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entitled 'Millennium Challenge Corporation: Review of Compact Records 
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United States Government Accountability Office: 
GAO: 

Report to the Ranking Member, Subcommittee on State, Foreign 
Operations, and Related Agencies, Committee on Appropriations, U.S. 
Senate: 

June 2013: 

Millennium Challenge Corporation: 

Review of Compact Records and Information Management Program: 

GAO-13-615: 

GAO Highlights: 

Highlights of GAO-13-615, a report to the Ranking Member, Subcommittee 
on State, Foreign Operations, and Related Agencies, U.S. Senate. 

Why GAO Did This Study: 

MCC has approved 26 bilateral compact agreements, providing a total of 
about $9.3 billion to help eligible developing countries reduce 
poverty and stimulate economic growth. MCC is subject to the Federal 
Records Act, which requires that agencies preserve all records 
documenting its functions and other important transactions. 

GAO was asked to review MCC’s management of records and information. 
This report (1) examines MCC’s records and information management 
program and practices and (2) assesses partner governments’ 
implementation of MCC’s information retention guidelines. GAO analyzed 
MCC documents, interviewed MCC officials, and tested MCC’s ability to 
retrieve compact-related information from five closed compacts. GAO 
selected these compacts because they closed after May 2011, when MCC’s 
Program Closure Guidelines went into effect. 

What GAO Found: 

In 2006, the Millennium Challenge Corporation (MCC) established a 
records and information management program to maintain and preserve 
its federal records. The program includes policies related to compact 
management records—-a subset of MCC’s federal records. These policies 
also address the handling of other compact-related information 
generated by MCC partner governments’ accountable entities, which 
typically manage compact implementation until the 5-year compacts 
close. MCC’s policies require that the entities transfer their compact 
management records to MCC for storage before compact closure. MCC also 
requires that partner governments retain compact-related information 
not classified as records, such as survey data and data quality 
reviews, for at least 5 years after their compacts close, to 
facilitate audits and analysis of MCC assistance. However, MCC does 
not require, and has not conducted, periodic reviews to determine 
whether it has received all compact-management records from the 
accountable entities consistent with federal internal control 
standards. As a result, MCC cannot be sure that it is meeting the 
federal requirement that it preserve all records documenting its 
functions, activities, and other transactions. 

In reviews of five closed compacts—-Armenia’s, Benin’s, El Salvador’s, 
Ghana’s, and Mali’s—-GAO found variation in the accountable entities’ 
implementation of MCC document retention requirements and the partner 
governments’ ability to retrieve requested compact-related information 
after the compacts closed. As required by MCC’s compact closure 
guidelines, all five program closure plans that we reviewed contained 
some discussion of retaining and storing documents, but each 
accountable entity addressed the guidelines’ requirements differently. 
MCC’s guidelines do not provide a list specifying standard types of 
compact-related information that most compacts should retain. Such 
variation in approaches to retaining and storing compact-related 
information will make it more difficult for MCC to verify that 
standard compact information is retained in all partner countries 
after the compacts close. In addition, in a test of MCC’s ability to 
retrieve documents from the partner governments after compact closure, 
GAO found that four of the five governments provided all or most 
requested documents within 30 days, but Mali’s, which is involved in 
political turmoil, provided no documents (see figure). Political 
turmoil in Madagascar, another compact-recipient country, has also 
impeded MCC’s ability to obtain compact information that may be needed 
to conduct future audits, evaluate project impact, or inform future 
compact designs. 

Figure: Number of Documents Returned to GAO within 30 Days, by Country: 

[Refer to PDF for image: stacked horizontal bar graph] 

MCC country: Armenia; 
Number of documents requested: 13; 
Number of documents received: 15. 

MCC country: Benin; 
Number of documents requested: 20; 
Number of documents received: 20. 

MCC country: El Salvador; 
Number of documents requested: 14; 
Number of documents received: 18. 

MCC country: Ghana; 
Number of documents requested: 17; 
Number of documents received: 20. 

MCC country: Mali; 
Number of documents requested: 0; 
Number of documents received: 20. 

Source: GAO. 

[End of figure] 

What GAO Recommends: 

To strengthen MCC’s records and information management program, MCC’s 
Chief Executive Officer should (1) develop a policy requiring—-and 
conduct--periodic reviews of MCC’s compact-management records to 
ensure they are complete, (2) revise guidelines to include a sample 
document retention schedule specifying standard types of compact-
related information compacts should retain, and (3) review MCC’s 
policy of delegating storage of most compact-related information to 
partner governments. MCC agreed with all three recommendations and 
stated that they have already taken steps to implement them. 

View [hyperlink, http://www.gao.gov/products/GAO-13-615]. For more 
information, contact David Gootnick at (202) 512-3149 or 
gootnickd@gao.gov. 

[End of section] 

Contents: 

Letter: 

Background: 

MCC Has Established a Records and Information Management Program but 
Has Not Reviewed Its Inventory of Compact-Management Records: 

Partner Countries' Implementation of MCC Document Retention 
Requirements and Their Ability to Provide Requested Documents Vary: 

Conclusions: 

Recommendations: 

Agency Comments and Our Evaluation: 

Appendix I: Objectives, Scope, and Methodology: 

Appendix II: MCC Scores on NARA Self-Assessment Survey, 2009-2012: 

Appendix III: Comments from the Millennium Challenge Corporation: 

Appendix IV: GAO Contact and Staff Acknowledgments: 

Tables: 

Table 1: Descriptions of MCC Compact Management Records and Other 
Compact-Related Information: 

Table 2: MCC's Score on 2012 NARA Survey, by Section: 

Table 3: Selected USAID Office of the Inspector General Audit Reports, 
by Title and Number: 

Table 4: Number of Documents in Random Sample, per MCC Compact and 
Type of Audit: 

Table 5: MCC Scores on NARA Self-Assessment Survey, by Section, 2009: 

Table 6: MCC Scores on NARA Self-Assessment Survey, by Section, 2010: 

Table 7: MCC Scores on NARA Self-Assessment Survey, by Section, 2011: 

Table 8: MCC Scores on NARA Self-Assessment Survey, by Section, 2012: 

Figure: 

Figure 1: Number of Requested Documents Returned within 30 Days, by 
Country: 

Abbreviations: 

FOIA: Freedom of Information Act: 

OIG: Office of the Inspector General: 

MCA: Millennium Challenge Account: 

MCC: Millennium Challenge Corporation: 

NARA: National Archives and Records Administration: 

USAID: United States Agency for International Development: 

[End of section] 

GAO:
United States Government Accountability Office: 
441 G St. N.W. 
Washington, DC 20548: 

June 20, 2013: 

The Honorable Lindsey Graham: 
Ranking Member: 
Subcommittee on State, Foreign Operations, and Related Agencies: 
Committee on Appropriations: 
United States Senate: 

Dear Senator Graham: 

The Millennium Challenge Corporation (MCC), a U.S. government 
corporation, provides aid to developing countries that have 
demonstrated a commitment to ruling justly, encouraging economic 
freedom, and investing in people. MCC provides its assistance to 
eligible countries through 5-year compact agreements with the specific 
goal of reducing poverty by stimulating economic growth. Since its 
establishment in 2004, MCC has signed 26 compacts with the governments 
of 25 low-income or lower-middle-income countries, committing 
approximately $9.3 billion for compact assistance.[Footnote 1] The 
partner governments vest accountable entities, generally referred to 
as Millennium Challenge Accounts (MCAs), with responsibility for 
implementing the compacts, including managing compact records and 
other information, in accordance with MCC policies and guidelines. 

