Negotiated Indirect Cost Rate Agreements: Opportunities Exist to Improve Processes and Data Management

Submitting OIG:

U.S. Agency for International Development OIG

Date Issued:

Friday, January 26, 2024

Agency Reviewed / Investigated:

U.S. Agency for International Development

Submitting OIG-Specific Report Number:

3-000-24-001-U

Type of Report:

Audit

Questioned Costs:

Funds for Better Use:

Number of Recommendations:

Report updated under NDAA 5274:

View Document:

Attachment	Size
3-000-24-001-U.pdf	10.54 MB

Recommendation Number	Recommendation Status	Significant Recommendation	Additional Details
1	Open
To address the weaknesses identified in the report, the firm recommend that USAID’s Acting Director, Office of Acquisition & Assistance:_x000D_ Develop and implement procedures to collect indirect cost data from implementers in a systematic manner that will allow it to comprehensively report and analyze the indirect costing methodology and rates for implementers. This information should include indirect cost rate agreement type (e.g., cognizant agency-negotiated indirect cost rate or de minimis agreements).
2	Open
To address the weaknesses identified in the report, the firm recommend that USAID’s Acting Director, Office of Acquisition & Assistance:_x000D_ Review the results of the prime implementer’s sub-awardee monitoring specifically for indirect cost concerns during site visits or other reviews of the prime.
3	Open
To address the weaknesses identified in the report, the firm recommend that USAID’s Acting Director, Office of Acquisition & Assistance:_x000D_ Develop written internal control policies, procedures, or guidance specific to USAID’s Overhead, Special Cost, and Closeout Branch indirect cost processes to clarify minimal documentation retention rules during every phase of the indirect cost process, notably first time, subsequent, and final negotiations.
4	Open
To address the weaknesses identified in the report, the firm recommend that USAID’s Acting Director, Office of Acquisition & Assistance:_x000D_ Develop checklists to verify completion of for-profit organizations files similar to the checklist used for non-profit organizations.
5	Open
To address the weaknesses identified in the report, the firm recommend that USAID’s Acting Director, Office of Acquisition & Assistance:_x000D_ Develop a process to conduct periodic reviews of a sample of implementer files for missing documents or accuracy of indirect costs charged and report unsupported payments as improper payments.
6	Open
To address the weaknesses identified in the report, the firm recommend that USAID’s Acting Director, Office of Acquisition & Assistance:_x000D_ Consider implementation of a centralized document control methodology and tracking mechanism to improve internal document control practices.

Recommendation Number

Recommendation Status

Significant Recommendation

Additional Details

Open

To address the weaknesses identified in the report, the firm recommend that USAID’s Acting Director, Office of Acquisition & Assistance:_x000D_ Develop and implement procedures to collect indirect cost data from implementers in a systematic manner that will allow it to comprehensively report and analyze the indirect costing methodology and rates for implementers. This information should include indirect cost rate agreement type (e.g., cognizant agency-negotiated indirect cost rate or de minimis agreements).

Open

To address the weaknesses identified in the report, the firm recommend that USAID’s Acting Director, Office of Acquisition & Assistance:_x000D_ Review the results of the prime implementer’s sub-awardee monitoring specifically for indirect cost concerns during site visits or other reviews of the prime.

Open

To address the weaknesses identified in the report, the firm recommend that USAID’s Acting Director, Office of Acquisition & Assistance:_x000D_ Develop written internal control policies, procedures, or guidance specific to USAID’s Overhead, Special Cost, and Closeout Branch indirect cost processes to clarify minimal documentation retention rules during every phase of the indirect cost process, notably first time, subsequent, and final negotiations.

Open

To address the weaknesses identified in the report, the firm recommend that USAID’s Acting Director, Office of Acquisition & Assistance:_x000D_ Develop checklists to verify completion of for-profit organizations files similar to the checklist used for non-profit organizations.