INTERNATIONAL 

FOOD AID

Better Agency 

Collaboration Needed 

to Assess and 

Improve Emergency 

Food Aid 

Procurement System

Report to the Chairwoman, Committee 

on Agriculture, Nutrition, and Forestry, 

U.S. Senate

March 2014

GAO-14-22

United States Government Accountability Office
United States Government Accountability Office

Highlights of GAO-14-22, a report to the

Chairwoman, Committee on Agriculture, 

Nutrition, and Forestry, U.S. Senate 

March 2014 

INTERNATIONAL FOOD AID

Better Agency Collaboration Needed to Assess and

Improve Emergency Food Aid Procurement System

Why GAO Did This Study

USDA and USAID spent about $9.2 

billion to provide international

emergency food aid during fiscal years 

2007-2012. USDA developed WBSCM 

with USAID’s input to manage 

domestic and international food aid 

procurements. USDA spent about 

$187 million to develop and implement 

the system. GAO was asked to 

examine the international emergency 

food aid procurement process. 

This report examines (1) the extent to 

which agencies agree to use WBSCM 

to manage the process, (2) how the 

agencies’ use of WBSCM and other 

systems affects USDA’s ability to have 

accurate information, and (3) the 

extent to which the agencies are 

collaborating on how to use WBSCM. 

GAO reviewed the procurement 

process and observed WBSCM in use. 

We analyzed inventory spreadsheets 

used to compile USDA’s financial 

reports. We compared agencies’ 

efforts to collaborate against key 

elements for effective interagency 

collaboration.

What GAO Recommends

GAO recommended the agencies work 

together to ensure USDA receives 

accurate prepositioned inventory data, 

improve WBSCM’s functionality by 

testing modified functions, and develop 

a written agreement that clearly 

outlines outcomes and roles and 

responsibilities for using WBSCM. 

USAID noted its view that 

prepositioned commodities move off 

USDA’s books and onto those of

USAID but agreed in general with our 

other two recommendations. USDA 

agreed with our recommendations and 

stated that the Commodity Credit 

Corporation retains ownership of 

prepositioned commodities.

What GAO Found

Although the U.S. Department of Agriculture (USDA) and U.S. Agency for 

International Development (USAID) jointly manage international emergency food 

aid procurement, the agencies disagree about the usefulness of the Web Based 

Supply Chain Management system (WBSCM) to manage the entire process. 

WBSCM had significant deficiencies when it was implemented in April 2011, 

which led USAID to discontinue using it to procure ocean freight for bulk 

commodities, manage prepositioned or stockpiled commodity inventory, and 

track food aid shipments. For example, WBSCM was slow and time consuming 

to use and its process to procure ocean freight for bulk commodities was not 

compatible with USAID’s process to negotiate contracts with ocean freight 

vendors. USDA currently uses WBSCM to procure food aid commodities, while 

USAID procures ocean freight using other systems not connected to WBSCM. 

Since March 2012, USDA has made changes to WBSCM, and USDA officials 

assert that these changes address some of the problems that led to USAID’s 

decision to discontinue use of the system. 

Since USAID uses systems outside of WBSCM, USAID and USDA lack 

information on individual food aid shipments, which, in turn, hinders USDA’s 

ability to use WBSCM to prepare reports and efficiently file claims against ocean 

carriers to recover U.S. government funds. GAO’s Standards for Internal Control 

in the Federal Government state that information should be accurately recorded 

and communicated to those who need it and in a form that enables them to carry 

out their internal control and other responsibilities. USAID relies on freight 

forwarders to track and periodically provide information on shipments. In GAO’s 

work for a recent report, we found that freight forwarders did not collect complete 

or consistent information on emergency food aid shipments. Without accurate 

information from its freight forwarders, USAID is limited in its ability to generate 

accurate information on food aid shipments. In addition, GAO found that USAID 

and its warehouse contractors did not always accurately record all prepositioned 

commodity inventory transactions. USAID provides this potentially inaccurate 

information to USDA officials who enter this information into WBSCM to generate 

quarterly financial statements. Moreover, USAID’s data collection outside 

WBSCM makes it more difficult for USDA to file claims efficiently against ocean 

freight vendors and recover U.S. funds because USDA officials must manually 

enter USAID information. According to USDA officials, USDA filed 131 such 

claims in fiscal year 2012 valued at $1.2 million. 

USDA and USAID are not collaborating effectively to resolve their disagreement 

on the usefulness of WBSCM. In prior work, GAO identified key elements of 

effective collaboration that can enhance and sustain collaboration among federal 

agencies. Although USDA and USAID’s collaborative efforts have incorporated 

some of these elements to develop WBSCM, they have not incorporated others. 

Specifically, USDA and USAID do not agree on the roles and responsibilities of 

key participants in the process, do not share a defined outcome for their 

collaboration, and do not have a written agreement stating how the agencies will 

collaborate. An upcoming functional upgrade of WBSCM offers an opportunity to 

make substantial changes that are mutually agreeable. 

View GAO-14-22. For more information, 

contact Thomas Melito at (202) 512-9601 or 

melitot@gao.gov. 
Page i GAO-14-22 International Food Aid

Letter 1 

Background 4

USDA and USAID Disagree on WBSCM’s Usefulness in 

Managing the International Emergency Food Aid Procurement 

Process 9

USAID’s Use of Other Systems Hinders USDA’s Ability to Prepare 

Accurate Reports and Efficiently File Claims Against Ocean 

Carriers to Recover Government Funds 13

USDA and USAID Have Not Resolved Their Disagreement about 

WBSCM, but Planned System Upgrades Provide an 

Opportunity to Collaborate More Effectively 19

Conclusions 22

Recommendations for Executive Action 23

Agency Comments and Our Evaluation 23

Appendix I Objectives, Scope, and Methodology 25

Appendix II Comments from the U.S. Department of Agriculture 30

Appendix III Comments from the U.S. Agency for International Development 32

Appendix IV GAO Contact and Staff Acknowledgments 36

Related GAO Products 37

Figures

Figure 1: Costs and Percentages of U.S. Title II Emergency Food 

Aid Components, Fiscal Year 2012 5

Figure 2: USDA and USAID Standard Title II Emergency Food Aid 

Procurement Process 6

Contents
Page ii GAO-14-22 International Food Aid

Abbreviations

CCC Commodity Credit Corporation

FSA Farm Service Agency

OMB Office of Management and Budget

USAID U.S. Agency for International Development

USDA U.S. Department of Agriculture

WBSCM Web Based Supply Chain Management system

This is a work of the U.S. government and is not subject to copyright protection in the 

United States. The published product may be reproduced and distributed in its entirety 

without further permission from GAO. However, because this work may contain 

copyrighted images or other material, permission from the copyright holder may be 

necessary if you wish to reproduce this material separately.
Page 1 GAO-14-22 International Food Aid

441 G St. N.W.

Washington, DC 20548

March 26, 2014

The Honorable Debbie Stabenow

Chairwoman

Committee on Agriculture, Nutrition, and Forestry

United States Senate

Dear Chairwoman Stabenow:

The U.S. Department of Agriculture (USDA) and the U.S. Agency for 

International Development (USAID) spent about $9.2 billion to procure 

and deliver international emergency food aid during fiscal years 2007 

through 2012 as authorized by Title II of the Food for Peace Act.1

 USDA 

and USAID have joint responsibility for the U.S. government response to 

emergency food crises, such as the 2013 typhoon in the Philippines and 

the persistent droughts in East Africa. In addition, USAID relies on 

cooperating sponsors, such as the World Food Program, and their 

contractors, to deliver food aid. Congress appropriates funds for the Food 

for Peace program to USDA, which it uses to procure commodities. 

USDA also allocates a portion of these funds to USAID to implement the 

program and arrange ocean freight transportation.2 Although USDA is 

responsible for adhering to financial reporting requirements with respect 

to funds transferred to USAID, it is USAID’s responsibility to make every 

effort within reason to track and account for these funds and to report this 

information to USDA.3

Between 2003 and 2011, USDA planned, designed, and implemented a 

Web Based Supply Chain Management system (WBSCM, referred to as 

 

1

Section 3001 of Pub. L. No. 110-246, the Food, Conservation, and Energy Act of 2008, 

changed the title of P.L. 480, originally named the Agricultural Trade Development Aid Act

of 1954, to the Food for Peace Act. Title II of the Food for Peace Act, administered by 

USAID, addresses donation of agricultural commodities for humanitarian purposes. Other 

U.S. food aid programs are administered through the U.S. Department of Agriculture, 

including Food for Peace Title I, Food for Progress, and the McGovern-Dole International 

Food for Education and Child Nutrition programs.

2

Allocation means a delegation, authorized in law, by one agency of its authority to 

obligate budget authority and outlay funds to another agency. GAO, A Glossary of Terms 

Used in the Federal Budget Process, GAO-05-734SP (Washington, D.C.: Sept. 2005).

