Audit of SBA's Oversight of the SCORE Association

This audit report presents the results of our review of SBA’s oversight of the SCORE Association. The SCORE program is an entrepreneurial development program administered by the Small Business Administration’s (SBA’s) Office of Entrepreneurship Education within the Office of Entrepreneurial Development. The SCORE Association (SCORE) is a single cooperative agreement recipient for the program. Established in 1964 as a national, volunteer nonprofit organization, SCORE has been an SBA resource partner for more than 50 years and provides free of charge business and technical assistance to existing and emerging small business owners nationwide. Our audit reviewed SCORE’s fiscal year (FY) 2017 award of $10.5 million and the first quarter of FY 2018’s award of $11.5 million to determine whether SBA provided effective oversight over the program’s awarded federal funds and the measurement and achievement of program goals. We determined that program officials need to make major improvements to ensure effective oversight of the SCORE program. We found that program officials did not oversee SCORE’s use of federal funds. Specifically, SCORE commingled federal funds with unrestricted donations and used federal funds for unallowable, unallocable, and unsupported costs. We also found that SCORE inappropriately solicited donations for mentoring services, charged for publication materials that did not included the required SBA acknowledgement statement, and improperly managed funds used for cosponsored activities. As a result, we questioned $713,986 of costs that did not adhere to the cooperative agreement requirements or were not properly supported. Also, program officials did not accurately measure or report SCORE’s performance goal achievements. Further, program officials established only one outcome-based performance measure, which limited SBA’s ability to assess whether the program achieved its intended purpose. We made, and management agreed with, 11 recommendations that, if implemented, will improve SBA’s oversight and monitoring of SCORE’s use of government funds and its reporting of performance results. In addition, we recommended that SBA recover or remedy $713,986 of unallowable and unsupported costs. SBA management has planned actions that will resolve all noted recommendations and has demonstrated that it implemented corrective actions to close three of the recommendations.