progress in resolving the following challenge
• information security
Of the agency’s five major management challenges, its performance plan had
1. goals and measures that were directly related to one of the challenges, 2. goals and measures that were indirectly applicable to two of the
challenges, including
• strategic human capital management and
• financial management information unreliable/financial statements inaccurate and do not measure program results
3. no goals and measures related to one of the challenges, but discussed strategies to address the challenge, which was
• challenges with developing reliable performance measures and accurately reporting results of programs
4. no goals, measures or strategies to address one of the challenges
• information security.
Table 23: Major Management Challenges for USAID
Major management challenge
Progress in resolving major management challenge as discussed in agency’s fiscal year 2001 performance report
Applicable goals, measures, and strategies as discussed in agency’s fiscal year 2003 performance plan GAO-designated government wide
high risk
Strategic human capital management:GAO has identified shortcomings at multiple agencies involving key elements of modern strategic human capital management, including strategic human capital planning and organizational alignment;
leadership continuity and succession planning; acquiring and developing a staff whose size, skills, and deployment meet agency needs; and creating results-oriented organizational cultures.
Since the early 1990s, we have reported that USAID has made limited progress in addressing its human capital management issues. A major concern is USAID’s inability to establish and integrate a comprehensive workforce plan with its strategic goals and objectives. Developing such a plan is critical due to a reduction in its workforce during the 1990s and expected high continuing attrition.
USAID stated that it took a number of steps to build a stronger and more capable human resource base. The agency continued recruiting entry-level staff through its New Entry Professional program and increased the level of midcareer professionals, specifically contract and legal officers. In addition, USAID reported that it increased the number of senior managers trained through external sources and developed in-house training to enhance the results-oriented management, financial
management, acquisitions and assistance, and supervisory skills of program managers and their staffs.
USAID reported specific performance results in 2001 that included
• hiring 77 new entry professionals, 18 presidential management interns, and 46 career civil service employees and
• providing training to
- 385 individuals in supervisory classes and seminars,
- 348 employees on managing for results, and - 480 employees on acquisition and assistance rules and procedures.
USAID also reported that it is developing a workforce strategy that systematically and comprehensively assesses its headquarter’s staffing needs.
USAID reported that it intends to strengthen its human capital
management capabilities by continuing its recruitment efforts and providing in-house training.
USAID plans to deploy staff rapidly in all labor categories through intensified recruitment efforts. To do so, the agency intends to meet all its foreign service and civil service staffing requirements and to complete a civil service recruitment plan.
In addition, the agency intends to make
“Web-enhanced human resource management tools” available to human resource management personnel.
USAID intends to continue providing in-house training in leadership, operations, financial management, and overall managing for results. The agency plans to train 2,500 employees in fiscal 2003.
Appendix XXII
Observations on the U.S. Agency for International Development’s Efforts to Address Its Major Management Challenges
Information security: Our January 2001 high-risk update noted that agencies’ and governmentwide efforts to strengthen information security have gained momentum and expanded.
Nevertheless, recent audits continue to show that federal computer systems are riddled with weaknesses that make them highly vulnerable to computer-based attacks and place a broad range of critical operations and assets at risk of fraud, misuse, and disruption. Further, the events of September 11, 2001, underscored the need to protect America’s cyberspace against potentially disastrous cyber attacks—
attacks that could also be coordinated to coincide with physical terrorist attacks to maximize the impact of both.
USAID reported that it has improved its computer security. For example, the agency’s computer security framework includes updated security policies and a risk assessment process. USAID has also improved its security training. However, the report does not provide any information on the content of the security training or the numbers and types of personnel who received the training.
USAID plans to initiate actions to improve its computer security to reduce the possibility of unauthorized access.
However, the plan does not provide information on specific actions or time frames for completion.
The National Institute of Standards and Technology (NIST) developed a security assessment framework and related tools that agencies can use in determining the status of their information security programs. Also, Office of Management and Budget (OMB) guidance for fiscal year 2002 reporting under the
Government Information Security Reform Act (GISRA) requires agencies to use tools developed by NIST to evaluate the security of unclassified systems or groups of systems.
In addition, OMB’s GISRA reporting guidance requires specific performance measures as well as corrective action plans with quarterly status updates.
