UNITED STATES AGENCY FOR INTERNATIONAL DEVELOPMENT 

OFFICE OF INSPECTOR GENERAL
 

FOR THE
 

MILLENNIUM CHALLENGE CORPORATION
 

SEMIANNUAL REPORT
 

TO THE CONGRESS
 

October 1, 2006 - March 31, 2007
 
MISSION
 

Mission 

The mission of the Office of Inspector General (OIG) is to contribute to and support 

integrity, efficiency, and effectiveness in all activities of the organizations for which it has 

oversight responsibilities. 

Values 

In accomplishing our mission, OIG is committed to the following: 

• Integrity 

• Excellence 

• Teamwork 

Strategic Goals 

• 	Promote sound accounting and reporting on financial activities and information 
 

security.
 

• 	Promote economy, efficiency, and effectiveness, and assess program results. 

• 	Preserve and protect program and employee integrity. 
CONTENTS
 

Message from the Inspector General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iii
 

Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
 

Summary of Results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
 

Strategic Goal 1: Promote sound accounting and reporting on
 

financial activities and information security . . . . . . . . . . . . . . . . . . . . . . . . 3
 

Strategic Goal 2: Promote economy, efficiency, and effectiveness,
 

and assess program results . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
 

Strategic Goal 3: Preserve and protect program and employee
 

integrity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
 

Appendices: Reporting Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
 

SEMIANNUAL REPORT TO THE CONGRESS i 

MESSAGE FROM THE 

INSPECTOR GENERAL 

This Semiannual Report to the 

Congress (SARC) presents 

information about the 

work of the United States Agency 

for International Development 

(USAID), Office of Inspector 

General (OIG) in providing 

oversight for the Millennium 

Challenge Corporation (MCC) 

during the six-month period ending 

on March 31, 2007. It is issued in 

accordance with the requirements 

of the Inspector General Act of 

1978, as amended, and specifi cally 

addresses our responsibilities for 

MCC. 

The work reported was planned and 

executed in support of OIG’s three 

strategic goals for MCC: 

• 	 Promote sound accounting and 

reporting on fi nancial activities 

and information security. 

•	 Promote economy, effi ciency, and 

effectiveness, and assess program 

results. 

• 	 Preserve and protect program and 

employee integrity. 

This report describes signifi cant 

OIG activity and achievements in 

support of these goals. 

Donald A. Gambatesa 

Inspector General 

SEMIANNUAL REPORT TO THE CONGRESS iii 

EXECUTIVE SUMMARY
 

OIG’s collaborative 

working relationship 

with MCC continues to 

achieve positive results. During 

this reporting period, management 

decision was reached on 13 

recommendations. Final action was 

recorded on 20 recommendations. 

OIG results achieved under each of 

the goals are described below. 

Strategic Goal 1: 

Promote sound accounting 

and reporting on financial 

activities and information 

security. 

OIG continues to address MCC’s 

challenge in developing effective 

financial management systems 

and related internal controls and 

worked with foreign accounting 

fi rms overseeing fi nancial audits 

conducted on OIG’s behalf during 

this reporting period. Before qualifi ­

cation, OIG assesses local fi rms for 

eligibility to perform audits, reviews 

documents to facilitate the incountry audit process, and evaluates 

audit products for quality. During 

this period, OIG issued seven 

reports addressing MCC’s fi nancial 

activities: the audit of the fi nancial 

statements for the period ending 

on September 30, 2006; a report on 

MCC’s withholdings/contributions 

for the employee benefi t program; a 

risk assessment of MCC’s Vanuatu 

financial operations; and four Fund 

Accountability Statement (FAS) 

audits. 

MCC’s financial statements for fi scal 

year 2006 were audited under OIG 

oversight by a nonfederal accounting 

firm. The audit fi rm identifi ed six 

reportable conditions in MCC’s 

internal controls process for 

financial reporting and operations 

which included fi ve material 

weaknesses and three instances 

of noncompliance with laws, 

regulations, contracts, and grant 

agreements. 

OIG made 12 recommendations, 

and final action was taken on all but 

two recommendations. 

