EMBASSY 

MANAGEMENT

State Department and 

Other Agencies 

Should Further 

Explore Opportunities 

to Save Administrative 

Costs Overseas

Report to the Chairman, Subcommittee on 

Oversight of Government Management, the 

Federal Workforce, and the District of Columbia, 

Committee on Homeland Security and 

Governmental Affairs, United States Senate

January 2012

GAO-12-317

United States Government Accountability Office

GAO
United States Government Accountability Office

Highlights of GAO-12-317, a report to the 

Chairman, Subcommittee on Oversight of 

Government Management, the Federal 

Workforce, and the District of Columbia, 

Committee on Homeland Security and 

Governmental Affairs, United States Senate

January 2012

EMBASSY MANAGEMENT

State Department and Other Agencies Should 

Further Explore Opportunities to Save 

Administrative Costs Overseas

Why GAO Did This Study

The U.S. government employs more 

than 23,500 Americans overseas at 

more than 250 diplomatic and consular 

posts. These posts require a variety of 

support services, such as building 

maintenance and vehicle operations. 

Agencies may obtain these services, 

primarily from the Department of State 

(State), through the International 

Cooperative Administrative Support 

Services (ICASS), but participation in 

most services is voluntary. A 2004 

GAO report found that ICASS had not 

eliminated duplication of support 

services and that customers generally 

approved of the quality of ICASS 

services, but that the level of 

satisfaction was difficult to quantify.

For this report, GAO assessed (1) how

changes in ICASS participation have

affected the duplication and cost of 

support services and (2) customer 

satisfaction with the quality of ICASS 

services. GAO surveyed ICASS 

customers, analyzed ICASS data, 

interviewed officials from State and 

seven other agencies, and conducted 

fieldwork in four countries. 

What GAO Recommends

Congress may wish to consider

requiring agencies to participate in

ICASS services unless they provide a 

business case to show that they can 

obtain these services outside of ICASS 

without increasing overall costs to the 

U.S. government or that their mission 

cannot be achieved within ICASS. 

GAO is also making recommendations 

regarding the reengineering of 

administrative processes, use of nonState ICASS service providers, and 

improvement of service standards. 

State and U.S. Agency for International 

Development generally concur. 

What GAO Found

Agencies continue to provide potentially duplicative administrative services 

overseas despite slight increases in their participation in ICASS since 2004. 

When agencies had a choice to opt out of ICASS and provide services 

independently, they did so about one-third of the time, on average, in 2011. The 

U.S. Agency for International Development (USAID), however, has reduced 

duplicative administrative operations by increasing its participation in ICASS 

markedly since 2005. Agencies have cited several factors for opting out of 

ICASS, principally concerns about cost, but they do not usually provide any 

formal rationale to ICASS management and often have not conducted any cost 

analysis to justify their decisions. Some agencies also indicated that they cannot 

meet their mission requirements within ICASS. GAO’s analysis of ICASS cost 

and workload data shows that significant economies of scale can be achieved 

through greater participation in ICASS. Thus, while agencies may opt out of 

ICASS because they believe they can obtain less costly services on their own, 

doing so may actually increase the overall cost to the U.S. government. ICASS 

management’s ability to convince agencies that participating will save them or 

the U.S. government money is hampered by the lack of comparative cost data to 

demonstrate potential savings. In 2004, GAO recommended that the ICASS 

Executive Board—the highest level policy-making body in the ICASS system 

composed of customer agency representatives—encourage greater ICASS 

participation. However, experience has shown that board members do not 

necessarily have the incentive to require their agencies to participate in ICASS, 

especially if they are unconvinced that it is in their agencies’ individual financial 

interest. In this context, Congressional action may be necessary to increase 

participation and achieve greater economies of scale. Separately, State has 

made limited progress improving the cost effectiveness of ICASS services in 

other ways, such as reducing the need for American staff overseas or using other 

qualified agencies, such as USAID, to provide some ICASS services. 

Results from annual ICASS customer satisfaction surveys as well as GAO’s own 

survey show overall satisfaction with ICASS services. For example, data from the 

annual ICASS survey indicate that, on a scale from 1 to 5, the average overall 

score increased from 3.95 in 2005 to 4.03 in 2011. Data from GAO’s survey 

show that nearly 80 percent of agency representatives participating in ICASS

indicated that the quality of services was “good” or better. Nonetheless, some

dissatisfaction persists, potentially hampering participation. In some cases, 

performance problems and service limitations could affect agencies’ ability to 

achieve their missions efficiently and effectively. For example, USAID officials 

have cited the unavailability of ICASS motor pool vehicles for travel to distant 

project sites as a major impediment to achieving their mission. State’s service 

delivery data suggest that these concerns have merit, as ICASS service 

providers fulfilled about 70 percent of the requests for non-local transportation in 

2011. State has implemented new monitoring tools to improve ICASS managers’ 

ability to evaluate performance, but they do not address some agencies’ 

concerns involving billing errors, inequity, and problems with certain critical 

View GAO-12-317. For more information, services. contact Michael Courts at (202) 512-8980 or 

courtsm@gao.gov. 
Page i GAO-12-317 Embassy Management

Letter 1 

Background 3

By Opting Out of ICASS Services, Agencies Are Not Realizing 

Economies of Scale 6

ICASS Customers Generally Satisfied, and Management Has New 

Tools to Monitor Quality in Some Areas 22

Conclusions 34

Matter for Congressional Consideration 36

Recommendation for Executive Action 36

Agency Comments and Our Evaluation 36

Appendix I Objectives, Scope, and Methodology 39

Appendix II Services Available through ICASS 52

Appendix III Status of Consolidation of State and USAID Administrative Platforms 55

Appendix IV Agency Participation in ICASS 57

Appendix V Comments from the Department of State 60

Appendix VI Comments from the U.S. Agency for International Development 70

Appendix VII Comments from the Department of Commerce 74

Appendix VIII Comments from the Department of Agriculture 79

Contents
Page ii GAO-12-317 Embassy Management

Appendix IX Comments from the Department of Homeland Security 81

Appendix X GAO Contact and Staff Acknowledgments 84

Tables

Table 1: Average Participation Rates by ICASS Service, 2005 and 

2011 8

Table 2: Rate of Participation in Available Voluntary Services, by 

Selected Subagency Code, 2005 and 2011 10

Table 3: Number of Respondents Indicating That They Think the 

Cost of Obtaining Services Within ICASS is More 

Expensive, About the Same, or Less Expensive Than 

Obtain Services Outside of ICASS 12

Table 4: Number of Respondents Indicating That Their Agency 

Obtains Services Outside of ICASS and Has or Has Not 

Compared the Cost of Services within and outside of 

ICASS 13

Table 5: Estimated Change in ICASS Unit Costs with 10 Percent 

Increase in Workload 16

Table 6: Average Customer Satisfaction Scores on a Scale from 1 to 

5 by Agency for 2011 25

Table 7: Responses from USAID and Other Agency Personnel as to 

Whether They Receive Higher or Lower Priority than State 

Personnel When Requesting ICASS Services. 29

Table 8: Selected ICASS Services and Uniform Service Standards 

with the Percentage of Service Completions Meeting 

Standards, Fiscal Year 2011 32

Table 9: eServices Point-of-Service Ratings, on a Scale from 1 to 5, 

by Service, Fiscal Years 2010 and 2011 33

Table 10: Summary Statistics of ICASS Data 42

Table11: Frequency Table for Year of ICASS Service 43

Table 12: Frequency Table for Type of Post 43

Table 13: Frequency Table for Regions 43

Table 14: Frequency Table for ICASS Services 44

Table 15: Summary Regression Results 46

Table 16: ICASS Council Representatives That Received and 

Completed the Survey 47

Table 17: ICASS Cost Centers 52
Page iii GAO-12-317 Embassy Management

Table 18: Rate of Participation in Available Services, by Agency, 

2005 and 2011 57

Figures

Figure 1: Total ICASS Costs and Overseas U.S. Direct Hire Staff, 

Fiscal Years 2001 through 2011 6

Figure 2: ICASS Customer Satisfaction Scores on a Scale from 1 to 

5 for Selected Agencies, 2005 through 2011 24

Figure 3: Customer Perceptions on the Quality of Selected ICASS 

Services, 2011 26

Abbreviations

AFSA American Foreign Service Association

Commerce Department of Commerce

DHS Department of Homeland Security

DOD Department of Defense

DOJ Department of Justice

FAS Foreign Agricultural Service

HHS Department of Health and Human Services

ICASS International Cooperative Administrative Support Services

M/PRI Office of Management, Policy, Rightsizing, and Innovation

State Department of State

USAID U.S. Agency for International Development

USDA U.S. Department of Agriculture

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 

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Page 1 GAO-12-317 Embassy Management

United States Government Accountability Office

Washington, DC 20548

January 31, 2012

The Honorable Daniel K. Akaka

Chairman

Subcommittee on Oversight of Government

Management, the Federal Workforce, 

and the District of Columbia

Committee on Homeland Security

and Governmental Affairs

United States Senate

Dear Mr. Chairman:

The U.S. government employs more than 23,500 Americans overseas, 

including nearly 15,000 with the Department of State (State), at more than 

250 diplomatic and consular posts. The operation of these posts requires 

a wide variety of administrative support services for overseas personnel, 

such as building maintenance, vehicle operations, and travel services, 

among others. Agencies may obtain these services through the 

International Cooperative Administrative Support Services (ICASS) 

system, the principal means by which the U.S. government provides and 

shares the cost of common services. ICASS is an interagency system 

established in 1997 for distributing the cost of administrative services at 

overseas posts and is intended to ensure that each agency bears the cost 

of its overseas presence.1

 

1

The Omnibus Consolidated Appropriations Act of 1997 (Pub. L. No. 104-208) mandated 

the establishment of a system “that allocates to each department and agency the full cost 

of its presence outside of the United States.” In addition, ICASS operates under various 

sections of legislation, including provisions authorizing State to enter into agreements with 

other agencies under certain conditions to consolidate administrative platforms and 

provide goods and services to other agencies on a reimbursable basis. The Foreign 

Affairs Handbook also provides guidance on ICASS, including its organization, cost 

distribution system, and budget and billing process. 

While State has the primary responsibility for 

operating the system, over 40 agencies share the cost of ICASS services, 

which totaled more than $2 billion in fiscal year 2011. State, the 

Department of Defense (DOD), and the U.S. Agency for International 

Development (USAID) were the largest participants in ICASS in fiscal 

year 2010, together accounting for nearly 90 percent of all ICASS costs.

The ICASS system seeks to provide quality services at the lowest cost, 

while ensuring that each agency bears the cost of its presence overseas.

 
 

Page 2 GAO-12-317 Embassy Management

However, participation in most ICASS services is voluntary, and agencies 

may choose to obtain these services outside of ICASS.

In 2004, we reviewed the performance of ICASS for the first time since its 

implementation.2

In March 2011, we issued our first annual report to Congress in response 

to a new statutory requirement that we identify federal programs, 

agencies, offices, and initiatives, either within departments or 

governmentwide, which have duplicative goals or activities.

In that report, we found that ICASS had not eliminated 

costly duplication of administrative support services or achieved 

economies of scale, systematic cost-containment measures, and the 

streamlining of operations. We also found that agencies deciding to 

obtain services outside of ICASS rarely made a business case to explain 

their decisions. In addition, we found that agencies generally approve of 

the quality of ICASS services, but the level of satisfaction was difficult to 

quantify. More recently, officials at some agencies, notably USAID, have 

expressed serious concerns about the quality of ICASS services.

3

This report updates our 2004 report and assesses (1) how changes in 

ICASS participation have affected the duplication and cost of 

administrative support services and (2) customer satisfaction with the 

quality of ICASS services overseas. To address these objectives, we 

reviewed legislation governing ICASS; analyzed data and documentation 

on ICASS participation, costs, and performance metrics from 2000 

through 2011;

We 

considered “duplication” to occur when two or more agencies or programs 

are engaged in the same activities or provide the same services to the 

same beneficiaries. However, determining whether and to what extent 

programs are actually duplicative requires programmatic information that 

is often not readily available. In instances in this report where we lacked 

such information, we use the term “potential duplication.” 

4

 

2

GAO, Embassy Management: Actions Are Needed to Increase Efficiency and Improve 

Delivery of Administrative Support Services, 

reviewed the results of annual ICASS surveys; and 

GAO-04-511 (Washington, D.C.: Sept. 7, 

2004).

3

GAO, Opportunities to Reduce Potential Duplication in Government Programs, Save Tax 

Dollars, and Enhance Revenue, GAO-11-318SP (Washington, D.C.: Mar. 1, 2011).

4

We assessed the reliability of these data and determined that they were sufficiently 

reliable for the purposes of our report. 
 

Page 3 GAO-12-317 Embassy Management

interviewed cognizant staff at State, USAID, DOD, and five other 

agencies with a large overseas presence: the Departments of Agriculture 

(USDA), Commerce (Commerce), Health and Human Services (HHS), 

Homeland Security (DHS), and Justice (DOJ). Together, these eight 

agencies accounted for more than 98 percent of the total ICASS budget 

in 2010. We also surveyed representatives from these agencies at posts 

around the world regarding their agencies’ participation in ICASS and 

their opinions about the cost and quality of ICASS services.5

We conducted this performance audit from August 2010 to January 2012 

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.

We 

conducted fieldwork at four overseas locations—Tokyo, Japan; Nairobi, 

Kenya; Manila, the Philippines; and Kigali, Rwanda—where we observed 

administrative services, met with embassy management officials, and 

conducted focus groups of ICASS customers. Appendix I provides more 

details about our objectives, scope, and methodology.

Under State’s leadership, ICASS relies on collaboration among multiple 

agencies both in Washington, D.C., and at overseas posts to develop and 

implement ICASS policies. The following bodies have a role in 

implementing the ICASS system:

• In Washington, D.C., the ICASS Executive Board sets the strategic 

vision for ICASS and is the highest level policy-making body in the 

ICASS system. The board is comprised of senior representatives from 

participating agencies and is chaired by State.

 

5

We surveyed a random sample of 350 ICASS Council representatives from the eight 

agencies within the scope of our review at 133 posts worldwide regarding their agencies’ 

participation in and opinions regarding nine ICASS services. These services were: 

household furniture, furnishings, and appliance pools; motor pool; shipping and customs; 

government-owned/long and short-term lease residential building operations; vouchering; 

leasing; information management technical support; procurement; and human resources 

for locally engaged staff. We received responses from 184 representatives at 102 posts.

Background 
 

Page 4 GAO-12-317 Embassy Management

• The ICASS Working Group is the staff arm of the Executive Board 

responsible for presenting policy issues to the board, making policy 

decisions when delegated to do so by the board, and resolving issues 

raised by posts. The Working Group is open to any agency that 

receives ICASS services.

• The ICASS Service Center, housed within State, serves as the 

Secretariat to the Executive Board and Working Group. The Service 

Center is primarily responsible for overseeing worldwide ICASS 

operations and facilitates and coordinates the ICASS budget and 

allotments process.

• At overseas posts, the ICASS Council develops local policies on what 

services will be available at post, selects service providers, and 

approves the post’s ICASS budget. The post ICASS Council consists 

of representatives from each agency that receives ICASS services at 

that post.

• The ICASS service provider at overseas posts is responsible for 

delivering services to customer agencies. While there may be different 

providers for different services at a given post, State is the principal—

and most often only—service provider at most posts around the world.

At some posts, USAID provides ICASS services to other agencies as 

an alternate ICASS service provider in lieu of State.

In addition to these ICASS entities, State and USAID established a Joint 

Management Board in 2011 to facilitate the continued consolidation of 

their support services.6

Agencies may obtain administrative support from ICASS by participating 

on a case-by-case basis in each service or group of services available at 

an overseas post (appendix II lists these services and provides a brief 

 

6

In 2006, we reported on State’s and USAID’s initial efforts to consolidate overseas 

support services and found that the two agencies had directed overseas posts to begin 

the process of identifying duplicative services and initiating further consolidation efforts. 

See GAO, Overseas Presence: State and USAID Should Adopt a Comprehensive Plan to 

Improve the Consolidation of Overseas Support Services, GAO-06-829 (Washington, D.C: 

Sept. 8, 2006). Appendix III provides more details on the status of State-USAID 

consolidation.
 