The Federal Records Act of 1950, as amended, requires each federal 
agency, including MCC, to make and preserve records that, among other 
things, document the agency's decisions, procedures, and essential 
transactions.[Footnote 2] Since 2009, the National Archives and 
Records Administration (NARA) has required agencies to complete an 
annual self-assessment of their records management practices, which it 
uses to rate the agencies' compliance with the Federal Records Act and 
other laws and regulations related to records management. As our 
previous work has shown, agencies with poorly managed records risk 
increased costs when attempting to search their records in response to 
Freedom of Information Act (FOIA) requests or litigation-related 
discovery actions. Without effective management of the documentation 
of government actions, the ability of the people to hold the 
government accountable is jeopardized.[Footnote 3] In addition, 
effective records management is an important tool for efficient 
government operation; without adequate and readily accessible 
documentation, agencies may not have access to important operational 
information to make decisions and carry out their missions.[Footnote 4] 

You asked us to review MCC's approach to records management, including 
its practice of delegating the retention and storage of most compact-
related information to partner governments. This report (1) examines 
MCC's records and information management program and practices and (2) 
assesses partner governments' implementation of MCC guidelines for 
retention and storage of compact-related information. 

To describe MCC's approach to records management, we reviewed NARA's 
records-management guidance and the self-assessment survey that NARA 
administers to assess agencies' compliance with federal requirements. 
We also reviewed MCC's policies and procedures and interviewed 
cognizant officials at MCC and NARA. To assess the extent to which 
MCAs have implemented MCC's guidelines for information retention, we 
selected five closed MCC compacts--with Armenia, Benin, El Salvador, 
Ghana, and Mali--to use as case studies.[Footnote 5] We reviewed 
certain documentation compiled by each MCA or partner government in 
accordance with MCC's guidelines[Footnote 6] and conducted a test of 
MCC's ability to retrieve compact-related information after compact 
closure. For this test, we drew a random sample of MCA documents that 
had been used for audits conducted by the U.S. Agency for 
International Development's (USAID) Office of the Inspector General in 
our case-study countries.[Footnote 7] We provided MCC with a list of 
about 20 documents[Footnote 8] for each case-study country and asked 
that the partner governments provide the documents to us within a 
specific timeframe. (See appendix I for further details of our scope 
and methodology.) 

We conducted this performance audit from September 2012 to June 2013 
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. 

Background: 

In accordance with the Federal Records Act and NARA's implementing 
regulations for records management and retention, MCC is responsible 
for managing the records that it generates. MCC has established 
policies and issued guidance intended to ensure that the records 
generated by the governments receiving compact and threshold 
assistance are properly identified and transferred to MCC for storage 
and management.[Footnote 9] 

Federal Records Act Requirements: 

The Federal Records Act, as amended,[Footnote 10] requires each 
federal agency to make and preserve records that (1) document the 
organization, functions, policies, decisions, procedures, and 
essential transactions of the agency; and (2) provide the information 
necessary to protect the legal and financial rights of the government 
and of persons directly affected by the agency's activities.[Footnote 
11] Such records must be managed and preserved in accordance with the 
act's provisions. 

To ensure that they have appropriate systems for managing and 
preserving their records, the act requires agencies to develop records 
management programs.[Footnote 12] These programs are intended, among 
other things, to provide for accurate and complete documentation of 
the policies and transactions of each federal agency, to control the 
quality and quantity of records they produce, and to provide for 
judicious preservation and disposal of federal records. A records 
management program identifies records and sources of records and 
provides records management guidance, including agency-specific 
recordkeeping practices that establish what records need to be created 
to conduct agency business, among other things. 

NARA Records Management Oversight and Requirements: 

Under the Federal Records Act, NARA has general responsibilities for 
oversight of agencies' federal records management.[Footnote 13] These 
responsibilities include issuing guidance for records management; 
working with agencies to implement effective controls over the 
creation, maintenance, and use of records in the conduct of agency 
business; providing oversight of agencies' records management 
programs; approving the disposition (destruction or preservation) of 
records; and providing storage facilities for agency records on a fee-
for-service basis. 

NARA has issued regulations requiring that records be effectively 
managed throughout their life cycle, including records creation and 
receipt, maintenance and use, and disposition. One key records 
management process is scheduling, the means by which NARA and agencies 
identify federal records and determine timeframes for disposition. 
Creating records schedules involves identifying and inventorying 
records, appraising their value, determining whether they are 
temporary or permanent, and determining how long they should be kept 
before they are destroyed or turned over to NARA for archiving. 
Scheduling records requires agencies to invest time and resources to 
analyze the information that an agency receives, produces, and uses to 
fulfill its mission. Such an analysis allows an agency to set up 
processes and structures to associate records with schedules and other 
information to help it find and use records during their useful lives 
and dispose of those no longer needed. Scheduling involves broad 
categories of records rather than individual documents or file folders. 

Since 2009, NARA has required federal agencies to complete an annual 
self-assessment of their records management practices, to determine 
whether the agencies are compliant with statutory and regulatory 
records management requirements. The 2012 self-assessment survey 
called for agencies to evaluate themselves in four areas: (1) records 
management activities, (2) oversight and compliance, (3) records 
disposition, and (4) electronic records. NARA scores the self-
assessments, and the accompanying agency documentation, and uses the 
scores to categorize each agency as low, moderate, or high risk in 
terms of compliance with federal regulations. 

MCC Has Established a Records and Information Management Program but 
Has Not Reviewed Its Inventory of Compact Management Records: 

Beginning in 2006, MCC established a records and information 
management program and subsequently established guidelines for 
handling compact management records and other compact-related 
information. However, MCC has not created a policy for--or conducted--
periodic reviews of the extent to which it has received the compact 
management records that it requires MCAs to provide to MCC for 
storage. In 2012, MCC's score on the NARA survey placed the agency in 
the moderate risk category--an average rating--for compliance with 
federal requirements. 