During this reporting period, OIG 

work continued in support of 

the requirements for audits under 

Compact agreements, which are the 

grant instruments used for recipient 

countries. Audits of the funds 

managed by the Compact recipients 

were issued for the first time, and 

the fi ndings were signifi cant. 

Work continued in the information 

security area relative to fi ndings of 

the Federal Information Security 

Management Act (FISMA) 

audit from the previous period. 

Final action was taken on seven 

recommendations. 

Strategic Goal 2:
 

Promote economy,
 

efficiency, and effectiveness,
 

and assess program results.
 

OIG surveyed MCC’s Trade 

Capacity Building (TCB) program 

activities in response to a request 

from members of the Committee 

on Small Business, U.S. House 

of Representatives to determine 

if MCC’s programs support the 

implementation of free-trade 

agreements. OIG also issued an 

audit of MCC’s due-diligence 

process leading to Compact awards. 

Results of Compact countries will 

be the subject of future audits 

because Compacts are in the early 

stages of disbursing funds and 

initiating activities in the recipient 

countries. 

Strategic Goal 3: 

Preserve and protect 

program and employee 

integrity. 

Fraud awareness training was 

conducted in two countries. The 

briefings highlighted potential 

contracting irregularities and 

educated those who have responsibility for administering MCC 

programs on potential vulnerabilities. 

SEMIANNUAL REPORT TO THE CONGRESS 1 

SUMMARY OF RESULTS
 

Strategic Goal 1: 

Promote sound accounting and reporting on 

financial activities and information security. 

OIG is pursuing an 

aggressive fi nancial 

management audit 

program to identify defi ciencies 

that can be addressed as MCC 

enters each new phase of Compact 

administration. Efforts are aimed 

at establishing sound fi nancial 

accounting methodologies for 

the long term. One key area for 

financial management is MCC’s 

process and procedures for disbursing funds to Compact recipients, 

for which OIG made several 

recommendations. 

OIG’s information security work 

during this period focused on 

recommendations to MCC in 

previous audits. MCC and OIG 

have achieved signifi cant results 

on follow-up of outstanding 

recommendations. 

SIGNIFICANT 

OIG WORK 

Consolidated Financial 

Statements, Internal 

Controls, and Compliance for 

Fiscal Years 2006 and 2005 

OIG issued an unqualifi ed opinion 

on MCC’s fi nancial-statement audit 

for fiscal year 2006. This annual 

audit has three components: review 

of the assets and liability accounts 

of MCC as presented in the 

financial statements; review of the 

internal control process; and review 

of the organization’s compliance 

with rules, regulations, and laws. 

The audit was conducted by a 

nonfederal audit fi rm, which found 

that the fi nancial statements were 

presented in conformity with 

generally accepted accounting 

principles. The opinion included 

six reportable conditions which 

included five material weaknesses 

and three instances of noncompliance with laws, regulations, 

contracts, and grant agreements. 

The material weaknesses identifi ed 

in MCC’s internal controls increased 

risks such as misstating amounts in 

the financial statements, unauthorized transactions, omissions, 

potential fund-control violations, 

and noncompliance. 

OIG reviewed the audit report and 

made 12 recommendations for 

addressing weaknesses in MCC’s 

financial management operations. 

Two of the recommendations are 

pending fi nal action. 

MCC continues to address fi scal 

year 2005 fi nancial-statement audit 

recommendations concerning cash 

management. MCC is preparing 

a description of the methodology it will use to implement the 

recommendation for developing 

policies and procedures to ensure 

that the payment schedules and 

other agreements entered into with 

grantees reflect the Department of 

Treasury requirements for advances 

and immediate cash needs. 

(Audit Report No. M-000-07-0001-F) 

Financial Audits of Compact 

Funds – Fund Accountability 

Statement Audits 

OIG responsibilities include 

financial audits of U.S. Government 

funds provided under MCC’s 

Compact agreements. Those 

Compact grants contain a provision 

for financial audits of funds held 

by the Accountable Entity1 that 

manages the funds. Compacts 

currently require such audits at 

1. The Accountable Entity is an entity established by the recipient government to manage the MCC-funded program. The recipient government delegates 

responsibilities to an Accountable Entity. 

SEMIANNUAL REPORT TO THE CONGRESS 3 
least once a year. However, MCC is 

requiring the recipient countries to 

perform audits twice a year. 

