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U.S. Environmental Protection Agency
Office of Inspector General
At a Glance
2005-P-00005
February 4, 2005
Why This Review Was
Performed
Under Public Law 106-74, four
Federal agencies were authorized
funds to endow the United States-
Mexico Foundation for Science
(USMFS). As the major U.S.
contributor to the USMFS
endowment, the National Science
Foundation (NSF) Office of
Inspector General (OIG) audited
Federal Government
contributions to the USMFS to
evaluate (1) the adequacy of
policies and procedures for
managing and monitoring the
USMFS award and (2) whether
the USMFS was administering
funds in accordance with award
terms and conditions.
EPA Region 9 awarded Grant
No. XP989490-01 to the USMFS
on September 30, 1999. This $2
million grant was reviewed by the
NSF OIG as part of the audit.
Background
The USMFS is a non-profit
organization that promotes
cooperation in science and
technology to solve problems that
affect both the United States and
Mexico.
For further information,
contact our Office of
Congressional and Public Liaison
at (202) 566-2391.
Catalyst for Improving the Environment
Audit of United States-Mexico Foundation
for Science
What Was Found
The NSF OIG identified several significant non-compliance issues regarding
grants awarded to USMFS by four Federal agencies, including EPA. The
USMFS did not meet its requirement to provide $2 million in matching funds
for its EPA grant, thus violating the terms and conditions of the grant.
According to EPA grant requirements, EPA had the right to reclaim the grant
award if the matching contribution was not made within 1 year of the U.S.
contribution.
The NSF OIG found the USMFS did not have adequate financial management
processes. The NSF OIG identified numerous financial management process
issues, including a lack of written internal control policies and procedures for
its cost accounting system, lack of an adequate labor distribution system, lack
of a process to review and reimburse travel expenditures, and non-compliance
with the single audit provisions under Office of Management and Budget
Circular A-133.
What We Recommend
Based on the findings of the NSF OIG, the EPA OIG recommends that the
EPA Region 9 Administrator require the USMFS to meet its matching
requirements, or recover the $2 million in EPA grant funds. The Regional
Administrator should also require the USMFS to provide documentation
demonstrating that it has adequately addressed the financial management
issues. If the USMFS is unable to provide adequate documentation, EPA
should recover these funds. We also recommend that the Regional
Administrator award no grants until the USMFS is able to demonstrate that it
has adequate financial management processes in place. Further, we
recommend the Regional Administrator coordinate actions with EPA's Grants
Administration Division because the USMFS is an international organization.
To view the full report, click on the
following link:
www.nsf.aov/oia/USMFS05.pdf

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