Page 5 GAO-12-317 Embassy Management

description of each).7 Agencies may opt out of most services by providing 

these services for themselves or obtaining them from another source. The 

ICASS Executive Board has made some services mandatory in most 

cases for all agencies overseas: these include several services that can 

only be obtained by the embassy, such as securing diplomatic credentials 

from the host country, and services provided by the Community Liaison 

Office at each post, such as providing welcoming and orientation 

materials and assisting family members with employment opportunities.8

Spending on administrative services for agencies overseas through 

ICASS has increased significantly over the last decade, from $736 million 

in 2001 to more than $2 billion in 2011 (see fig. 1). Agencies that do not 

fully participate in ICASS also incur costs to obtain administrative services 

overseas, but these costs are not always clearly and consistently 

accounted for by the agencies. According to ICASS officials, several 

factors explain the growth in spending on services overseas, some of 

which apply equally to ICASS and non-ICASS services. Since 2001, the 

increase in U.S. personnel overseas, the addition of new services into 

ICASS, the construction of new embassy compounds (which are more 

The ICASS Working Group has further decided that starting in fiscal year 

2013, participation in two additional services—security and health 

services—will be mandatory. All remaining services are optional. 

Depending on the service, ICASS distributes costs among customers 

either on the basis of static measures, such as an agency’s head count or 

the space it occupies, or on the amount of service the agency actually 

uses, such as the number of kilometers driven. When an agency chooses 

to withdraw from an ICASS service, its share of the fixed cost of that 

service is reallocated among remaining participants, potentially increasing 

these agencies’ costs. The withdrawing agency must then provide the 

service itself at its own expense.

 

7

These groups of services are referred to as “cost centers” in ICASS. For simplicity, in 

this report we use the term “service” to denote both cost centers and the services provided 

within those cost centers. Overall, ICASS is implemented in one of two manners: 

“Standard” and “Lite.” An ICASS Standard post breaks the services into 31 cost centers, 

while an ICASS Lite maintains 16 cost centers. In general, ICASS Lite tends to be used at 

small posts because the management burden is lower than at ICASS Standard posts. 

ICASS Standard, however, allows for greater flexibility to customers in choosing which 

services they will take and avoiding paying for services they do not receive.

8

These services are mandatory for every agency at post with U.S. direct hire and certain 

authorized third country national, U.S. contractor, or other staff. At posts where an agency 

has only local staff, the agency is not required to participate in these services. 
 

Page 6 GAO-12-317 Embassy Management

costly to maintain than the buildings they replaced), the strengthening of 

security requirements, and exchange rate fluctuations have all contributed 

to the increase in the overall spending on administrative services abroad.

When these factors are accounted for, per capita costs for ICASS 

services have remained relatively constant since 2000, according to 

analysis by the ICASS Service Center.

Figure 1: Total ICASS Costs and Overseas U.S. Direct Hire Staff, Fiscal Years 2001 

through 2011

Since 2004, overall participation in ICASS has increased slightly, but our 

analysis and observations suggest that agencies are still providing 

potentially duplicative services at posts overseas. While agencies cite 

several factors for not participating more fully in ICASS, they generally do 

not provide justifications for their decisions to opt out of these services.

As a result, the government as a whole may be missing opportunities for 

cost savings resulting from economies of scale within ICASS—that is, the 

cost per unit of service provided decreases as consumption of services 

increases. However, while there are exceptions, ICASS and customer 

agencies generally have insufficient data to perform a meaningful cost 

By Opting Out of 

ICASS Services, 

Agencies Are Not 

Realizing Economies 

of Scale
 

Page 7 GAO-12-317 Embassy Management

analysis to quantify the potential cost savings of consolidating services to 

individual agencies or the government as a whole. Aside from realizing 

some economies of scale, State has made limited progress in lowering 

costs through the reengineering of ICASS administrative operations. Also, 

we observed that USAID may be better equipped than State to provide 

ICASS services to other agencies cost-effectively at some posts, but 

State has retained its role as service provider in almost all cases.

In 2004, we reported that, since the establishment of ICASS, many 

agencies had not signed up for ICASS services and decided instead to 

provide similar services for their own staff independently.9 Providing 

services outside of ICASS resulted in duplicative administrative systems 

that limited ICASS’s ability to achieve economies of scale and deliver 

administrative services efficiently. Our analysis of ICASS data from 2005 

to 2011 shows that U.S. government agencies still do not fully participate 

in ICASS and are thus providing potentially duplicative administrative 

services for staff and operations overseas. In 2011, when agencies had a 

choice to obtain administrative services through ICASS, they did so 64 

percent of the time, on average.10 Participation rates for individual 

services ranged from nearly 22 percent to about 96 percent in 2011 (see 

table 1). In addition, participation rates for many services have remained 

relatively constant since 2005. Participation rates for 10 services have 

increased by 5 percentage points or less, while only 3 services have seen 

participation rates increase by 10 percentage points or more. An 

additional 12 services experienced a decrease in participation rates 

between 2005 and 2011. Furthermore, the ICASS participation rate was 

below 50 percent for eight ICASS services in 2011.

 

9

GAO-04-511. 

10In order to calculate the participation rate of different ICASS services, we counted the 

agencies at each post where the service is provided and then the number of agencies 

which subscribe to the service. The ratio between the two numbers is the participation 

rate. See appendix I for a detailed discussion of our methodology. We excluded two 

services, basic package and community liaison office services, which are mandatory for all 

agencies with U.S. direct hire, certain authorized third country nationals, U.S. contractors, 

and other staff at a post.

Nonparticipation in ICASS 

Services Indicates 

Potential Duplication
 

Page 8 GAO-12-317 Embassy Management

Table 1: Average Participation Rates by ICASS Service, 2005 and 2011

Participation rate Percent change between 

Service (in ascending order of 2011 participation rate) 2005 2011 2005 and 2011

Government-owned/long-term lease residential building operations 22.8% 21.7% -1.1%

Budgeting and financial plans 26.1 25.0 -1.1

Vehicle maintenance 27.2 25.7 -1.5

Reproduction services 28.1 28.0 -0.1

Short-term lease nonresidential building operations 40.0 32.2 -7.8

Human resources: U.S. citizen services 46.4 35.6 -10.8

Accounts and records 43.5 39.9 -3.6

Motor pool services 37.5 45.1 7.6

Pouching services 49.2 50.2 1.0

Administrative supply 61.0 56.5 -4.6

Furniture, furnishings, and appliance pools 43.7 57.5 13.8

Short-term lease residential building operations 57.7 63.4 5.7

Payroll 63.2 65.2 2.0

Shipping and customs 67.6 66.2 -1.4

Leasing services 62.5 67.9 5.4

Government-owned/long-term lease nonresidential building operations 61.1 68.0 6.9

Nonexpendable property management 52.8 70.6 17.8

Human resources: locally employed staff 67.1 70.6 3.5 

Travel services 69.1 70.7 1.5

Reception, switchboard, and telephone services 70.6 71.3 0.6

Nonresidential local guard program services 67.1 72.2 5.2

Procurement services 70.3 75.4 5.1

Information management technical support 60.9 77.6 16.7

Cashiering 80.3 81.4 1.1

Health services 80.9 83.4 2.5

Human resources services 86.2 b 85.4 -0.8

Mail and messenger services 87.7 87.0 -0.7

Vouchering 88.0 87.6 -0.4

Information management services 92.1 b 92.8 0.7

Security services 89.9 93.1 3.2

Financial management services 91.5 b 94.0 2.5

General services 91.1 b 96.2 5.1

Source: GAO analysis of ICASS data.
 

Page 9 GAO-12-317 Embassy Management

a

Basic package services—which includes several services that can only be obtained by the embassy, 

such as securing diplomatic credentials from the host country—and community liaison office services 

are generally mandatory. Participation rates are not 100 percent for these services because an 

agency may have only local staff at a given post, and these staff are not required to participate in 

these two services. In such cases, agencies may receive some services from ICASS, but not basic 

package or community liaison office services.

b

Information management services, general services, financial management services, and human 

resources services are service bundles used at posts operating under the streamlined ICASS “Lite” 

methodology. These service bundles incorporate several services that are provided separately at 

standard ICASS posts.

In some instances, nonparticipation may indicate that a service is not 

offered to all agencies at a post or that an agency does not need a 

particular service. For example, some agencies do not participate in 

government-owned/long-term lease residential building operations 

because they house their staff only in residences with short-term leases.

In such instances, nonparticipation does not necessarily indicate 

duplication of services.

Although ICASS participation rates vary widely by agency, with the 

exception of USAID, individual agency rates have remained relatively 

constant since 2005.11 Of the 46 non-State agencies that were present at 

10 or more posts in both 2005 and 2011, 17 experienced increases in 

participation rates of 5 percentage points or less, while 13 saw 

participation increase by 10 or more points.12

 

11In order to calculate participation rate by agencies, we counted the total number of 

services a particular agency participates in and the total number of services provided at 

the posts where that agency has a presence. The ratio of the two numbers is the 

participation rate by agency. See appendix I for detailed discussion of the methodology.

An additional 11 agencies 

reduced their participation in ICASS during this period. USAID has 

experienced a marked increase in participation since it began 

consolidating its administrative operations with State, from 51 percent in 

2005 to 68 percent in 2011 (see app. III for detailed discussion of USAID 

12Individual agencies may have multiple sub-agency codes for ICASS billing purposes, 

and participation rates generally vary by subagency code, even within the same agency. 

In some cases, these subagency codes correspond to a discrete unit within an agency, 

such as the Defense Intelligence Agency. In others, the codes correspond to accounting 

entities, such as USAID’s Operating Expenses account. In 2011, there were 320 such 

subagency codes in ICASS. DOD had the most codes (152) while the other agencies 

within the scope of our review had between 9 and 56 codes. As a result, it is not feasible 

or meaningful to calculate an overall agencywide participation rate, and the figures we 

present here are at the subagency code level.
 

Page 10 GAO-12-317 Embassy Management

and State consolidation).13 However, other agencies have not significantly 

increased their rates of participation over this period. Table 2 shows 

ICASS participation rates in 2005 and 2011 for selected components of 

the agencies within the scope of our review with a large overseas 

presence.14

Table 2: Rate of Participation in Available Voluntary Services, by Selected Subagency Code, 2005 and 2011 

Participation rate

Agency name (in ascending order of 2011 participation rate) 2005 2011

Percent change between 

2005 and 2011

HHS, Centers for Disease Control and Prevention 54% 66% 12%

USDA, Foreign Agriculture Service 66 64 -2 

Justice, Federal Bureau of Investigation/Legal Attaché 65 67 2 

USAID (Operating Expenses) 51 68 17

Commerce, Foreign Commercial Service 68 71 3 

DHS, Immigration and Customs Enforcement 65 70 5 

DOD, Defense Intelligence Agency 82 81 -1 

Source: GAO analysis of State data.

Note: This table shows one subagency code for each of the non-State agencies within the scope of 

our review. We chose to include the one code from each agency that was present at the most number 

of posts.

To the extent that agencies do not participate in ICASS services and 

provide these services themselves, they are creating potentially duplicative 

administrative systems that may not be cost effective for the U.S. 

government as a whole. We observed such potential duplication during our 

visits to four overseas missions. For example, at each post we visited, we 

found that instead of participating in the ICASS-managed motor pool, 

several agencies operated or maintained their vehicles independently. 

Even some units within State do not fully participate in ICASS motor pool 

services; for example, State’s Bureau of International Narcotics and Law 

Enforcement participated in the ICASS motor pool in about 37 percent of 

 

13These figures reflect USAID’s largest ICASS subagency code: Operating Expenses. 

Other USAID codes have also seen an increase in ICASS participation since 2005, 

including USAID’s Development Assistance code, whose participation rate increased from 

37 percent to 56 percent between 2005 and 2011.

14USDA, Commerce, DOD, HHS, DHS, Justice, and USAID. See appendix IV for 

participation rates for all agency components with a presence at 10 or more posts in 2011.
 

Page 11 GAO-12-317 Embassy Management

the posts where it was present in 2011. In addition, many agencies 

procured their own appliances or shipped their own furniture, declining to 

participate in ICASS furniture and appliance pools, where ICASS staff 

would manage these pools collectively. In Manila, the financial 

management officer noted that agencies’ opting out of these pools not only 

reduced the opportunity to lower the U.S. government’s overall 

procurement costs through larger bulk ICASS purchases, it also entailed 

other hidden costs, including increased labor and wear and tear on 

property. According to this officer, over a 6-month period in 2010, ICASS 

service providers had to remove and reinstall furniture at embassymanaged residences 67 times as a result of agency officials being replaced 

in a home by officials from a different agency. Such additional work would 

not have been necessary if all agencies participated in one furniture and 

appliance pool. Additionally, in Nairobi, where virtually all agencies were 

colocated at the U.S. embassy compound, we observed separate, similarly 

equipped photocopy rooms—one for USAID staff and one for other ICASS 

customers—located on the same hallway.

While agencies may have valid justifications for not participating in ICASS 

services, they generally do not document their rationales or formally 

share them with ICASS service providers or other customer agencies. In 

2004, we recommended that the ICASS Executive Board encourage 

agencies not participating in ICASS services to submit detailed 

explanations—or business cases—of how they would fulfill these service 

needs and at what cost. However, ICASS officials told us that ICASS 

Executive Board representatives from customer agencies lack the 

incentive to direct their agencies to participate in ICASS services or justify 

their decisions not to participate. Further, neither State nor ICASS 

systematically requests such analyses or documents the reasons why 

agencies choose not to participate in an ICASS service.

Agencies decide to opt out of ICASS services based on a variety of 

factors. In response to our survey, agency representatives cited cost most 

frequently as a factor in their decision not to participate in ICASS.15

 

15Of the 269 cases where agency representatives indicated that their agency did not 

subscribe to a given service, the cost to the respondent’s agency was cited 44 times and 

the quality of the service provided was cited 34 times. In 25 instances, respondents 

indicated that their agency’s mission requirements could not be met within ICASS. 

Respondents cited other factors less frequently, such as headquarters guidance about 

participating in ICASS.

Some 

Rationale for Agency 

Decisions to Opt Out of 

ICASS Are Not WellDocumented, though Cost 

and Quality Concerns Are 

Key Factors

Agencies Cite Cost as a Reason 

Not to Participate in ICASS
 

Page 12 GAO-12-317 Embassy Management

agency representatives who obtain a specific service outside of ICASS 

indicated that they thought that doing so was less expensive than 

obtaining this service through ICASS. For example, 34 of 68 

representatives whose agency did not participate in the ICASS furniture 

and appliance pool at their post indicated that they thought obtaining this 

service through ICASS was more expensive than obtaining it outside of 

ICASS; 21 of 44 representatives said the same about motor pool 

services. However, in nearly half of the total responses to this question, 

respondents indicated that they had no basis to judge the relative costs of 

ICASS and non-ICASS services or did not respond to our question on this 

issue (see table 3).16

Table 3: Number of Respondents Indicating That They Think the Cost of Obtaining Services Within ICASS is More Expensive, 

About the Same, or Less Expensive Than Obtain Services Outside of ICASS

Service

ICASS services 

are more 

expensive

Cost of ICASS 

services is about 

the same

ICASS services 

are less 

expensive

No basis to 

judge or no 

response

Total number 

of responses

Furniture, furnishings, and appliance 

pools

34 4 5 25 68

Motor pool services 21 5 1 17 44

Shipment and customs 0 0 0 3 3 

Government-owned/long-term lease 

residential building operations

1 1 0 8 10

Vouchering services 7 0 3 10 20

Leasing services 3 0 0 11 14

Information management technical 

support

10 0 2 4 16

Procurement services 5 0 3 5 13

Human resources: locally employed 

staff

3 0 1 12 16

Total 84 10 15 95 204

Source: GAO.

Separately, we asked survey respondents whether their agency had 

compared the cost of obtaining services within ICASS to the costs of 

services outside of ICASS. Responses to this question show that some 

 

16Although respondents indicated that their agency did not participate in an ICASS service 

a total 269 times, the number of responses to specific follow-up questions varied, as some 

respondents did not choose to answer all questions. 
 

Page 13 GAO-12-317 Embassy Management

agencies have chosen to obtain services outside of ICASS without 

conducting any cost analysis. Respondents indicated that their agency had 

compared ICASS and non-ICASS costs of services in only 62 of 205 cases 

where the agency did not participate in ICASS services (see table 4).