As part of its quality assurance 

program, OIG continues to identify 

and approve audit fi rms overseas 

that are qualified to perform the 

audits. Qualifi cation requires 

consideration of compliance with 

elements of professional auditing 

standards. In all cases, OIG staff 

travel to the country to conduct 

the assessments. In addition, OIG 

reviews the statements of work and 

resulting audit work performed on 

the accounts. These audits review 

the entity’s FAS, internal controls, 

and compliance with material 

provisions, and OIG issues the 

audit with recommendations to 

MCC for overseeing the resolution 

of identified weaknesses and 

questioned costs. 

During this period, OIG qualifi ed 

audit firms in two additional 

countries, bringing the total number 

of Compact countries with qualifi ed 

audit firms to 11. Emphasis 

continues on building relationships 

with other organizations having 

experience or interest in international auditing of development 

projects. 

OIG reviewed and issued the 

first audits performed by local 

audit firms. FAS audit reports for 

Madagascar, Cape Verde, Honduras, 

and Georgia were completed during 

this reporting period. MCC must 

work with the Accountable Entities 

to resolve the audit fi ndings. 

Risk Assessment of 

Millennium Challenge 

Account Vanuatu’s Financial 

Operations 

During this period, OIG performed a risk assessment of the 

$65.7 million Compact program 

during the Millennium Challenge 

Account (MCA) Vanuatu’s 

implementation to detect 

vulnerabilities in cash management 

and procurement. 

OIG held several meetings with 

various individuals involved in 

developing the proposal and 

providing assistance in the compact 

activities; with key staff to discuss 

policies and procedures; and with 

fiscal and procurement agents to 

review progress in building an 

organizational structure and to 

assess their role in understanding 

responsibilities for complying with 

MCC’s requirements. 

OIG found that MCA Vanuatu had 

moderate risk in cash management 

and procurement. No recommendations were made. 

(Report No. M-000-07-003-F) 

Review of MCC’s Benefits 

Withholdings/Contributions 

and the Supplemental 

Semiannual Headcount 

Report Submitted to 

the Office of Personnel 

Management 

OIG oversaw a nonfederal account 

firm’s review of “Agreed Upon 

Procedures of MCC’s Retirement, 

Health Benefits, and Life Insurance 

Withholdings/Contributions and 

the Supplemental Semiannual 

Headcount Report” submitted by 

MCC to the Office of Personnel 

Management (OPM) for the period 

ending on June 10, 2006. 

The review was conducted at the 

request of MCC to ensure that 

certain personnel deductions were 

being managed correctly. The 

nonfederal auditor tested MCC 

personnel documentation on the 

basis of the sampling outlined in 

the “Agreed Upon Procedures”; 

interviewed human resources and 

payroll personnel and reviewed 

policies and procedures to identify 

material weaknesses and their 

causes; and reviewed offi cial 

personnel fi les, performed recalculations, and verified withholdings and 

contributions with the general ledger 

and offi cial OPM reports. 

There were no findings in the 

report, which was issued without 

recommendations. 

(Report No: M-000-07-002-F) 

OTHER WORK 

THIS PERIOD 

OIG continues to work with MCC 

after an audit is completed to ensure 

that proposed actions in response to 

recommendations will be effective 

in resolving identified weaknesses. 

Specific emphasis is on recommendations resulting from legislatively 

required audits, including the 

FISMA audit. 

The FISMA audit requirements are 

designed to identify weaknesses that 

must be corrected to protect MCC’s 

information technology and system 

assets. 

Follow-up efforts have been focused 

on the FISMA audit of the previous 

period, with much work directed at 

4 

4 SEMIANNUAL REPORT TO THE CONGRESS 
resolution of outstanding actions. 

Ongoing collaboration is essential 

to the integrity of the audit process 

and has tangible benefits for MCC 

and OIG. During this period, the 

collective effort resulted in fi nal 

action on seven recommendations 

and refl ects considerable work 

addressing information technology 

security agencywide. 

Significant work was conducted 

to follow up on recommendations 

made in “Risk Assessment of MCA 

Cape Verde’s Financial Operations.” 

However, MCC was unable to reach 

management decision on recommendations concerning management of 

cash advances to and by Compact 

recipients and secondary recipients. 

