MEMORANDUM ON AUDIT OF LOCAL CURRENCY EXPENDITURES - FOOD CROP PROTECTION AND INTEGRATED PEST MANAGEMENT PROJECTS IN THE GAMBIA

Evaluation covers the period 8/76-9/80 and is based on an audit of project records, site visits, and interviews with host country and USAID officials. The audit focuses on the use of A.I.D. funds for local currency purchases. The audit"s major finding is that A.I.D. provided inadequate oversight of the projects due to their regional, rather than local, management and complex administrative structures. The use of A.I.D. funds was well documented by the Ministry of Agriculture and Natural Resources (MANR), the implementing agency, but there were inadequate internal controls over expenditures. Goods and services were procured mainly by a non-competitive bidding system, despite Government of The Gambia (GOTG) and A.I.D. regulations to the contrary. A.I.D. funds were deposited in commercial bank checking accounts, rather than in the Central Bank. Also, MANR was found to have consistently overestimated its quarterly cash requirements, leading to $33,880 in uncommitted funds. One contract was made to a GOTG civil servent, violating GOTG rules on moonlighting and competitive bidding. Finally, several project vehicles were inoperational and in need of substantial repair. It is recommended that the Senegal and Upper Volta Missions: (1) ensure that all project-related funds are transferred to the Central Bank, thus bringing expenditures under the review of the GOTG Accountant General; (2) require GOTG to return the unused Food Crop Protection funds to the U.S. Treasury and make more realistic projections of its cash requirements in the future; (3) recover the $18,737 paid to the GOTG civil servant, as well as $471 in other unallowable expenses; and (4) obtain a commitment from MANR to repair project vehicles. Finally, the Bureau for Africa assistant administrator should review USAID oversight responsibilities and performance on the two projects and, where feasible, assign heavier responsibilities to the Missions closest to the implementation area.