Breakdown of management controls by a host country contractor for the AID-financed agricultural development systems project in Egypt

Audit report covers the period 1/79-3/83 and is based on document review and site visits. Due to inadequate management and performance by the contractor, the University of California (UC), the objective of institutionalizing a system for upgrading the MOA and integrating its capabilities has not been met. Technical achievements such as increasing tomato production, testing plant materials on a large scale, producing scientific publications, and conducting policy workshops - and even the collaboration developed between MOA professionals and local university scientists - do not, USAID/E comments to the contrary notwithstanding, outweigh this failure. UC set examples of waste, inefficiency, and abuse that filtered down to Egyptian personnel to such a degree that there was a breakdown in the management of project funds. UC failed to account for LE 387,968 of A.I.D. advances, to document disposition of LE 68,955 in subadvances as of 3/31/83, and to justify $155,270 of claimed airfares and $82,338 of per diems. These problems remained undetected due to USAID/E"s failure to adequately monitor UC"s performance. Further, UC did not require expense vouchers in Egypt and permitted travel by unauthorized expatriate spouses and by nonproject persons, resulting in ineligible claims of $57,695 in airfares and $23,675 in per diems. In motorpool operations, lack of supervision led to unreasonable repair and maintenance costs, unaccounted for mileage, excessive gas consumption, and unauthorized and inappropriate vehicle use. Equipment, supplies, and materials were not completely inventoried, accountability is lacking, and UC resisted releasing information on these commodities. Finally, participant trainees were not processed according to A.I.D. regulations and USAID/E procedures. A key recommendation among the 20 provided is that a proposed $2 million project amendment be postponed until the MOA is prepared to assume project responsibilities. It is strongly suggested that A.I.D. consider UC"s performance before recommending Title XII grants.