Final Report: FOREIGN ASSISTANCE: State Department Should Take Steps to Improve Timeliness of Required Budgetary Reporting

foreign assistance funds to foreign countries and international organizations by category of assistance as mandated. However, the reports were not submitted within the mandated time frame. Specifically, in fiscal years 2015 through 2018, the Department of State submitted Section 653(a) reports from 80 to 230 days past the 30-day mandate. Multiple factors contributed to delays in submitting the Section 653(a) report. The Department of State has developed a multistep process for responding to hundreds of congressional instructions each year, while also reflecting administration priorities. This process involves coordination with the U.S. Agency for International Development (USAID), about 200 bureaus and overseas posts, and the Office of Management and Budget. The process is complex and does not meet the mandated time frame, and the Department of State has not systematically reviewed its process since it revised the process in fiscal year 2016. A key part of the Department of State's process, involving data collection, has weaknesses that lead to discrepancies and hinder efficiency. The Department of State's mechanism for collecting information is a spreadsheet-based system susceptible to human errors, and the Department does not have appropriate controls in place to ensure data consistency. In fiscal year 2018, staffing gaps also affected the development of the Section 653(a) report. The Department of State's two offices primarily responsible for managing the Section 653(a) process had 15 of 54 full-time equivalent positions vacant, which contributed to delays in submitting the Section 653(a) report. The Department of State and USAID were responsible for managing $33.7 billion in foreign assistance funds in fiscal year 2018. Section 653(a) of the Foreign Assistance Act of 1961 mandates the President to report to Congress, on an annual basis, funding allocations by foreign country and category of assistance within 30 days of Congress appropriating certain funds. The Department of State, in coordination with USAID, makes decisions on how to allocate the funds, taking into consideration congressional instructions, the administration's priorities, and country-specific foreign assistance needs. The Department of State's timeliness in submitting Section 653(a) reports was affected by its complex process, data collection weaknesses, and, in fiscal year 2018, staff vacancies. The Department of State should take steps to address these factors to improve the timeliness of its Section 653(a) reporting. The Department of State should conduct a systematic review of its Section 653(a) process to identify inefficiencies and determine the amount of time needed to prepare the Section 653(a) report. The Department of State should also improve data collection and develop a plan to address staff vacancies, in consultation with USAID as appropriate.