MCC's Records and Information Management Program Includes Guidelines 
Defining Records: 

MCC established its records and information management program in 
2006.[Footnote 14] The program's stated objectives, according to the 
2011 version of its Records and Information Management Policy, are to 
create, maintain, and preserve adequate and proper documentation of 
its policies, transactions, and decisions; ensure the security and 
integrity of MCC's federal records, including the safeguarding of 
records against unauthorized access or disposition; and prevent the 
removal of records and control the removal of other materials from the 
agency. 

MCC's Records and Information Management Policy defines "federal 
record" consistently with the Federal Records Act's definition of 
"record." According to the policy, MCC catalogs its federal records 
into four major series, based on the records' functions.[Footnote 15] 

* Administrative: Records commonly found at any federal agency, such 
as accounting and finance files, and budget, personnel, and 
procurement files. 

* Governance: Records related to the Millennium Challenge Act of 2003, 
authorities, laws, and legislation, such as Board of Directors meeting 
minutes and resolutions, legal opinions, and ethics program records. 

* Communications: Exchanges with external entities, such as MCC's 
annual report, congressional notifications, press releases, and 
official speeches, among other things. 

* Millennium Challenge Account Assistance: MCC mission development, 
implementation, oversight, results, and closeout information 
pertaining to threshold programs and compacts. This category also 
includes compact management records, which are generated at least in 
part by the MCAs. 

MCC Has Issued Guidance for Managing Compact Management Records and 
Other Compact-related Information: 

MCC provides guidance regarding the maintenance of compact management 
records and the retention and storage of compact-related information. 
In 2007, MCC issued Policy and Procedures for Compact-Related Federal 
Recordkeeping,[Footnote 16] which was updated in 2012. The policy 
outlines specific policies and procedures regarding compact management 
records--which MCC refers to as a subset of federal records--and other 
compact-related information.[Footnote 17] The policy also includes a 
list specifying the types of documents that MCC classifies as compact 
management records. The policy and procedures apply regardless of 
whether the records and other compact-related information are created 
by MCC staff, partner governments, MCA entities, contractors, or other 
parties.[Footnote 18] 

* Maintenance of compact management records. According to MCC's Policy 
and Procedures for Compact-Related Federal Recordkeeping, all 
information defined as a compact management record must be maintained 
at MCC headquarters during compact development and implementation and 
after compact closure. For example, under the policy, the following 
monitoring and evaluation documents are classified as compact 
management records, to be maintained at headquarters: indicator 
tracking tables, monitoring and evaluation plans and revisions, 
reviews and final impact evaluations, and data quality reviews. 

* Retention and storage of compact-related information. MCC's Policy 
and Procedures for Compact-Related Federal Recordkeeping further 
states that the partner governments must retain, for at least 5 years 
after compact closure, types of information that are not defined as 
records but are important to the implementation and closure of 
compacts.[Footnote 19] The policy specifies, as examples of such 
information, (1) documents to support audits by MCC's Office of the 
Inspector General and GAO and (2) program evaluation documents to 
support ongoing analysis of MCC assistance. In another policy 
document, Program Closure Guidelines, MCC also requires MCAs to 
provide to MCC certain compact-related information for storage at MCC 
headquarters. For example, MCAs are required to provide the following 
information related to compact monitoring and evaluation: all MCC-
funded survey data sets and supporting materials, such as 
questionnaires, enumerator field guides, data entry manuals, data 
dictionaries, and final reports; other analyses; evaluations; and data 
quality reviews and special studies that were funded through the 
compact's monitoring and evaluation budget. 

Table 1 describes compact management records and other compact-related 
information. 

Table 1: Descriptions of MCC Compact Management Records and Other 
Compact-Related Information: 

Type of information: Compact-management records; 
Description: A subset of the Millennium Challenge Account Assistance 
series of federal records that must be maintained by MCC headquarters 
during implementation and after compact closure. 

Compact-related information: To be retained by partner governments for 
at least 5 years after compact closure; 
Description: Documents that may be needed to support future audits or 
analysis of MCC assistance. 

Compact-related information: To be provided by MCAs for storage by MCC 
headquarters; 
Description: Documents or copies of documents that must be provided to 
MCC during implementation or at compact closure, such as survey data 
sets and supporting materials. 

Source: GAO analysis of guidance from MCC, Policy and Procedures for 
Compact-Related Federal Recordkeeping (2012) and Program Closure 
Guidelines (2011). 

[End of table] 

MCC's Policy and Procedures for Compact-Related Federal Recordkeeping 
assigns the responsibility for ensuring that the country's compact 
management records are transmitted and received at MCC headquarters to 
the MCC Resident Country Director serving in each partner country. 
[Footnote 20] The policy states that MCC has the responsibility to 
ensure that MCAs are taking reasonable steps to meet records 
management requirements. The policy also states that MCC is 
responsible for ensuring that the partners understand (1) what is 
covered by both compact management records and other compact-related 
information and (2) that MCC or a U.S. government audit, legal, or 
oversight entity may need to have access to such information for at 
least 5 years after the compact end date. 

MCC Has Not Reviewed Its Compact Management Records for Completeness: 

MCC policy does not call for, and MCC has not performed, reviews of 
the extent to which it has received the compact management records 
that it requires MCAs to provide to MCC for storage. According to 
Standards for Internal Control in the Federal Government,[Footnote 21] 
a federal agency should have in place control activities--that is, 
policies, procedures, techniques, and mechanisms, including reviews of 
performance--to help ensure that management's directives are carried 
out. MCC's Policy and Procedures for Compact-Related Federal 
Recordkeeping assigns to the MCC Resident Country Director in each 
partner country the responsibility for ensuring the transmittal and 
receipt of the country's compact management records at MCC 
headquarters. However, MCC policy does not require periodic reviews of 
the records received from the MCAs to ensure that all required records 
have been transferred. In addition, MCC's Records Management Officer 
stated that MCC has not reviewed the compact management records it has 
received, for the following reasons: (1) the first compacts ended only 
recently, and (2) the records management program has limited 
resources. However, of the 11 compacts that have closed or been 
terminated, 5 ended in 2011 and 2 ended in 2010. Without periodically 
reviewing the compact management records it receives from the MCAs, 
MCC cannot be sure that it is meeting the Federal Records Act's 
requirement that it preserve all records documenting its functions, 
activities, decisions, and other important transactions. 

MCC's Records Management Program Received an Average Rating on NARA 
Survey in 2012: 

In 2012, MCC received a revised score of 77 out of 100 on NARA's self-
assessment survey, which placed MCC in the moderate risk category in 
terms of compliance with federal requirements (see table 2). A NARA 
official characterized this score as an "average rating" for federal 
agencies. In the previous 3 years, MCC received the following scores: 
92 (2009), 83 (2010), and 76 (2011) (see appendix II for more 
information.) MCC's Records Management Officer also stated that 
meeting NARA requirements, especially for electronic records, is 
difficult for small federal agencies with limited resources and that 
MCC, in conjunction with other small agencies, has appealed to NARA 
for assistance.[Footnote 22] 

Table 2: MCC's Score on 2012 NARA Survey, by Section: 

Survey section: Records management activities; 
MCC points received: 21; 
Total possible points: 21; 
Percentage: 100%. 

