Audit report n°91/389 : finalized January 1992

I DISTR.: RESTRICTED WORLD HEALTH ORGANIZATION AUDrr REPORT NO. 9l/389 ONCHOCERCIAS]S CONTROL PROGRA.I"IME (OCP) OUAGADOUGOU, BI.TRKINA FASO Finalized January 1992 OFFICE OF AUDIT AND ADMTNISTRATIVE MANAGEMENT AUDrT R_EPoRT NO. 9L/389 oNcHocERcIASIS CoNTROL PROGRAITUE (OCP) OUAGADOUGOU, BIIRKINA FASO Finalized January 1992 Table of Contents Paqe 1 INTRODUCTION 11 L2 31 32 33 34 35 36 37 38 39 Background The Present Status of the Programrne 1 1 2 2 SCOPE OF THE ETAUINATION 3 RESULTS OF THE EXAI{INATION Personal Accounts Sundry Debtors and Creditors Reserves Inventories Visit to the Eastern Operational Area Financial Reporting Expenditure Accounting Insurance Administrative Support provided by OCP Headquarters Ouagadougou 3 3 3 3 4 4 5 8 8 8 9 1 INTRODUCTION 11 Backeround The Onchocerciasis Control Programme (OCP) was set up in L974 as a multi-donor disease control progra[une at the request of seven countries : Benin, Burkina Faso , Ghana, C6te d' Ivoire , l'lali , Niger and Togo. Its overriding objective was to reduce the impact of onchocerciasis to a sufficiently low leve1 so that it no longer represents either a public health problem or an obstacle to socio - economic development. The prograume activities were subsequently extended westwards in 1989 after four other countries had joined in 1985: Guinea, Guinea Bissau, Senegal and Sierra Leone. These four countries together with Mali formed the Western Extension of the Programme area. The objectives of extending the programme operations to the Western and Southern areas were to combat reinvasion of blackflies and to interrupt the transmission of onchocerciasis in these countries. The OCP area including the extension areas covers about 1 3OO 000 km2 with a population of some 30 million. The main characteristics of the organizational set-up in the Western Extension zone is that all the staff, administrative and technical, are national employees of their governments. The programme activities are being carried out by the nationals under the guidance and direction of the OCP Management. The programme is sponsored by four multilateral agencies: WHO, World Bank, FAO and UNDP. There are now 23 donors providing financing. The World Bank mobilizes funding for OCP and manages Programmes' trust fund whilst WHO is the Executing Agency. WHO consultation with the Committee of Sponsoring Agencies (CSA) and participating countries, appoints the Programme Director, who is chief executive officer of OCP. the the in the The Trust Fund agreement provides for six-year financial phases, but the programme works on annual budget cycles for accountability purposes and in respect of use of funds and achievement of planned prograrutre results. 2The programme is being audited annually both by Internal and External Audit. It also undergoes annual technical reviews by the Expert Advisory Cornmittee (EAC) which reports its findings to the Joint Programme Comrnittee (JPC). t2 The Present Status of the Proeranme Our review of reports by expert committees, including a most recent rePort by the External Review team conducted in June/July 1990, showed that the programme has achieved a rernarkable success in interrupting the transmission of onchocerciasis in the original area. On the achievements of Ehe Progr€unme, the External Review report states that "few progran'rmes can claim the kind of success that the OCP, inspite of seri-ous obstacles, has achieved in the past 15 years. In all of the original Programme area the disease has ceased to be a public health problem" . With the successful elirnination of onchocerciasis as a public health problem in the original area, OCP presently has two important issues to deal with. One is the reinvasion of blackflies into the western and south-eastern border zones from sources located outside the OCP area. The problem and control of reinvasion is now being dealt with successfully by extending vector control activities into the Western Extension zone which covers five countries: Guinea, Guinea Bi.ssau, Senegal, Sierra Leone and part of Mali. The second important issue is the "Devolution" when maintenance of OCP achievements after cessation of Programme operations will be the resPonsibility of the participating countries. OCPs contribution to devolution includes: (a) the development of technical standards and evaluation of entomological and epidemiological surveillance; (b) training of nationals in all aspects of OCP operations as well as health care systems; (c) advising the participating countries on the development of national plans for devolution. Devolution