Table 4: Number of Respondents Indicating That Their Agency Obtains Services Outside of ICASS and Has or Has Not 

Compared the Cost of Services within and outside of ICASS

Service

Agency has compared 

ICASS and 

non-ICASS costs

Agency has not

compared ICASS and 

non-ICASS costs

Don’t know or 

no response

Total number of 

responses

Furniture, furnishings, and appliance 

pools

31 4 33 68

Motor pool services 17 8 20 45

Shipment and customs 0 0 3 3

Government-owned/long-term lease 

residential building operations

1 0 9 10

Vouchering services 3 8 9 20

Leasing services 1 1 12 14

Information management technical 

support

5 5 6 16

Procurement services 3 5 5 13

Human resources: locally employed staff 1 4 11 16

Total 62 35 108 205

Source: GAO.

Even in cases where respondents cited cost as a significant factor in their 

agency’s decision not to participate in ICASS, respondents indicated that 

their agency had frequently not compared the costs of ICASS and nonICASS services. In 41 such cases, respondents indicated that their 

agency had compared costs in 24 cases.

In some cases, agency officials indicated that they were able to obtain 

some services from their headquarters more efficiently or effectively than 

through ICASS. For example, a Foreign Agricultural Service (FAS) official 

told us that FAS had begun to obtain certain financial services from the 

USDA Minneapolis Finance Center rather than from ICASS providers at 

individual posts, since USDA is part of the National Finance Center and 

already provides these services to several other agencies (including 

GAO). FAS has estimated that shifting this workload out of ICASS has 

saved FAS more than $500,000 per year. Also, Commerce, DOD, and 

DHS officials indicated that they generally do not participate in ICASS 

human resource services for American staff because their staff in 
 

Page 14 GAO-12-317 Embassy Management

Washington, D.C., are more familiar with agency personnel policies than

ICASS service providers overseas and thus can provide more efficient 

service to their respective officials. Additionally, according to a Customs 

and Border Protection official in Washington, D.C., the agency is a strong 

advocate for centralizing some services at the Customs and Border 

Protection headquarters in Washington, D.C., because its administrative 

staff are better positioned than ICASS service providers at post to provide 

agency-specific services such as information technology, human 

resources, and budgeting.

Agency officials also told us that in some cases they would be unable to 

fulfill their agency’s mission if they relied on ICASS services. Several 

officials cited their unique transportation needs in explaining their decision 

not to participate in the ICASS motor pool. For example, in Manila, DHS 

officials said they needed to maintain their own vehicles to have 

immediate, 24 hours-a-day access for them to conduct investigations.

Several USAID and USDA officials also noted that their missions require 

them to take extended trips to the field that the ICASS motor pool is 

sometimes not able to accommodate. Our survey found that 11 of 56 

respondents who indicated that they did not participate in ICASS motor 

pool services said that their agencies’ mission requirements for motor 

pool could not be met within ICASS.

Our analysis of ICASS costs and observations overseas, along with State 

and USAID attempts to quantify the effects of consolidation, demonstrate 

that consolidating administrative services has led to cost savings for the 

U.S. government. However, because of the limited amount of cost data 

available, quantifying the cost savings due to consolidation has been 

difficult.

State and others have maintained that greater participation in ICASS 

reduces the U.S. government’s overall cost of posting staff overseas, due 

to economies of scale. In 2010, a joint State-USAID review of support 

services overseas found that consolidation of these services had resulted 

in economies of scale at 20 posts. In 2011, when many posts were 

considering establishing furniture pools, the ICASS Service Center noted 

that when agencies do not participate in these pools, efficiencies of scale 

are not achieved and service providers’ workload increases due to 

separate warehousing, inventory, and ordering for different agencies.

Commenting on our 2004 report, State noted that the option for customer 

agencies to withdraw from ICASS services has limited ICASS’s ability to 

realize the potential benefits of economies of scale.

Consolidation of Services 

Leads to Cost Savings from 

Economies of Scale, but 

Quantifying These Savings 

Is Difficult

Economies of Scale within 

ICASS
 

Page 15 GAO-12-317 Embassy Management

Our analysis of ICASS cost and workload data confirms that State and 

other agencies participating in ICASS have realized savings through 

economies of scale. As ICASS workloads increased—for example, 

through increased participation in ICASS services or growth in staff 

posted overseas—costs per unit of output have generally decreased even 

as total ICASS costs have increased over the last ten years. We analyzed 

workload data from 2000 through 2011 for 28 services within ICASS.17 In 

all 28 cases, we found that costs per unit decreased, on average, as 

workload increased, suggesting that as more agencies participate in 

ICASS services and the amount of services received through ICASS 

increases, service provision becomes more efficient. Overall, for every 10 

percent increase in ICASS workloads, unit costs decrease by 5 percent 

on average (see table 5). For example, if a post offers reproduction 

services through ICASS and one agency provides this service for itself, 

this agency incurs its own personnel, material, and rent costs outside of 

ICASS. If that agency then decides to join ICASS, it starts to share 

personnel and rent costs. Hypothetically, if the workload for ICASS 

reproduction services increases by 10 percent, our analysis suggests that 

the cost per copy for ICASS customers would decrease by about 6 

percent, resulting in cost savings to all existing ICASS customers. Unless 

non-ICASS costs of reproduction services to the agency that had 

previously self-provided this service were significantly lower than costs to 

existing ICASS customers, this agency’s decision to join ICASS would 

likely result in overall cost savings to the U.S. government.

 

17We analyzed data for all ICASS standard services, excluding the two generally 

mandatory services—basic package and community liaison office services—and 

miscellaneous services, for which workload is not well defined. See appendix I for a 

detailed discussion of our methodology.
 

Page 16 GAO-12-317 Embassy Management

Table 5: Estimated Change in ICASS Unit Costs with 10 Percent Increase in 

Workload 

Service

Percent change in per 

unit cost of service 

Budgeting and financial plans -9.2

Nonexpendable property management -9.1

Furniture, furnishings, and appliance pools -8.4

Pouch services -7.0

Travel services -6.2

Reproduction services -6.2

Shipment and customs -6.1

Administrative supply -5.6

Procurement services -5.6

Motor pool services -4.8

Nonresidential local guard program services -4.7

Accounts and records -4.4

Payroll -4.2

Short-term lease residential building operations -4.1

Government-owned/long-term lease nonresidential building 

operations

-3.8

Cashiering -3.2

Vouchering -3.2

Security services -3.4

Information management technical support -3.0

Leasing services -3.0

Human resources: locally employed staff -2.9

Government-owned/long-term lease residential building 

operations

-2.6

Human resources: U.S. citizen services -2.3

Mail and messenger services -1.5

Health services -1.5

Vehicle maintenance -1.3

Reception, switchboard, and telephone services -1.2

Short-term lease nonresidential building operations -0.7

Average of all services -5.1

Source: GAO analysis of ICASS data.
 

Page 17 GAO-12-317 Embassy Management

Individual posts have reported numerous efforts to consolidate 

administrative operations that resulted in efficiencies. The following are 

examples of some of these efforts.

• Kenya. During our fieldwork in Nairobi, we visited State and USAID’s 

combined warehouses, which were consolidated in 2009. Prior to 

consolidation, State managed 12 units of the warehouse compound 

and USAID managed 6, and each agency had its own manager and 

inventory system, according to the embassy’s general services officer. 

Now, all 18 units are managed under ICASS, and the former USAID 

warehouse manager is the ICASS manager’s deputy. As a result of 

consolidation, this official said the embassy has reduced the number 

of local staff at the warehouse from 66 to approximately 50, and there 

is more space in the warehouse compound. Overall, according to the 

management counselor, the embassy has reduced the number of 

U.S. direct hire employees by 2 and local staff by 22 as a result of 

consolidation. Embassy Nairobi’s Mission Strategic Plan for fiscal year 

2010 noted that these efforts have resulted in an overseas 

administrative platform that is leaner, more flexible, and more 

responsive to the needs of both agencies as well as to the needs of all 

ICASS customers.

• Germany. In 2011, State’s Inspector General reported that the Berlin 

and Frankfurt financial management offices were finalizing their 

consolidation into a single operation, centralized at the embassy. 

Under this restructuring, the Frankfurt financial office would reduce its 

number of local staff from 18 to 6, while Berlin would increase its 

staffing by 3. According to the Inspector General, the mission expects 

these efforts to save an estimated $700,000 annually.

• Cambodia. In 2006, we reported that the embassy in Phnom Penh 

had successfully merged four services and realized efficiency gains, 

and that State and USAID officials described Phnom Penh as the 

model project of consolidation.18

 

18

Prior to consolidation, USAID and 

State motor pool drivers occupied two separate offices, but these 

were joined under ICASS, making better use of existing space and 

decreasing utility costs. Further, the consolidation of maintenance 

services allowed USAID in Phnom Penh to terminate its maintenance 

shop lease, which led to savings in utilities and rent expenses. Finally, 

GAO-06-829. 

Examples of Consolidation at 

Specific Posts 
 

Page 18 GAO-12-317 Embassy Management

by consolidating warehouse operations, the post reported that it had 

realized gains in delivery times and a 40 percent decrease in the 

amount of space used.

While our analysis shows that costs to existing ICASS customers will 

likely decrease as more customers join ICASS and workloads increase, 

we were unable to calculate the savings to the U.S. government as a 

whole resulting from increased participation in ICASS. Specifically, we 

were unable to calculate the cost implications for new agencies joining 

ICASS services because cost data on services outside of ICASS are 

generally not comparable with ICASS cost data. Moreover, as we have 

noted, agencies have generally not conducted such analyses.

State and USAID attempts to quantify cost savings have also been 

complicated by the lack of comparable data. A 2008 review of 

consolidation efforts to date estimated that the U.S. government had 

saved millions of dollars per year by reducing staff and eliminating 

warehouses. However, the review concluded that an exhaustive 

quantification of cost savings resulting from consolidation may not be 

possible, noting that a comprehensive study of all costs and savings 

would be prohibitively expensive to conduct. This review also noted that 

while its estimate represents a savings to the government as a whole, the 

impact on individual agencies would likely vary.

In 2010, the Task Force 11 report also attempted to quantify such cost 

savings by comparing costs before and after consolidation at 27 posts.

Overall, the report found that per capita costs related to consolidation for 

both ICASS and USAID decreased at most posts following 

consolidation.19

 

19In aggregate, after adjusting for several factors, the study concluded that per capita 

costs decreased by 1.7 percent at these posts. However, at some of these posts, per 

capita costs increased for a variety of reasons, which the report did not fully explain.

However, the report also determined that baseline data 

on non-ICASS administrative costs prior to consolidation were not 

available for USAID at 7 posts, which had to be excluded from the 

analysis. For the remaining 20 posts, the authors of the Task Force 11 

report also had to make several adjustments to the preconsolidation data 

in order to develop comparable data sets. According to State and USAID 

staff who conducted this analysis, their efforts were complicated by the 

lack of any USAID database that tracks and segregates the costs of 

administrative services that USAID incurs at missions worldwide from 

Quantifying Actual Cost 

Savings Is Difficult Due to 

Limited Data on Non-ICASS 

Services 
 

Page 19 GAO-12-317 Embassy Management

other operational expenses. As a result, they said, it was very difficult to 

compare the cost of administrative services previously provided by 

USAID to the cost of services provided by ICASS after consolidation.

One of ICASS’s primary goals is to contain or reduce administrative 

costs. Yet State, as the primary ICASS service provider, has made little 

progress in containing costs by reducing the need for American 

administrative staff overseas. Nor has State sought to maximize the costeffectiveness of ICASS services by ensuring that the most appropriate 

agency deliver these services at all posts.

In 2004, we recommended that, in addition to pursuing the elimination of 

duplicative administrative support structures, the ICASS Executive Board 

seek to contain ICASS cost by reengineering administrative processes 

and employing innovative managerial approaches through competitive 

sourcing, regionalization of services, improved technology, and adoption 

of other best practices developed by agencies and other posts.20

State has implemented a wide variety of smaller scale innovations that 

have increased efficiency of ICASS service delivery and reduced costs. 

These initiatives include improvements in management information 

collection and analysis, standardization of posts’ business processes, and 

We 

further noted that State had undertaken several initiatives to increase the 

efficiency of ICASS services, primarily by reducing the need for 

administrative staff overseas. However, according to ICASS management 

officials, State has discontinued these efforts without demonstrating 

significant progress in containing costs. For example, State did not fully 

implement a pilot effort to streamline services by requiring ICASS service 

providers and ICASS councils to rationalize administrative staffing levels. 

Moreover, State did not execute its plans to relocate some administrative

support activities from overseas to the Florida Regional Center in Fort 

Lauderdale, which State estimated would save ICASS customers up to 

$140 million over 5 years. According to State and ICASS management 

officials, State discontinued these efforts because it determined that the 

potential cost savings did not outweigh the administrative burden of fully 

implementing them. Furthermore, they indicated that State has not 

undertaken any other streamlining efforts of comparable scope. 

 

20GAO-04-511. 

State Has Made Limited 

Progress on Other Cost 

Containment Efforts

Innovation and Reengineering 

of Service Delivery Has Been 

Limited
 

Page 20 GAO-12-317 Embassy Management

measurement of performance and customer satisfaction. State has also 

realized efficiencies through reengineering and reorganization of some of 

its business processes. For example State established a “post support 

unit” to provide vouchering services to more than 90 posts worldwide from 

three central locations. State also implemented a program that allows 

staff to initiate and process procurements from alternate locations, which 

State indicates has been especially helpful for high danger posts, such as 

Iraq. Also, in 2011, State implemented a global network energy 

management program, which has reportedly reduced energy costs by 

almost $900,000 in its first 10 months. Other than this initiative, State has 

not identified the specific cost impacts of these innovations. State 

anticipates future cost savings from innovative approaches it has 

undertaken in procurement of air freight pouch and mail services and 

information technology equipment.

Officials from nearly every agency we met with expressed concern about 

State’s failure to contain the cost of the ICASS services it provides. In 

particular, agency officials in Washington, D.C., and at the overseas posts 

we visited commonly complained that State employed too many American 

staff overseas to provide administrative services instead of relying on 

much less expensive locally employed staff or outsourcing to local firms.21

 

21In 2004, we found that the per capita labor cost of an American direct hire staff was 

almost eight times higher than that of a local hire.

Officials from State’s Office of Management Policy, Rightsizing, and 

Innovation indicated that significant ICASS cost savings were elusive 

unless State reduces the number of management-related American staff 

overseas. Yet, according to State, many posts have noted that security 

concerns have been a barrier to having local staff perform functions 

normally performed by Americans, and State has acknowledged that 

empowering local staff remains a challenge. In contrast, USAID officials 

pointed to numerous instances in which locally employed USAID staff 

have effectively provided administrative services, such as local 

procurement and real property leasing. Similarly, DOD officials in Manila 

asserted that local repair shops could provide car maintenance services 

at a lower cost than the State-run ICASS shop. However, because State 

is generally the only ICASS service provider, the interagency ICASS 

Executive Board has limited power to determine the numbers of ICASS 

service provider staff overseas.
 

Page 21 GAO-12-317 Embassy Management

Although State management counselors and the interagency ICASS 

councils at individual posts are empowered to undertake cost 

containment efforts, State and ICASS management officials indicated that 

the councils have generally failed to do so. We found that ICASS service 

providers at individual posts have implemented a variety of small scale 

efforts to contain costs, but these efforts have not resulted in significant 

savings. According to a DHS official responsible for managing the 

overseas costs of his agency, posts’ cost reduction plans have been 

largely limited to superficial efforts, which are unlikely to provide 

significant savings, such as installing energy efficient light bulbs. We 

found that in some cases State has limited local ICASS councils’ ability to 

undertake more significant cost-saving initiatives. Moreover, we found 

instances where State has reversed ICASS councils’ cost containment 

decisions. In Nairobi, after the council had approved a modest increase in 

local administrative staff salaries, the ambassador overruled this decision 

and directly promised all local staff a significantly larger pay increase 

without consulting the ICASS council. Management officials in Tokyo told 

us that prior to the transition to a new travel system, the embassy had 

vouchers processed in Bangkok, where the cost of this service was much 

lower. However, after the implementation of the new system, voucher 

processing shifted back to Tokyo, increasing the cost of this service.

Finally, a senior State management official told us that ICASS councils 

and management officers are frequently dissuaded from outsourcing 

administrative operations by State regional security officers, who object 

due to security concerns.

Although State provides virtually all ICASS services, in some cases, an 

agency other than State may be able to provide one or more of these 

services through ICASS to agencies more cost effectively at a given post.

