In accordance with the Reports Consolidation Act of 2000, OIG is submitting a statement on what it considers to be the most significant management and performance challenges facing the Peace Corps. At Peace Corps OIG, we base this statement on the following: our audit, evaluation, and investigative work; our knowledge of the Peace Corps’ activities and operations; and the insights of agency senior leaders who provide their perspectives and expertise. For fiscal year (FY) 2026, we identified the following challenge areas:  Volunteer Delivery System; Volunteer Health and Safety; Human Capital Management; and Information Technology Security Management. Addressing the issues related to these challenge and performance areas will enhance the agency’s operational efficiencies, minimize potential fraud, waste, and abuse, and improve mission effectiveness.

The objective of this Federal Information Security Modernization Act of 2014 (FISMA) review was to determine the effectiveness of the Peace Corps’ information security program and practices based on the fiscal year (FY) 2025 Inspector General (IG) FISMA Reporting Metrics v2.0,1 which are categorized into 6 functional areas and 10 associated domains. The review also evaluated the Peace Corps’ efforts in addressing previously issued exceptions and recommendations.

The audit concluded that the Peace Corps’ financial statements were fairly presented, in all material respects, in accordance with Generally Accepted Accounting Principles (GAAP), and noted two significant deficiencies in the agency’s internal control over financial reporting, as well as one instance of reportable noncompliance related to provisions of applicable laws, regulations, contracts, and grant agreements.