3

Office of Management and Budget, Circular A-136, Financial Reporting Requirements.
 , 

Page 2 GAO-14-22 International Food Aid

“Web S-C-M”) with input from USAID to replace what it considered to be 

an outdated food aid procurement system. USDA intended WBSCM to be 

the procurement and supply chain management system for both the U.S. 

government’s domestic and international food aid programs. As of the 

end of fiscal year 2013, USDA had spent more than $187 million to 

design, implement, operate, and maintain WBSCM.

The Senate Committee on Agriculture, Nutrition, and Forestry asked us to 

examine USDA’s international food aid procurement process. This report 

examines (1) the extent to which agencies agree to use WBSCM to 

manage the international emergency food aid procurement process; (2) 

how the agencies’ use of WBSCM and other systems affects USDA’s 

ability to have accurate information about emergency international food 

aid shipments; and (3) the extent to which the agencies are collaborating 

on how to use WBSCM.

To examine the extent to which agencies agree to use WBSCM and other 

systems to manage the international food aid procurement process for the 

Food for Peace, Title II program, we collected information about how 

WBSCM is used to procure commodities and ocean freight 

transportation.4

To examine how the agencies use of WBSCM and other systems affects 

USDA’s ability to have accurate information about food aid shipments, we 

analyzed how Congress appropriates funds for this program to USDA’s 

Commodity Credit Corporation (CCC). We also reviewed the Office of 

Management and Budget’s Circular A-136 and USDA and USAID’s 

We observed how USDA’s Farm Service Agency’s (FSA) 

Commodity Operations Office and the USAID’s Office of Food for Peace 

use WBSCM, and we observed how USAID uses its Food for Peace 

Management Information System. We examined agency documents to 

determine the roles and responsibilities of agency officials and their 

international stakeholders. Stakeholders include cooperating sponsors 

that implement emergency food aid programs on behalf of USAID; freight 

forwarders that manage ocean freight logistics, commodity vendors, 

ocean freight vendors, and contractors that manage the warehouses 

where USAID prepositions or stockpiles commodities for emergencies 

overseas.

 

4

We did not assess the extent to which USDA uses WBSCM for its domestic and 

international food aid programs or whether WBSCM performs these functions effectively. 
 , 

Page 3 GAO-14-22 International Food Aid

Offices of Inspector General reports. We used this information to 

determine the funding relationship between the agencies and the financial 

responsibilities each has in accounting for U.S. government resources 

and funds for this program. We also drew on work conducted for a 

separate report to describe the systems that USAID relies upon to track 

emergency food aid shipments.5 In that report, we also looked at how 

USAID collects data on emergency food aid shipments and we 

determined the data to be sufficiently reliable for our analysis. We 

compared GAO’s Standards for Internal Control in the Federal 

Government to USDA and USAID actions in the procurement process.6

To examine the extent to which the agencies are collaborating on how to 

use WBSCM, we compared U.S. agencies’ efforts to resolve their 

disagreement on how to use WBSCM against key considerations that we 

identified in 2012 for implementing effective interagency collaboration with 

practices for enhancing and sustaining collaboration that we identified in 

2005.7

As part of this review, we obtained commodity and ocean freight funding 

data for fiscal years 2007 through 2012 from USAID, and we determined 

that the data were sufficiently reliable for our purposes. We also 

interviewed agency officials at USAID’s Food for Peace and 

Transportation Offices and at the USDA’s Agricultural Marketing Service, 

the FSA, including the Commodity Operations Office, and the Foreign 

Based on our analysis of the agencies’ actions, we found that 

clearly defining roles and responsibilities, defining a common outcome, 

and having a written formal agreement to collaborate were the most 

relevant practices to assess their efforts.

 

5

GAO, International Food Aid: Prepositioning Speeds Delivery of Emergency Aid, but 

Additional Monitoring of Time Frames and Costs Is Needed, GAO-14-277, (Washington, 

D.C.: Mar. 5, 2014).

6

GAO, Internal Control: Standards for Internal Control in the Federal Government, 

GAO/AIMD-00-21.3.1 (Washington, D.C.: September 1999) and Internal Control: Internal 

Control Management and Evaluation Tool, GAO-01-1008G (Washington, D.C.: August 

2001).

7

We developed this list of considerations through a review of interviews with experts on 

collaboration, and a review of findings from a number of our previous reports on 

collaboration in the federal government. See GAO, Managing for Results: Key 

Considerations for Implementing Interagency Collaborative Mechanisms, GAO-12-1022 

(Washington, D.C.: Sept. 27, 2012) and Results-Oriented Government: Practices That 

Can Help Enhance and Sustain Collaboration among Federal Agencies, GAO-06-15 

(Washington, D.C.: Oct. 21, 2005).
 , 

Page 4 GAO-14-22 International Food Aid

Agriculture Service in Washington, D.C., and Kansas City, Missouri; as 

well as cooperating sponsors and freight forwarders. For additional details 

about our scope and methodology, see appendix I.

We conducted this performance audit from March 2013 to March 2014 in 

accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives.

Under Title II of the Food for Peace Act, the United States provides 

agricultural commodities to address famine and food crises in foreign 

countries. Between fiscal years 2007 and 2012, the United States spent 

about $9.2 billion to provide emergency food aid to 57 countries through 

its cooperating sponsors, such as the World Food Program, Catholic 

Relief Services, and Save the Children Federation. The United States 

annually spent between $1.1 billion and $2.0 billion to purchase and 

deliver about 1 to 2 million metric tons of emergency food aid to recipients 

in foreign countries.

U. S. agencies spend the largest percentage of food aid funds to procure 

and transport commodities within the United States, and second largest 

on the transport, storage, and handling of commodities in recipient 

countries. Figure 1 illustrates this distribution of spending for fiscal year 

2012. USAID and cooperating sponsors spent the third largest 

percentage of funds on ocean freight contracts to transport commodities 

across the ocean. USAID directed the remaining funds to cooperating 

sponsors to develop and manage programs and deliver commodities from 

discharge ports to landlocked recipient countries. Of the emergency food 

aid funds directed to cooperating sponsors, the World Food Program 

administered over 80 percent, while other cooperating sponsors 

administered the rest. USAID and cooperating sponsors contracted with 

seven ocean freight forwarders to act on behalf of USAID and its 

cooperating sponsors to manage ocean transportation logistics 

throughout the shipping process.

Background

U.S. Title II Emergency 

Food Aid Program, Cost, 

and Funding
 , 

Page 5 GAO-14-22 International Food Aid

Figure 1: Costs and Percentages of U.S. Title II Emergency Food Aid Components, 

Fiscal Year 2012

a

Commodity and U.S. transportation procurement includes funds paid to commodity vendors that 

provide commodities and arrange for their domestic transportation to U.S. transfer locations. 

b

Ocean freight includes funds paid to freight vendors that transport emergency food aid from U.S. 

ports overseas to foreign ports, or to inland points. 

c

Cooperating sponsor program development and management refers to funding provided to assist 

cooperating sponsors with establishing programs in foreign countries pursuant to Section 202(e) of 

the Food for Peace Act (7 USC 1722(e)). 

d

Inland freight is the cost associated with transporting commodities from the port of discharge to the 

border of the foreign destination country if the destination country is landlocked. 

e

Internal transportation, storage, and handling includes costs such as storage, distribution, and 

oversight of commodities to the final foreign destination, such as storage and distribution sites. 

USAID provides these funds directly to cooperating sponsors as a cash contribution. 

USDA and USAID jointly manage Food for Peace emergency food aid 

procurement. USDA procures commodities for the program and USAID or 

its cooperating sponsors procure ocean transportation for the 

commodities. The agencies use a three-phase procurement process: (1) 

acquisition planning (reviewing and responding to food requests), (2) 

contract formation (procuring commodities and transportation), and (3) 

contract administration (delivering commodities and overseeing the 

Various Entities Procure 

and Deliver Emergency 

Food Aid
 , 

Page 6 GAO-14-22 International Food Aid

process).8 See figure 2 for an overview of the process to procure 

packaged and bulk commodities and ocean freight.9

Figure 2: USDA and USAID Standard Title II Emergency Food Aid Procurement Process

USAID’s standard procurement process for emergency food aid is to 

procure and ship commodities in response to a request from cooperating 

sponsors for a specific food emergency. However, USAID may also 

preposition commodities in domestic and overseas warehouses located 

near regions of the world with historically high emergency food aid 

 

8

Acquisition planning integrates the efforts of personnel responsible for purchasing to 

ensure that the government meets its needs in the most effective, economical, and timely 

manner. Contract formation includes soliciting, evaluating, and awarding contracts. 

Contract administration includes several functions performed by a government agency in 

accordance with federal acquisition regulations, agency acquisition policies, and the terms 

of the contract.

