Report of audit maternal & child health, project no., 439-11-570-081

The maternal/child health (MCH) program is designed to improve MCH health care and to provide a distribution system for birth control information and contraceptives. The audit included a review of project documents, some end-use observations of project commodities, and interviews with USAID officals. Project is still in its formative stages; measurable results will not be seen for several years. Laos has initiated construction of the 200-bed central hospital and plans to start construction of 5 additional facilities and renovation of 10 other facilities during the next year. A participant training program has been initiated. The Royal Lao government (RLG) has placed over 200 people on its MCH payroll throughout the country. Examination of "open-end" PIO/C procurement authorizations issued under this project disclsed that USAID/Laos did not have adequate procedures and controls to manage this type of procurement. This resulted in procurement authorizations being made prior to the needs of the project and questionable uncommitted balances remaining on several "open-end" procurement authorizations. Basic planning and adequate documentation has not been accomplished for this project. The PROP needs revision; no Project Implementation Plan has been prepared; funds have been obligated before plans and reasonably firm cost estimates were completed, and inadequate consideration has been given as to whether RLG has the financial and human resources necessary to effectively maintain and utilize the facilities being constructed. Audit also disclosed that population funds have been used for general refugee support and expansion of the USAID/PHD warehouse. USAID should take corrective action to eliminate overstocked and non-utilized commodities, improve monitoring of open-ended PIO/C"s, and update the PROP and other documents. Auditors recommend that USAID (1) conduct a management analysis of the Public Health Division, (2) complete a Project Manager"s Handbook, and (3) insure that all project managers carry out their responsibilities as set forth in the handbook.