Direct Assistance: USAID Has Taken Positive Action to Assess Afghan Ministries' Ability to Manage Donor Funds, but Concerns Remain [open pdf - 7MB]
"The U.S. government has committed to providing at least 50 percent of its development aid to Afghanistan through on-budget assistance to the Afghan government. On-budget assistance includes (1) direct assistance, which is comprised of host country contracts and government-to-government awards and is the focus of this audit; (2) contributions to multi-donor trust funds; and (3) direct budget support. As of August 2013, the U.S. Agency for International Development (USAID) had commitments of $1.6 billion in direct assistance to 18 programs across 10 Afghan ministries and other government entities. Since 2010, both Congress and USAID have strengthened policies to regulate direct assistance. In an effort to improve accountability and meet congressional requirements, USAID contracted with Ernst & Young and KPMG in late 2010 and early 2011 to assess 16 Afghan ministries' abilities to manage U.S. funds. In addition, to help ensure the proper management and implementation of direct assistance worldwide, USAID developed 'Automated Directives System 220: Use of Reliable Partner Country Systems for Direct Management and Implementation of Assistance' in August 2011. […] The objectives of this audit were to (1) assess the extent to which Ernst & Young and KPMG adhered to USAID contract requirements when conducting the ministry assessments, (2) describe assessment findings and conclusions about the ability of the Afghan ministries to manage U.S. funds and analyze how USAID has used, or plans to use, the assessments to inform its direct assistance to the Afghan government, and (3) examine the U.S. Department of State's certification and USAID's notification provided to Congress, pursuant to congressional requirements for providing direct assistance to the Afghan government."
SIGAR 14-32; Special Inspector General for Afghanistan Reconstruction 14-32
Special Inspector General for Afghanistan Reconstruction: http://www.sigar.mil/