Survey section: Oversight/compliance; 
MCC points received: 23; 
Total possible points: 31; 
Percentage: 74%. 

Survey section: Records disposition; 
MCC points received: 15; 
Total possible points: 15; 
Percentage: 100%. 

Survey section: Electronic records; 
MCC points received: 18; 
Total possible points: 33; 
Percentage: 55%. 

Survey section: Total score; 
MCC points received: 77; 
Total possible points: 100; 
Percentage: 77%. 

Source: GAO analysis of MCC results on the NARA survey. 

[End of table] 

Partner Countries' Implementation of MCC Document Retention 
Requirements and Their Ability to Provide Requested Documents Vary: 

For the five closed compacts that we reviewed--MCC's compacts with 
Armenia, Benin, El Salvador, Ghana, and Mali--the MCAs provided 
varying levels of detail about their plans for retaining compact-
related information to address MCC requirements. In addition, the five 
partner governments showed varying capacity to provide the documents 
that we asked MCC to retrieve. 

MCAs Provided Varying Levels of Detail about Document Retention Plans: 

* For the five compacts that we reviewed, the MCAs provided varying 
levels of detail about their plans for retaining compact-related 
information. MCC's Program Closure Guidelines instruct accountable 
entities to develop program closure plans describing their strategy 
for retaining and storing compact-related information. The guidelines 
state that each accountable entity should provide the following three 
items for MCC approval prior to the compact end date: 

* a list of the types of documents the partner government will retain, 

* a document retention schedule, and: 

* a brief description of the form and manner in which the documents 
will be stored.[Footnote 23] 

MCC's compact closure guidelines do not provide a sample document 
retention schedule specifying standard types of compact-related 
information that most compacts would need to retain or provide. 

All five program closure plans that we reviewed contained some 
discussion of filing and storing documents, but each MCA addressed the 
guidelines' three requirements differently. Such variation in 
approaches to scheduling and storing compact documentation will make 
it more difficult for MCC to verify that standard compact information 
is being retained in all partner countries after the compacts have 
closed. 

Types of documents to be retained. The program closure plans for the 
Armenia, Ghana, and Mali compacts specified that the respective 
partner governments would retain all compact-related information. The 
program closure plan for the Benin compact did not list the types of 
documents that the government would retain but stated that the MCA 
would provide further information in the document retention schedule. 
The program closure plan for the El Salvador compact stated that the 
government, through a contractor, would retain original files related 
to personnel, projects, procurement, finance, monitoring and 
evaluation, and studies. 

Document retention schedule. The MCAs' document retention schedules 
also varied. Armenia and Benin did not provide document retention 
schedules.[Footnote 24] El Salvador provided a comprehensive listing, 
by category, of all documents to be retained; however, it provided 
this list for the purposes of our review in April 2013, after the 
compact end date. Ghana's schedule, submitted after the compact end 
date but within the 3-month compact closure period, specified document 
types to be retained. Mali provided an undated printout of its 
electronic file system. According to MCC officials, the disparity 
among the MCAs' document retention schedules stemmed from 
insufficiently specific guidance provided by MCC. 

Form and manner of document storage. The MCAs' program closure plans 
specified varying forms and manners of storage for compact-related 
information after compact closure. According to the plans: 

* Armenia will store the documents at three different government 
agencies: the state archives, the Ministry of Transport and 
Communications, and the Foreign Financing Projects Management Center 
(a foreign donor coordination unit); 

* Benin will store the documents at its national archives; 

* El Salvador has made a contractor responsible for the safekeeping of 
compact-related files and documents; 

* Ghana's MCA will continue as a foreign donor coordination unit after 
compact closure and will retain all MCC documents; and: 

* Mali will store compact-related information at the Office of the 
Secretary General of the President (the "Office of the Segal"), which 
was the office of the principal government representative under the 
compact. 

Countries' Ability to Provide Specific Documents Varied: 

Our test of MCC's ability to retrieve compact-related information from 
the five countries produced varying results that depended on the 
stability of the governments. Four of the governments provided all or 
most of the documents we requested. In contrast, Mali's government, 
which is in transition, provided none of the requested documents. 
Figure 1 displays the test results. 

Figure 1: Number of Requested Documents Returned within 30 Days, by 
Country: 

[Refer to PDF for image: stacked horizontal bar graph] 

MCC country: Armenia; 
Number of documents requested: 13; 
Number of documents received: 15. 

MCC country: Benin; 
Number of documents requested: 20; 
Number of documents received: 20. 

MCC country: El Salvador; 
Number of documents requested: 14; 
Number of documents received: 18. 

MCC country: Ghana; 
Number of documents requested: 17; 
Number of documents received: 20. 

MCC country: Mali; 
Number of documents requested: 0; 
Number of documents received: 20. 

Source: GAO. 

Note: El Salvador provided two additional documents after the 30-day 
period. 

[End of figure] 

Owing to its policy of relying on partner governments to retain and 
store compact-related information, MCC lost access to this information 
for 2 of the 11 closed compacts when, because of political turmoil, it 
terminated its compacts with Mali and Madagascar. Mali's government 
has been in transition since March 2012, when the administration at 
that time was overthrown. According to MCC, the transitional 
government in Mali will establish an office to handle post-compact 
issues but has not provided a point of contact. As a result, MCC 
officials reported that although they believe the information related 
to the Mali and Madagascar compacts exists and has been maintained in 
an organized fashion, they are currently unable to access the 
requested documents. MCC has previously noted that political turmoil 
in Madagascar, whose government was overthrown in 2009, impeded MCC's 
ability to access documents.[Footnote 25] 

MCC officials stated that they considered the response rate to our 
test to be good, particularly since the people retrieving the 
documents were not necessarily the same people who created or stored 
them. Previously, MCC has stated that its ability to retrieve 
documents from partner countries is reliant on its ability to access 
key individuals.[Footnote 26] MCC officials further stated that the 
difference in document return rates among the four countries that 
provided all or most of the requested documents may have been due to 
our test methodology. According to these officials, some of the 
documents we requested were not "critical path" documents, and our 
descriptions of the documents may not have been specific enough to 
allow the partner countries to identify them. However, all of the 
documents we requested were used in audits by the USAID's Office of 
the Inspector General. They thus serve as examples of the types of 
documents that might be needed to support future audits--one of the 
purposes for which MCC requires the partner governments to retain 
compact-related information for at least 5 years. 