9

Packaged commodities are those shipped in woven polypropylene bags, multi-walled 

paper bags, plastic containers, or steel cans and drums. Bulk commodities, such as freeflowing grain and vegetable oil, are those directly loaded and shipped in an ocean vessel’s 

cargo hold.
 , 

Page 7 GAO-14-22 International Food Aid

needs.10 Using this approach, USAID requests commodities from USDA 

and ships them to a warehouse before a need for the commodities is 

identified.11

In addition, USAID can divert commodities originally destined for a 

prepositioned warehouse to respond to a cooperating sponsor’s 

emergency food aid request.

For the commodities shipped to warehouses, ocean freight 

vendors submit invoices directly to USAID for payment, and USDA retains 

ownership of the commodities until cooperating sponsors pick up the 

commodities from the warehouses, according to USDA. As a result, 

commodities in these warehouses remain on USDA’s accounting ledger 

as inventory assets until cooperating sponsors make requests and take 

possession of the commodities for their programs. Since USAID contracts 

for the management of its domestic and overseas warehouses, USDA 

requires USAID to provide it with information on the type, amount, and 

value of commodities in each warehouse’s inventory.

12 When diversion occurs, instead of 

delivering commodities to a prepositioned warehouse as planned, ocean 

freight vendors deliver to an alternate port that is specified on the ocean 

freight contract or to a cooperating sponsor at the same foreign port as 

the warehouse. As a result, the ship, foreign port, ocean bill of lading, and 

cost of ocean freight can change from what was originally agreed to 

under the initial ocean freight contract.13

 

10See GAO-14-277 for further information on USAID’s prepositioning of emergency food 

aid.

11Congress has authorized the expenditure of up to $15 million annually for overseas 

prepositioning storage costs. See Pub. L. No. 113-79,§3009.

12In the food aid community, “diversion” generally refers to loss or theft of food aid. 

However, USAID and cooperating sponsors also use “diversion” to refer to the redirection 

of food aid from some stage of the prepositioning process to a foreign port to meet 

immediate needs. In this report, “diversion” has the latter meaning.

13An ocean bill of lading is a document that establishes the terms of a contract between 

USAID or a cooperating sponsor and the ocean freight vendor. A bill of lading shows 

ownership of the cargo.
 , 

Page 8 GAO-14-22 International Food Aid

The USDA’s Agricultural Marketing Service, which procures commodities 

for USDA’s domestic food aid programs, funded most of WBSCM’s 

design and currently manages the system.14 WBSCM replaced USDA’s 

ordering, procurement, and inventory systems, some of which USDA 

considered costly and outdated.15

USDA developed the business case for WBSCM in 2003 and awarded 

the contract for developing the software in October 2006. To identify the 

international food aid procurement functions, USDA established an 

interagency project team that included representatives from USDA’s Farm 

Service Agency (FSA) and Foreign Agriculture Service and USAID’s Food 

for Peace and Transportation Offices. The interagency team started to 

develop the system’s technical requirements for the food aid programs in 

2007. Agencies began the initial testing phase of WBSCM in November 

2009, and USDA began a phased rollout of WBSCM in June 2010, 

focusing primarily on domestic food aid procurement.

These systems did not electronically 

manage the entire food aid procurement process, provide accurate 

inventory accounting, or track commodity shipments in real time. USDA 

also could not use the systems to electronically process invoices and 

payments. USDA expected WBSCM to integrate supply chain activities of 

up to 40,000 users, process requests for 4.5 million metric tons of 

domestic and international food aid each year, manage electronic 

contracting for commodities and freight, track inventory, pay vendors, and 

process claims. USDA intended that all stakeholders including those 

participating in international food assistance would use WBSCM as a 

supply chain management system. To do so, WBSCM uses data entered 

during earlier steps of the process to complete some of the later steps. 

Therefore, information needs to be entered in a sequential order for the 

later functions of the system to work correctly.

 

14USDA’s domestic food aid agencies—Agricultural Marketing Service, Food and Nutrition 

Service, and FSA—use WBSCM to order, track, and pay for commodities used in 

domestic food aid programs. These include the National School Lunch Program, which 

provides nutritionally balanced, low-cost or free lunches to children. This report does not 

review USDA’s uses of WBSCM for the domestic food aid procurement processes.

15USDA managed its prior processes with systems that lacked online procurement 

capabilities, such as bidding, procuring, contracting, and invoicing. 

USDA Developed WBSCM 

to Manage Food Aid 

Procurement
 , 

Page 9 GAO-14-22 International Food Aid

USDA and USAID disagree about the usefulness of WBSCM to manage 

the entire emergency food aid procurement process. Although USDA 

created WBSCM with input from USAID, the system had deficiencies 

when it was implemented in April 2011. Since August 2011, USAID has 

not been using WBSCM as intended to procure ocean freight for bulk 

commodities, manage commodity inventory in preposition warehouses, or 

track food aid shipments. USAID manages its part of the procurement 

process using other systems not connected to WBSCM. USDA officials 

assert that, since March 2012, the agency has made significant 

improvements to WBSCM that would address many of the problems that 

led to USAID’s discontinued use of the system’s functions to procure bulk 

commodity ocean freight, manage commodity inventory, and track food 

aid shipments.16

WBSCM had deficiencies when it was implemented in April 2011, so 

USAID gradually discontinued using it to procure ocean freight for bulk 

commodities, manage commodities for prepositioned warehouses, and 

track food aid shipments between August 2011 and June 2012. When 

USDA, USAID, and several international stakeholders, such as USAID’s 

cooperating sponsors and freight forwarders, started to use WBSCM, 

they immediately encountered significant problems. The USDA’s Foreign 

Agricultural Service reported in an April 2011 memo that WBSCM might 

not be ready to handle complex international food aid procurements 

involving multiple delivery points and commodities. In June 2011, USAID 

informed USDA in a letter that its stakeholders found WBSCM time 

consuming to use. In addition, USAID stated that the system’s process to 

procure international bulk ocean freight was not compatible with USAID’s 

process and recommended that neither agency use WBSCM to procure 

bulk ocean freight.17

 

16As mentioned above, we did not assess whether the functions for which USDA uses 

WBSCM perform effectively. We therefore did not verify whether the changes USDA made 

have addressed USAID’s concerns with WBSCM.

For example, USAID informed USDA that WBSCM 

could not account for key information—such as current market conditions, 

available funding, alternate foreign ports, and available ships with 

sufficient cargo space—that USAID needed to negotiate with vendors 

when procuring ocean freight for bulk commodities. In addition, USAID 

and its stakeholders experienced substantial performance problems and 

17Bulk freight includes all vessels designed to carry bulk cargo such as grain.

USDA and USAID 

Disagree on 

WBSCM’s Usefulness 

in Managing the 

International 

Emergency Food Aid 

Procurement Process

USAID Has Not Used 

WBSCM as Intended 

Because It Had Significant 

Deficiencies at 

Implementation
 , 

Page 10 GAO-14-22 International Food Aid

indicated that the system was cumbersome and not user friendly. In a 

July 2011 memo, USDA acknowledged deficiencies in WBSCM and 

stated it was working to fix problems. For example, the USDA memo 

acknowledged USAID’s difficulties in using WBSCM to procure bulk 

freight.

Moreover, freight forwarders that manage ocean freight logistics for the 

cooperating sponsors identified concerns they had about the additional 

workload WBSCM required of them. For example, they noted in June 

2011 that WBSCM required them to enter data historically completed by 

stevedores (contractors who load or unload commodities) at U.S. load 

ports, which increased the freight forwarders’ workload and created 

confusion about what commodity was being delivered, loaded, and 

unloaded at U.S. load ports. Furthermore, WBSCM’s initial inability to 

track food aid shipments, such as recording when a shipment had been 

diverted before the commodities arrived in a foreign location, posed a 

problem for freight forwarders. As a result, the freight forwarders 

experienced unnecessary delays in coordinating information with ocean 

freight vendors and providing these vendors with required instructions for 

shipping and unloading cargoes.

As a result of difficulties in using WBSCM, USAID discontinued using it 

for certain functions. In August 2011, USAID issued a memo to 

cooperating sponsors, freight forwarders, ocean transportation providers 

and their brokers stating that, effective immediately, all bid offers for bulk 

ocean freight transportation shipped under the Title II program did not 

need to be submitted through WBSCM. USAID also decided it would not 

use WBSCM to manage its prepositioned commodity inventories. At that 

time, a USAID official informed USDA that USAID had a number of issues 

with WBSCM that needed to be addressed for it to effectively manage 

prepositioned commodity inventories using the system. The official further 

stated that until these issues were fixed, USAID would continue to work 

outside WBSCM to manage these inventories.

In response to concerns expressed about WBSCM, USDA and USAID 

announced the formation of an interagency team in November 2011 to 

address international stakeholders’ concerns with WBSCM. At that time, 

the WBSCM program manager acknowledged that USDA had been 

unable to implement timely solutions for the problems that the 

international stakeholders had faced and that WBSCM had been 

designed with insufficient input from the international stakeholders. During 

November and December 2011, the agencies held meetings to identify 
 , 

Page 11 GAO-14-22 International Food Aid

needs and priorities, created an action list, and assigned individual USDA 

and USAID officials to specific tasks on the list.