In several instances of duplication we observed, USAID appeared to have 

more expertise in providing a particular service than the existing State 

ICASS provider, potentially making USAID a reasonable alternate ICASS 

provider. For example, in Nairobi, USAID operates a copy center for its 

own staff inside the embassy compound, offering more specialized 

services, including digitization, than the ICASS copy center provides. In 

addition, staff in several focus groups we convened overseas indicated 

that drivers in USAID motor pools traditionally have valuable 

communications and navigation skills that State’s ICASS drivers do not 

always possess, making USAID drivers particularly useful for trips outside 

the capital city. In Kigali, the management counselor noted that USAID 

human resources staff had experience in a broader range of employment 

contracts than their State ICASS counterparts and could potentially 

provide its services to both agencies.

Restricted Use of Alternate 

ICASS Service Providers Limits 

Opportunities for Greater 

Efficiencies 
 

Page 22 GAO-12-317 Embassy Management

State’s Foreign Affairs Handbook recognizes that an agency other than 

State may be better positioned to be the principal provider of specific 

services for themselves and other agencies at a given post. It allows for 

the use of these alternate service providers in cases where an agency 

has a sufficiently large administrative support capability at a location and 

agrees to provide services to other agencies at that post. However, in 

2006, State and USAID, in the interest of simplifying and expediting the 

consolidation of their administrative operations overseas, adopted a 

policy effectively restricting the establishment of new alternate ICASS 

service providers. This policy applied to posts where State and USAID 

would colocate between fiscal years 2007 and 2010. As a result, in 2012, 

only seven posts had such a provider for one or more ICASS service, 

potentially limiting opportunities for ICASS to achieve greater efficiency 

and effectiveness. In 2010, Task Force 11, a joint State-USAID group 

supporting the development of the Quadrennial Diplomacy and 

Development Review,22 recommended that posts consider the use of 

alternate service providers in order to reduce costs. Task Force 11 also 

proposed that State and USAID establish a Joint Management Board and 

formulate a consolidation policy that considers the use of alternate 

providers. However, the Joint Management Board, created in August 

2011, has not yet established such a policy.

Results from the annual ICASS survey, and our own survey of U.S. 

government agency representatives overseas, show that survey 

respondents are generally satisfied with the quality of ICASS services. 

Furthermore, officials in focus groups we conducted at four posts 

generally felt that ICASS provided quality administrative services. 

Nonetheless, some dissatisfaction with ICASS performance still exists, 

especially among USAID staff, and in some cases, ICASS performance 

problems could affect some agencies’ ability to achieve their respective 

missions efficiently and effectively. State has begun implementing tools 

that improve managers’ ability to monitor and evaluate performance and 

customer satisfaction; however, the standards do not measure 

performance for some aspects of services that agencies have reported 

are particularly problematic.

 

22Department of State and the U.S. Agency for International Development, Leading 

Through Civilian Power: The First Quadrennial Diplomacy and Development Review

(Washington, D.C.: Dec. 15, 2010).

ICASS Customers 

Generally Satisfied, 

and Management Has 

New Tools to Monitor 

Quality in Some Areas
 

Page 23 GAO-12-317 Embassy Management

Results from the annual ICASS survey, and our survey of ICASS service 

recipients, show that respondents are generally satisfied with overall 

ICASS services, although results varied for some agencies and services. 

While some dissatisfaction exists among some customer agencies, 

officials we interviewed at four posts were generally satisfied with ICASS 

services. 

The ICASS Service Center uses its annual ICASS Customer Satisfaction 

Survey to gauge overall satisfaction with each administrative service 

provided at a post. In 2011, the ICASS Service Center reported a 67 

percent response rate to the survey, with nearly 47,000 responses from 

234 posts worldwide. Service recipients, which include American and 

local staff, dependents of American personnel overseas, and ICASS 

service providers, access the survey through the Internet to evaluate 

ICASS services they received over the past year. Although we found 

limitations with the methodology of this survey, customers have generally 

reported overall satisfaction with ICASS services since the ICASS Service 

Center began conducting this survey in 2005.23

 

23In reviewing the survey results, we found that the response rate for several posts 

exceeded 100 percent. ICASS officials indicated that they use human resources 

population-at-post data to determine the total number of eligible survey respondents when 

calculating the response rate. Eligible respondents are notified through flyers, 

newsletters, and e-mails to complete the web-based survey anonymously. Because the 

survey administration was anonymous, it is difficult to determine potential bias in the 

results. Therefore, the results may only reflect the views of the respondents and not all 

service recipients. 

On a scale from 1 to 5, a 

score of 2 or lower indicates a customer’s dissatisfaction with a service 

and a score of 4 or higher indicates satisfaction. (A score of 3 is labeled 

as “neutral.”) The average score for overall satisfaction from all survey 

respondents ranged from 3.95 in 2005 to 4.03 in 2011 (see fig. 2).

Surveys of Service 

Recipients Show Overall 

Satisfaction with ICASS

ICASS Survey Shows Overall 

Satisfaction
 

Page 24 GAO-12-317 Embassy Management

Figure 2: ICASS Customer Satisfaction Scores on a Scale from 1 to 5 for Selected 

Agencies, 2005 through 2011

Note: Respondents were asked to rate the extent to which they agreed or disagreed with the 

statement, “Overall, I am satisfied with this service,” with 1 = strongly disagree; 2 = disagree; 3 = 

neutral; 4 = agree; 5 = strongly agree. Data for “all agencies” include responses from ICASS service 

providers.

a

“All agencies” include responses from all ICASS customers.

b

“State” includes responses from ICASS service providers, who are almost always State employees.

c

“Other agencies” include responses from USDA, Commerce, DOD, HHS, DHS, and Justice.

Though results of the ICASS annual survey have consistently indicated 

that service recipients who have responded to the survey are generally 

satisfied, the survey data also indicate that responses from agencies 

other than State consistently express lower levels of overall satisfaction, 

as shown in figure 2. In addition, the most recent survey data show that 

responses to overall satisfaction with ICASS services vary by agency and 

service. For example, in 2011, State respondents expressed somewhat 

higher satisfaction with ICASS than did USAID and other agency 

respondents (see table 6). Also, 21 services received satisfaction scores 

above 4, including the 2 highest-ranked services: cashiering and 
 

Page 25 GAO-12-317 Embassy Management

information management technical support (each with a score of 4.24).

Only one service—leasing—received a score below 3.85.

Table 6: Average Customer Satisfaction Scores on a Scale from 1 to 5 by Agency 

for 2011

Agency Overall satisfaction score Number of respondents 

ICASS service providers 4.25 a 13,628

State 4.00 23,424

HHS 3.94 911

Commerce 3.88 566

USDA 3.87 393

DOD 3.87 2,435

Justice 3.81 663

DHS 3.70 539

USAID 3.64 3,163

Source: ICASS Service Center.

Note: Respondents were asked to evaluate overall ICASS services by indicating whether they agreed 

or disagreed with the statement, “Overall, I am satisfied with this service,” with 1 = strongly disagree; 

2 = disagree; 3 = neutral; 4 = agree; 5 = strongly agree.

a

The annual ICASS survey reports responses from ICASS service providers separately. In almost all 

cases, these service providers are State employees.

We surveyed ICASS Council representatives from the eight largest 

ICASS customer agencies regarding the quality of ICASS services.24

Nearly 80 percent of all responses indicated that the quality of services 

received through ICASS was “good” or better (see fig. 3). Only about 6 

percent of responses indicated that the quality was “poor”.25

 

24These agencies were State, DOD, USAID, Commerce, USDA, Justice, DHS, and HHS. 

We also included USAID executive officers in our survey. We chose these respondents 

because we determined that they had sufficient knowledge to answer questions regarding 

the cost and quality of administrative services at their posts.

For example, 

133 of 152 respondents (88 percent) who receive information technology 

services through ICASS indicated that the quality of this service was 

“good” or better. Similarly, 141 of 163 respondents (87 percent) rated 

shipping and customs services “good” or better.

25In our survey, 184 respondents rated the quality of up to nine services, providing 1,292 

total responses to the question regarding quality. Of the total responses for all services, 

1,008 responses indicated that quality was “good” or better, while 82 responses indicated 

the quality was “poor.” 

Our Survey Results Also Show 

Overall Satisfaction with ICASS 

Services Among the Largest 

Agencies 
 

Page 26 GAO-12-317 Embassy Management

Figure 3: Customer Perceptions on the Quality of Selected ICASS Services, 2011

Note: Our survey asked respondents to rate the quality of each of the selected services in which they 

participated as either excellent, very good, good, fair, or poor. “Good” or better includes good, very 

good, and excellent responses.

While survey respondents indicated that they were generally satisfied with 

the nine services included in our survey, about 30 percent of responses 

rated their satisfaction as “fair” or “poor” for three of the nine services. For 

example, 42 of 150 respondents (28 percent) who receive leasing services 

through ICASS indicated that the quality of this service was “fair” or “poor.” 

Similarly, 52 of 157 (33 percent) rated procurement “fair” or “poor.”

At the four posts we visited, ICASS customers were generally satisfied 

with the services they received. Participants in our focus groups were 

particularly satisfied with reception and telephone services, medical 

services, security services, and human resources services for local staff.

For example, officials in Tokyo said the embassy’s telephone operators 

Agency Officials We 

Interviewed at Four Posts Were 

Generally Satisfied with ICASS 

Services 
 

Page 27 GAO-12-317 Embassy Management

were very helpful, especially for staff who spoke little or no Japanese. 

State and USAID officials in Nairobi also found the embassy’s medical 

services helpful and noted that although customers must now schedule 

appointments ahead of time, medical unit staff can normally see the 

patient on the day of the request. On the other hand, some staff at posts 

we visited registered complaints about other services, including 

household maintenance and motor pool. However, senior USAID officials 

we interviewed noted that, despite some staff complaints, there had been 

few reductions in services that negatively impacted USAID officials’ ability 

to complete their mission at post.

Despite the general levels of satisfaction expressed in our survey and in 

the annual ICASS Customer Satisfaction Survey, some dissatisfaction still 

exists, potentially limiting agencies’ participation in ICASS. Furthermore, 

in some cases, agency officials indicated that poor delivery of 

administrative service could impact the ability of agencies to achieve their 

missions overseas efficiently and effectively. In particular, we found that 

USAID personnel have concerns about the ability of ICASS to meet their 

unique requirements; some ICASS customers perceive that their 

agencies’ service requests receive lower priority than other agencies’ 

requests; and common errors in ICASS billing create inefficiencies and 

additional administrative burdens for customer agencies, according to 

some of the agency officials we interviewed.

USAID respondents have consistently rated ICASS services lower than 

other agencies in the annual ICASS survey. Some USAID staff we 

interviewed overseas expressed a concern that they have lost or would 

lose control over their administrative operations after consolidating with 

State, resulting in a lower level of responsiveness from administrative 

service providers than they were accustomed to. In addition, in 2010, the 

American Foreign Service Association (AFSA) conducted a survey to 

document the views of USAID officials about the ongoing consolidation of 

State and USAID administrative operations. According to AFSA, the 

results of this survey highlighted concerns about the morale of USAID 

staff overseas. Although we found that this survey has several 

Some Dissatisfaction with 

Administrative Services 

Persists

USAID Concerns
 

Page 28 GAO-12-317 Embassy Management

limitations,26 it highlights serious concerns that some USAID staff had 

about consolidating some support services. In particular, according to a 

2010 AFSA report on the results of this survey, USAID personnel have 

serious complaints about the quality of motor pool services, property 

maintenance, information technology, and the treatment and 

compensation of locally employed staff. In addition, research conducted 

by a joint State and USAID task force in 2010 found that consolidation 

had had a negative impact on 20 percent of USAID respondents and 3 

percent of State respondents surveyed.27

In 2004, we reported that some ICASS customers expressed the opinion 

that service provision was not always equitable and that State employees 

received preferential treatment in both the quality and priority of services 

provided; however, we further reported that we could find no evidence of 

systematic preferential treatment to support such claims. In our 2011 

survey, the majority of non-State respondents indicated that their 

agency’s requests were given the same priority as State’s requests for six 

of the nine services included in the questionnaire (see table 7). However, 

at least one-third of respondents thought that their agency’s requests 

received lower priority than State requests for five of the nine services. In 

addition, some respondents in our survey commented that ICASS service 

allocated better quality furniture to State than to other agencies.

 

26AFSA officials administered an anonymous Web-based survey to overseas USAID 

Foreign Service officers, U.S. personal service contractors, and Foreign Service nationals 

from March 15, 2010, to April 2, 2010, and received 1,073 responses. Because the survey 

administration was anonymous, it is difficult to determine any potential bias in the results. 

Therefore, the survey results may only reflect the views of the respondents and not those 

of all USAID personnel. In addition, questions in the survey may have biased the 

respondent to answer in a manner favorable to the organization conducting the survey. 

27Department of State and the U.S. Agency for International Development, Leading 

Through Civilian Power: The First Quadrennial Diplomacy and Development Review

(Washington, D.C.: Dec. 15, 2010), p. 203.

Equitable Treatment in Service 

Priority and Quality
 

Page 29 GAO-12-317 Embassy Management

Table 7: Responses from USAID and Other Agency Personnel as to Whether They Receive Higher or Lower Priority than State 

Personnel When Requesting ICASS Services.

Service 

Number of 

respondents 

indicating higher 

priority

Number of 

respondents 

indicating about 

the same 

Number of 

respondents 

indicating lower 

priority

No basis to 

judge or no 

response

Total 

responses 

Furniture pool 0 32 20 7 59

Motor pool 2 33 28 8 71

Shipping and customs 0 82 23 12 117

Government-owned/long-term 

lease and short-term lease 

residential building operations 

2 54 47 8 111

Vouchering services 0 68 18 12 98

Leasing services 2 47 37 15 101

Information management 

technical support services 

2 60 27 12 101

Procurement services 1 55 39 14 109

Human resources: locally 

employed staff services

1 70 22 12 105

Source: GAO survey.

Note: Our survey asked respondents to indicate whether their agency’s requests for ICASS services 

were given a higher or lower priority than State requests as much higher, somewhat higher, about the 

same, somewhat lower, or much lower than State.

AFSA’s report on the results of its 2010 survey indicate that “USAID 

employees feel ignored and upset at the treatment they have received 

from their State counterparts.” In particular, according to this report, when 

ICASS providers take over building, warehouse, and residence 

operations, USAID staff experience poorer maintenance service and 

smaller working spaces compared to State personnel.

Despite such perceptions, we found no concrete evidence that State 

received preferential treatment from ICASS service providers. In Nairobi, 

for example, the management officer said that USAID staff often 

complained that they had less access to the ICASS motor pool than State 

officials and therefore had to frequently travel to meetings by taxi. 

However, in response to comments in the annual survey, the 

management section analyzed the post’s taxi usage from 2007 through 

2010 and found that the perception that the motor pool assigned taxis to 

USAID staff more than to other embassy staff was incorrect.
 

Page 30 GAO-12-317 Embassy Management

Officials from several agencies we spoke with said that their annual 

ICASS invoices often contain numerous errors, which require a significant 

amount of effort to correct. For example, USDA conducted an analysis of 

its ICASS workload counts for fiscal year 2011 and found that 22 of the 

100 cases it reviewed contained discrepancies that required corrections. 

At one post we visited, the DOD ICASS Council representative said he 

and his staff were able to reduce DOD’s share of the post’s total ICASS 

expenses from 9.6 to 6.5 percent by identifying and correcting errors, 

such as being charged for space that they did not occupy. Commerce 

officials said they had identified an instance in which the ICASS service 

provider did not cancel a lease for an unoccupied building for many 

months, resulting in higher than necessary ICASS costs for all customer 

agencies at the post. In its 2010 report on ICASS, AFSA reported that 

USAID staff spend “an enormous amount of time in checking of vouchers 

and services due to an increase in inappropriate billings and mistakes.” 

Further, a DHS official said that a component agency identified an error in 

its ICASS bill at one post that had caused a 50 percent increase in its 

security charges. This official noted, however, that while identifying and 

correcting such errors saves his department money, it does not save 

money for the government as a whole because correcting the error 

merely redistributes the costs being shared by all the agencies served by 

ICASS at the post in question.

State has implemented management tools to identify and address 

performance and satisfaction issues in a timelier manner. In 2007, State 

launched the Collaborative Management Initiative, a process that 

included input from service providers in the field to draft standards and 

performance metrics for ICASS services that would apply to all posts. 

