the 4.5 years originally established for the program. In February 1997, USAID and SFOR signed a new memorandum of agreement delineating the responsibilities for the 1997 CIRPs among USAID, Parsons, and SFOR. Under this new agreement, SFOR is responsible for preparing weekly monitoring reports on each activity. Since project implementation began during the month of June 1997, it was too soon to verify whether the new monitoring procedures are being followed.