GAO-designated major management challenge
Challenges with developing reliable performance measures and
accurately reporting results of programs: USAID continues to have problems developing performance measurement systems that meet external and internal reporting requirements, including the requirements of the Government Performance and Results Act of 1993.
USAID reported that it has taken a number of steps to address this challenge. USAID’s corrective actions included (1) developing and disseminating lists of indicators that can be used by missions seeking appropriate tools to measure performance, (2) sending annual reporting guidance cables to operating units on the types of data needed and the documentation required, (3) expanding the publication of supplementary guidance to missions on managing data for maximum quality and utility, and (4) holding training seminars for its overseas officers on managing for results.
In 2001, USAID started to train its staff through a series of workshops held at missions around the world. During fiscal 2001, USAID reported that it trained 750 officers on its programming policies and nearly 500 officers on performance management.
According to USAID’s 2003 plan, the agency is streamlining, simplifying, and improving its annual performance reporting process. In addition, the plan includes an annex that describes performance measurement indicators and how they are calculated. The annex also assesses the quality of the data.
However, the 2003 plan does not include specific goals related to improving the reliability of performance indicators and reporting of results.
USAID plans to continue providing training on performance management and reporting. However, its 2003 plan does not include specific training targets.
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Major management challenge
Progress in resolving major management challenge as discussed in agency’s fiscal year 2001 performance report
Applicable goals, measures, and strategies as discussed in agency’s fiscal year 2003 performance plan
Implementing an integrated financial management system
USAID acknowledged the cornerstone of its financial management improvement program is the implementation of a core financial system that is fully compliant with federal requirements and standards. While USAID has made progress in improving some areas of financial management, it still needs to make additional improvements to produce timely and accurate financial information for use by USAID managers in carrying out the agency’s goal of providing economic, development, and humanitarian assistance around the world in support of United States foreign policy.
The Inspector General has continued to report that USAID’s financial management systems do not meet federal financial system requirements. In Fiscal 2001, USAID used a variety of nonintegrated systems that required data reentry, supplementary accounting records, and lengthy and burdensome reconciliation processes. Currently USAID uses a variety of nonintegrated systems that require data reentry, supplementary accounting records, and lengthy and burdensome reconciliation processes.
In an attempt to mitigate this long-standing problem, USAID recently deployed an off-the-shelf accounting system as a component of its financial management system. However, USAID still lacks a fully integrated financial management system and places a greater reliance on manual processes such as reconciliations, because data for the same transactions are entered into multiple systems.
USAID’s performance goal for a core financial management system certified compliant with federal requirements has two indicators:
• A fully operational, secure, and compliant core financial system installed with interfaces to major feeder systems.
• A system installed in Washington and the field to allocate administrative cost to agency strategic goals.
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Major management challenge
Progress in resolving major management challenge as discussed in agency’s fiscal year 2001 performance report
Applicable goals, measures, and strategies as discussed in agency’s fiscal year 2003 performance plan
Appendix XXII
Observations on the U.S. Agency for International Development’s Efforts to Address Its Major Management Challenges
Financial management information unreliable/financial statements inaccurate and do not measure program results
USAID’s report identified financial management as a management challenge and recognized the need to improve the quality and availability of financial and performance data. However, the report does not directly address agency progress in obtaining an unqualified opinion on its financial statements.
Fiscal year 2001 marked the first time that the USAID Inspector General was able to express an opinion on three of USAID’s financial statements—
the Balance Sheet, Statement of Changes in Net Position, and Statement of Budgetary Resources.
However, the opinions were qualified and achieved only through extensive efforts to overcome material internal control weaknesses. Thus, the progress made is not necessarily sustainable. Further, the Inspector General was still unable to express an opinion on USAID’s Statement of Net Cost and Statement of Financing because USAID’s financial management systems could not produce accurate, complete, reliable, timely, and consistent financial statement and performance information. USAID’s inadequate accounting systems make it difficult for the agency to accurately account for activity costs and measure its program results.
The plan has no goals or measures that addresses this challenge. However, it provides a fiscal year 2003 time frame for establishing an integrated financial management system that is certified compliant with federal requirements.
Also, USAID indicated that in fiscal 2003 it has a target to install a system capable of allocating costs to strategic objectives throughout the agency.
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Major management challenge
Progress in resolving major management challenge as discussed in agency’s fiscal year 2001 performance report
Applicable goals, measures, and strategies as discussed in agency’s fiscal year 2003 performance plan