Prior to this initiative, service standards were inconsistent and varied by 

post. This effort resulted in the creation and implementation of uniform 

service standards and eServices—an online software program to request 

services and give service providers immediate feedback on the quality of 

each service rendered. In addition, the eServices program captures and 

reports to management performance-related metrics on the volume of 

services provided, and the extent to which service providers are meeting 

performance standards. However, these metrics do not address some 

concerns about service quality raised to us by customer agencies.

In 2008, State developed about 50 uniform service standards to provide 

consistent requirements among posts for fulfilling administrative service 

requests—such as the time required to complete a residential repair or 

provide transportation to a meeting. State began measuring each post’s 

Billing Errors

New Management Tools 

Measure Some Aspects of 

Quality of ICASS Services

Uniform Service Standards
 

Page 31 GAO-12-317 Embassy Management

performance against these standards in 2010. A 2008 review of StateUSAID consolidation to date stated that implementing these service 

standards would allow analysis of the most cost-effective means to 

provide administrative support services at the maximum possible quality 

levels.28

In fiscal year 2011, 64 percent of all ICASS services for which standards 

had been set met their specific service standard. According to State data, 

ICASS service providers received more than 1.5 million requests for 

these services worldwide in fiscal year 2011, more than 1 million of which 

were completed within the specified standard.

State officials commented that the implementation of these 

standards has focused attention on service delivery at posts and, as a 

result, improved service delivery.

29

 

28Joint Management Council, Consolidation After-Action Review: Best Practices and 

Lessons Learned from Tier 1 Posts (Washington, D.C.: Nov. 2008).

For example, post motor 

pools logged more than 600,000 requests for local trips in fiscal year 

2011, and ICASS service providers were able to fulfill nearly 74 percent of 

these requests within 4 hours. In addition, post motor pools logged more 

than 6,100 requests for nonlocal trips in fiscal year 2011, and ICASS 

service providers were able to fulfill about 69 percent of these requests 

within 5 business days. Table 8 lists selected services and their uniform 

service standard along with fiscal year 2011 performance data.

29Figures represent requests for the 49 services that State currently tracks through the 

Uniform Service Standards. Because State has identified more than 200 unique services 

that are provided through ICASS, these figures are a fraction of the total number of 

requests that ICASS service providers received in fiscal year 2011.
 

Page 32 GAO-12-317 Embassy Management

Table 8: Selected ICASS Services and Uniform Service Standards with the Percentage of Service Completions Meeting 

Standards, Fiscal Year 2011

Service category Specific Service Uniform service standard

Number of 

services 

completed

Percentage of 

service completions 

meeting standard

Motor pool services Local transportation by carand-driver (governmentowned or contract) or other 

cost-effective alternatives 

such as self-drives or taxis

Submit request for a vehicle 4 

business hours in advance for 

local trips.

631,473 73.8%

Motor pool services Non-local trips Submit request for a vehicle 5 

business days in advance for 

nonlocal trips.

6,135 68.7% 

Travel services Make transportation and 

hotel reservations

Make, change, or cancel 

transportation or hotel 

reservations and inform 

customer within 1 business day.

37,152 66.2

Reception and 

switchboard services

Issue visitor passes Visitor passes issued within 15 

minutes of arrival.

22,695 60.0 

Information 

management technical 

support services

Minor trouble shooting, 

maintenance, and routine 

tasks performed by the 

Information Technology staff

Respond to routine Help Desk 

support requests within 4 

business hours and achieve a 

customer satisfaction level of 

95% or better.

181,075 58.6

Residential building 

operations services

Minor repair and 

maintenance

Routine minor repairs and 

maintenance completed in 7 

business days. 

71,479 58.6

Source: State.

Note: Uniform service standards in this table are only a sample of the 195 service standards.

At the end of fiscal year 2010, 83 percent of overseas posts were using the 

service request software program, eServices, to generate customer 

feedback in order to improve support services. State began tracking 

customer feedback results in fiscal year 2010, and the scores have 

generally increased from fiscal year 2010 to 2011. The eServices feedback 

survey uses a scale of 1 to 5, with a score of 2 or lower indicating 

dissatisfaction and a score of 3 or higher indicating some level of 

satisfaction. For fiscal year 2011, 14 services received an average score of 

4 or higher, compared to 7 services in fiscal year 2010 (see table 9).

eServices Customer 

Feedback Results 
 

Page 33 GAO-12-317 Embassy Management

Table 9: eServices Point-of-Service Ratings, on a Scale from 1 to 5, by Service, 

Fiscal Years 2010 and 2011 

Average survey rating

Service (in descending order of 2011 survey rating) 2010 2011

Community Liaison Office Services 4.12 4.38

Information management technical services 4.04 4.24

Payrolling services 4.32 4.24

Shipping and customs 3.96 4.24

Nonexpendable property management 3.96 4.19

Travel services 4.00 4.18

Human resources: locally employed staff 3.99 4.16

Vouchering services 3.83 4.16

Motor pool services 3.88 4.15

Human resources: U.S. citizen services 4.18 4.12

Long-term lease nonresidential building operations 3.84 4.12

Basic package 4.04 4.09

Reception, switchboard, and telephone services 3.94 4.09

Health services 4.27 4.07

Administrative supply 3.74 3.99

Security services 3.66 3.91

Procurement services 3.70 3.90

Long-term lease residential building operations 3.70 3.87

Leasing services 3.89 3.82

Source: State.

Note: Respondents were asked to rate the level of their level of satisfaction with their last eServices 

transaction: 1 = very dissatisfied; 2 = dissatisfied; 3 = somewhat satisfied; 4 = satisfied; 5 = very 

satisfied.

The metrics that State is using to measure performance against 

standards do not address some concerns about service quality raised to 

us by customer agencies. Moreover, since State’s performance reporting 

to the missions does not disaggregate results by customer agency, it 

does not reflect the extent to which service delivery is equitable across 

agencies. Nor do State’s metrics gauge progress on reducing the 

incidents of ICASS billing errors.

Performance Metrics Do Not 

Address Some Aspects of 

ICASS Customer 

Dissatisfaction
 

Page 34 GAO-12-317 Embassy Management

In November 2011, we reported that obtaining customer input to meet 

customer needs is a key operating principle for effective management of 

cost-sharing systems, such as ICASS, used to conduct business-like 

activities within and between federal agencies.30

In responding to a draft of this report, both State and USAID indicated 

that more meaningful customer input is needed to establish appropriate 

performance standards and address areas of dissatisfaction. According to 

USAID, the process for developing the current standards resulted in the 

preeminence of service provider views over those of customers. State 

indicated that it needs greater input from customer agencies at posts 

about the services that they consider problematic so that concerns can be 

addressed. State also indicated that it is planning to implement new 

systems to capture more customer feedback and other performance data 

that will enable the department to recalibrate existing service standards 

and develop new ones.

State’s process for 

establishing uniform service standards is informed by input from ICASS 

service providers and customer agency officials in Washington, D.C.

However, it is not clear that these standards address common concerns 

of overseas ICASS customers. A State management counselor we spoke 

to in Nairobi indicated that achieving the uniform service standards does 

not necessarily constitute acceptable performance for many of their 

customers. This opinion was echoed by customer agency representatives 

in focus groups and interviews we conducted overseas. For example, 

USAID officials have cited the unavailability of ICASS motor pool vehicles 

for travel to distant project sites as a major impediment to achieving their 

mission. Although ICASS performance standards call for the motor pool 

to provide nonlocal transportation within 5 business days of receiving a 

request, USAID officials indicated that they often need vehicles more 

quickly than this to effectively monitor their projects. 

In the current budget environment, the obligation of agencies to review 

their operations to identify areas of duplication and overlap and to 

 

30GAO, Intragovernmental Revolving Funds: Commerce Departmental and Census 

Working Capital Funds Should Better Reflect Key Operating Principles, GAO-12-56

(Washington, D.C: Nov. 18, 2011). This report discusses key principles for effective 

management of Intragovernmental Revolving Funds, such as Working Capital Funds. The 

ICASS Working Capital Fund is a no-year fund that permits posts to retain a portion of 

their unobligated funds from one fiscal year to the next.

Conclusions 
 

Page 35 GAO-12-317 Embassy Management

consider areas for potential cost savings has become critically important.

In 2004, we recommended that the ICASS Executive Board pursue the 

elimination of duplicative administrative support structures with the goal of 

limiting each service to one provider at U.S. facilities overseas. While 

State and USAID have made notable progress in consolidating their 

administrative operations, overall participation in ICASS has not 

increased significantly, and agencies are likely missing opportunities to 

take advantage of clear economies of scale. The voluntary nature of 

ICASS has permitted the continuation of duplicative services, as agencies 

often make decisions about participating in ICASS based on their own 

costs and not the costs to the U.S. government as a whole. While 

agencies may opt out of ICASS because they believe they can obtain less 

costly services on their own, doing so may actually increase the overall 

cost to the U.S. government. Since agencies usually do not formally 

justify their decisions to opt out of ICASS or routinely conduct cost 

analyses, in some cases their decisions may be based more on poorly 

supported perceptions of cost and quality than on hard data and facts.

Because ICASS management lacks comparable data on the cost of 

overseas administrative services within and outside of ICASS, it is poorly 

positioned to convince agencies that greater participation in ICASS 

services is in their own interest or that of the U.S. government overall. 

Moreover, ICASS has still not led to systematic innovation and 

reengineering of administrative services delivery, especially those which 

would reduce the need for expensive American staff overseas and thus 

reduce costs significantly and make participation in ICASS more costeffective for agencies. State and USAID may also be missing 

opportunities for achieving greater efficiency and effectiveness by limiting 

the use of USAID, in lieu of State, as an alternate ICASS service provider.

We have previously recommended that the ICASS Executive Board 

encourage greater ICASS participation and pursue other streamlining 

efforts. However, experience has shown that board members do not 

necessarily have the incentive to require their agencies to participate in 

ICASS, especially if they are unconvinced that it is in their agency’s 

financial self-interest. The board has also had limited power to effectuate 

reengineering and innovation in administrative processes, as State 

maintains control over virtually all of these processes as both the primary 

provider and customer of ICASS services. In this context, congressional 

action may be necessary to increase participation in ICASS. Finally, 

without more comprehensive performance data, ICASS service providers 

are poorly positioned to demonstrate to the agencies that they are 

focusing on critical areas of dissatisfaction with ICASS that could be 

impediments to achieving agency missions.
 

Page 36 GAO-12-317 Embassy Management

In order to contain costs and reduce duplication of administrative support 

services overseas, Congress may wish to consider requiring agencies to 

participate in ICASS services unless they provide a business case to 

show that they can obtain these services outside of ICASS without 

increasing overall costs to the U.S. government or that their mission 

cannot be achieved within ICASS.

The Secretary of State should increase the cost effectiveness of ICASS 

services by continuing to reengineer administrative processes and seek 

innovative managerial approaches, including those that would reduce the 

reliance on American officials overseas to provide these services. 

Where agencies are able to demonstrate, through a compelling business 

case, that they can provide a service more efficiently than the existing 

State ICASS provider without adverse effects on the overall government 

budget, we recommend that the Secretary of State and the Administrator 

of USAID allow the creation of new ICASS service providers, in lieu of 

State, that could provide administrative services to the other agencies at 

individual posts.

To help ensure that ICASS provides satisfactory and equitable 

administrative service, we also recommend that the Secretary of State, in 

close coordination with ICASS customer agencies, develop additional 

uniform service standards and other performance measures that gauge 

ICASS service providers’ progress in resolving major sources of customer 

dissatisfaction.

We provided a draft of this report to the agencies within the scope of our 

review for their comment. State, USAID, USDA, Commerce, and DHS 

provided written comments which are reproduced in appendices V 

through IX along with our responses to specific points. DOD, HHS, and 

DOJ did not provide written comments. The agencies and the ICASS 

Service Center also provided technical comments that were incorporated, 

as appropriate.

State and USAID generally concurred with the report’s conclusions and 

recommendations. However, while State agreed that continued efforts 

are needed to increase the cost effectiveness of ICASS services, it did 

not agree that such actions have not been undertaken or that such efforts 

would substantially reduce the need for the American management staff 

abroad. We added information about State’s other cost reduction efforts, 

Matter for 

Congressional 

Consideration 

Recommendation for 

Executive Action

Agency Comments 

and Our Evaluation
 

Page 37 GAO-12-317 Embassy Management

noting that they were of a smaller scale than those State had indicated in 

2004 that it would undertake. Given the relatively high cost of posting 

American management staff overseas compared to engaging staff locally, 

we believe that even minor modifications in staffing could have significant 

cost implications and should be thoroughly explored, in close coordination 

with ICASS-participating agencies. We modified our recommendation to 

clarify that reengineering of administrative processes and innovative 

managerial approaches should include such staff reductions but not be 

limited to them necessarily. 

USDA, Commerce, and DHS took issue with our finding that 

nonparticipation in ICASS services reflects potential duplication of 

administrative services overseas and with our suggestion that Congress 

consider requiring agencies to participate in ICASS services unless they 

provide a business case to justify opting out. In particular, these agencies 

noted that ICASS customers have a variety of valid reasons for not 

participating in ICASS services and expressed concern that developing 

business cases to justify nonparticipation would be overly burdensome. 

We believe that, while agencies may have valid reasons for not 

participating in some ICASS services, the voluntary nature of ICASS has 

permitted agencies to opt out of the system without conducting rigorous 

cost analyses. Without such analyses, agencies are making decisions 

about participating in ICASS based on their own costs—or perceptions of 

cost—and not necessarily the overall cost to the U.S. government. We 

believe that if conducted in close coordination with the ICASS Service 

Center and other participating agencies, preparing business cases need 

not be overly burdensome and could lead to significant, long term savings 

for the U.S. government that would justify the additional effort.
 

Page 38 GAO-12-317 Embassy Management

As agreed with your office, unless you publicly announce the contents of 

this report earlier, we plan no further distribution until 28 days from the 

report date. At that time, we will send copies to the appropriate 

congressional committees, the Secretary of State, and other interested 

parties. In addition, the report will be available at no charge on the GAO 

website at http://www.gao.gov. 

Should you or your staff have questions concerning this report, please 

contact me at (202) 512-8980 or courtsm@gao.gov. Contact points for 

our Offices of Congressional Relations and Public Affairs may be found 

on the last page of this report. Key contributors to this report are listed in 

appendix X.

Michael J. Courts

Acting Director

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

Methodology

Page 39 GAO-12-317 Embassy Management

In response to a congressional request to update our 2004 report on the 

International Cooperative Administrative Support Services (ICASS) 

system and review ICASS’s progress in improving its efficiency, we 

assessed (1) the extent to which changes in ICASS participation have 

affected the duplication and cost of administrative support services and

(2) customer satisfaction with the quality of ICASS services overseas.

Our review focused on the eight agencies with the largest ICASS 

invoices: the Departments of Agriculture (USDA), Commerce 

(Commerce), Defense (DOD), Health and Human Services (HHS), 

Homeland Security (DHS), Justice (DOJ), and State (State), as well as 

the United States Agency for International Development (USAID).

Together, these agencies accounted more than 98 percent of the total 

ICASS budget in 2010. We reviewed data on these agencies’ 

participation in ICASS, including their costs and results of the annual 

ICASS Customer Satisfaction Survey, from 2005 to 2011. We interviewed 

officials at each agency as well as at the ICASS Service Center. We also 

conducted fieldwork at four overseas locations: Tokyo, Japan; Nairobi, 

Kenya; Manila, the Philippines; and Kigali, Rwanda. At each location, we 

observed administrative services, met with embassy management 

officials, and conducted focus groups of ICASS customers. We chose 

these locations based on the size of and number of agencies at the post; 

status of consolidation of USAID’s and State’s administrative platforms; 

cost of obtaining services in the host country; and geographic diversity.

To assess the extent to which changes in ICASS participation have 

affected the duplication and cost of administrative support services, we 

analyzed data from the ICASS Global Database, which is maintained by 

the ICASS Service Center and contains information for each ICASS 

service and subagency code at each overseas post on: workloads; billing 

by agency; unit costs; and other information necessary for operating the 

system. As described in the following section, we assessed the strength 

of these data and compared them against other ICASS data. We found 

these data sufficiently reliable for the purposes of describing customer 

agencies’ participation rates in ICASS and demonstrating the economies 

of scale that occur as ICASS workloads increase.

