DCCUBENT ESURE 01921 - A1192181] [The Use of a Decentralized Audit Cperatinn for Performing Reviews of United States Activities Overseau]. 1D-77-35; B-188834. April 22, 1977. 3 pp. Report to Rep. Clement J. Zablocki, Chairman, House Committee on International Relations; by Elmer E. Staats, Comptroller General. Issue Area: Internal Auditing Sisterms (200). Contact: International Div. Budget Function: Miscellaneous: Financial Management and Information Systems (1002); International Affairs (130). Congressional Relevance: House Committee on International Relations. The advantages and disadvantages of the use of a decentralized audit operation for performing reviews of U.S. activities overseas ere investigated. Findings/Conclusions: The General Accounting Office presently has three branches at overseas locations: the European Branch, with 45 professional and 5 support personnel; the Far East Branch, with 40 professional and 6 support personnel; and the Latin American Branch, with 15 professional and 2 support personnel. The permanent staffs overseas are periodically supplemented, when required by c&alcad, with temporary duty erscnnel from the U.S. Temporary duty personnel join project teams hi-' are composed principally of the experienced overseas staff. The ability to recruit and ffectively perform the necessary overseas assignments us.nq temporary duty perscnnel would be an almost impossible task. ILe additional cost of maintaining the modest overseas staffs are more than overcome by the producing of audits that are acre efficient, effective, and timely than could be expected with a temporary duty approach. The decentralized crganizaticn provides quicker and better service on high-priority tasks that have close deadlines; better relations with associate organizations and goverament officials in the areas covered; improved professional expertise gained from firsthand and continuous experience; and the maintenance of higher employee morale than would be possible operating on a centralized basis. There have been few, if any, disadvantages to maintaining the small overseas staffs. (SC) COMPTROLLER GECNERAL OF THE UNItTE STATES WASHINN D.C. W.S. O B-188834 April 22, 1977 The Honorable Clement J. Zablocki Chairman, Committee on International Relations Bouse of Representatives Dear Mr. Chairman: This is in response to your letter of March 22, 1977, regarding the use of a decentralized audit operation for performing reviews of U.S. activities overseas. You stated that, since GAO uses a decentralized audit operation in performing its reviews and evaluations of U.S. activities overseas, yoc would like to have our views on the advantages and'disadvantages of this type of operation. GAO presently has three branches at cverseas loc-ations-- the European Franuh with 45 professional and 5 support personnel is headquartered in Frankfurt, Germany, and covers audits in Europe, Africa, and the Near East to the eastern border of Iran. The Far East Branch with 40 professional and 6 support personnel is headquartered in Honolulu with a s3uboffice n.Bangkok, Thailand and covers audits of U.S. activities throuqghout he Pacific Ocean and Asia to the western borders of Afqhanistan and Pakistan. The Latin Amierica Branch with 15 pofessional and 2 support personnel is headquartered in Panama City, Panama, and i responsible for audits in Cent:al and South America, the West Indies and Mexico. The permanent sffs overseas are eriodically supplemented, when required by the workload, witth temporary duty personnel selected from our headquarters and rgional offices. Cn the average, we find that as much as 25 staff years of assistance are necessary on a temporary duty basis. The personnel selected for temporary duty juin project teams which are composed principally of our experienced overseas staffs in order to maintain the fundamental advantages inherent in resident staffs. ID-77-35 B-188834 In fiscal year 1976, the 100 professional staff members and the temporary duty supplements erformed about 135 different assignments for the International, Logistic3 and Communications, Procurement and Systems Acquisition, and Federal Personnel and Compensation Divisions. The ability to recruit and effectively perform these assignments overseas using temporary duty personnel only would have, in our opinion, been an almost impossible task. The existence f offices overseas st.uffed with auditors who have made a personal commit- ment to live in a foreign climate results in a competence and capability not otherwise obtainable. The permanent staffs overseas are committed to becoming familiar wit the customs, language, protocol, and complexities of United States and host-country functions involved in U.S. programs subject to audit. This essential capability would be very difficult to imbue in stateside staffs recruited to perform on a temporary duty basis in an overseas environment. Further, having staffs available in key locations overseas faci3itater; the efficient performance of the many assignments. In the absence of overseas offices, it would be necessary to Individually recruit and create over 100 individual teams of 2 to 10 auditors to perform the work tt is now assigr.ed to the overseas branches. Staffs committed for tours overseas also provide us with necessary insight into local conditions, which enhances the ability. of the General Accounting Office to maintain continuous oversight over the many activities conducted overseas. Our experien e hs been that there he been few, if arty, disadvantages to maintaining modest staffs overseas to perform essential assignments. It is a fact that overseas operations are more expensive than performing the assignments on a temporary duty basis with stateside personnel. We firmly believe, however; that tis cost is more than over- come with audits that are more efficient, effective, and timely than could be expected from a temporary duty approach. To summarize, we believe that a decentralized organization provides quicker and better service on high-priority tasks that have close deadlines; better relations with associate organizations and government officials in the areas covered; improved professional expertise gained from firsthand and 2 B-188834 continuous experience; and the maintenance of higher employee morale than would be possible operating on a centralized basis. We would be pleased to discuss in greater detail some of the more general matters discussed above. 'y'ou Comptroller General of the United States 3-
The Use of a Decentralized Audit Operation for Performing Reviews of United States Activities Overseas
Published by the Government Accountability Office on 1977-04-22.
Below is a raw (and likely hideous) rendition of the original report. (PDF)