OIG requested MCC’s action on 

report recommendations after three 

months and again after four months.

2 

OIG continues to work with MCC 

on these recommendations from this 

audit. 

2. OIG letter to MCC Chief Executive Officer,Ambassador John J. Danilovich, dated March 2, 2007. 

SEMIANNUAL REPORT TO THE CONGRESS 5 

Strategic Goal 2: 

Promote economy, efficiency, and 

effectiveness, and assess program results. 

OIG directs efforts toward 

evaluating MCC’s response 

to management challenges 

and providing recommendations 

for addressing vulnerabilities. The 

challenges relate to human capital, 

application of laws and regulations, 

and development of effective 

management-oversight methodologies and programs. 

SIGNIFICANT 

OIG WORK 

Survey of MCC’s Trade 

Capacity Building 

Programs for Supporting 

Implementation of Free Trade 

Agreements 

OIG surveyed MCC Trade 

Capacity Building (TCB) programs 

in response to a request by three 

members of the House Small 

Business Committee. TCB 

programs assist developing 

countries by building trade 

competitiveness, improving 

standards for traded goods, and 

improving customs procedures. 

TCB activities are categorized as 

physical-infrastructure development, 

financial-sector development and 

good governance, trade-related 

agriculture, and business services 

and training. MCC’s mission 

focuses on promoting sustainable 

economic growth that reduces 

poverty through investments in 

areas such as agriculture, education, 

private-sector development, 

and capacity building, providing 

monetary assistance through 

Compact and threshold agreements 

to eligible countries that have welldesigned programs. During 2005, 

MCC reported in the TCB database 

$368.9 million in funding for TCBrelated activities for Madagascar, 

Honduras, and Nicaragua. The 

activities were related primarily 

to infrastructure and agriculture 

projects. 

OIG conducted the survey to 

determine whether MCC provided 

guidance to eligible countries 

on TCB programs; whether the 

programs supported implementation of free trade agreements with 

its Compact countries; whether 

the 2006 National Export Strategy 

reflected MCC’s current and 

planned TCB accomplishments; and 

the status of MCC’s small-business 

trade matchmaking efforts. 

OIG concluded that MCC does 

not have a specifi c, identifi able 

TCB program and therefore 

did not provide guidance to 

eligible countries on trade-related 

activities. Furthermore, MCC’s 

programs do not directly support 

free trade agreements, although 

the countries’ proposed programs 

may complement established trade 

agreements. In addition, the 2006 

National Export Strategy report 

does not reflect MCC’s planned 

TCB accomplishments but reports 

on MCC’s current TCB activities 

from fiscal year 2005. Finally, MCC 

does not have a small-business 

trade matchmaking program but 

encourages the participation of 

small businesses in procurement 

ventures that will enable the small 

businesses to compete with larger 

firms both in the United States and 

overseas. 

(Survey Report No. M-000-07-001-S) 

Audit of the Millennium 

Challenge Corporation’s 

Due-Diligence Review 

Process Leading to Compact 

Awards 

OIG audited MCC’s due-diligence 

review process leading to Compact 

awards to determine the methodology that MCC used in evaluating 

country proposals for funding 

and whether MCC evaluated the 

proposals in compliance with its 

policies and procedures. 

OIG found that the due-diligence 

process was effective. MCC 

assessed country proposals in 

compliance with its policies and 

procedures with one exception. 

Specifically, MCC did not provide 

timely information on a proposed 

project in one country for the 

country’s analysis and comment 

before Compact negotiation. In 

another country, a sustainability 

gap in the proposal was identifi ed 

during the due-diligence process, 

and MCC worked to develop a 

solution for helping ensure the 

success of its investment. In 

addition, the due-diligence process 

was aided in one country by the 

SEMIANNUAL REPORT TO THE CONGRESS 7 
Photograph of an OIG auditor with irrigation specialists at the proposed irrigation 

project site. The Government of Armenia provided specialists in irrigation with 

extensive experience to help develop the project proposals. 