We used annual data generated through the ICASS Global Database and 

data prepared by the ICASS Service Center for the purposes of its annual 

customer satisfaction survey to analyze participation rates. The data 

cover ICASS services provided from 2005 to 2011 and contain 

information on the level of services an agency is billed for at all the posts 

Appendix I: Objectives, Scope, and 

Methodology 

General 

Participation Rate
Appendix I: Objectives, Scope, and 

Methodology

Page 40 GAO-12-317 Embassy Management

where it has a presence. In order to compare these data across fiscal 

years, we corrected inconsistencies in the names of the posts and 

agencies before we merged the annual data. Because two ICASS 

services—basic service and community liaison service—are generally 

mandatory,1

Using these data, we analyzed participation rates for different ICASS 

services. Participation rate by ICASS service measures the proportion of 

agencies at a post that use ICASS for a particular service. A higher 

participation rate indicates the service has more agencies participating 

than a service with a lower participation rate. This analysis helps us 

identify how “popular” a service is: whether agencies use this service 

provided through ICASS or opt out and provide a similar service for 

themselves. In order to calculate the participation rate by ICASS service, 

we first counted the number of agencies which participate in a particular 

service at a post, and then we summed this number across all the posts 

where the service is provided through ICASS. Next, we calculated the 

total number of agencies at all the posts where the service is provided, 

which is also the maximum number of agencies potentially participating in 

a service if every agency chooses to use ICASS. The ratio between the 

two sums is the participation rate of a service. Our calculation may 

overestimate the non-participation rate if agencies do not participate in 

ICASS because they do not have “real needs” for certain services.

However, without detailed “needs assessments” from every agency at 

every post, it is not possible to differentiate non-participation because of 

all agencies with an overseas presence should be covered in 

the ICASS Global Database, even if they choose to provide all 

nonmandatory services outside ICASS. To assess the reliability of these 

data, we interviewed knowledgeable officials regarding the collection and 

maintenance of these data. We also tested some of these data 

electronically against data prepared by the ICASS Service Center for the 

annual ICASS customer satisfaction survey. We determined the data 

were sufficiently reliable for the purposes of reporting ICASS participation 

rates by agency and by service.

 

1

These two services are mandatory for all agencies at a post with U.S. direct hires and 

certain authorized third-country national, U.S. contractor, or other staff. Basic package—

which includes several services that can only be obtained by the embassy, such as 

securing diplomatic credentials from the host country—and community liaison office 

services are generally mandatory. Participation rates are not 100 percent for these 

services because an agency may have only local staff at a given post, and these staff are 

not required to participate in these two services. In such cases, agencies may receive 

some services from ICASS, but not basic package or community liaison office services.
Appendix I: Objectives, Scope, and 

Methodology

Page 41 GAO-12-317 Embassy Management

no “real needs” from non-participation due to duplication of services. We 

used the ICASS standard cost center definitions in our analysis. The 

standard cost centers, with 31 services, define the services in more detail 

than the “lite” cost centers, which bunches some services in broader 

categories and contains 16 services. 

We also analyzed participation rates for different agencies. The ICASS 

Global Database contains data at the subagency code level, which is the 

level at which ICASS invoices are calculated. Some agencies have 

numerous subagency codes—for example, DOD has more than 150 such 

codes—while others have few. We calculated and presented data on 

participation rates at the subagency code level. Participation rate by 

agency measures the amount of ICASS services an agency uses as a 

proportion of the total number of services offered through ICASS at the 

posts where an agency has a presence. A higher participation rate 

indicates the agency uses ICASS more than an agency with a lower 

participation rate. This analysis helps us identify the range of agencies 

deciding to get services through ICASS: a 100 percent participation rate 

indicates that an agency uses all the ICASS services provided at each 

post where it has a presence. In order to calculate the participation rate 

by agency, we calculated the total number of ICASS services an agency 

participates in at a post. We determined the maximum number of services 

that a post offers. Next, we summed the total number of ICASS services 

an agency participates in and the maximum number of services offered at 

all the posts where the agency has a presence. The ratio of the two sums 

is the participation rate of the agency. Because we are interested in how 

agencies choose to provide the services when they have a choice, we 

excluded two mandatory services from our calculation, the basic service 

and community liaison service.

We reviewed economics literature to understand the factors driving 

economies of scale. We also reviewed the econometric method used to 

identify evidence of economies of scale and test the hypothesis of 

increased production level leading to lower average cost.

To determine whether there was evidence of economies of scale within 

ICASS, and the extent of these potential economies, we obtained data 

generated through ICASS Global Database. These data cover ICASS 

services provided from 2000 to 2010 at approximately 180 posts and 

contain information on the units of services provided (known as 

workload), the cost of the services, and the location of each post. See 

table 10 for a summary statistics of the numeric variables in the data.

Economies of Scale
Appendix I: Objectives, Scope, and 

Methodology

Page 42 GAO-12-317 Embassy Management

Table 10: Summary Statistics of ICASS Data

Name of variables Units Number of observations Mean Standard deviation Minimum Maximum

Total workload Varies by service 33,758 146,702 1,710,242 0.1 154,814,960

Total cost Dollars 33,758 303,758 563,586 2.0 44,664,036

Personnel cost Dollars 33,758 195,502 260,841 0 5,618,009

Operational cost Dollars 33,758 100,618 354,329 0 16,561,950

Investment cost Dollars 33,758 7,638 132,813 0 22,932,257

Source: GAO.

Notes:

1. Each observation represents the cost of a particular service at a particular post for a particular 

year. For example, the health care service in Abidjan in 2000 is one observation.

2. Each observation includes data on the name of the post, the units of service provided, and the cost 

of providing the service.

3. Cost data reflect the total cost of providing a particular service, including both fixed and variable 

costs. The data also include three components of the total costs: investment cost, personnel cost and 

operational cost.

4. We excluded observations with a zero workload or zero total cost.

The data contains information on the year the service was provided, the 

location of the post, and whether the post is standard or “lite” post.2

 

2

The standard cost centers, with 31 services, define the services in more detail than the 

“lite” cost centers, which bunches some services in broader category and contains 16 

services. 

Tables 11-14 are frequency tables for the year, location, post type, and 

ICASS service.
Appendix I: Objectives, Scope, and 

Methodology

Page 43 GAO-12-317 Embassy Management

Table11: Frequency Table for Year of ICASS Service

Fiscal year Frequency Percent Cumulative percent

2000 3,005 8.90% 8.90%

2001 2,975 8.81 17.71

2002 3,005 8.90 26.62

2003 3,030 8.98 35.59

2004 3,030 8.98 44.57

2005 3,117 9.23 53.80

2006 3,069 9.09 62.89

2007 3,015 8.93 71.82

2008 3,026 8.96 80.79

2009 3,204 9.49 90.28

2010 3,282 9.72 100.00

Total 33,758 100.00%

Source: GAO

Table 12: Frequency Table for Type of Post

Post type Frequency Percent Cumulative percent

Lite 12,258 36.31% 36.31%

Standard 21,500 63.69 100.00

Total 33,758 100.00%

Source: GAO

Table 13: Frequency Table for Regions

Region Frequency Percent Cumulative percent

Africa 7,423 21.99% 21.99%

East Asia and the Pacific 4,503 13.34 35.33

Europe 9,074 26.88 62.21

International organizations 112 0.33 62.54

Near East 3,955 11.72 74.25

South Asia 842 a 2.49 76.75

South and Central Asia 776 2.30 79.05

Western Hemisphere 7,073 20.95 100.00

Total 33,758 100.00%

Source: GAO.

a

In 2006, State merged the Office of Central Asian Affairs with the Bureau for South Asian Affairs to 

create the Bureau for South and Central Asian Affairs.
Appendix I: Objectives, Scope, and 

Methodology

Page 44 GAO-12-317 Embassy Management

Table 14: Frequency Table for ICASS Services

ICASS services Frequency Percent

Information management technical support 1,627 4.82%

Health services 1,717 5.09

Nonresidential local guard program service 447 1.32

Security services 941 2.79

Vehicle maintenance 663 1.96

Administrative supply 768 2.28

Procurement services 770 2.28

Reproduction services 558 1.65

Shipping and customs 767 2.27

Motor pool services 759 2.25

Nonexpendable property management 768 2.28

Leasing services 768 2.28

Travel 728 2.16

Household furniture, furnishings, and appliance pools 273 0.81

General servicesa 1,029 3.05

Basic package services 1,800 5.33

Pouching services 762 2.26

Mail and messenger services 770 2.28

Reception, switchboard, and telephone services 766 2.27

Information management services 1,026 a 3.04

Budgets and financial plans 770 2.28

Accounts and records 770 2.28

Payrolling services 770 2.28

Vouchering services 770 2.28

Cashiering services 770 2.28

Financial management services 1,029 a 3.05

Human resources services 1,028 a 3.05

Human resources: U.S. citizen services 770 2.28

Human resources: locally employed staff services 770 2.28

Community Liaison Office services 1,664 4.93

Government-owned/long-term lease residential building 

operations

1,504 4.46

Government-owned/long-term lease nonresidential building 

operations

1,666 4.94 

Short-term lease residential building operations 1,735 5.14

Short-term lease nonresidential building operations 1,374 4.07

Miscellaneous costs 458 1.36

Source: GAO.

Note: The data contain some services not defined in the ICASS standard or lite cost center 

distribution factors, thus the total shown above is less than 100 percent.

a

These bundled cost centers are present at posts using the ICASS Lite methodology.
Appendix I: Objectives, Scope, and 

Methodology

Page 45 GAO-12-317 Embassy Management

In order to test whether economies of scale exist in providing ICASS 

services, we used the following specification in the regression:

Ln (unit cost) = a_0+a_1*Ln (total workload)+a_2*dummy for region

+a_3*dummy for post type+a_4*dummy for tier

+a_5*dummy for services+a_6*year

Where total workload is a measure of units of services provided;

Post type indicates whether a post is a standard or “lite” post;

Tier indicates whether a post is a tier 1 post (USAID and State are 

colocated);

Year = 1 for 2000, 2 for 2001 and so on.

With large numbers of dummy variables, we ran a stepwise regression, 

specifying a significance level for removal from the model. In addition to 

running the regression with the type of services as dummy variables, we 

also ran the regression on each individual service. For example, we ran a 

regression on how the unit cost of copying service is related to the 

number of copies made, where the posts are located, the type of posts 

and the year the service was provided.

The coefficient on the log of total workload can be interpreted as the cost 

elasticity, a percentage increase in total workload leads to a_1

percentage change in unit cost. A negative coefficient implies that 

increased workload is related to decreased unit cost. This model 

specification has been used in the literature to test for economies of 

scale.3

 

3

For example, in “Does School District Consolidation Cut Costs?” [Duncombe and Yinger, 

“Does School District Consolidation Cut Costs?” Education Finance and Policy, Vol. 2, Is. 

4 (Fall 2007)], the authors used a specification of per pupil school spending as a function 

of school performance, input prices and enrollment. They specified a log linear form to test 

how per pupil cost is related to the size of enrollment. 

Table 15 presents the regression results from including all the 

services as dummy variables.
Appendix I: Objectives, Scope, and 

Methodology

Page 46 GAO-12-317 Embassy Management

Table 15: Summary Regression Results

Coefficient T value P>t 

a_0

Constant

7.59 218.34 0.000

a_1

Ln(total workload)

-0.51 -126.22 0.000

a_2

Dummy for region

_Iregion_2 -0.10 -7.56 0.000

_Iregion_3 0.16 14.18 0.000

_Iregion_4 0.71 10.46 0.000

_Iregion_5 -0.14 -9.97 0.000

_Iregion_6 -0.16 -6.07 0.000

_Iregion_8 -0.19 -16.13 0.000

a_3

Dummy for post type

0.49 37.30 0.000

a_4

Dummy for tier

-0.06 -5.88 0.000

a_5

Dummy for services

(30 dummies, not displayed)

a_6

Year

0.06 47.31 0.000

Source: GAO.

F(45, 33712)= 9125.46

Prob > F= 0.0000

R-squared= 0.9241

Adj R-squared= 0.9240

To obtain agency-level information on customer perceptions on the 

quality and reasonableness of cost of these ICASS support services 

overseas, we conducted a web-based survey of a probability sample of 

ICASS Council representatives who served on an ICASS council at an 

embassy in fiscals year 2010 or 2011.

The target population consisted of 641 ICASS Council representatives 

from 8 agencies within the scope of our review—State, USAID, USDA, 

DOD, Justice, Commerce, DHS, and HHS—in 167 embassies worldwide. 

We developed our sampling frame from the results of a preliminary 

Survey 
Appendix I: Objectives, Scope, and 

Methodology

Page 47 GAO-12-317 Embassy Management

survey we sent to ICASS Council chairpersons at 167 posts, requesting 

the names and e-mail addresses of officials currently serving as ICASS 

Council representatives at post. We also obtained contact information for 

ICASS Council Chairs from officials at the ICASS Service Center, State’s 

telephone directory, and officials from customer agencies within the 

scope of our review. On the basis of our analysis of the results from the 

preliminary survey, and the information we received from the additional 

sources mentioned, we determined the data to be adequate for the 

purposes of providing a sampling frame.

The survey sample design was a simple random sample of 350 ICASS 

Council representatives selected from the population of 641 ICASS 

Council representatives. We obtained 184 usable responses for an 

overall response rate of 53 percent. In addition, we confirmed that 4 of the 

selected council representatives were out-of-scope for our survey 

because they retired during the survey period, in 2011. See table 16 for 

complete response rate data.

Table 16: ICASS Council Representatives That Received and Completed the Survey

Stratum 

Population/ 

universe Sample size Responses Out-of-scope

State 143 85 51 0 

USAID 89 54 30 0 

Other departments 409 211 103 0 

Agriculture 57 31 21 0 

Commerce 60 36 13 1 

Homeland Security 54 25 10 0 

Defense 127 68 30 2 

Health and Human Services 34 12 7 0 

Justice 77 39 22 1 

Total 641 350 184 4 

Source: GAO.

Nonresponse bias may exist in some survey responses, since 

characteristics of survey respondents may differ from those of 

nonrespondents in ways that affect the responses (e.g., if those 

representing one customer agency would have provided different 

responses than those that represent another one). We conducted an 

analysis of our survey results to identify potential sources of nonresponse 

bias by comparing weighted estimates from respondents to known 

population values. These values included participation rates, 
Appendix I: Objectives, Scope, and 

Methodology

Page 48 GAO-12-317 Embassy Management

representation by region, and representation by agency. We conducted 

statistical tests of differences, at the 95 percent confidence level, between 

estimates and known population values. We did not observe significant 

differences between weighted estimates and known population values for 

most of our comparisons. We did, however, observe significant 

differences in participation rates for seven of the nine ICASS services we 

included in our survey. Based on the 53 percent response rate and the 

results of our examination of nonresponse bias in our survey results, we 

consider the survey results sufficiently reliable for the purposes of this 

report. However, we chose not to generalize the survey results to the 

target population of 641 ICASS Council representatives and chose to 

present the results of our survey for the 184 respondents.

To develop the survey, we interviewed officials from the ICASS Service 

Center; State’s Office of Management, Policy, Rightsizing and Innovation; 

USAID; and the American Foreign Service Association (AFSA). We also 

conducted focus groups at U.S. embassies in Manila, Tokyo, Nairobi, and 

Kigali, with officials from State, USAID, DHS, Commerce, USDA, Justice, 

DOD, HHS, and locally employed staff. During our visits to these 

embassies, we also interviewed management counselors and deputy 

chiefs of mission at all four posts. While we are not able to generalize the 

results of our focus groups to all overseas personnel of the agencies the 

participants represented, their responses provided a range of 

perspectives on the motivations of customers to either obtain support 

services through ICASS or obtain services outside of the ICASS system. 

Based on information from our focus groups, observations, and interviews 

with officials domestically and abroad, we determined ICASS Council 

representatives to be the most knowledgeable officials in the field to 

respond to our survey.

We administered the survey between August 8, 2011, and October 25, 

2011. We notified 350 ICASS Council representatives through e-mail, 

which contained information on the review, a unique username and 

password, and a link to our web-based survey. The instrument included 

nine services and asked ICASS Council representatives to identify 

whether or not their agency received the services through ICASS. In 

order to reduce the burden on respondents of answering questions about 
Appendix I: Objectives, Scope, and 

Methodology

Page 49 GAO-12-317 Embassy Management

all ICASS services, we only asked questions about nine services.4

In addition to the reported sampling errors, the practical difficulties of 

conducting any survey may introduce other types of errors, commonly 

referred to as nonsampling error. For example, differences in how a 

particular question is interpreted, the sources of information available to 

respondents, or the types of people who do not respond can introduce 

unwanted variability into survey results. We included steps in the survey 

design, data collection, and data analysis to minimize such nonsampling 

errors.

