Independent Review and Evaluation at the Asian Development Bank

ID-78-49: Published: Oct 18, 1978. Publicly Released: Oct 18, 1978.

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The Asian Development Bank in Manila was founded by international agreement in 1965. At the beginning of 1978, it had approved 333 loans totaling $4.2 billion. The U.S. subscription is $771 million, entitling it to 8.77% of the voting power. The Foreign Assistance Act of 1973 proposed the establishment of an independent and continuous review and evaluation system for the Bank with reports being submitted directly to its governing body. In accordance with the law, GAO provided a statement of auditing and reporting standards for use by the U.S. Executive Director to the Bank in April 1975.

The Bank began evaluation of projects assisted by its loans in 1973, and in August 1974, its Board of Directors adopted a program for a post-evaluation system. The Bank's Economic Office performs reviews either on its own or with outside organizations under contract. The Economic Office is not directly responsible to the Board of Directors nor independent of Bank management as called for in the Comptroller General's Statement of Auditing and Reporting Standards. Its post-evaluation of completed projects occurs 5 to 8 years after loan approval and does not provide an assessment of current Bank practices. Bank management and the Audit Committee of the Board of Directors recognized the need for improvements in review and evaluation of activities, including: strengthening followup procedures on report recommendations, adopting a more simplified form of report, and developing a plan for review and evaluation activities suitable to the composition of bank lending. A proposed reorganization and increasing interest by the Board of Directors provide an opportunity for the adoption of a more independent and broader-based review and evaluation system.

Recommendation for Executive Action

  1. Status: Closed

    Comments: Please call 202/512-6100 for additional information.

    Recommendation: The Secretary of the Treasury should instruct the U.S. Executive Director to suggest to Bank management the need to set a timetable for the formulation of a truly independent review and evaluation group which would perform selective reviews of major programs and activities of the Bank. Until such a group can be formed and placed under the Board of Directors, interim measures during a period no longer than 2 years should be taken to have the group placed for administrative purposes under the President of the Bank or under the Vice President in charge of nonoperational departments.

    Agency Affected:

 

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