Despite these efforts, USAID and international stakeholders continued to 

have concerns about using WBSCM. USAID eventually decided in 

February 2012 that WBSCM should only be used for USDA to procure 

commodities. As a result, USAID awards ocean freight contracts for bulk 

and packaged commodities outside of WBSCM. Furthermore, in June 

2012, USAID and USDA agreed that freight forwarders did not need to 

use WBSCM to update ocean freight contracts. Rather, freight forwarders 

continue to update ocean freight contracts in their own separate systems.

USAID and its international stakeholders currently perform most of the 

functions required to procure bulk ocean freight in systems not connected 

to WBSCM. For example, USAID receives bulk freight bids via email and 

negotiates bulk ocean freight contracts directly with vendors. According to 

USDA officials, USDA then manually enters the awarded ocean freight 

contract information for bulk commodities in WBSCM. In addition, USAID 

officials said they do not use WBSCM to record changes to ocean freight. 

As a result, USDA does not receive updates in WBSCM when USAID 

makes changes to the shipment, or when freight forwarders divert 

commodities on USAID’s behalf.

USAID officials also said they do not use WBSCM to track inventory of 

prepositioned commodities because key information required to track 

commodities from the U.S. load port to overseas warehouses is not 

entered in WBSCM. As we noted above, USAID informed USDA in 

August 2011 that the agency would continue to track and allocate 

prepositioned commodity inventory using other systems. Instead of using 

WBSCM, USAID officials track prepositioned commodity inventory using 

spreadsheets with information from USAID’s contractors at its 

prepositioned warehouses. USAID officials send USDA a consolidated 

spreadsheet, and USDA officials manually enter inventory data in 

WBSCM to provide food aid information for the Commodity Credit 

Corporation’s (CCC) quarterly financial statements.18

 

18The Commodity Credit Corporation (CCC) is a wholly owned government corporation 

managed by USDA’s Farm Service Agency (FSA).

USAID Manages Its 

Procurement Process 

Using Systems Not 

Connected to WBSCM
 , 

Page 12 GAO-14-22 International Food Aid

USDA officials have stated that, since March 2012, the agency has made 

significant improvements to WBSCM that address many of its difficulties. 

During the course of our review, USDA officials stated that several of 

WBSCM’s shortcomings, such as poor functionality and ease of use, 

have been addressed.

19 They also noted that USDA’s Foreign Agriculture 

Service currently uses WBSCM to manage all procurement functions for 

its international food aid programs and requires stakeholders to manage 

aspects of the programs, including updating ocean freight information, in 

WBSCM.20

According to USDA officials, the agency would like USAID to resume fully 

using WBSCM, which would address USDA concerns regarding the lack 

of current information about shipments after they depart U.S. ports and 

inventory of prepositioned commodities. USAID officials from the Food for 

Peace and Transportation Offices indicated in August 2013 that they are 

currently able to manage their portion of the emergency food aid program 

without expanding their use of WBSCM. They also indicated that they 

would consider using WBSCM again if USDA made substantial 

improvements that addressed their concerns. However, as of February 

2014, USAID had not tested WBSCM’s ability to manage prepositioned 

commodity inventory and track food aid shipments since USDA made 

changes to the system.

In addition, USDA officials noted that they have modified the 

inventory management function of WBSCM that could be used to track 

prepositioned inventory. They also said that they have modified WBSCM 

sufficiently to facilitate tracking changes in freight information. For 

example, these officials said that WBSCM had been modified so that it 

can capture needed information when a shipment has been divided to 

ship on multiple vessels.

 

19USDA agencies use WBSCM to manage their domestic and international food aid 

programs. For example, they use WBSCM to solicit, receive, and evaluate bids; award 

contracts; manage and track food shipments; pay vendors; and process claims.

20According to USDA and USAID officials, the Foreign Agriculture Service’s international 

food aid programs generally process smaller and fewer shipments than USAID’s 

emergency food aid program.

USDA Asserts That It Has 

Made Significant 

Improvements to WBSCM
 , 

Page 13 GAO-14-22 International Food Aid

Since USAID uses systems outside of WBSCM, USAID and USDA lack 

complete and accurate information on individual food aid shipments, 

which, in turn, hinders USDA’s ability to use WBSCM to prepare accurate 

financial reports and recover U.S. government funds. For example, 

USAID’s systems cannot provide tracking information on some food aid 

shipments. In addition, USAID’s current systems for tracking the inventory 

of commodities that it has in prepositioning warehouses lack sufficient 

internal controls, according to the USAID Inspector General, thus 

hindering the agencies’ abilities to verify commodity inventories.21

USAID’s data collection outside of WBSCM also makes it more difficult for 

USDA to efficiently file claims to recover U.S. government funds.

In our work for a recent report on the impact of prepositioning on the 

timeliness of emergency food aid, we found that some information on 

emergency food aid shipments in WBSCM could not be used to assess 

their delivery timeframes.22

 

21USAID Office of the Inspector General, Audit of USAID’s Internal Controls Over 

Prepositioned Food Assistance for the Horn of Africa, Audit Report Number 4-962-13-004-

P (Pretoria, South Africa: Jan. 7, 2013). In response to the USAID inspector general 

recommendation, USAID stated that in July 2013 the agency had replaced Djibouti’s 

manual warehouse inventory control system with an automated system. USAID officials 

also stated that they were working to develop a tracking system to monitor the movement 

of commodities in and out of the overseas prepositioned warehouses. However, according 

to USAID officials, the development of the tracking system is being re-evaluated due to 

funding constraints. 

 USAID’s Office of Food for Peace informed 

USDA in a February 2012 letter that USAID would rely on its 

Transportation Office and the freight forwarders to track and periodically 

provide information on shipments. In addition, in June 2012 USAID 

informed freight forwarders that they no longer were expected to update 

tracking information for emergency food aid shipments into WBSCM.

However, in our related GAO report on prepositioning food aid, we found 

that USAID does not maintain tracking data on food aid shipments that 

would allow it to assess the timeliness of deliveries. Rather, the freight 

forwarders maintain tracking data in their own, separate systems from 

which USAID can request data.

22GAO-14-277. 

USAID’s Use of Other 

Systems Hinders 

USDA’s Ability to 

Prepare Accurate 

Reports and 

Efficiently File Claims 

Against Ocean 

Carriers to Recover 

Government Funds

USAID’s Systems Cannot 

Provide Information on 

Some Food Aid Shipments
 , 

Page 14 GAO-14-22 International Food Aid

USDA has expressed concerns that it does not have complete and 

accurate information it needs and it is unclear whether USAID has 

sufficient internal controls over the data that freight forwarders collect on 

individual shipments of emergency food aid. GAO’s Standards for Internal 

Control requires that agencies implement appropriate control activities, 

such as ensuring that transactions are recorded in a complete and 

accurate manner.23

Furthermore, when we obtained information on over 5,000 food aid 

shipments from fiscal years 2007 through 2012 for our recent report, we 

found that some of the information contained inaccuracies and was not 

consistently collected.

USDA’s FSA issued a memo in April 2012 outlining 

the implications of USAID’s decision in February 2012 to not use WBSCM 

to track food aid shipments. Specifically, FSA stated that administering 

activities outside of WBSCM would increase the number of errors, be 

more labor intensive, and create additional strain on FSA’s resources. 

FSA also stated that by not using these features of WBSCM, USAID 

would limit the government’s ability to track commodities from initial order 

through final delivery. In addition, FSA officials have indicated that 

USAID’s decision to stop requiring freight forwarders to enter updated 

freight award information in WBSCM affects the accuracy of ocean freight 

information in WBSCM, such as the price paid to transport commodities; 

the foreign destination port; and the vessel used. FSA officials noted that 

this is information they need to prepare reports on food aid shipments. In 

addition, USAID has not provided guidance on the information that USAID 

and USDA need collected on individual shipments.

24

 

23

We found that for three of the six freight 

forwarders, their data were incomplete due to missing shipments and 

partial information provided for other shipments. As a result, we were 

unable to use their information to assess the timeframes of their 

deliveries. In addition, we found inconsistencies in the information 

collected. For example, to identify the starting date of a shipment, the 

World Food Program provided the date that USAID and the World Food 

Program signed a grant agreement. However, the freight forwarders’ data 

GAO-AIMD-00-21.3.1

24GAO-14-277
 , 

Page 15 GAO-14-22 International Food Aid

show dates that approximate the dates when the cooperating sponsors 

requested the food from USAID.25

A recent USAID inspector general report and independent audits of the 

Commodity Credit Corporation (CCC) raise concerns that USAID and 

USDA’s current systems for tracking commodities that USAID has 

prepositioned in warehouses may have insufficient internal controls, 

hindering the agencies’ abilities to verify commodity inventories. Similarly, 

we found that USAID’s commodity inventory spreadsheets contained 

missing data and incorrect formulas to compile inventory information.

