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.
Open Recommendations
| Recommendation Number | Significant Recommendation | Recommended Questioned Costs | Recommended Funds for Better Use | Additional Details | |
|---|---|---|---|---|---|
| 5 | No | $0 | $0 | ||
| We recommend that the Peace Corps OCFO develops and documents a process for adopting and implementing new accounting standards and guidance going forward, including, but not limited to, the implementation of the embedded leases13 portion of SFFAS 54. | |||||
| 6 | No | $0 | $0 | ||
| We recommend that the Peace Corps OCFO updates its policy to include all assumptions and used and the reasoning behind those assumptions. | |||||
| 7 | No | $0 | $0 | ||
| 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. | |||||
| 8 | No | $0 | $0 | ||
| 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. | |||||
| 9 | No | $0 | $0 | ||
| 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. | |||||
| 10 | No | $0 | $0 | ||
| 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. | |||||
| 11 | No | $0 | $0 | ||
| We recommend that the Peace Corps implements the provided FISMA recommendations from the Peace Corps OIG Report on FISMA (IG-25-01-SR) to mature and improve its information security program. | |||||
| 1 | No | $0 | $0 | ||
| We recommend that the Peace Corps Office of Management establishes a process and procedure for all Peace Corps offices to record property on tracking spreadsheets and provide those spreadsheets to the Office of Management on a monthly basis, until Maximo is fully operational. Follow-up with any offices that are not adequately submitting the information. | |||||
| 2 | No | $0 | $0 | ||
| We recommend that the Peace Corps Office of Management establishes a plan with milestones and timelines to fully implement Maximo as soon as possible and work with OCFO and the offices to ensure all applicable property data is transferred into the system. | |||||
| 3 | No | $0 | $0 | ||
| We recommend that the Peace Corps OCFO perform monthly reconciliations of information entered on the property tracking spreadsheets with payable data in Odyssey and research any discrepancies to ensure the completeness and accuracy of the property tracking spreadsheets. | |||||
| 4 | No | $0 | $0 | ||
| We recommend that the Peace Corps OCFO, once Maximo is operational, perform monthly reconciliations between Maximo and Odyssey and investigate any differences. Coordinate with the Compliance and Risk Office to review the initial reconciliations to ensure it is designed and operating effectively. | |||||