Management of Conditions 

Precedent3 in MCC Compact 

Agreements 

During this reporting period, OIG 

conducted fieldwork in Cape Verde, 

Georgia, Honduras, and Nicaragua 

in March 2007 in support of this 

audit. The audit is designed to 

determine if MCC ensured that all 

required conditions were met before 

Compact agreements went into 

effect or disbursements were made 

to Compact countries. It also will 

address the thoroughness of MCC’s 

review of required documents to 

ensure that the Compact countries 

have met all the required conditions. 

OIG recommended that MCC 

develop and issue guidance to 

staff for establishing time frames 

for receipt of consultant reports 

and for providing such reports to 

prospective countries in suffi cient 

time for Compact negotiation. 

Management decision was reached 

on the recommendation. 

(Audit Report No. M-000-07-001-P) 

country counterparts’ expertise 

and knowledge of the proposed 

projects. Their use assisted in the 

timely and efficient execution of the 

due-diligence process. 

OIG identified two issues that 

warrant MCC management’s 

consideration: (1) MCC’s duediligence budgeting process; and 

(2) the English language capacity 

of officials reviewing MCC-related 

documents. 

3. Conditions precedent is a legal term coined by MCC that certain conditions, a process, or performance must take place before the Compact becomes 

a binding agreement and before MCC is obligated to make disbursements to the Compact country. 

8 

8 SEMIANNUAL REPORT TO THE CONGRESS 
Strategic Goal 3: 

Preserve and protect program and employee 

integrity. 

local government, implementing 

agencies, audit firm staff, foreign 

government officials, and Supreme 

Audit Institute members. 

OIG employs proactive 

strategies to prevent 

fraud. For example, 

fraud awareness training given to 

employees, contractors, grantees, 

and others alerts them to fraudulent 

practices and schemes and advises 

them on how to report fraud. 

OIG’s fraud-awareness program 

focuses on prevention of fraud 

and protection of resources and 

consists of briefings and a manual 

that highlights potential contracting 

irregularities. OIG plans briefi ngs 

at MCC headquarters as needed and 

with MCA entities of host countries 

and other interested parties. 

During this reporting period, 

OIG conducted fraud-awareness 

briefings in Armenia and Mali for 

Month 

OCT 

NOV 

DEC 

JAN 

Location Sessions Attendees Professional Affi liation 

Nothing to Report 

FRAUD AWARENESS BRIEFINGS WORLDWIDE 

AS OF MARCH 31, 2007 

Yerevan, Armenia 1 40 USAID and MCA Personnel 

MCA Personnel 

Local Accounting Firms 

Ministry of Finance representatives 

Nothing to Report 

Bamako, Mali 1 31 MCC, USAID, and MCA Personnel 

Local Accounting Firms 

Ministry of Finance representatives 

FEB Nothing to Report
 

MAR Nothing to Report
 

TOTAL 2 71
 

SEMIANNUAL REPORT TO THE CONGRESS 9 

A
 

P
 

P
 

REPORTING E 

REQUIREMENTS N 

D 

I 

C 


E 


S 


11 

FINANCIAL AUDIT REPORTS ISSUED 

October 1, 2006 through March 31, 2007 

M-000-07-001-F 11/14/06 Audit of the MCC’s Due Diligence Review Process Leading to 

Compact Awards 

M-000-07-002-F 01/05/07 Agreed Upon Procedures Performed on the MCC’s Retirement, 

Health Benefits, and Life Insurance Withholdings/Contributions 

and the Supplemental Semiannual Headcount Report Submitted 

to the Office of Personnel Management for the period ending 

June 10, 2006 

M-000-07-003-F 01/11/07 Risk Assessment of MCC’s Vanuatu’s Financial Operations 

Report 

Number 

Date of 

Report Report Title 

Amount of 

Findings 

Type of 

Findings 

QC--Questioned Costs
 

UN--Unsupported Costs
 

Note: UN is part of QC
 

Appendix A SEMIANNUAL REPORT TO THE CONGRESS 13 
PERFORMANCE AUDIT REPORTS ISSUED
 

October 1, 2006 through March 31, 2007
 

Report 

Number 

Date of 

Report Report Title 

Amount of 

Findings 

Type of 

Findings 

M-000-07-001-S 12/01/06 Survey of the MCC’s Trade Capacity Building Programs to 

Support Implementation of Free Trade 

M-000-07-001-P 03/02/07 Audit of the MCC’s Due Diligence Review Process Leading 

to Compact Awards 

QC--Questioned Costs
 

UN--Unsupported Costs
 

Note: UN is part of QC
 

14 SEMIANNUAL REPORT TO THE CONGRESS Appendix A
MISCELLANEOUS AUDIT REPORTS ISSUED
 

October 1, 2006 through March 31, 2007
 

M-000-07-001-N 12/21/06 Audit of the Fund Accountability Statement of the MCC $6,617 QC 