A January 2013 USAID inspector general report found that internal 

control weaknesses in USAID’s prepositioning inventory records caused 

irreconcilable discrepancies between the agency’s records and 

warehouse inventory records. According to USAID’s Automated 

Directives System, contract officer representatives must ensure that the 

cooperating sponsor is performing in accordance with the terms 

contained in the contract. However, the inspector general found that 

USAID’s Transportation Office, foreign warehouses and others did not 

have an adequate system in place to consistently identify and resolve 

discrepancies in inventory records. Specifically, the audit found that the 

amount of incoming and outgoing food at the Djibouti warehouse could 

not be reconciled within the threshold established in the warehouse 

contract. The audit stated that commodity differences can result from 

changes in shipments or commodity losses. It also noted that 

discrepancies in records resulted from a number of factors, including 

incomplete records and incomplete survey reports conducted by an 

independent contractor monitoring warehouse activities. According to the 

report, reconciliations throughout the supply chain would improve the 

system’s reliability and allow USAID to evaluate the performance of 

 

25In assessing the reliability of the food aid shipment data, we determined that data on 

3,785 shipments were sufficiently reliable for the purposes of our analysis. According to 

USAID, the number of days between the request for food and USAID’s approval date is 

similar for prepositioned and standard shipments. However, both USAID and World Food 

Program officials noted that whether a shipment was sourced from a prepositioning 

warehouse or the standard shipping process did not affect the number of days between 

the request for food date and the USAID’s grant agreement date. We therefore 

determined that these data were sufficiently reliable for the purposes of assessing the 

impact of USAID’s prepositioning program on the timeliness of emergency food aid 

deliveries. 

USDA and USAID Have 

Been Unable to Verify 

Overseas Commodity 

Inventory Data
 , 

Page 16 GAO-14-22 International Food Aid

warehouse contractors accurately. The inspector general recommended 

that USAID implement a system of internal controls to reconcile its 

records regularly with reports from warehouses and outgoing shipment 

reports to identify and resolve differences in a timely manner.

Furthermore, independent audits of CCC’s financial activities showed 

instances where USDA had insufficient internal controls to verify 

commodity information that it received from USAID; as a result, the 

independent audits reported significant deficiencies in CCC’s financial 

statements.26 GAO’s Standards for Internal Control state that control 

activities, such as reviews of management at the functional or activity 

level, are an integral part of an entity’s accountability for government 

resources. However, the audits reported USDA’s controls over foreign 

prepositioned inventory distributed by USAID as a significant deficiency in 

CCC’s financial statements for fiscal years 2012 and 2013.27

In addition, we found that some of the spreadsheets that USAID used to 

compile inventory information were missing data and contained incorrect 

formulas. We reviewed spreadsheets for 6 warehouses where USAID 

prepositions commodities and found errors in 3 of them. For example, we 

found that the spreadsheet that the contractors used to track inventory at 

the prepositioning warehouse in Djibouti contained errors. It showed eight 

instances in which contractors documented commodities leaving the 

warehouse before the same commodities were documented as entering 

Specifically, 

the fiscal year 2012 audit noted that the process USDA used to determine 

the amount of inventory on hand at foreign warehouses consisted only of 

an email sent from USAID to USDA outlining the levels of inventory by 

commodity. It found that CCC had no evidence of adequate controls or 

policy and procedures over the warehouse inventory information to 

determine whether the balances reported by USAID are reasonable prior 

to entries by CCC. During the course of our review, USDA officials 

responsible for entering inventory information into WBSCM to produce 

CCC’s financial reports confirmed that they cannot verify the inventory 

information they receive from USAID.

 

26CliftonLarsonAllen LLP, Independent Auditor’s Report, December 3, 2013; and 

CliftonLarsonAllen LLP, Fiscal Year 2012 Management Letter, November 5, 2012.

27A significant deficiency is a control deficiency or combination of deficiencies in internal 

control that is less severe than a material weakness, yet important enough to merit 

attention by those charged with governance.
 , 

Page 17 GAO-14-22 International Food Aid

the warehouse. We also found two instances in which contractors 

recorded commodities leaving the warehouse 4 months after they had left 

the warehouse. To determine inventory levels, contractors at each 

warehouse submit inventory information to USAID, which consolidates 

the information into a single spreadsheet that it provides to USDA. As a 

result, inaccuracies in a single warehouse inventory spreadsheet create 

inaccuracies in USAID’s consolidated spreadsheets. USDA officials enter 

information provided by USAID into WBSCM to generate various reports, 

including CCC’s quarterly financial statements to the Office of 

Management and Budget.

USAID’s data collection outside WBSCM impedes USDA’s process to file 

claims against ocean freight vendors and recover U.S. funds. When an 

ocean freight vendor loses or damages a portion of the commodities 

loaded onto its vessels, the vendor is liable for the funds it received to 

transport that portion of the shipment in addition to the value of the lost or 

damaged commodities.28

USDA’s ability to file claims against ocean freight vendors depends on 

having accurate information about changes that USAID makes to ocean 

freight shipments after contracts are awarded. USAID can authorize 

changes in a shipment that can result in changes to both deliveries and 

the amounts USAID may pay to an ocean freight vendor. For example, 

USAID may approve the substitution of one ocean freight vessel for 

another or split a shipment onto two or more vessels. We found that 

USAID diverted 60 percent of shipments destined for prepositioning 

warehouses between fiscal year 2007 and 2012, potentially incurring 

freight rates different from what the vendor would have charged to deliver 

According to USDA officials, USDA filed 131 

claims against vendors in fiscal year 2012, valued at $1.2 million. Since 

USAID and cooperating sponsors use freight forwarders to manage 

logistics for ocean freight services, USDA requires information from 

USAID, cooperating sponsors, and freight forwarders to process ocean 

freight claims. 

 

28Because nongovernmental cooperating sponsors take title to commodities when they 

are loaded on an ocean vessel at the U.S. port, it is the responsibility of the cooperating 

sponsors to file claims against the ocean freight vendors for the value of lost or damaged 

commodities. However, when USAID contracts for ocean transportation, USDA retains the 

right to prosecute claims against carriers. Some cooperating sponsors sign over rights to 

their freight forwarders or USDA to file claims on their behalf.

USAID’s Data Collection 

Outside WBSCM Impedes 

USDA’s Process to 

Recover U.S. Government 

Funds Efficiently
 , 

Page 18 GAO-14-22 International Food Aid

the commodities to the original destinations. According to USDA officials, 

since freight forwarders do not regularly update freight information in 

WBSCM, USDA officials must do additional work to determine changes 

made to each freight award.

Additionally, USDA officials process ocean freight claims using 

information in WBSCM, but they upload information they need to process 

claims themselves since USAID and freight forwarders do not use the 

system to track shipments or store freight information. USDA’s ability to 

file claims against ocean freight vendors depends on having accurate 

information on ocean freight shipment details, confirmation of each 

delivery, and the amounts that USAID pays for ocean freight in WBSCM. 

According to USDA officials, WBSCM did not have the capability to 

process ocean freight claims when the system was first implemented, so 

USDA requested USAID, cooperating sponsors, freight forwarders, and 

others to submit claims documentation outside of WBSCM. Although 

USDA officials say claims could be processed through WBSCM since 

November 2012, USAID and freight forwarders continue to provide 

documents via email, and regular mail instead of uploading documents 

into WBSCM.29

Furthermore, from June 2012 to June 2013, USAID did not send all of the 

documentation that USDA required to process ocean freight claims. In 

June 2012, USDA notified USAID of the documentation that USAID, 

cooperating sponsors, and freight forwarders needed to provide USDA to 

process claims. For example, USDA’s guidance required USAID to 

provide ocean bills of lading and freight vouchers.30

 

29As mentioned above, since we did not assess whether the functions for which USDA 

uses WBSCM perform effectively, we also did not verify if the WBSCM claims function that 

USDA stated work have actually done so since November 2012. 

However, from June 

2012 to June 2013, USAID did not send USDA freight vouchers to 

confirm the amount that USAID reimbursed to cooperating sponsors for 

ocean freight. As a result, USDA relied on the ocean bill of lading to 

identify the amount. However, USDA officials said they do not always 

receive updated ocean bills of lading, particularly when shipments are 

split between multiple vessels. Therefore, USDA did not always have 

30USDA’s guidance also required freight forwarders to provide freight contracts and 

discharge/delivery surveys, among other documents. In addition, the guidance required 

cooperating sponsors to sign off their rights to have USDA to pursue a claim on their 

behalf.
 , 

Page 19 GAO-14-22 International Food Aid

accurate information on the amount USAID actually paid. During the 

course of GAO’s work, USAID contacted USDA and made arrangements 

to provide the necessary documents to assist USDA in its claims process.

