GRANTS TO CBCI SOCIETY FOR MEDICAL EDUCATION

EVALUATION COVERS THE PERIOD 5/1/76 TO 2/28/79 AND IS BASED ON PROJECT DOCUMENTATION. IMPLEMENTATION AND MANAGEMENT PROBLEMS HAVE DELAYED PROJECT SINCE INCEPTION AND COSTS HAVE RISEN SHARPLY. CONSTRUCTION UNDER GRANT 1 IS MOSTLY COMPLETE, HAS BEGUN UNDER GRANT 2, AND WILL BEGIN IN 1980 UNDER GRANT 3. GRANTEE HAS NOT HEEDED USAID"S ADVICE TO PREPARE ITS DEFENSE IN IMMINENT COURT LITIGATION INITIATED BY CONTRACTORS. USAID SHOULD NOW FORMALLY INSTRUCT THE GRANTEE TO DO SO AND SHOULD MAKE COST OVERRUNS DEPEND ON GRANTEE"S COMPLIANCE. GRANT FUNDS USED TO CONSTRUCT A CHAPEL IN VIOLATION OF AID REGULATIONS SHOULD BE RETURNED TO USAID. USAID SHOULD REQUIRE GRANTEE TO RESTORE EXCESS PAYMENTS OF $133,765 AND INELIGIBLE COSTS OF $478 AND TO PROVIDE INFORMATION ON PROPRIETY OF OTHER CONSTRUCTION COSTS PRIOR RO FINAL SETTLEMENT WITH CONTRACTORS. PROCEDURES FOR DETERMINING HOSPITAL OPERATING DEFICITS ARE STILL NOT ESTABLISHED. ALTHOUGH THE MCCORMACK FUND (MF) HAS BEEN IN OPERATION FOR A YEAR. USAID SHOULD ESTABLISH THESE AT ONCE. CHARGES TOTALLING $177,067 APPEAR QUESTIONABLE. USAID SHOULD: REVIEW THE ADMISSIBILITY OF REMOVING THE SERVICE CHARGE FROM MF; REQUIRE THE GRANTEE TO RESTORE INADMISSIBLE CHARGES, INCLUDING $18,750 FOR MONEY PROVIDED BY THE COLLEGE TO THE CENTER PRIOR TO GRANT AGREEMENTS AND TO DISCONTINUE THIS CHARGE IN THE FUTURE; CONFIRM THAT GRANTEE HAS RESTORED $8,359 TO MF. A RELIABLE ACCOUNTING FOR GRANT-PROCURED EQUIPMENT, MOST OF WHICH IS STILL UNUSED, IS NOT YET AVAILABLE. USAID SHOULD REQUIRE GRANTEE TO: RECONCILE ITS INVENTORY AND FINANCIAL RECORDS; FURNISH REQUIRED QUARTERLY REPORTS ON MF; PREPARE FOR AN AUDIT OF MF BY A PUBLIC ACCOUNTANT; FURNISH MINUTES OF THE REPORTED TRUSTEE"S MEETINGS ON MF AND MAKE THEM AVAILABLE FOR FUTURE AUDITS.