We 

selected these nine services based on several factors, such as, the total 

cost of the service for fiscal year 2010, ICASS customer satisfaction 

ratings, and the number of posts using the service, among others. We 

also analyzed the results of our focus groups of customer agency staff in 

Manila, Tokyo, Kigali, and Nairobi to develop a list of services that 

included both services that customers expressed satisfaction with and 

those that customers expressed dissatisfaction with. Next, the survey 

instructed respondents to identify significant factors for participating, or 

not participating in nine ICASS services; rate the quality of the services 

they received through ICASS, or outside of ICASS; rate the importance of 

the service to achieving their mission; and to identify how reasonable they 

perceived the cost of ICASS services to be, among other questions.

We took steps to clarify questions to ensure that respondents would 

correctly interpret survey questions. For example, following our focus 

groups in Manila and Tokyo, interviews, and observations in the field, we 

designed draft questionnaires in close collaboration with GAO survey 

specialists. We conducted pretests in Washington, D.C.—in person or via 

e-mail—with former ICASS Council representatives—from Commerce, 

DOD, DHS, Justice, USAID, and USDA. We conducted these pretests to 

ensure that respondents understood the questions and could provide the 

answers; and to ensure that respondents could complete the questions in 

a reasonable amount of time. We documented the results of each pretest, 

and made revisions to the draft instrument considering feedback from the 

pretests. After officially launching the survey, we shared the final survey 

 

4

The nine services included in our survey were furniture pool, motor pool, shipping and 

customs, government-owned/long-term lease and short-term lease residential building 

operations, vouchering services, leasing services, information management technical 

support services, procurement services, and human resources–locally engaged staff 

services. 
Appendix I: Objectives, Scope, and 

Methodology

Page 50 GAO-12-317 Embassy Management

instrument with officials at the ICASS Service Center, and a senior official 

at State, as a courtesy.

To increase the response rate for this survey, we began contacting nonrespondents by e-mail and telephone in several iterations during the data 

collection period. We developed two follow-up e-mails with log-in 

information and a link to the survey. To assist us with the follow-up 

telephone calls, we acquired the services of a professional services for 2 

days. After the 2-day period, GAO staff conducted calls from September 

to October 2011.

An additional source of nonsampling error can be errors in computer 

processing and data analysis. All computer programs relied upon for 

analysis of this survey data were independently verified by a second 

analyst for accuracy.

To assess customer satisfaction with the quality of ICASS services, we 

conducted data analyses using data from the annual ICASS Customer 

Satisfaction survey, which was developed by the ICASS Service Center 

and contains customer satisfaction scores for ICASS services by overall 

satisfaction, agency, and service, dating back to 2005. To assess the 

reliability of the ICASS survey data, we performed manual testing for 

errors in accuracy and completeness, and discussed data reliability 

issues with agency officials knowledgeable about the data. Although the 

results were not generalizeable and we found some issues with the 

response rates of some groups in the annual satisfaction survey, we 

determined the data to be sufficiently reliable for the purposes of reporting 

general levels of satisfaction with ICASS services by customer agency.5

 

 

5

For example, the ICASS Service Center does not have a list of all eligible respondents to 

whom they can send the survey invitation. It uses human resources post population data 

to determine the amount of eligible respondents to the survey and then divides the amount 

of responses by the survey population to determine a response rate. Respondents 

anonymously access the survey through a public Web site and have the potential to 

respond more than once. Because survey administration was anonymous, it is difficult to 

determine any potential bias in the results. Therefore, the survey results may only reflect 

the views of the respondents and not those of all ICASS customers.

Customer Satisfaction 

and Service Delivery 

Data
Appendix I: Objectives, Scope, and 

Methodology

Page 51 GAO-12-317 Embassy Management

We also conducted analyses using data from eServices, which was 

developed by State’s Office of Innovation, and contains service delivery 

and customer feedback questionnaire data for fiscal years 2010 and 

2011.
Appendix II: Services Available through ICASS

Page 52 GAO-12-317 Embassy Management

Dozens of specific administrative services are provided through ICASS, 

and these services are bundled into so-called “cost centers.” Table 17 

lists these cost centers and provides a description of the services 

provides within each bundle.

Table 17: ICASS Cost Centers

Cost center Description

Information management technical 

support

Provides the installation and maintenance of hardware/software, training, e-mail systems, 

system security operations and programs, system backup, information technology 

recommendations for software/hardware updates and changes, and troubleshooting 

services.

Health services Services vary depending on the post and the staffing of the Health Unit but may include: 

first aid, immunizations, coordination with and evaluation of local caregivers, support with 

medical evacuations and hospitalizations, and other similar services of a health operation. 

Nonresidential local guard program 

service

Pertains only to guard services at shared buildings such as chanceries, embassy 

compounds, and annexes. The service includes appropriate screening of visitors and 

vehicles.

Security services Service includes conducting special investigations and background investigations for 

locally employed staff, reviewing and recommending security enhancements for 

nonresidential spaces, taking security photos, fingerprinting new locally employed staff, 

and assisting with general security issues. 

Vehicle maintenance Service includes routine maintenance of official vehicles and related record keeping and 

coordination with local vendors for nonroutine repairs.

Administrative supply Orders and dispenses office supplies. Includes inventory control, warehousing, and 

issuance of office supplies.

Procurement services Manages purchase of items or services for official use only. This includes purchase by 

contract, purchase order, requisition, credit card and other standard means.

Reproduction services Provides printing and copying services through a central facility. 

Shipping and customs This service varies from post to post but may include arranging and overseeing (as 

required) the packing, crating and forwarding of shipments, and performing necessary 

customs clearance for all incoming and outgoing shipments (e.g., official shipments, 

household effects, vehicles, pouches, equipment, etc.). 

Motor pool services Covers the scheduling, dispatch and proper use of official vehicles. Includes providing 

skilled, knowledgeable drivers and proper upkeep of vehicles.

Nonexpendable property management Covers inventory management, warehousing and issuance of office and residential 

furniture, furnishings and appliances.

Leasing services Includes all phases of the leasing process for residential, office, warehouse or other space 

as required by requesting agency. Pertains to U.S. government-signed leases only. 

Includes locating appropriate, safe properties, negotiating and renewing leases, 

monitoring landlord performance, and providing assistance with initial connection and 

termination of utility and phone services.

Travel Services may differ from post to post but may include: processing flight, ground 

transportation, and hotel reservation requests; assisting with arrival and departure; 

overseeing travel management center contractor; and obtaining visas.

Household furniture, furnishings, and 

appliance pools

Includes requisitioning, inventory control, warehousing, care, delivery, removal and 

disposal of all pooled furniture and appliances.

Appendix II: Services Available through 

ICASS 
Appendix II: Services Available through ICASS

Page 53 GAO-12-317 Embassy Management

Cost center Description

Basic package services Varies by post but covers the basic services that support all agencies such as 

accreditation, licenses and permits, the post report, telephone books, support for/liaison 

with local international school(s), negotiation of hotel rates, support structure for VIP visits, 

surveys for cost of living allowance, per diem and education allowance, coordination of 

newcomer and temporary staff orientation, coordination of the mission awards program, 

provision of building access badges, and other such services.

Pouching services Covers the receipt and distribution of incoming pouch materials and the preparation and 

forwarding of outgoing pouches (classified and unclassified).

Mail and messenger services Covers pickup, delivery, and sorting of mail from various sources. Includes transport of 

mail to and from airport, coordination with local customs and airline personnel, and receipt 

and delivery of registered and express delivery. Also provides local messenger service.

Reception, switchboard, and telephone 

services

Covers post’s central switchboard services and reception services for visitors. Includes 

answering and directing calls within mission offices, servicing and relocating of 

instruments connected to the switchboard, and support for official cell phone program, 

where applicable.

Budgets and financial plans Includes the preparation and submission of budgets that meet deadlines and reflect 

customer needs based on trends, analysis and customer input. Provides financial advice 

including assistance to the ICASS council and Budget Committee regarding ICASS 

financial and budget issues.

Accounts and records Manages allotments of participating serviced agencies (i.e., agencies whose accounting 

records are maintained by Resources Management/Global Financial Services Charleston) 

recording, reviewing, and adjusting obligations and certifying funds available.

Payrolling services Payrolling services involves reporting and maintenance of time and attendance, pay, 

benefits, leave allowances, and tax records; coordinates periodic payments for locally 

employed staff; reports locally employed staff retirement/insurance plans to host 

government; and follows up on lost payroll checks and reconciles payroll problems with 

payment center. 

Vouchering services Vouchering services prepares, certifies and tracks vouchers, ensuring timely payments to 

vendors and other U.S. government agencies. It maintains controls to preclude duplicate 

payments and legal records of payments. Also assists with preparing Travel Vouchers.

Cashiering services Cashier services includes petty cash advances, check cashing and accommodation 

exchange (at posts where it is authorized). Collects receipts from sales of official property 

and receipts for personal usage of certain services (i.e., gasoline and telephone).

Human resources: U.S. citizen services Provides all human resources services including employee relations, evaluations, career 

advancement, discipline and grievances, and advising on health/life insurance, retirement 

plan, Thrift Savings Plan and other allotments. It also includes maintaining employee 

organization, position and staffing plans (Note: The latter services related to maintaining 

mission-wide reports and staffing plans are covered under Basic Package).

Human resources: locally employed staff 

services

Manages the compensation plan, salary surveys, position classifications, awards program, 

locally employed staff employee orientation, and job advertisements. If you do not have 

locally employed staff employees, then you do not receive this service. 

Community Liaison Office services Provides a wide range of community integrating functions including but not limited to 

welcome packages, orientation seminars, school interface, briefings, and post newsletters. 

The Community Liaison Office maintains community interface with host country 

organizations.
Appendix II: Services Available through ICASS

Page 54 GAO-12-317 Embassy Management

Cost center Description

Government-owned/long-term lease 

residential building operations

Provides routine maintenance and preventative repairs, ensures preparation for new 

arrivals, and ensures adequate utilities (garbage removal, heating and air conditioning) 

are available to the extent possible. Service may be provided directly by ICASS or involve 

working with the landlord. Includes maintenance of grounds if government-owned.

Government-owned/long-term lease 

nonresidential building operations

Provides routine maintenance and preventative repairs, manages custodial and grounds 

services, plans space utilization, and ensures adequate utilities (garbage removal, heating 

and air-conditioning) are available to the extent possible. Service may be provided directly 

by ICASS or involve working with the landlord.

Short-term lease residential building 

operations

This service covers all activities related to occupancy and use of short-term leased 

residential properties. Landlord responsibilities vary from post to post (both in practice and 

according to local law) and it may be necessary to adjust the kinds of services provided by 

the mission based on local conditions. The services include: (1) work with the landlord to 

ensure reasonable and necessary repairs are made properly and on time and/or 

performing minor repairs with contractors or in-house staff, as appropriate; (2) ensure 

properties are prepared for new arrivals, conduct preoccupancy and pre-departure 

inspections and perform routine between occupant fix-ups (e.g., painting, minor repairs); 

(3) provide residential “hospitality/welcome kits” in accordance with post policy; (4) provide 

security escort services for maintenance personnel in accordance with post policy; and (5) 

repair/reupholster government-owned furniture and equipment in accordance with post 

policy. 

Short-term lease nonresidential building 

operations

This service covers all activities related to occupancy and use of shared short-term lease 

nonresidential properties and includes: (1) work with the landlord to ensure reasonable 

and necessary repairs are made properly and on time, the building infrastructure and 

grounds are properly maintained and/or perform minor repairs with contractors or in-house 

staff, as appropriate; (2) provide or contract for custodial services; (3) perform routine 

between occupant “fix-up” and prepare for new arrivals; (4) provide security escort 

services for maintenance personnel as required, in accordance with post policy; and (5) 

repair/reupholster government-owned furniture and equipment in accordance with post 

policy.

Miscellaneous costs This includes only those costs that are not easily spread to other specific services, or of 

minimal value compared to the effort and expense to spread the costs precisely. The total 

for miscellaneous costs generally should not exceed five percent of the total ICASS 

budget.

Financial management services Includes services provided under the following ICASS Standard cost centers: budget and 

financial plans, accounts and records, payrolling, vouchering, and cashiering.

a

General services Includes services provided under the following ICASS Standard cost centers: vehicle 

maintenance, administrative supply, procurement, reproduction, shipping and customs, 

motor pool, nonexpendable property management, leasing, and travel.

a

Information management services Includes services provided under the following ICASS Standard cost centers: pouching; 

mail and messenger services; and reception, switchboard, and telephone services.

a

Human resources services Includes services provided under the following ICASS Standard cost centers: human 

resources–U.S. citizen services, and human resources–locally employed staff services.

a

Source: State.

a

These bundled cost centers are present at posts using the ICASS “Lite” methodology.
Appendix III: Status of Consolidation of State 

and USAID Administrative Platforms

Page 55 GAO-12-317 Embassy Management

USAID has significantly increased its participation in ICASS services 

since it began systematically consolidating its operations with State 

overseas. In 2006, recognizing the need to contain growth and eliminate 

duplicative and non-essential government functions at overseas posts, 

State and USAID issued a joint strategic vision for management 

operations to guide the consolidation of administrative support services.

This strategic vision called for a leaner, more flexible and more 

responsive administrative platform to provide services to all ICASS 

customers, at better value to the U.S. taxpayer and at cost savings to 

both State and USAID. The issuance of this strategic vision followed pilot 

consolidation projects at four posts, whose goal was to combine the best 

employees, equipment, and processes from existing operations to ensure 

that both State and USAID, as well as all ICASS customers, benefited 

from improved services at lower cost to the taxpayer. Following this pilot 

project, State and USAID reported that the four posts had successfully 

consolidated in full or in part 12 of the 16 services targeted, resulting in 

operational efficiencies and avoided costs.

Since 2007, following this pilot project, State and USAID have been 

consolidating administrative support services overseas in order to 

improve the efficiency and effectiveness of management operations.

State and USAID divided posts into three tiers, based on when the two 

agencies expected to colocate on a new embassy compound, and began 

consolidating operations at posts which were colocated the earliest. The 

two agencies first consolidated 15 services at so-called Tier 1 posts, 

where State and USAID were colocated on a new embassy compound by 

fiscal year 2007. By October 2007, 33 such posts had consolidated many 

or all of the targeted services. According to State, another 14 posts in Tier 

2—where posts were expected to be colocated on a new embassy 

compound in fiscal year 2008, 2009, or 2010—had consolidated 70 

percent of available services by October 2010. State and USAID are 

currently reviewing the status of consolidation at Tier 3 posts—those 

expected to be colocated in fiscal year 2011 or later. Going forward, State 

and USAID will continue to obtain services through ICASS. In 2009 

guidance regarding further consolidation, State and USAID advised posts 

that when new offices are opened or existing programs are expanded, the 

default plan should be to purchase the necessary support service from 

ICASS rather than to set up or expand parallel support systems.

In 2011, State and USAID established a Joint Management Board to 

facilitate further consolidation of services and ensure that customers of 

these services receive high quality administrative support at a reasonable 

cost. A joint State-USAID task force supporting the Quadrennial 

Appendix III: Status of Consolidation of State 

and USAID Administrative Platforms
Appendix III: Status of Consolidation of State 

and USAID Administrative Platforms

Page 56 GAO-12-317 Embassy Management

Diplomacy and Development Review, Task Force 11, recommended this 

board be created to solve management issues, communicate to the field 

with a single voice, and implement change.1 Task Force 11 also 

recommended that the Joint Management Board formulate a 

consolidation policy for State and USAID, including establishing clear 

criteria for exceptions to consolidation, weighing the need for a single 

platform overseas to achieve cost effective, high quality services with 

post-specific situations where the embassy and the USAID mission 

believe that a strong basis exists for flexibility in consolidation of some 

services. According to board members, one of the board’s initial tasks is 

to improve communication about consolidation and provide further 

guidance to posts in an effort to mitigate USAID concerns.

 

1

Department of State and the U.S. Agency for International Development, Leading 

Through Civilian Power: The First Quadrennial Diplomacy and Development Review

(Washington, D.C.: Dec. 15, 2010).
Appendix IV: Agency Participation in ICASS

Page 57 GAO-12-317 Embassy Management

We analyzed data from State to determine participation rates in ICASS.