As of February 2014, USAID had provided USDA with at least 190 freight 

vouchers to process ocean freight claims since July 2013.

USDA and USAID have been unable to collaborate effectively to resolve 

their disagreement on the suitability of WBSCM for emergency food aid 

procurement. In prior work, we have identified practices that can enhance 

and sustain collaboration among federal agencies, thereby improving 

performance and results.31 Although USDA’s and USAID’s collaborative 

efforts have incorporated some of these elements to develop WBSCM, 

they have not incorporated others. Nevertheless, an upcoming functional 

upgrade of WBSCM offers the agencies an opportunity to make 

substantial, mutually agreeable changes to WBSCM.

USDA and USAID have not collaborated effectively to resolve their 

disagreement on the suitability of WBSCM for emergency food aid 

procurement. Although USDA’s and USAID’s efforts have incorporated 

some practices to enhance and sustain collaboration they have not 

incorporated others. As we mentioned above, the agencies held weekly 

meetings to identify needs and priorities, created an action list, and 

assigned relevant individual USDA and USAID officials to specific tasks 

on the list between November and December 2011. However, by March 

2012, the agencies could not agree on how to move forward with using 

WBSCM to procure bulk ocean freight and USAID has not tested changes 

that USDA has made to the system since March 2012. Specifically, USDA 

and USAID do not agree on the roles and responsibilities of key 

participants in the international food aid procurement process, do not 

share a defined outcome for their collaboration, and do not have a written 

agreement stating how the agencies will collaborate.

 

31GAO-12-1022 and GAO-06-15. 

USDA and USAID 

Have Not Resolved 

Their Disagreement 

about WBSCM, but 

Planned System 

Upgrades Provide an 

Opportunity to 

Collaborate More 

Effectively

USDA and USAID Have 

Not Been Able to 

Collaborate to Resolve 

Disagreements over 

WBSCM
 , 

Page 20 GAO-14-22 International Food Aid

• Clarify roles and responsibilities. While USDA and USAID have 

designated some roles and responsibilities between themselves, they 

do not agree on the role and responsibilities that the freight forwarders 

should have in entering and updating information in WBSCM. Our 

prior work found that a key factor of effective collaboration is that 

agencies clarify the roles and responsibilities of those participating in 

the collaborative effort.32 During the design phase of WBSCM, the 

agencies assigned the freight forwarders responsibility for entering 

information about individual shipments and updating the information 

whenever there were changes. However, freight forwarders we 

interviewed have said they were not consulted by either agency and, 

after WBSCM was rolled out, they expressed concerns about the 

amount of information they needed to update, according to agency 

documents and officials. They noted that entering such information 

into WBSCM was redundant with their own systems, cumbersome, 

and time consuming given the system problems WBSCM was 

experiencing. As we previously noted, USAID informed USDA in June 

2012 that they would no longer require the freight forwarders to 

update shipment information in WBSCM for USAID’s international 

food aid shipments. The lack of updated information has created 

challenges for USDA in processing claims and ensuring that they 

have accurate inventory information.

• Agree on common goals. USDA and USAID established some joint 

action items for WBSCM, but they do not agree on a common goal for 

its further development and use of WBSCM. Our prior work has found 

that most experts we interviewed in collaborative resource 

management emphasize the importance of collaborative groups 

having clear goals.33

 

32

Experts noted that participants may not have the 

same interests, but establishing common goals provides them a 

reason to participate in the process. After the rollout, as problems 

arose, USDA and USAID agreed that USAID would suspend using the 

system for bulk freight procurement, and then for tracking 

prepositioned food aid inventory. They also agreed that freight 

forwarders would not be required to update freight information as 

changes in the shipments occurred. While the agencies collaborated 

to resolve some problems, such as creating a role for the stevedores 

in WBSCM, they have not resolved whether USAID would resume 

GAO-12-1022 and GAO-06-15. 

33GAO-12-1022 and GAO-06-15. 
 , 

Page 21 GAO-14-22 International Food Aid

trying to use WBSCM fully for bulk freight procurement, tracking and 

updating information on shipments, and recording prepositioned food 

aid inventory. As we noted above, as of February 2014, USAID had

not agreed to test the changes that USDA made to the system since 

March 2012 to improve its performance and functionality to procure

emergency food aid. In its response to this report, USAID stated that it 

would test the international procurement functions of WBSCM.

• Written collaborative agreements. USDA and USAID have not 

documented how they would further develop and use WBSCM, or 

how they would resolve their outstanding issues. Our prior work found 

that agencies that articulate their agreements in formal documents 

can strengthen their commitment to working collaboratively.34 As we 

have previously reported, having a clear and compelling rationale to 

work together is a key factor in successful collaborations. Agencies 

can overcome significant differences when such a rationale and 

commitment exist.35 USDA and USAID have a memorandum of 

understanding (MOU) concerning the emergency food aid program 

that FSA and USAID signed in 1991.36 FSA and USAID have drafted, 

but not yet signed, an updated MOU that USDA’s General Counsel is 

currently reviewing. According to USDA officials, both MOUs generally 

cover USAID’s and USDA’s roles and responsibilities in carrying out 

emergency food aid operations. However, neither MOU specifies the 

roles and responsibilities of either agency or desired outcome 

regarding their collaboration on WBSCM.

USDA officials said in August 2013 that they have addressed several of 

WBSCM’s performance and functional issues; however, they note that 

reconfiguring WBSCM to fully address USAID’s needs will require 

additional technical and functional upgrades. In September 2013, USDA 

began a technical upgrade of WBSCM to replace some system 

components and software that are obsolete and are increasingly difficult 

to maintain. According to USDA officials, the technical upgrade should 

also result in some benefits for users, such as improved performance, 

 

34GAO-06-15. 

35GAO, Next Generation Air Transportation: Collaborative Efforts with European Union 

Generally Mirror Effective Practices, but Near-Term Challenges Could Delay 

Implementation, GAO-12-48 (Washington, D.C.: Nov. 3, 2011). 

36In 1991, FSA was called the CCC/Agricultural Stabilization and Conservation Service.

Planned WBSCM 

Upgrades Provide an 

Opportunity to Address 

System Deficiencies
 , 

Page 22 GAO-14-22 International Food Aid

and allow users to better segregate and identify the cost of split 

shipments. In addition, the technical upgrade will enable users to access 

the system using the most current versions of Internet Explorer, which is 

a widely used Internet browser. A USDA official cautioned, however, that 

because USDA has just begun making this upgrade, it cannot be sure of 

the full scope of the improvements that will occur.

The technical upgrade will be the foundation for a more extensive, 

functional upgrade that USDA plans to conduct in fiscal years 2015 

through 2017, according to USDA officials. To make WBSCM a more 

effective system, USDA intends to change the functionality of WBSCM to 

align with current commercial business practices. Therefore, as part of 

the functional upgrade effort, USDA plans to examine domestic and 

international commercial food business trends and best practices and the 

extent to which its food aid procurement processes reflect them. 

According to USDA officials, the planned functional upgrade would 

provide an opportunity to fully address USAID’s concerns. For example, 

the functional upgrade could allow USDA to re-configure WBSCM so that 

it fits USAID’s bulk ocean freight procurement needs. As mentioned 

previously, USAID officials told us that they are willing to use WBSCM to 

procure bulk ocean freight and manage inventory if USDA is able to 

address the deficiencies that they and others have identified.

USDA and USAID have joint responsibility to carry out the Food for 

Peace program and respond to global emergency food crises. Toward 

that end, USDA developed a web-based system with USAID’s input to 

manage the procurement of food aid. However, because of WBSCM’s 

deficiencies, USAID discontinued use of the system starting in 2011. The 

agencies are currently at an impasse. USDA has made modifications to 

the system, but it is unclear if these would fully respond to USAID’s 

concerns, and USAID has not tested the modifications. Their continued 

disagreement on the usefulness of WBSCM is hindering USDA’s ability to

prepare accurate financial reports and efficiently file claims to recover 

funds. USDA’s planned major upgrade of the system affords USDA and 

USAID an opportunity to revisit their collaboration on WBSCM and 

improve the system so that it meets the needs of all users and to ensure 

that USDA has reliable and accurate data to prepare its financial 

statements and account for U.S. government funds.

Conclusions
 , 

Page 23 GAO-14-22 International Food Aid

To improve the efficiency and accountability of the emergency food aid 

procurement process, we recommend the Secretary of Agriculture and 

Administrator of USAID direct their staffs to work together to take steps 

to:

• improve USDA’s ability to account for U.S. government funds by 

ensuring that USAID provides USDA with accurate prepositioned 

commodity inventory data that USDA can independently verify; and

• assess WBSCM’s functionality by testing the international 

procurement functions that have been modified since April 2011 and 

documenting the results.