plans for Mali, Niger and Burkina Faso have already been approved by the JPC and draft plans submitted for Benin, Ghana, C6te d'Ivoire and Togo.V- It, ( 3 2 SCOPE OF THE EXAUINATION A financial audit of the Onchocerciasis Control Programme (OCP) was carried out in February/March 1991. The audit included reviews of.major internal controls covering banks, imprests, and other liquid assets, personal accounts, debtors, creditors and an exami-nation of a selection of other financial and administrative operations. Besides the OCP Headquarters at Ouagadougou, the auditor also visited the Sector Office for the Eastern Operational Area (EOA), located in Kara, Togo, where aerial operations for the eastern area and stocks of materials are warehoused and controlled. 3 RESULTS OF THE EXAI{INATION The overall results of the audit were satisfactory. Our comments and observations on various matters which came to attention in the course of the audit are set out below for information and action where appropriate 31 Personal Accounts A review of personal accounts revealed thirteen accounts with long outstanding balances. It is rec ommended that personal accounts should be reviewed frequently to improve recovery ofand effective follo!/-up action be taken outstanding items. 32 Sundrv Debtors and Creditors In January 1990, the "Aircraft Conditional Sales Agreement" for the i{HO owned Turbo Thrush was renegotiated with Evergreen Helicopters. WHO agreed to the extension of the period of repayment from 31 December 1989 until 30 April 1992. In consideration of the extension of time, Evergreen Helicopters agreed to pay to WHO the amount of US$ 91 362, instead of the balance due at 31 December 1989 of US$ 82 185. The increased sale price of USg 8 500 had not been reflected in the debtor account set up to control the amount due and payabre by Evergreen Helicopters. The necessary accounting entries have since been passed. rl t 4I^Ie noted that services such as repairs of wehicles, freight and clearance charges, etc., were being provided by OCP to the Office of the WHO Representative, Ouagadougou on a reitrmbursable basis. The cost of such services was being debited to a debtor account and periodically billed to the wR. rt was agreed that a more efficient way to account for these costs would be for OCP to debit AFRO by inter-office voucher quoting the sticker mrmber. This procedure has since been implemented. 33 Reserves Manual rv.4.115 prescribes that the contracts of short-term staff members be obligated up to 31 December against the current year's allotments. A review of 1990 reserves revealed six cases of contracts of short-term staff that were obligated beyond 3l- December 1990 as follows: One contract was obligated to end February; June; one up to July; one up to September; October 1991. two were obligated up to and one up to We noted one eleven-month consultantship starting on 4 December 1990 that was obligated in furr in the 1990 allotment. This action is contrary to Manual IV.6.23O.2 which reads as follows: "For consultants, the per diem and other costs should be obligated in the year(s) during which services are rendered,'. / OCP is taking appropriate action to ensure strict compliance with the relevant Manual provisions. 34 Inventories / ManuarJvX.5.150 requires that a statement be sent every year to rnternal Audit certifying that inventory reports have been received from all proj ects and that discrepancies have either been satisfactorily explained and/or dealt with by the property Survey committee. rnstead of the certificate, ocp have sent to rnternar Audit in 1989 and in 1990 photocopi-es of arl inventory cards / 5maintained by the prograone. It was agreed that in the future only Ehe statement would be sent to Internal Audit, as prescribed in the I{HO Manual IV. 5 . 150. A review and comparison of the inventory cards for 1989 and 1990 revealed the following: a) Obsolete items, including consumables, were being carried in inventory. (Manual VI.6.20 requires that inventory records should be maintained for items costing US$ 1 000 or more per unit and with a serviceable life of at least 5 years and for attractive items regardless of value.) b) inventory cards were missing in 1990. It was suggested a control checklist be maintained to this effect. Some that X c) Some of the inventory cards were re-written in 1990 and in some of them missing or unfound items were deleted. d) Some items not found in 1989 were still reported missing in 1990 These matters were discussed with the responsible OCP officials and it was suggested that, given the size of uhe inventories and the widespread location, OCP should consider introducing procedures as part of its periodic Inventory Verification System to ensure that the condition of inventories is assessed and obsolete and damaged items are reported to OCP. Any discrepancies, items missing and found shourd also be reported as required by Manual provisionslYX.6.110-120. 