Audit of USAID/Sri Lanka reporting on completed projects

Audit report covers eight projects completed between 9/83 and 9/86 and is based on document review, interviews with USAID/SL officials, and site visits. USAID/SL"s performance needs improvement. The Mission completed six of the eight required PACR"s and was preparing a seventh. No report was prepared for the remaining project because Mission officials thought an 8/85 A.I.D. audit report issued at the end of the project sufficed for the PACR. However, although the six PACR"s addressed the Government of Sri Lanka"s (GSL) respective contributions to the projects, they did not provide complete and accurate information sufficient to determine if the GSL had made the required contribution. In some cases, the amounts reported in the PACR"s were not correct or were amounts reported by GSL without verification by the Mission. Also, while five of the PACR"s indicated that the GSL did not provide its required contribution, they did not reconcile or explain the differences between required and actual amounts. Secondly, USAID/SL failed to monitor recommendations made in the PACR"s to ensure that they were effectively carried out. In one case, $186,403 in funds were not deobligated until 18 months after project completion (and only then due to an unrelated financial review) because the review recommended in the PACR was not carried out. In another instance, some 800 of the 2,000 moisture meters purchased over 6 years ago for an agricultural storage project were still not being utilized - without the knowledge of USAID/SL. It is recommended that USAID/SL establish procedures to improve its performance vis-a-vis PACR"s and that it establish a plan for effectively utilizing the equipment purchased under the agricultural storage project or take action to collect a refund from GSL. Since the Mission agreed to implement both recommendations, they will be closed upon completion of the corrective actions. Mission comments have been incorporated in the report as appropriate and the full text of its comments are appended.