Conclusions: 

Records and information management is important in all government 
agencies, in part because it helps ensure that the agencies remain 
transparent and accountable to the public and allows for congressional 
and executive branch oversight. MCC established a records management 
program that, according to NARA, is comparable to many others in the 
federal government. Yet, as an international aid agency providing 
bilateral assistance to partner governments, MCC's situation regarding 
records and information management is atypical: Much of the 
information related to its core business is generated by the partner 
governments' accountable entities, the MCAs. In accordance with NARA 
guidelines, MCC has established policies and guidelines stipulating 
that the MCAs must provide it with the compact management information 
it classifies as U.S. federal records. However, because its policies 
do not call for, and it does not conduct, systematic reviews of the 
records it receives, MCC cannot be sure that it is meeting the Federal 
Records Act's requirement that it preserve all records documenting its 
functions, activities, decisions, and other important transactions. 

MCC also has established policies that require partner governments to 
retain other compact-related information for at least 5 years after 
the compact closes, to support audits and its own program evaluations. 
However, for the five closed compacts that we reviewed, the variations 
in the partner governments' plans for retaining compact-related 
information could make it difficult for MCC to verify that the 
appropriate information is being retained. While MCC provides the 
partner governments a list specifying what types of documents it 
classifies as compact management records needed for storage at MCC 
headquarters, it does not provide such a list for other compact-
related information expected to be retained in-country by the partner 
governments. A standardized schedule of compact-related information to 
be retained by each partner government would improve MCC's ability to 
find and use this information and increase MCC's efficiency in 
comparing similar information across compacts. 

Last, while four of the five partner governments were able to provide 
the information we requested in our test of MCC's system, the 
inability of one country--Mali, whose government is in transition--to 
produce any of the requested documents calls into question MCC's 
policy of relying on partner governments to retain and store most 
compact-related information. While the situation in Mali is unusual, 
the recent political turmoil in Madagascar, another former MCC 
partner, shows that such situations are not unique. Given that the 
countries that MCC targets for aid are, by definition, in transition, 
MCC could benefit from taking precautionary steps--such as weighing 
the costs and benefits of storing more compact-related information at 
MCC headquarters--to protect and ensure access to compact-related 
information. 

Recommendations: 

We recommend that MCC's Chief Executive Officer take the following 
three actions to strengthen MCC's records and information management 
program: 

1. Develop a policy requiring--and conduct--periodic reviews of each 
set of compact management records that MCC receives from partner 
governments, to ensure that the records are complete. 

2. Revise program closure guidelines to include a sample document 
retention schedule, specifying standard types of compact-related 
information that most compacts would need to retain. 

3. Review MCC's policy of delegating the storage of compact-related 
information to partner governments, weighing the costs and benefits of 
storing more of this information at MCC headquarters. 

Agency Comments and Our Evaluation: 

In written comments about a draft of this report, MCC stated that it 
agrees with our recommendations and is taking steps to implement them. 

* With respect to our first recommendation--to develop a policy 
requiring, and to conduct, periodic reviews of each set of compact 
management records received from partner governments--MCC stated that, 
although it has been conducting selected reviews of compliance with 
compact records management requirements, making the practice more 
systematic would be useful. To that end, its Department of Compact 
Operations will ensure that reviews of MCC and MCA compliance with 
compact management records polices are incorporated in both 
implementation and close-out procedures. 

* With respect to our second recommendation--to revise program closure 
guidelines to include a sample document retention schedule--MCC stated 
that it will consider how best to structure a standardized list of 
core documents that also preserves a country's flexibility to tailor 
its document retention schedule in light of local laws and the 
specific types of compact projects. 

* With respect to our third recommendation--to weigh the costs and 
benefits of storing more compact-related information at MCC 
headquarters--MCC stated that it will review, and revise as necessary, 
its Policy and Procedures for Compact-Related Federal Record Keeping 
to ensure that it specifies all documents that should be defined as 
federal records. 

We have reprinted MCC's comments in appendix III. We have also 
incorporated technical comments from MCC in our report where 
appropriate. 

NARA also provided technical comments on a draft of this report, which 
we have incorporated as appropriate. In addition, NARA stated that 
having reviewed our description of MCC's classification of federal 
records and "non-records" as they pertain to the MCAs, it will contact 
MCC to ensure that proper classification is occurring. 

We are sending copies of this report to interested congressional 
committees and the Millennium Challenge Corporation. In addition, this 
report is available at no charge on the GAO website at [hyperlink, 
http://www.gao.gov]. 

If you or your staff members have any questions about this report, 
please contact David Gootnick at (202) 512-3149 or gootnickd@gao.gov. 
Contact points for our Offices of Congressional Relations and Public 
Affairs may be found on the last page of this report. GAO staff 
members who made major contributions to this report are listed in 
appendix IV. 

Sincerely yours, 

David Gootnick: 
Director: 
International Affairs and Trade: 

[End of section] 

Appendix I: Objectives, Scope, and Methodology: 

Our objectives were to (1) examine the Millennium Challenge 
Corporation's (MCC) records and information management program and 
practices and (2) assess partner-country governments' implementation 
of MCC guidelines for retention and storage of compact-related 
information. 

To examine MCC's records and information management program and 
practices, we reviewed MCC's policies and guidelines regarding records 
and information management, focusing in particular on three documents: 
Records and Information Management Policy (June 2011), Policy and 
Procedures for Compact-Related Federal Recordkeeping (September 2012), 
and Program Closure Guidelines (May 2011). We also reviewed the 
results of MCC's annual self-assessment surveys from 2009 through 
2012, a tool that the National Archives and Records Administration 
(NARA) developed to assess agencies' self-compliance with the Federal 
Records Act and other laws and regulations related to records 
management, and we reviewed relevant laws, regulations, and circulars 
produced by the Office of Management and Budget. In addition, we 
interviewed officials at MCC and NARA. 

To assess partner governments' implementation of MCC's guidelines for 
retention and storage of compact-related information, we selected five 
closed compacts--Armenia's, Benin's, El Salvador's, Ghana's, and 
Mali's--to use as case studies. We chose these compacts because they 
closed after May 2011 and therefore were subject to MCC's Program 
Closure Guidelines, which were finalized that month. We reviewed the 
documentation that the partner governments or their accountable 
entities (usually referred to as Millennium Challenge Accounts, or 
MCAs) had provided to MCC in response to those guidelines. Regarding 
MCC's requirement that the partner governments make provisions for the 
form and manner of document storage, we reviewed the compacts' program 
closure plans to ensure that provisions for document storage were 
included, but we did not verify that specific storage requirements--
such as security and acclimatization--were met. 