In preparation for WBSCM’s functional upgrade, we recommend the 

Secretary of Agriculture and Administrator of USAID direct their staffs to 

work together to take steps to:

• develop a written agreement signed by both agencies that clearly 

outlines the desired outcomes of their collaboration and the roles and 

responsibilities of participants, such as freight forwarders.

We provided a draft of this report to USDA and USAID for comment. 

USDA and USAID provided written comments on the draft, which are 

reprinted in appendixes II and III, respectively. We also received technical 

comments from USDA and USAID, which we incorporated throughout our 

report as appropriate. USDA generally agreed with our recommendations 

and expressed willingness to continue to initiate improvements in the 

efficiency and accountability of the emergency food aid procurement 

process. USAID agreed to test WBSCM’s current functionality and to 

clarify the roles and responsibilities of participants in a written agreement 

with USDA. Regarding our recommendation to ensure that USAID 

provides USDA with accurate prepositioned commodity inventory data 

that can be independently verified, USAID stated it is of the view that 

commodities move off USDA’s books and onto those of USAID when a 

contractor takes possession, on USAID’s behalf, of the commodities in 

question. However, according to USDA and its independent auditor, the 

CCC retains the ownership of the commodity inventory until USAID 

distributes it from the warehouse. USAID did not comment on the

concerns we identified about the quality of USAID’s internal controls and 

inventory data, which need to be addressed regardless of which agency 

includes the data in its financial reporting.

Recommendations for 

Executive Action

Agency Comments 

and Our Evaluation
 , 

Page 24 GAO-14-22 International Food Aid

In addition to providing copies of this report to your offices, we will send 

copies to interested congressional committees, the Secretary of 

Agriculture, and the Administrator of USAID. We will make copies 

available to others on request. In addition, the report is also available at 

no charge on the GAO website at http://www.gao.gov. 

If you or your staff has any questions about this report, please contact me 

at (202) 512-9601 or melitot@gao.gov. Contact points for our Offices of 

Congressional Relations and Public Affairs may be found on the last page 

of this report. GAO staff who made major contributions to this report are 

listed in appendix IV.

Sincerely yours,

Thomas Melito

Director, International Affairs and Trade
Appendix I: Objectives, Scope, and 

Methodology, 

Page 25 GAO-14-22 International Food Aid

Our review focused on the procurement process for the Title II emergency 

food aid program managed by the U.S. Department of Agriculture (USDA) 

and the U.S. Agency for International Development (USAID). This report 

examines (1) the extent to which agencies agree to use WBSCM to 

manage the international emergency food aid procurement process; (2) 

how the agencies’ use of WBSCM and other systems affects USDA’s 

ability to have accurate information about emergency international food 

aid shipments; and (3) the extent to which the agencies are collaborating 

on how to use WBSCM.

To provide context and background on the Title II emergency food aid 

procurement process, we analyzed the total food aid expenditures and 

tonnage data for fiscal years 2007 through 2012. The data that we 

obtained included USAID commodity and ocean freight funding data for 

fiscal years 2007 through 2012. These data were presented for context 

and background purposes only, and we determined they were reliable for 

our purposes. We also analyzed budget processes, financial reporting 

requirements, contract documents, cooperating sponsor cooperative 

agreements and transfer authorizations, legislation, acquisition 

regulations, and past GAO food aid reports to understand the emergency 

food aid procurement process.

To examine the extent to which the two agencies use the Web Based 

Supply Chain Management system (WBSCM) to manage the international 

emergency process to procure commodities and ocean freight 

transportation, we interviewed USDA and USAID officials and reviewed 

documentation. At USDA, we met with officials of the Agricultural 

Marketing Service; Foreign Agricultural Service, and Farm Service 

Agency, including officials in the Farm Service Agency’s Commodity 

Operations Office in Kansas City, Missouri. At USAID, we met with 

officials of the Office of Food for Peace and the Transportation Office in 

Washington, D.C. Documents we reviewed included agency procurement 

schedules, organizational charts, policies and procedures, and flow 

charts, as well as contract documents, legislation, and acquisition 

regulations. We also obtained and analyzed USDA and USAID memos, 

briefings, and newsletters that discuss what WBSCM was designed to do 

and concerns surrounding the use of WBSCM. We observed how both 

agencies use WBSCM, and USAID officials explained or demonstrated 

some of the systems that they use separately from WBSCM to procure 

and manage emergency food aid, including USAID’s Food for Peace 

Management Information System.

Appendix I: Objectives, Scope, and 

Methodology
Appendix I: Objectives, Scope, and 

Methodology, 

Page 26 GAO-14-22 International Food Aid

In addition to conducting interviews with agency officials and obtaining 

agency documentation, we conducted interviews with and obtained 

documentation from officials of the World Food Program and private 

voluntary organizations. We also interviewed and obtained documentation 

from six of the seven freight forwarders that manage the transportation of 

food aid from the U.S. load port to the foreign destination or overseas 

prepositioned warehouse port. We did not test the system ourselves 

because it was beyond the scope of this review to simulate multiple food 

aid procurements, including the variances that occur during the shipping 

process, and simulate the interface for multiple users. We did not assess 

the extent to which USDA uses WBSCM for its domestic and international 

food aid programs, or whether WBSCM performs these functions 

effectively because that was beyond the scope of this engagement.

To examine how the agencies use of WBSCM and other systems affects 

USDA’s ability to have accurate information as well as USDA’s ability to 

efficiently recover U.S. government funds from lost or damaged 

commodities during ocean transit, we interviewed officials from USDA’s 

Commodity Operations Office and USAID’s Office of Food for Peace, 

Transportation Office and Office of the Chief Financial Officer. To 

examine how USAID’s use of systems outside of WBSCM affects USDA’s 

ability to report and account for U.S. government funds, we obtained and 

analyzed USDA and USAID documentation and spreadsheets used to 

track foreign prepositioned commodity inventory levels and how these are 

used to provide information for financial statements. The documentation 

that we obtained and analyzed included warehouse inventory reports 

prepared by each of the contractors that manage USAID’s foreign 

prepositioned warehouses, as well as a consolidated warehouse 

inventory spreadsheet that USAID has provided to USDA to comply with 

USDA’s request for inventory data to use in complying with applicable 

financial reporting requirements.

We also drew on work conducted for a recent report to describe the 

systems that USAID relies upon to track emergency food aid shipments.1

 

1

For that report, we collected data on emergency food aid shipments from 

fiscal years 2007 through 2012 from the World Food Program and six 

freight forwarders. We assessed the reliability of these data by asking the 

World Food Program and the six freight forwarders that manage the 

GAO-14-277. 
Appendix I: Objectives, Scope, and 

Methodology, 

Page 27 GAO-14-22 International Food Aid

transportation of Title II emergency food aid for cooperating sponsors how 

they collected the data, the quality checks that they perform, and the 

internal controls they have in place to ensure the accuracy of the data. 

We also tested some of the data for missing data, outliers, and obvious 

errors. In total, we assessed the records for 5,142 emergency food aid 

shipments during this period. Based on our assessments, we found that 

data for 1,357 shipments were not sufficiently reliable to determine how 

prepositioning and diverting food aid affects the timeliness of food aid 

deliveries. See appendix II in GAO-14-277 for the results of this analysis.

To understand the applicable quarterly financial reporting requirements 

that USDA must address to account for overseas prepositioned food aid 

inventories, we analyzed how Congress appropriates funding for this 

program. We also obtained and analyzed applicable Office of 

Management and Budget (OMB) circulars, such as the OMB Circular A136 and other federal regulations. We also identified the internal control 

requirements applicable to federal agencies. These are contained in 

GAO’s Standards for Internal Control in the Federal Government.

2 We 

compared the internal control standards identified in this report with 

USDA and USAID’s actions in the procurement process.3

 

2

GAO, Internal Control: Standards for Internal Control in the Federal Government, 

We also 

reviewed internal control deficiencies identified in a January 2013 USAID 

regional inspector general report, as well as in audits of the Commodity 

Credit Corporation prepared by an independent auditor. We did not 

independently audit the Commodity Credit Corporation’s financial 

statements, but the USDA Inspector General did not find instances where 

the auditor did not comply, in all material respects, with government 

auditing standards and the OMB Bulletin 07-04, Audit Requirements for 

Federal Financial Statements, as amended. To assess the extent to 

GAO/AIMD-00-21.3.1 (Washington, D.C.: September 1999) and GAO, Internal Control:

Internal Control Management and Evaluation Tool, GAO-01-1008G (Washington, D.C.: 

August 2001).