Resources Managed by MCA-Madagascar Under the 

Compact Agreement Dated April 18, 2005 Between MCC UN

and the Government of the Republic of Madagascar for 

the Period from July 27, 2005 to June 30, 2006 

M-000-07-002-N 01/11/07 Audit of the Fund Accountability Statement of the MCC $4,366 QC 

Resources Managed by MCA-Cape Verde Under the 

Compact Agreement dated July 4, 2005, between MCC and UN

the Government of the Republic of Cape Verde for the 

period from October 17, 2005 to June 30, 2006 

M-000-07-003-N 02/07/07 Independent Auditor’s Report on the Financial Audit of 

the MCC Resources Managed by Millennium AccountHonduras (MCA-Honduras), Under the Compact 

Agreement Between the MCC and MCA-Honduras from 

February 22, 2006 - June 30, 2006 

M-000-07-004-N 02/27/07 Audit of the Fund Accountability Statement of the MCC 

Resources Managed by Millennium Challenge - Georgia 

(MCA-Georgia), Under the Compact Agreement Dated 

September 12, 2005, Between the MCC and the 

Government of Georgia for the Period from April 7, 2006, 

to June 30, 2006 

Report 

Number 

Date of 

Report Report Title 

Amount of 

Findings 

Type of 

Findings 

QC--Questioned Costs
 

UN--Unsupported Costs
 

Note: UN is part of QC
 

Appendix A SEMIANNUAL REPORT TO THE CONGRESS 15 
AUDIT REPORTS OVER SIX MONTHS OLD
 

WITH NO MANAGEMENT DECISION 
 

As of March 31, 2007
 

Report 

Number Report Title 

Date of 

Report 

Current 

Recommendation 

Status 

Desired 

Decision 

Target 

Date 

M-000-06-001-C Audit of the Millennium Challenge Corporation’s Financial 

Statements, Internal Controls, and Compliance for the 

Period Ending September 30, 2005, and the Nine-month 

period Ending September 30, 2004 

12/06/05 3.1* 04/07 

M-000-06-004-F Risk Assessment of Millennium Challenge Account Cape 

Verde’s Financial Operations 

09/26/06 1 and 3 04/07 

* The management decision previously recorded for recommendation 3.1,“Audit of the MCC’s Financial Statements, Internal Controls, 

and Compliance for the Period Ending September 30, 2005, and the nine-month period ending September 20, 2004,” Report 

No. M-000-06-001-C, December 6, 2005, was rescinded by MCC on March 8, 2007. MCC has determined that the 2005 management 

decision does not reflect their current position. The management decision was rescinded and accordingly, the OIG records reflect that 

Management Decision is pending. 

1616 SEMIANNUAL SEMIANNUAL REPORT TO THE CONGRESS CONGRESS Appendix B Appendix B
SIGNIFICANT AUDIT RECOMMENDATIONS
 

DESCRIBED IN PREVIOUS SEMIANNUAL
 

REPORTS WITHOUT FINAL ACTION
 

As of March 31, 2007
 

Report 

Number Subject of Report 

Rec. 

No. 

