Foreign Assistance: U.S. Food Aid Program to Russia Had Weak Internal Controls
GENERAL ACCOUNTING OFFICE WASHINGTON DC NATIONAL SECURITY AND INTERNATIONAL AFFAIRS DIV
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In December 1998, the United States responded to a request by the Russian Federation for food aid that was triggered by the twin effects of one of the lowest Russian grain harvests in decades and a severe financial crisis. The United States agreed to provide 3.7 million metric tons of food aid in fiscal year 1999 at a cost of approximately 1.1 billion including commodity and freight costs. Most of the food aid was sold by the Russian government to regional mills and processors and is expected to raise about 353.2 million for the Russian Pension Fund and 2.3 million for agricultural projects in Russia. A small portion of the U.S. food aid was donated to Russian social institutions to feed some of the most needy people. The fiscal year 1999 program, which is administered by the Department of Agricultures Foreign Agricultural Service, was one of the largest food aid programs to a single nation in the history of U.S. food aid. Out of concern over the size and complexity of the U.S. food aid program, as well as the well publicized allegations of corruption and misappropriation of government resources in Russia, you requested the General Accounting Office was asked to evaluate how the Foreign Agricultural Service monitored the distribution of U.S. food aid commodities and funds generated from their sale. A key factor in helping managers achieve program objectives and minimize operational problems and risk of fraud and abuse is the implementation of appropriate internal controls. This report focuses on the internal controls used by the Foreign Agricultural Service in its management of the fiscal year 1999 government-to-government food aid programs to Russia.
- Government and Political Science
- Food, Food Service and Nutrition