3

We also examined USDA and USAID’s regulations, policies, and guidance on internal 

controls. See USDA, Office of Chief Financial Officer Regulation, Management 

Responsibility for International Control Number: 1110-002 (Washington, D.C.: Jun 17, 

2013) and USAID, Automated Directive System Chapter 596, Management’s 

Responsibility for Internal Control (Washington, D.C.: Aug 8, 2012). We compared USDA 

and USAID’s internal control standards with their activities during the procurement 

process; however, each agency’s internal control policies apply only to that agency and 

not to other agencies. Since this program is jointly managed, we found GAO’s internal 

control standards were more appropriate because they apply to the U.S. government. 
Appendix I: Objectives, Scope, and 

Methodology, 

Page 28 GAO-14-22 International Food Aid

which the use of WBSCM and other systems affects USDA’s ability to 

process ocean freight claims and efficiently recover U.S. government 

funds, we obtained and analyzed USDA and USAID documents and 

emails that describe the claims documentation submission process that 

the two agencies agreed to implement in June 2012. We also examined 

the extent to which USDA and USAID are sharing claims-related 

information by analyzing e-mails and freight vouchers submitted by 

USAID to USDA from June 2013 through February 2014. 

To examine the extent to which USDA and USAID collaborate on how to 

use WBSCM, we obtained documentation from both agencies and 

developed a timeline of events. The documentation obtained included 

annual performance reports, letters, memos, emails, information bulletins, 

updates to USDA’s risk management plan, and meeting notes. We also 

obtained a copy of a post-implementation review conducted by an 

independent contractor that documented a number of findings related to 

WBSCM. We interviewed officials from the USDA’s Agriculture Marketing 

Service, Foreign Agriculture Service, and Farm Service Agency, as well 

as officials from USAID’s Food for Peace and Transportation Offices. We 

also interviewed six of the seven freight forwarders that manage the 

transportation of food aid for USAID and cooperating sponsors. After 

reviewing GAO’s 2005 and 2012 reports on practices to improve 

interagency collaboration, we compared the practices with USDA and 

USAID actions from April 2011 to August 2013 and determined that five of 

the practices were the most relevant in describing the agencies’ efforts to 

resolve their concerns about WBSCM.4

 

4

See GAO, Managing for Results: Key Considerations for Implementing Interagency 

Collaborative Mechanisms, 

We determined that the two 

agencies did follow two leading practices. However, we also determined 

that there were three collaboration practices that they had not followed. 

Our 2005 and 2012 reports highlighted the need for agencies’ to 

document their agreement to collaborate through memorandums of 

understanding or other similar documents. Also, our reports demonstrated 

the benefits of ensuring that collaborating agencies agree and are clear 

with respect to their roles and responsibilities. This includes agreeing on 

the role of the contractors that implement the program. In addition, our 

reports highlighted the importance of ensuring that collaborating agencies 

have clearly defined goals.

GAO-12-1022 (Washington, D.C.: Sept. 27, 2012) and 

Results-Oriented Government: Practices That Can Help Enhance and Sustain 

Collaboration among Federal Agencies, GAO-06-15 (Washington, D.C.: Oct. 21, 2005).
Appendix I: Objectives, Scope, and 

Methodology, 

Page 29 GAO-14-22 International Food Aid

We conducted this performance audit from March 2013 to March 2014 in 

accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain 

sufficient, appropriate evidence to provide a reasonable basis for our 

findings and conclusions based on our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives.
Appendix II: Comments from the U.S. 

Department of Agriculture

Page 30 GAO-14-22 International Food Aid

Appendix II: Comments from the U.S. 

Department of Agriculture 
Appendix II: Comments from the U.S. 

Department of Agriculture

Page 31 GAO-14-22 International Food Aid
Appendix III: Comments from the U.S. Agency 

for International Development

Page 32 GAO-14-22 International Food Aid

Appendix III: Comments from the U.S. 

Agency for International Development

Note: GAO comments 

supplementing those in 

the report text appear at 

the end of this appendix.
Appendix III: Comments from the U.S. Agency 

for International Development

Page 33 GAO-14-22 International Food Aid

See comment.
Appendix III: Comments from the U.S. Agency 

for International Development

Page 34 GAO-14-22 International Food Aid
Appendix III: Comments from the U.S. Agency 

for International Development

Page 35 GAO-14-22 International Food Aid

Following is GAO’s comment on USAID’s letter. 

USAID stated it is of the view that commodities move off USDA’s books 

and onto those of USAID when a USAID contractor takes possession of 

the commodities in question. However, according to USDA and its 

independent auditor, CCC retains ownership of the inventory when it is in 

USAID’s possession. Nevertheless, we identified concerns about the 

quality of USAID’s internal controls and inventory data, which need to be 

addressed regardless of which agency includes the data in its financial 

reporting.

GAO Comment 
Appendix IV: GAO Contact and Staff 

Acknowledgments

Page 36 GAO-14-22 International Food Aid

Thomas Melito, (202) 512-9601 or melitot@gao.gov

In addition to the person named above, Valérie L. Nowak (Assistant 

Director), Rhonda Horried, Mark Needham, José M. Peña III, Ashley 

Chaifetz, Fang He, Martin De Alteriis, Mark Dowling, Etana Finkler, Karen 

Deans, and Carol Bray made significant contributions to this report.

Appendix IV: GAO Contact and Staff 

Acknowledgments

GAO Contact

Staff 

Acknowledgments
Related GAO Products

Page 37 GAO-14-22 International Food Aid

International Food Aid: Prepositioning Speeds Delivery of Emergency Aid, 

but Additional Monitoring of Time Frames and Costs Is Needed. GAO-14-

277. Washington, D.C.: March 5, 2014.

World Food Program: Stronger Controls Needed in High-Risk Areas. 

GAO-12-790. Washington, D.C.: September 13, 2012.

Farm Bill: Issues to Consider for Reauthorization. GAO-12-338SP. 

Washington, D.C.: April 24, 2012.

USDA Systems Modernization: Management and Oversight 

Improvements Are Needed. GAO-11-586. Washington D.C.: July 20, 

2011.

International Food Assistance: Better Nutrition and Quality Control Can 

Further Improve U.S. Food Aid. GAO-11-491. Washington, D.C.: May 12, 

2011.

International Food Assistance: A U.S. Governmentwide Strategy Could 

Accelerate Progress toward Global Food Security. GAO-10-212T. 

Washington, D.C.: October 29, 2009.

International Food Assistance: Key Issues for Congressional Oversight. 

GAO-09-977SP. Washington, D.C.: September 30, 2009.

Foreign Assistance: Various Challenges Limit the Efficiency and 

Effectiveness of U.S. Food Aid. GAO-07-905T. Washington, D.C.: May 

24, 2007.

Foreign Assistance: Various Challenges Impede the Efficiency and 

Effectiveness of U.S. Food Aid. GAO-07-560. Washington, D.C.: April 13, 

2007.

Related GAO Products

(320968)
The Government Accountability Office, the audit, evaluation, and 

investigative arm of Congress, exists to support Congress in meeting its 

constitutional responsibilities and to help improve the performance and 

accountability of the federal government for the American people. GAO 

examines the use of public funds; evaluates federal programs and 

policies; and provides analyses, recommendations, and other assistance 

to help Congress make informed oversight, policy, and funding decisions. 

GAO’s commitment to good government is reflected in its core values of 

accountability, integrity, and reliability.

The fastest and easiest way to obtain copies of GAO documents at no 

cost is through GAO’s website (http://www.gao.gov). Each weekday 

afternoon, GAO posts on its website newly released reports, testimony, 

and correspondence. To have GAO e-mail you a list of newly posted 

products, go to http://www.gao.gov and select “E-mail Updates.”

The price of each GAO publication reflects GAO’s actual cost of 

production and distribution and depends on the number of pages in the 

publication and whether the publication is printed in color or black and 

white. Pricing and ordering information is posted on GAO’s website, 

http://www.gao.gov/ordering.htm. 

Place orders by calling (202) 512-6000, toll free (866) 801-7077, or 

TDD (202) 512-2537. 

Orders may be paid for using American Express, Discover Card, 

MasterCard, Visa, check, or money order. Call for additional information.

Connect with GAO on Facebook, Flickr, Twitter, and YouTube. 

Subscribe to our RSS Feeds or E-mail Updates. Listen to our Podcasts. 

Visit GAO on the web at www.gao.gov. 

Contact:

Website: http://www.gao.gov/fraudnet/fraudnet.htm

E-mail: fraudnet@gao.gov

Automated answering system: (800) 424-5454 or (202) 512-7470

Katherine Siggerud, Managing Director, siggerudk@gao.gov, (202) 512-

4400, U.S. Government Accountability Office, 441 G Street NW, Room 

7125, Washington, DC 20548

Chuck Young, Managing Director, youngc1@gao.gov, (202) 512-4800

U.S. Government Accountability Office, 441 G Street NW, Room 7149 

Washington, DC 20548

GAO’s Mission

Obtaining Copies of 

GAO Reports and 

Testimony

Order by Phone

Connect with GAO

To Report Fraud, 

Waste, and Abuse in 

Federal Programs

Congressional 

Relations

Public Affairs

Please Print on Recycled Paper.