Indonesian agricultural development planning and administration project requires management attention

Audit report covers the period 7/77-6/83 and is based on document review and interviews with USAID/I, MOA, and Iowa State University technical assistance personnel. The project is generally meeting its objectives. A computer center has been established and is being heavily used. Participants have been, and are being trained at U.S., Indonesian, and third-country universities. Nonetheless, problems have occurred which must be addressed. The GOI used some $344,000 of A.I.D. funds for ineligible computer equipment and shipping and insurance costs to cover that equipment. The equipment did not meet U.S. source and origin requirements, because, while mostly manufactured in the United States, it was assembled and tested in France. Moreover, the computer maintenance contractor was not eligible to receive the award and has performed poorly. However, USAID/I lost its leverage to control the contractor when it advanced funds to cover 3 years of maintenance costs. Recommendations are: (1) recover loan funds for the computer equipment, shipping, and insurance from the GOI; (2) ensure that the contractor is fully qualified before approving a follow-on computer maintenance contract; and (3) deobligate some $785,000 in loan funds not needed to achieve project objectives.