We also conducted a test of MCC's ability to retrieve compact-related 
information from partner governments after compact closure. For this 
test, we asked MCC to request that the partner governments for the 
case-study compacts provide copies of documents that the U.S. Agency 
for International Development's (USAID) Office of the Inspector 
General (OIG) had collected during the course of performance and 
financial audits of the five countries. [Footnote 27] We selected the 
audits from a list that the OIG provided, and we drew from those 
audits a random sample of documents that we requested from the partner 
governments. We used OIG files because it has conducted audits in all 
5 countries, whereas GAO has not. 

* Selection of performance and financial audits. The OIG provided a 
list of 10 performance and 4 financial audits that it considered 
relevant to our case studies. We removed one performance audit from 
the list, because the OIG had conducted the audit prior to any MCC 
compact's entry into force and the audit therefore would not yield 
valid documents. We then selected three performance audits and one 
financial audit to review for each of the case-study compacts (except 
Armenia's, for which the OIG did not conduct a financial audit). 
Several of the performance audits on the OIG's list covered more than 
one of the case-study compacts. Because Armenia and Benin's compacts 
were both covered in two performance audits and Mali's compacts was 
covered by three performance audits, we included all of these audits 
in our sample. Because Ghana's and El Salvador's compacts were each 
covered by more than three performance audits, we randomly selected 
among the relevant audits. Because the OIG conducted only one 
financial audit per compact (except Armenia's), we selected all of the 
listed financial audits. See table 3 for a list of the audits that we 
selected from which we randomly drew supporting documents for our case 
studies. 

Table 3: Selected USAID Office of the Inspector General Audit Reports, 
by Title and Number: 

Report title: Audit of the Millennium Challenge Corporation's 
Resettlement Activities; 
Report number: M-000-13-002-P. 

Report title: Review of Millennium Challenge Corporation's Branding and 
Marking Policies and Practices; 
Report number: M-000-12-002-S. 

Report title: Review of the Millennium Challenge Corporation's Compact 
Modifications; 
Report number: M-000-12-006-S. 

Report title: Audit of Millennium Challenge Corporation-Funded Programs 
in El Salvador; 
Report number: M-000-11-005-P. 

Report title: Review of Millennium Challenge Corporation-Funded 
Contracts with Government-Owned Enterprises in Mali; 
Report number: M-000-11-004-S. 

Report title: Audit of the Millennium Challenge Corporation's Access to 
Markets Program in Benin; 
Report number: M-000-10-001-P. 

Report title: Audit of the Agricultural Credit Program in Ghana; 
Report number: M-000-09-005-P. 

Report title: Audit of Compliance with Procurement Requirements by the 
Millennium Challenge Corporation and its Compact Countries; 
Report number: M-000-08-002-P. 

Report title: Review of Millennium Challenge Corporation Funded 
Projects in Benin; 
Report number: M-000-12-005-S. 

Report title: Limited Scope Review of Millennium Challenge Corporation 
(MCC) Resources Managed by the Millennium Development Authority (MiDA), 
Under the Compact Agreement Between MCC and the Government of Ghana; 
Report number: M-000-11-002-S. 

Report title: Limited Scope Review of Millennium Challenge Corporation 
(MCC) Resources Managed by the Millennium Challenge Account-Mali (MCA-
Mali), Under the Compact Agreement Between the MCC and the Government 
of Mali; 
Report number: M-000-10-004-S. 

Report title: Millennium Challenge Corporation and Accountable Entities 
Compliance with "Policies and Procedures for Common Payment System"; 
Report number: M-000-09-001-S. 

Source: USAID Office of the Inspector General. 

[End of table] 

* Random sample of audit documents. Each audit contained multiple 
files, from which we randomly drew a sample of 93 documents: 20 
documents for Benin's, Ghana's, and Mali's compacts; 18 documents for 
El Salvador's compact; and 15 documents for Armenia's compact. The 
number of documents that we sampled per compact varied for two 
reasons: (1) because the OIG has not conducted a financial audit for 
Armenia's compact, we were unable to select any financial-audit-
related documents for our sample, and (2) the performance audit files 
for El Salvador's compact contained only 18 appropriate documents. 
Table 4 shows the number of documents we sampled per compact, by type 
of audit (financial or performance). 

Table 4: Number of Documents in Random Sample, per MCC Compact and 
Type of Audit: 

Country: Armenia; 
Financial audit documents: n/a; 
Performance audit documents: 15; 
Total: documents: 15. 

Country: Benin; 
Financial audit documents: 5; 
Performance audit documents: 15; 
Total: documents: 20. 

Country: El Salvador; 
Financial audit documents: 3; 
Performance audit documents: 15; 
Total: documents: 18. 

Country: Ghana; 
Financial audit documents: 5; 
Performance audit documents: 15; 
Total: documents: 20. 

Country: Mali; 
Financial audit documents: 5; 
Performance audit documents: 15; 
Total: documents: 20. 

Country: Total; 
Financial audit documents: 18; 
Performance audit documents: 75; 
Total: documents: 93. 

Source: GAO. 

[End of table] 

* Requests for sampled documents. We provided a list of the randomly 
sampled documents for each case-study compact to MCC. We identified 
each document using, as appropriate, its title, date, and other 
identifying information (e.g., contract number, payment order number, 
beneficiary name, letter recipient). For Benin's, Ghana's, El 
Salvador's, and Mali's compacts, we listed the document titles and 
other information in the document's original language (English, 
French, or Spanish). For Armenia, we translated the title and other 
information into English when necessary. We asked MCC to share these 
lists with the five partner governments and to request that they send 
us copies of the documents, either electronic or paper, within 20 
business days, in keeping with the Freedom of Information Act's (FOIA) 
requirement. In response to an MCC comment that the documents we 
requested would not, as "non-records," be subject to the FOIA 
requirement, we have reported the numbers of documents that the 
partner governments returned within 30 calendar days--the requirement 
stated in MCC's Program Closure Guidelines. However, the numbers of 
documents returned within 20 business days were identical to the 
numbers returned within 30 calendar days. 

* Verification of requested documents. To verify that the partner 
governments provided the documents we requested, we conducted two 
separate comparisons of the documents we received with corresponding 
electronic copies, which USAID's OIG had allowed us to retain in our 
files. 

We conducted this performance audit from September 2012 to June 2013 
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 the 
evidence obtained provides a reasonable basis for our findings and 
conclusions based on our audit objectives. 

[End of section] 

Appendix II: MCC Scores on NARA Self-Assessment Survey, 2009-2012: 

Since 2009, the National Archives and Records Administration (NARA) 
has administered a survey to assess federal agencies' compliance with 
federal records-keeping laws and regulations. The Millennium Challenge 
Corporation (MCC) has received the following scores: 92 (2009), 83 
(2010), 76 (2011), and 77 (2012). See tables 5 through 8 below for 
more information. 

Table 5: MCC Scores on NARA Self-Assessment Survey, by Section, 2009: 

Survey sections: Records management program; 
MCC score: 22; 
Total possible score: 26; 
Percentage: 85%. 

