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Audit of the Peace Corps’ Fiscal Year 2024 Financial Statements

Report Information

Date Issued
Report Type
Annual/Semi-annual Reports
Description
I am pleased to submit to you the Peace Corps’ Fiscal Year 2024 Financial Statements audit report.1 Williams Adley & Company, LLP, an independent certified public accounting firm was contracted by the Office of Inspector General to audit2 the Peace Corps’ financial statements for the fiscal years ending on September 30, 2024, and September 30, 2023. This year, 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 three 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. The Peace Corps’ agency leaders have demonstrated a longstanding commitment to financial management, as evidenced by more than 15 consecutive years of clean financial statement audit opinions. However, we note that two significant deficiencies reported in this year’s audit are repeat findings from prior years that have been highlighted for the agency’s attention and action but have yet to be fully realized. Specifically, the repeat finding for improper internal controls over Property, Plant, and Equipment (PP&E) contains new and concerning factors that present notable risk to the agency if the finding is not addressed in a timely manner. As described in this audit report, the Peace Corps decommissioned its existing Property Management System in June 2024, without having an operational replacement system. Instead, the agency relied on manual reporting mechanisms that resulted in a variety of challenges, including untimely, inconsistent, and incomplete PP&E data. At the time of this report, the Peace Corps still does not have an operational Property Management System replacement or a projected date for when one will be completed and functional. Generating timely, reliable, and useful PP&E data is essential to ensuring sound agency financial management. However, the current issues with the Property Management System, among the others identified in this audit report, will require focused senior leadership attention to ensure corrective actions are prioritized, potential risks are mitigated, and effective systems are in place.
Agency Wide
Yes (agency-wide)
Questioned Costs
$0
Funds for Better Use
$0
View report on Oversight.gov

Recommendations

Disclaimer: Open/Closed recommendations are updated semiannually.

We recommend that the Peace Corps OCFO updates its policy to include all assumptions and used and the reasoning behind those assumptions.

We recommend that the Peace Corps OCFO determines what information needs to be captured at a transaction level to allow for the identification of the lease and the type of lease (escalating vs. non-escalating) at the disbursement transaction level.

We recommend that the Peace Corps OCFO updates its current lease calculation methodologies to better align with SFFAS 54 and to calculate the interest expense and interest payments.

We recommend that the Peace Corps Office of Management develops and implements a process to capture the information needed to identify a lease, to allow for automation of calculating, reporting, and disclosing required lease balances.

We recommend that the Peace Corps Office of Management ensures the new processes developed to identify and record leases are adequately communicated to impacted personnel, both in writing and through trainings.