Enhanced Controls Are Needed to Ensure the Cost-Effectiveness of MCC Travel and Prevent Waste and Abuse

Audit Report
Report Number
0-MCC-20-012-C

We contracted with the independent certified public accounting firm RMA Associates LLC to determine (1) if MCC’s internal controls for the authorization and justification for premium travel were effective in preventing waste, fraud, or abuse; (2) whether MCC’s use of premium travel was cost-effective; and (3) how MCC’s use of premium travel aligns with the corporation’s mission and Federal travel policy, and the policies and practices of the State Department and USAID.

The audit firm reported that MCC premium travel averaged a high percentage (73 percent) of total travel cost across the audited period, and that premium travel use was substantially higher at MCC (44 percent) than at the State Department (3 percent) or USAID (2 percent) in fiscal year 2019. In answering the audit objectives, the audit firm found: (1) instances during testing where internal controls for premium travel were not effective in preventing waste and abuse; (2) MCC’s use of premium travel when compared to a less expensive method of flight travel suggested opportunities to improve cost-effectiveness regarding the type of travel; and (3) MCC’s policies were in alignment with Federal Travel Regulations and the Fly America Act. The audit firm also reported three findings related to noncompliance with various travel policies and regulations.

OIG made four recommendations to address the instances of noncompliance and considers all recommendations resolved but open pending completion of planned activities.

Recommendations

Recommendation 1

MCC's Chief Financial Officer Implement a process for ensuring that all flights considered for premium class travel meet the 14-hour rule as defined by the Title 41 of the Code of Federal Regulations, Section 301-10.125.

Questioned Cost:
$0
Funds For Better Use:
$0
Recommendation 2

MCC's Chief Financial Officer Provide training to reinforce MCC's Temporary Duty Travel policy requiring (1) a justification for late approval for each premium travel event prior to departure and (2) use of the appropriate level of authority.

Questioned Cost:
$0
Funds For Better Use:
$0
Recommendation 3

MCC's Chief Financial Officer Provide training to help reinforce the 2019 flight reservation policy to book travelers on coach class, or lower available fare, when submitting authorizations in E2 seven days or less from the date of departure unless another class of service is approved by the Vice President for Administration and Finance.

Questioned Cost:
$0
Funds For Better Use:
$0
Recommendation 4

MCC's Chief Financial Officer Update MCC's Temporary Duty Policy to (1) reinforce the requirement that travelers report to work the following day or sooner when utilizing premium class fares and (2) establish a control aligning a traveler's report to work requirements with eligibility to claim per diem during premium travel events.

Questioned Cost:
$0
Funds For Better Use:
$0