Survey sections: Records disposition; 
MCC score: 18; 
Total possible score: 18; 
Percentage: 100%. 

Survey sections: Email; 
MCC score: 30; 
Total possible score: 30; 
Percentage: 100%. 

Survey sections: Electronic records; 
MCC score: 14; 
Total possible score: 18; 
Percentage: 78%. 

Survey sections: Vital records; 
MCC score: 8; 
Total possible score: 8; 
Percentage: 100%. 

Survey sections: Total score; 
MCC score: 92; 
Total possible score: 100; 
Percentage: 92%. 

NARA rating of overall risk factor: Low. 

Source: GAO analysis of MCC results on NARA survey. 

[End of table] 

Table 6: MCC Scores on NARA Self-Assessment Survey, by Section, 2010: 

Survey sections: Records management program; 
MCC score: 14; 
Total possible score: 14; 
Percentage: 100%. 

Survey sections: Records management activities; 
MCC score: 12; 
Total possible score: 15; 
Percentage: 80%. 

Survey sections: Electronic records; 
MCC score: 12; 
Total possible score: 15; 
Percentage: 80%. 

Survey sections: Records disposal; 
MCC score: 16; 
Total possible score: 18; 
Percentage: 89%. 

Survey sections: Vital records; 
MCC score: 8; 
Total possible score: 8; 
Percentage: 100%. 

Survey sections: Records management training; 
MCC score: 21; 
Total possible score: 30; 
Percentage: 70%. 

Survey sections: Total score; 
MCC score: 83; 
Total possible score: 100; 
Percentage: 83%. 

NARA rating of overall risk factor: Moderate. 

[End of table] 

Source: GAO analysis of MCC results on NARA survey. 

Table 7: MCC Scores on NARA Self-Assessment Survey, by Section, 2011: 

Survey sections: Records management activities; 
MCC score: 20; 
Total possible score: 20; 
Percentage: 100%. 

Survey sections: Oversight/compliance; 
MCC score: 31; 
Total possible score: 37; 
Percentage: 84%. 

Survey sections: Records disposition; 
MCC score: 16; 
Total possible score: 18; 
Percentage: 89%. 

Survey sections: Electronic records; 
MCC score: 9; 
Total possible score: 25; 
Percentage: 36%. 

Survey sections: Total score; 
MCC score: 76; 
Total possible score: 100; 
Percentage: 76%. 

NARA rating of overall risk factor: Moderate. 

Source: GAO analysis of MCC results on NARA survey. 

[End of table] 

Table 8: MCC Scores on NARA Self-Assessment Survey, by Section, 2012: 

Survey sections: Records management activities; 
MCC score: 21; 
Total possible score: 21; 
Percentage: 100%. 

Survey sections: Oversight/compliance; 
MCC score: 23; 
Total possible score: 31; 
Percentage: 74%. 

Survey sections: Records disposition; 
MCC score: 15; 
Total possible score: 15; 
Percentage: 100%. 

Survey sections: Electronic records; 
MCC score: 18; 
Total possible score: 33; 
Percentage: 55%. 

Survey sections: Total score; 
MCC score: 77; 
Total possible score: 100; 
Percentage: 77%. 

NARA rating of overall risk factor: Moderate. 

Source: GAO analysis of MCC results on NARA survey. 

[End of table] 

[End of section] 

Appendix III: Comments from the Millennium Challenge Corporation: 

Millennium: 
Challenge Corporation: 
United States of America: 
875 Fifteenth Street NW: 
Washington, DC 20005-2221: 
p: (202) 521-3600: 
f: (202) 521-3700: 
[hyperlink, http://www.mcc.gov] 

June 3, 2013: 

David Gootnick: 
Director, International Affairs and Trade: 
U.S. Government Accountability Office: 
441 G Street, NW: 
Washington, DC 20548: 

Re: MCC Response to Draft Report GAO-13-615: 

Dear Mr. Gootnick: 

Thank you for the opportunity to review and comment on the U.S. 
Government Accountability Office's (GAO) draft report, "Millennium 
Challenge Corporation: Review of Compact Records and Information 
Management Program." 

We were pleased to see the report acknowledge the challenges the 
Millennium Challenge Corporation (MCC) faces working in countries 
characterized by major operational and capacity issues. As the report 
notes, four of the five countries included in the review were able to 
provide all or most of the documents requested, and the exception — 
Mali — is literally in the midst of a civil war. As the draft report 
recognizes, MCC has put significant effort into establishing policies 
on records management. In regard to meeting federally-mandated record-
keeping requirements, the GAO audit did not identify any material 
failure to adhere to required standards. MCC, as the report notes, has 
scored as average among much longer-established Federal agencies, and 
we are working to improve those scores. 

As discussed in the draft report, since MCC was created nine years 
ago, the agency has established a records and information management 
program; has established record series and retention schedules with 
the National Archives and Records Administration (NARA); and has 
issued several policies on records, including Records and Information 
Management Policy, the Policy and Procedures for Compact-Related 
Federal Recordkeeping, which identifies numerous compact-related 
documents as Federal Records in its Annex 1, and MCC Program Closure 
Guidelines which provides guidance to accountable entities (MCAs) 
regarding the maintenance of non-records. 

However, as the draft report concludes, there are areas in which MCC 
can improve its records management performance, something to which MCC 
is committed as a matter of principle. In that spirit, MCC found the 
recommendations set out in the GAO report of its records management 
review very helpful. The report makes three recommendations. We are in 
agreement with them and are already taking steps to implement them.
Please find more detailed responses below: 

1. Develop a policy requiring-2nd conduct-periodic reviews of each set 
of compact management records that MCC receives from partner 
governments, to ensure that the records are complete. MCC has been 
conducting selected reviews of compliance with compact records 
management requirements. However, MCC agrees that making this more 
systematic would be useful and therefore agrees with this 
recommendation. MCC's Department of Compact Operations will ensure 
that reviews of MCC and MCA compliance with compact management records 
policies are incorporated in both implementation and close-out 
procedures. 

2. Revise program closure guidelines to include a sample document 
retention schedule, specifying standard types of compact-related 
information that most compacts would need to retain. MCC has provided 
sample schedules in the past and has worked with MCAs on the 
development of country-specific schedules. It is necessary to retain 
the flexibility to tailor document retention schedules to each compact 
in order to ensure compliance with the laws of the partner country 
and/or to accurately document a specific compact. However, MCC agrees 
in principle that a standardized listing of core documents would be 
useful, so long as it is not read to exclude documents that may not be 
listed but which should be retained due to the laws in the specific 
partner country and/or subject of the compact, and will consider how 
best to structure such a list. 