Issue 

Date 

Management 

Decision Date 

Final Action 

Target 

Date 

M-000-05-003-P Audit of the Millennium Challenge Corporation’s 

Compliance with Provisions of the Federal 

Information Security Management Act of 2002 

8 06/20/05 06/20/05 04/07 

M-000-06-001-C Audit of the Millennium Challenge Corporation’s 

Financial Statements, Internal Controls, and 

Compliance for the Period Ending September 

30, 2005 and the Nine Month Period Ending 

September 30, 2004 

3.1 

5.2 

12/06/05 * 

12/06/05 

04/07 

04/07 

M-000-06-003-F Risk Assessment of Millennium Challenge 

Corporation’s MCA Madagascar Financial 

Operations 

1 

2 

03/28/06 03/28/06 

03/28/06 

08/07 

08/07 

M-000-06-001-S Review of the Millennium Challenge Corporation’s 

Progress in Achieving Its Planned Organizational 

Structure and Beginning Its Assistance Programs 

1.2 

2 

3 

4 

05/16/06 05/16/06 

05/16/06 

05/16/06 

05/16/06 

05/07 

05/07 

05/07 

05/07 

M-519-06-002-P Audit of the General and Application Controls 

of hte Government of El Salvador’s Integrated 

Financial Administration System 

1 

2 

07/07/06 07/07/06 

07/07/06 

07/07 

07/07 

M-000-06-004-F Risk Assessment of Millennium Challenge Account 

Cape Verde’s Financial Operations 

1 

2 

3 

09/26/06 * 

09/26/06 

* 

04/07 

09/07 

04/07 

M-000-06-002-P Audit of the Millennium Challenge Corporation’s 

Management of Section 609(g) Funds 

1 

2 

3 

4 

09/28/06 09/28/06 

09/28/06 

09/28/06 

09/28/06 

09/07 

09/07 

09/07 

09/07 

M-000-06-003-P Audit of the MCC’s Compliance with the 1 09/29/06 09/29/06 09/07 

Provisions of the Federal Information Security 

Management Act of 2002 for Fiscal Year 2006 

* MCC has not reached management decision on this audit recommendation. 

Appendix C SEMIANNUAL REPORT TO THE CONGRESS 17 
REPORTS ISSUED WITH QUESTIONED
 

AND UNSUPPORTED COSTS
 

October 1, 2006 through March 31, 2007
 

Reports 

Number 

of Audit 

Reports 

Questioned 

Costs 

Unsupported 

Costs * 

A. For which no management decision had been made as of 

October 1, 2006 

0 $0 $0 

B. Add: Reports issued October 1, 2006 through March 31, 

2007 

2 $10,983 $7,083 

Subtotal 2 $10,983 $7,083 

C. Less: Reports with a management decision made October 

1, 2006 through March 31, 2007 

0 $0 $0 

i. Value of Recommendations Disallowed by Agency 

Officials 

0 $0 $0 

ii. Value of Recommendations Allowed by Agency Officials 0 $0 $0 

D. For which no management decision had been made as of 

March 31, 2007 

0 $0 $0 

* Unsupported Costs are included in Questioned Costs, but are provided as additional information as required by the Inspector General 

Act Amendments of 1988 (P.L. 100-504). 

1818 SEMIANNUAL SEMIANNUAL REPORT TO THE CONGRESS CONGRESS Appendix D Appendix D
REPORTS ISSUED WITH RECOMMENDATIONS
 

THAT FUNDS BE PUT TO BETTER USE
 

October 1, 2006 through March 31, 2007
 

Reports 

Number 

of Audit 

Reports Dollar Value 

NOTHING TO REPORT
 

Appendix E SEMIANNUAL REPORT TO THE CONGRESS 19 

Inspector General 

HOTLINE 

OIG’s Hotline makes it easy to report allegations of fraud, 

waste, abuse, mismanagement or misconduct in programs 

and operations of the USAID, IAF, ADF, and MCC. 

Employees, contractors, program participants and the 

general public may report allegations directly by e-mail, 

telephone, or mail to: 

Phone 	1-202-712-1023

 1-800-230-6539 

E-mail 	 ig.hotline@usaid.gov 

Mail 	USAID OIG HOTLINE

 P.O. Box 657


 Washington, DC 20044-0657
 

U.S. Agency for International Development 

1300 Pennsylvania Avenue, N.W. 

Washington, D.C. 20523 

www.usaid.gov 
U.S.Agency for International Development 
 

Office of Inspector General 
 

for the
 

Millennium Challenge Corporation
 

1300 Pennsylvania Avenue, N.W.
 

Room 6.6D 
 

Washington, DC 20523
 

www.usaid.gov/oig 

The Semiannual Report to the Congress is available on the internet at 
 

www.usaid.gov/oig/public/semiann/mcc1.htm