Audit of the Millennium Challenge Corporation's Financial Statements, Internal Controls, and Compliance for the Period Ending September 30, 2010 and 2009
Modify the Payment Request Form (PRF) to specifically identify requests for advance payments to vendors.
Provide training to Fiscal Agents and other in-country personnel to explain how to properly record each line of the PRF based on supporting documents and how MCC financial statements are affected by MCA activities and transactions.
Establish a comprehensive methodology and/or standard process for obtaining, recording, and reporting yearend accruals which covers all MCAs and funds and include invoiced and rendered services which have not been recorded in the yearend trial balance.
Establish consistent communication with NBC and the MCAs for understanding the process and methodology developed.
Perform quality control procedures over amounts obtained and recorded. Review the amounts posted for reasonableness, accuracy, and completeness.
We recommend that the MCC Department of Compact Operations and Division of Finance: Performance of Timely and Complete MCA Audits Recommendation No. 6: Implement a process for coordinating with MCAs, audit firms, and the OIG to ensure all parties are adequately informed of the progress of all audits to ensure that MCA audits are completed in accordance with the compact.
We recommend that the MCC Department of Compact Operations and Division of Finance: Establish and implement a process to ensure that MCAs prepare and make available for audit the status of advances to contractors, retention balances and data necessary for MCC to properly report its accruals.
We recommend that MCC Management and Department of Compact Operations: Establish and implement a process to ensure that all personnel responsible for QFRs to guide them to submit accurately prepared and properly approved QFRs and Disbursement Requests in a timely manner.
We recommend that MCC Management and Department of Compact Operations:
Establish and implement a process to ensure that funds are periodically reviewed to determine if MCAs should submit final QFRs to record deobligations for funds no longer needed.
We recommend that MCC Department of Compact Operations coordinate with appropriate management levels to implement a formal process for administering 609(g) funds in all countries not managed by either MCC or an MCA.
We recommend that MCC Department of Compact Operations, in coordination with the Division of Finance monitor on a quarterly basis the cumulative obligation and disbursements of all countries that have received 609(g) funds and communicate with the MCAs to determine if there is still an immediate need to maintain excess 609(g) funds that have not been disbursed. The input from MCC Department of Compact Operations must be documented. Deobligate 609(g) funds that are no longer considered an immediate need to the MCA/Partnering Country.
We recommend that MCC Department of Compact Operations strengthen its CPS Signature Card process to include a MCC authorizing signature, effective and termination dates, to include an annual or other periodic review process between MCC, its financial service provider, and the MCAs to ensure that signature cards are kept on file for only active users of its CPS payment requesting system.
We recommend that the MCC management and Department of Compact Operations:
Develop policies and procedures for Program Closure of Compacts that have been suspended or terminated to ensure that programs, activities, and assets are properly accounted for, and final disposition is reported to MCC.
We recommend that the MCC management and Department of Compact Operations: Establish guidelines for Fiscal Accountability Directors, Fiscal Agents, as well as personnel in the Division of Finance and MCC's financial services provider to make them fully aware of any restrictions to process payments made during a program or compact close-out period.
We recommend that the MCC Division of Finance continue to follow USAID's progress toward elimination of cash balance differences between USAID and Treasury and timely clearing of suspense account items in order to monitor MCC's risk of potential misstatements.
Strengthen its quality reviews over financial statements to validate that information presented is accurate, complete, and complies with accounting standards and reporting guidance.
Establish quality control procedures to document during the review process any discrepancies, errors, and other anomalies that have occurred to provide an audit trail of issues that may require on-top adjustments.