Foreign Assistance:

Treasury's Technical Assistance Program

NSIAD-99-65: Published: Mar 12, 1999. Publicly Released: Apr 19, 1999.

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Pursuant to a congressional request, GAO reviewed the Department of the Treasury's Office of Technical Assistance (OTA) foreign aid program, focusing on: (1) the types of technical assistance OTA advisors have provided to Russia and Romania; (2) oversight by OTA of advisors' activities; (3) advisor qualifications, program cost, fund transfers between the Agency for International Development and the Treasury; and (4) the location of the Treasury's senior advisors to its program.

GAO noted that: (1) the Treasury's technical assistance advisors in Russia and Romania have assisted in efforts to reform tax and budget systems, improve banking and debt management policies, and enhance law enforcement; (2) in support of these initiatives, Treasury advisors have helped countries devise new systems and approaches to management of their finances, drafted legislation and procedures, and developed economic models; (3) host-government officials for the most part indicated that the advice received from the Treasury's advisors was beneficial to their reform efforts; (4) the advisor program has been carried out with little formal structure; (5) the only clear mandatory requirement is the filing of monthly reports, and reports of varying content were generally filed on a regular basis; (6) however, other documents OTA officials say they use in their oversight, such as host-country agreements, work plans, and the results of supervisory trips, were not available; (7) OTA has also been lax in enforcing advisors' financial disclosure requirements; and (8) in response to GAO's observations, OTA told GAO that they use informal means such as electronic mail and telephone calls to carry out their oversight of advisor activities.

Recommendation for Executive Action

  1. Status: Closed - Implemented

    Comments: GAO found that the Office of Technical Assistance relied primarily on informal mechanisms to maintain program oversight. As the Office of Technical Assistance began to expand its program outside its primary area of operation of Central Europe and Russia, GAO reported that it should develop more formal policies and procedures for conducting program oversight and enforcing them. Additionally, GAO reported that a more structured approach to program oversight and accountability was needed to provide assurance that the government's interest is protected and to provide an institutional memory that could be used to make future programmatic decisions. The report recommended that the Secretary of the Treasury establish formal requirements and procedures that clearly state advisor responsibilities and ensure compliance. The Department of the Treasury reported on June 16, 1999, that measures have been taken to implement the recommendation and to address the deficiencies identified in the report.

    Recommendation: The Secretary of the Treasury should establish formal requirements and procedures that clearly state advisor responsibilities, and take steps to ensure compliance with these requirements.

    Agency Affected: Department of the Treasury


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