3. Review MCC's policy of delegating the storage of compact-related 
information to partner governments, weighing the costs and benefits of 
storing more of this information at MCC headquarters. We agree with 
this recommendation in that it recognizes the need for continuous 
review and weighing of costs and benefits. We note, however, that MCC 
currently retains all compact-related Federal Records and has not 
delegated this responsibility to the MCA's. We also note that each MCA 
is subject to the laws of the partner country and may be required to 
retain certain documents pursuant to local law, such that it is not 
appropriate to store the original documents at MCC headquarters. 
Nonetheless, MCC reviews and updates its policies on an ongoing basis, 
and we will review and revise as necessary Annex I to the Policy and 
Procedures for Compact-Related Federal Recordkeeping, to ensure that 
it includes all documents that should be defined as Federal Records. 

We would like to take this opportunity to thank you and your staff for 
the professional manner in which this audit was conducted and for the 
opportunity to provide additional information and feedback on the GAO 
draft report. 

Sincerely, 

Signed by: 

Frances Reid: 
Senior Investment and Risk Officer: 
Office of the Chief Executive:
Millennium Challenge Corporation: 

[End of section] 

Appendix IV: GAO Contact and Staff Acknowledgments: 

GAO Contact: 

David Gootnick, (202) 512-3149, or gootnickd@gao.gov: 

Staff Acknowledgments: 

In addition to the contact named above, Emil Friberg, Jr. (Assistant 
Director) and Miriam Carroll Fenton made key contributions to this 
report. Additional technical assistance was provided by Reid Lowe, 
Christopher Mulkins, Justin Fisher, Martin de Alteriis, Nancy Hunn, 
Mark Bird, Etana Finkler, and Ernie Jackson. 

[End of section] 

Footnotes: 

[1] MCC commits funding when a compact is signed and obligates funds 
after the compact enters into force. As of May 2013, MCC had signed 
initial compacts with, in chronological order, Madagascar, Honduras, 
Cape Verde, Nicaragua, Georgia, Benin, Vanuatu, Armenia, Ghana, Mali, 
El Salvador, Mozambique, Lesotho, Morocco, Mongolia, Tanzania, Burkina 
Faso, Namibia, Senegal, Moldova, the Philippines, Jordan, Malawi, 
Indonesia, and Zambia. The compacts with Honduras, Cape Verde, 
Georgia, Vanuatu, Nicaragua, Armenia, Benin, Ghana, and El Salvador 
have ended. In addition, MCC terminated the compacts with Madagascar 
and Mali because both countries underwent a nondemocratic change of 
government. In February 2012, MCC signed a second compact with Cape 
Verde. 

[2] Codified at 44 U.S.C., chapters 21, 29, 31, and 33. 

[3] See GAO, Information Management: The Challenges of Managing 
Electronic Records, [hyperlink, 
http://www.gao.gov/products/GAO-10-838T] (Washington, D.C.: June 17, 
2010). 

[4] See GAO, Standards for Internal Control in the Federal Government, 
[hyperlink, http://www.gao.gov/products/GAO/AIMD-00-21.3.1] 
(Washington, D.C.: November 1999). 

[5] We chose these countries because they were subject to MCC's 
Program Closure Guidelines, which were finalized in May 2011. 

[6] We focused on the following three documents: Records and 
Information Management Policy (June 2011), Policy and Procedures for 
Compact-Related Federal Recordkeeping (September 2012), and Program 
Closure Guidelines (May 2011). 

[7] USAID's Office of the Inspector General is also responsible for 
overseeing MCC activities. 

[8] We requested 20 documents each from Benin, Ghana, and Mali. We 
requested 18 documents from El Salvador and 15 documents from Armenia 
because these were the complete sets of appropriate documents from the 
Inspector General's audit files. 

[9] In addition to compact agreements, MCC provides foreign assistance 
through its Threshold Program, which is designed to assist a country 
in becoming compact eligible by supporting target policy and 
institutional reforms. 

[10] The relevant provisions of the Federal Records Act of 1950 and 
subsequent records management statutes are largely codified in 
chapters 21, 29, 31, and 33 of Title 44 of the U.S. Code. 

[11] The definition of a record is given at 44 U.S.C. 3301. 

[12] 44 U.S.C. § 3102. 

[13] Under the Federal Records Act, NARA shares a number of records 
management responsibilities and authorities with the General Services 
Administration. In addition, the Office of Management and Budget has 
records management oversight responsibilities under the Paperwork 
Reduction Act and the E-Government Act. 

[14] MCC hired a records management officer in 2006 to establish the 
records and information management program. 

[15] A "record series" is the basic unit for organizing and 
controlling files. It is a group of files or documents kept together 
because they relate to a particular subject or function, result from 
the same activity, document a specific type of transaction, take a 
particular physical form, or have some other relationship arising out 
of their creation, receipt, maintenance, or use. 

[16] The document was originally titled "Recordkeeping Procedures for 
the Implementation of Compacts Policy." 

[17] MCC considers other compact-related information to be "non-
records." 

[18] MCC compact management records fall into 10 categories: (1) 
compact core document, (2) program oversight, (3) MCC decisions and 
approvals, (4) program procurement, (5) monitoring and evaluation, (6) 
environment and social assessment, (7) infrastructure, (8) fiscal 
accountability, (9) program MCA documents, and (10) compact close and 
post-compact. 

[19] In addition, the five compacts we reviewed contained a provision 
that requires the partner governments to maintain compact documents 
for at least 5 years after compact closure. 

[20] Prior to compact signature, MCC's Country Team Leader is 
responsible for ensuring that the appropriate records are retained. 

[21] GAO, Standards for Internal Control in the Federal Government, 
[hyperlink, http://www.gao.gov/products/GAO/AIMD-00-21.3.1] 
(Washington, DC: November 1999.) 

[22] According to NARA, it has not received a specific appeal for 
assistance from MCC. However, NARA noted that smaller agencies that 
have limited resources, like MCC, and experience similar challenges 
have generally appealed for assistance. 

[23] According to the Program Closure Guidelines, the documents must 
be maintained at a site that is secure, locked, and acclimatized to 
ensure the documents' viability and the proper treatment of sensitive 
information. 

[24] Armenia provided a draft contract that it would sign to create 
physical archives. Benin provided the protocol that it had signed with 
the government entity that maintains the country's archives. 

[25] In June 2009, MCC terminated its compact with Madagascar because 
of an undemocratic transfer of power in March of that year. MCC has 
stated that it has no diplomatic authority to independently engage 
with the post-coup government in Madagascar. 

[26] MCC does not require that MCAs designate points of contact for 
document retention issues. However, MCC guidelines do require each MCA 
to identify designated representatives who will serve as the primary 
points of contact for any monitoring-and evaluation-related obligation 
of the government. 

[27] USAID's Office of the Inspector General is responsible for 
overseeing MCC activities. 

[End of section] 

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Washington, DC 20548. 

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