Table 18 shows participation rates for all non-State subagency codes 

present at 10 or more posts overseas in fiscal year 2011.1

Table 18: Rate of Participation in Available Services, by Agency, 2005 and 2011

We calculated 

these rates by: (1) determining which posts each subagency was present 

at; (2) determining how many cost centers were available at those posts; 

and (3) determining the number of cost centers the subagency 

participated in. The participation rates listed below show the percentage 

of cost centers each subagency participated in 2005 and 2011 of the total 

cost centers available at posts where it has a presence.

a

 

2005 2011

Subagency name Rate Postsb Rate Posts

Navy Personnel Exchange Program

b

29% 15 16% 11

Army–Deputy Chief of Staff (Personnel), Students At Foreign Civilian Schools 16 7 17 18

Broadcasting Board of Governors–Correspondent Bureaus 21 15 18 12

Air Force–U.S. Air Force Students 22 14 21 22

Air Force–Professional Exchange Program 21 19 21 14

U.S. Marine Corps 21 14 27 25

American Battle Monuments Commission 27 11 31 10

National Geospatial Agency 31 10 32 12

Army–Deputy Chief of Staff (Operations), Strategic Leadership Division 33 57 34 49

Peace Corps 34 69 36 69

Immigration and Customs Enforcement/Container Security Initiative Special Investigations 37 10

Centers for Disease Control and Prevention–Detailees to International Organizations 45 3 38 17

Broadcasting Board of Governors–Transmitting Stations 40 11 41 10

Treasury–Office of International Affairs, Office of Technical Assistance 32 25 42 30

Naval Health Research Center 43 2 43 28

Army–U.S. Southern Command Traditional Commander-in-Charge Activities 34 21 44 20

 

1

Individual agencies may have multiple sub-agency codes for ICASS billing purposes, and 

participation rates generally vary by sub-agency code, even within the same agency. In 

some cases, these sub-agency codes correspond to a discrete unit within an agency, 

such as the Defense Intelligence Agency. In others, the codes correspond to accounting 

entities, such as USAID’s Operating Expenses account. In 2011, there were 320 such 

sub-agency codes in ICASS. DOD had the most codes (152) while the other agencies 

within the scope of our review had between 8 and 56 codes. As a result, it is not feasible 

or meaningful to calculate an overall agency-wide participation rate, and the figures we 

present here are at the sub-agency code level.

Appendix IV: Agency Participation in ICASS
Appendix IV: Agency Participation in ICASS

Page 58 GAO-12-317 Embassy Management

2005 2011

Subagency name Rate Postsb Rate Posts

Customs and Border Protection–Container Security Initiative

b

40 16 45 40

Open Source Center 41 26 46 31

U.S. Coast Guard 49 7 48 14

USAID–International Disaster Assistance 44 13 49 18

Library of Congress 49 14 50 14

Army–U.S. Southern Command, Counter Drug Teams 54 20 51 28

U.S. Army Corps of Engineers 52 13 51 13

Navy Investigative Services 31 4 51 10

Centers for Disease Control and Prevention 55 35 53 34

USAID–Child Survival & Diseases Program Fund 30 18 54 26

U.S. Secret Service 52 20 55 25

Justice–International Criminal Investigative Training and Assistance Program 54 9 55 21

USAID–Office of Transition Initiatives 45 7 55 12

USAID–Operating Expenses, Regional Organizations 53 8 55 10

USAID–Development Assistance 37 49 56 54 

Animal and Plant Health Inspection Service 53 42 56 47

Army–U.S. Africa Command 56 28

Department of Energy–Moscow/Kiev/Tokyo/Beijing/Vienna 65 6 56 13

U.S. Africa Command–Regional Defense Cooperation Office 56 12

Air Force–U.S. Central Command Operations and Maintenance 45 10 56 11

Army–U.S. European Command 51 37 57 37

Federal Aviation Administration 56 13 57 20

Internal Revenue Service 63 13 57 15

Social Security Administration 56 27 58 26

USAID–Economic Support Funds 34 17 58 21

Customs and Border Protection–International Affairs Office 47 11 59 26

U.S. Citizenship and Immigration Services–Refugee, Asylum, and International Operations 68 46 60 42

USAID–President’s Emergency Plan for AIDS Relief, Program Staff Support 61 19 

Centers for Disease Control and Prevention–Global AIDS Program 54 7 62 49

Treasury–Office of International Affairs 53 7 62 12

Defense Threat Reduction Agency 50 11 62 10

Justice–Overseas Prosecutorial Development Assistance and Training 73 4 63 19 

Navy–Force Protection Detachment 63 8 63 17

USAID–Freedom Support Act 44 16 63 15

Foreign Agricultural Service 66 82 64 76

Transportation Security Administration 62 16 64 24
Appendix IV: Agency Participation in ICASS

Page 59 GAO-12-317 Embassy Management

2005 2011

Subagency name Rate Postsb Rate Posts

Defense Security Cooperation Agency

b

66 113 66 122

Army–U.S. Southern Command, Security Assistance Officers 57 23 66 24

Foreign Agriculture Service/Agricultural Trade Office 54 20 66 16

Federal Bureau of Investigation/ Legal Attaché 65 68 67 85

Army–Force Protection Detachment 65 5 67 12

USAID–Operating Expenses, Missions 51 87 68 88

Justice–Criminal Division 58 19 68 16

Drug Enforcement Administration 74 72 70 84

Immigration and Customs Enforcement–International Affairs Office 65 45 70 59

Foreign Commercial Service 68 112 71 106

Food and Drug Administration 18 1 75 11

Millennium Challenge Corporation 76 19

Defense Intelligence Agency 82 146 81 147

Source: GAO analysis of ICASS data.

a

In some instances, nonparticipation may indicate that a service is not offered to all agencies at a post 

or that an agency does not need a particular service. In such instances, nonparticipation does not 

necessarily indicate duplication of services.

b

We calculated the number of posts an agency subcode was present at using data from the ICASS 

Global Database. If ICASS charged an agency subcode for at least one service at a given post, we 

determined that that subcode was present at that post.
Appendix V: Comments from the Department 

of State

Page 60 GAO-12-317 Embassy Management

Appendix V: Comments from the Department 

of State

Note: GAO comments 

supplementing those in 

the report text appear at 

the end of this appendix.
Appendix V: Comments from the Department 

of State

Page 61 GAO-12-317 Embassy Management
Appendix V: Comments from the Department 

of State

Page 62 GAO-12-317 Embassy Management

See comment 1.
Appendix V: Comments from the Department 

of State

Page 63 GAO-12-317 Embassy Management

See comment 2.

See comment 2.

See comment 3.
Appendix V: Comments from the Department 

of State

Page 64 GAO-12-317 Embassy Management

See comment 4.
Appendix V: Comments from the Department 

of State

Page 65 GAO-12-317 Embassy Management
Appendix V: Comments from the Department 

of State

Page 66 GAO-12-317 Embassy Management
Appendix V: Comments from the Department 

of State

Page 67 GAO-12-317 Embassy Management

See comment 5.
Appendix V: Comments from the Department 

of State

Page 68 GAO-12-317 Embassy Management

See comment 6.
Appendix V: Comments from the Department 

of State

Page 69 GAO-12-317 Embassy Management

The following are GAO’s comments on the Department of State’s letter

dated January 26, 2012.

1. As State and USAID continue to consolidate their administrative 

operations overseas, we believe that opportunities exist to reduce the 

number of American management staff by making greater use of local 

staff. However, we agree with State that efforts to reengineer 

administrative processes encompass a variety of actions, not limited 

to reducing the need for American administrative staff, and have 

clarified our recommendation accordingly.

2. We believe that the cost of American management positions oversees 

is significant, even at 14 percent of all ICASS expenses, which totaled 

over $2 billion is fiscal year 2011. Thus, reductions in this staffing 

could have significant cost implications for ICASS participating 

agencies and the U.S. government overall. 

3. We have removed this statement from our report.

4. The draft report mentioned some of State’s efforts to improve the 

quality of ICASS services. We have updated our report to include 

additional efforts that State has noted, along with the cost savings 

associated with these efforts.

5. We revised the report and recommendation to emphasize the 

importance of customer agency participation in the development of 

service standards.

6. In 2006, the State-USAID Joint Management Council, the 

predecessor to the Joint Management Board, sent guidance to posts 

instructing them not to initiate any new Alternative Service Providers 

at posts that were expected to have consolidated administrative 

operations by 2010. ICASS and USAID officials we spoke to consider 

this policy a restriction on the creation of new Alternative Service 

Providers. However, we have re-directed this recommendation from 

the ICASS Executive Board to the Secretary of State and the 

Administrator of USAID, as their agencies comprise the Joint 

Management Board.

GAO Comments
Appendix VI: Comments from the U.S. Agency 

for International Development

Page 70 GAO-12-317 Embassy Management

Appendix VI: Comments from the U.S. 

Agency for International Development
Appendix VI: Comments from the U.S. Agency 

for International Development

Page 71 GAO-12-317 Embassy Management
Appendix VI: Comments from the U.S. Agency 

for International Development

Page 72 GAO-12-317 Embassy Management
Appendix VI: Comments from the U.S. Agency 

for International Development

Page 73 GAO-12-317 Embassy Management
Appendix VII: Comments from the Department 

of Commerce

Page 74 GAO-12-317 Embassy Management

Appendix VII: Comments from the 

Department of Commerce

Note: GAO comments 

supplementing those in 

the report text appear at 

the end of this appendix.

See comment 1.
Appendix VII: Comments from the Department 

of Commerce

Page 75 GAO-12-317 Embassy Management

See comment 5.

See comment 4.

See comment 3.

See comment 2.
Appendix VII: Comments from the Department 

of Commerce

Page 76 GAO-12-317 Embassy Management
Appendix VII: Comments from the Department 

of Commerce

Page 77 GAO-12-317 Embassy Management

The following are GAO’s comments on the Department of Commerce’s 

letter dated January 24, 2012.

1. Our analysis of ICASS data and observations in the field revealed 

clear instances of duplication of administrative services at overseas 

posts. Not all instances of nonparticipation in ICASS services indicate 

duplication, as we note in our report. However, because customer 

agencies have not justified their decisions to opt out of ICASS 

services, we could not determine which services obtained outside of 

ICASS were not duplicative.

2. We disagree. Our report notes that customer agencies may have valid 

reasons for opting out of ICASS services, including agencies’ ability to 

obtain some services from their headquarters more efficiently or 

effectively than through ICASS. We do not suggest that this decision 

diminished the cost effectiveness of ICASS. However, we note that 

agencies typically do not provide justifications for these decisions, 

potentially limiting other customer agencies’ ability to take advantage 

of these opportunities.

3. Our report suggests that Congress may wish to consider requiring 

agencies to participate in ICASS services unless they provide a 

business case to show that they can obtain these services outside of 

ICASS without increasing overall costs to the U.S. government or that 

their mission cannot be achieved within ICASS. We do not believe 

that these are narrow exceptions. However, we do believe that 

customer agencies should be required to collect, analyze, and present 

data to support their decisions to opt out of ICASS services. Without a 

rigorous analysis, agencies cannot demonstrate that their decisions 

do not negatively impact overall costs to the U.S. government.

4. The pricing of ICASS services was outside of the scope of our review.

5. ITA has misinterpreted the information presented in our draft report.

Table 8 shows six selected ICASS services and their uniform service 

standards; however, this table shows that all six services have met 

their standard more often than not, doing so from about 59 to 74 

percent of the time. Nevertheless, we agree that there is significant 

room for improvement in meeting established service standards.

6. Our report notes that we were unable to quantify the cost savings 

resulting from increased participation in ICASS because cost data on 

services outside ICASS are generally not comparable with ICASS 

cost data. However, our analysis of ICASS cost data shows that there 

GAO Comments
Appendix VII: Comments from the Department 

of Commerce

Page 78 GAO-12-317 Embassy Management

are significant economies of scale within ICASS, so costs to existing 

customers would decrease as participation increases. 
Appendix VIII: Comments from the Department 

of Agriculture

Page 79 GAO-12-317 Embassy Management

Appendix VIII: Comments from the 

Department of Agriculture

Note: GAO comments 

supplementing those in 

the report text appear at 

the end of this appendix.

See comment 1.
Appendix VIII: Comments from the Department 

of Agriculture

Page 80 GAO-12-317 Embassy Management

The following are GAO’s comments on the Department of Agriculture’s 

letter dated January 24, 2012.

1. Our Matter for Congressional Consideration contains language that 

gives the agencies the flexibility to opt out of ICASS services when 

they can provide a business case to show that they can obtain these 

services outside of ICASS without increasing overall costs to the U.S. 

government. While we found that agencies generally are not 

developing these analyses, our report notes that agencies may have 

valid reasons for not participating in specific ICASS services. We also 

note that, without comparable data on costs, ICASS management is 

poorly positioned to convince agencies that participation in ICASS 

services is in their own interest. As a result, we believe both customer 

agencies and ICASS management are responsible for collecting and 

sharing cost data to ensure that customer agencies are making 

informed decisions on whether or not to participate in ICASS services.

We believe that if conducted in close coordination with the ICASS 

Service Center and other participating agencies, preparing business 

cases need not be overly burdensome and could lead to significant, 

long term savings for the U.S. government that would justify the 

additional effort. 

GAO Comments
Appendix IX: Comments from the Department 

of Homeland Security

Page 81 GAO-12-317 Embassy Management

Appendix IX: Comments from the 

Department of Homeland Security

Note: GAO comments 

supplementing those in 

the report text appear at 

the end of this appendix.

See comment 2.

See comment 1.
Appendix IX: Comments from the Department 

of Homeland Security

Page 82 GAO-12-317 Embassy Management

See comment 4.

See comment 3.
Appendix IX: Comments from the Department 

of Homeland Security

Page 83 GAO-12-317 Embassy Management

The following are GAO’s comments on the Department of Agriculture’s 

letter dated January 24, 2012. 

1. Our Matter for Congressional Consideration contains language that 

gives the agencies flexibility to opt out of ICASS services in cases 

where agencies are unable to meet their missions using those 

services. We believe that requiring agencies to develop business 

cases to justify their decisions to opt out of ICASS services will ensure 

that that are making decisions based on hard data and facts, rather 

than on poorly supported perception of cost and quality.

2. We disagree. We examined how ICASS unit costs are related to the 

level of services provided controlling for the year of the service, the 

region where the post is located, and whether the posts are standard 

or “lite” posts. We used data from 2000 to 2010, which reflect the 

increasing overall ICASS cost. We found strong evidence that unit 

cost decreases as the level of services increases despite increasing 

overall ICASS cost over the years. We looked at the cost centers 

independently and together, and the findings on the relationship 

between unit cost and the level of services are consistent.

3. Again, our Matter for Congressional Consideration contains language 

that gives the agencies flexibility to opt out of ICASS services in cases 

where agencies are unable to meet their missions using those 

services. In cases where DHS personnel are located far away from 

embassies or consulates, DHS should be able to develop a simple 

business case to explain its decision not to participate in ICASS 

services. 

4. Our analysis of ICASS data and observations in the field revealed 

clear instances of duplication of administrative services at overseas 

posts. Not all instances of nonparticipation in ICASS services indicate 

duplication, as we note in our report. For example, we note that in 

some instances, nonparticipation may indicate that a service is not 

offered to all agencies at a post or that an agency does not need a 

particular service. We also noted instances where agency officials 

indicated that they were able to obtain some services from their 

headquarters more efficiently or effectively than through ICASS. In 

such instances, nonparticipation does not necessarily indicate 

duplication of services. However, because customer agencies have 

not justified their decisions to opt out of ICASS services, we could not 

determine which services obtained outside of ICASS were not 

duplicative.

GAO Comments
Appendix X: GAO Contact and Staff 

Acknowledgments

Page 84 GAO-12-317 Embassy Management

Michael Courts, (202) 512-8980 or courtsm@gao.gov

In addition to the contact listed above, Jacquelyn Williams-Bridgers, Jess 

Ford, James Michels, Robert Ball, Ming Chen, Christopher Mulkins, 

Kyerion Printup, James Ashley, Richard Brown, Christina Bruff, David 

Dayton, Martin de Alteriis, Fang He, Jill Lacey, Grace Lui, Amanda Miller, 

Karen O’Conor, and Christina Werth made major contributions to this 

report.

Appendix X: GAO Contact and Staff 

Acknowledgments 

GAO Contact

Staff 

Acknowledgments 

(320802)
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