35 Visit to the Eastern Operational Area A visit was made to the Sector Office of the Eastern Operational Area (EOA), located in Kara, Togo. A review of the control of fuel and larvicides was carried out with satisfactory results. The basis of the system are manually kept inventory control cards which are updated immediately upon the return of the pilots from the missions. We attended the debriefing of one of the pilots just returning from a four-day mission and carried out a "walk through" of the system in place. 6Briefly, the system operates as follows: Pilots are required to do a physical count of all stocks of larvicides and fuel at each landing. Verified stocks are recorded in a fright report that is handed in to aerial operations at the end of the rnission, nornally on Friday. The flighc reports also record the quantities taken and, when called for, the quantities of larvicide returned to the depot. Aerial operations update the inventory cards and compare the balances in the card to the physical stock-taking done by the pilot. Any discrepancies are irnruedi-ately noted for investigation by the pilot nexE scheduled to land at the snme depot. A computer-based logistics support system is updated using che flight reports. Minimum levels of stocks are controlled and, when necessary, depots are re-stocked ower the week-end to permit flight operations to resume by Tuesday. A full physical inventory of all depots in the Eastern operational Area was carried out by ocP officials in the period between 17 and 22 December 1990. we compared the results of the physical inventory to the stock cards and to the pilot's flight report for the last time that stocks were taken in 1990 and found no discrepancies. This attests to the quality of record-keeping and to the care and dedication of the pilots in controlling and recording stocks under extreme conditions.l/ The results of the physical inventory carried out in December 1990 are reflected in a comprehensive report submitted by EoA Aerial operations to ouagadougou. The salient points are summarized hereunder: Ref' Management Survey Report No. 188: Stock Control and Management ofAviation Fuel and rnsecticides in ocp (Augusr 19g6) conducted by theOffice of Administrative Management and Evaluation (now Office tf e,rait and Administrative Management). The present Stock Control System is a result of that survey. L/ (a) Jet A1 Aviation Fuel (i) losses (licers) - seepaSe - contamination - theft seepage theft (ii) 1990 stocks 466,730 (iii) theft as percentage of stocks 0.577. (iv) 1,400 liters were stolen from one depot, 600 liters and 150 liters from two others. A11 three depots have been moved to different locations. (v) physical inventory: SIJRPLUS 3 ,040 (b) Larvicides (i) losses (liters) 7 300 380 2 640 830 2.4s3 3,32O 3,283 (ii) 1990 stocks (liters) 343,639 (iii) thefts as percentage of stocks O.IL'L (iv) no major thefts are reported. Protective measures taken are: moving depots, hiring a guard, contacts with the local authorities and village leaders. (v) physical inventory: SIJRPLUS attributed to the new spraying systems which tend to record more underdosage than overdosage. 3,230 /8 36 Financial Reporting At the country level, the accounting procedures that have been set up for the National Teams to observe are those of a WHO office handling an imprest fund. IJHO forns for imprest accounting and reporting are being used, backed-up with original documentation in accordance with WHO provisi-ons. The National Teams are being provided with fixed "ceilings" of funds equivalent to 2.5 month's estimated expenditure. The accountability through the imprest fund system used in the Western Extension is an appropriate one and we recorunend that this method of imprest accounEing be specifically provided for in the new country agreements under consideration. 37 Expenditure Accountlnq An analysis of expenditure transactions in the period 1 January to 31 October 1990 revealed that most of the transactions under aerial operations and insecticides had been accounted for under expenditure accountj-ng code 430 - rental/maintenance of equipment. The review of 430-coded transacti,ons showed that in several cases a different expenditure code would have been applicable. Explanations were given that going down to each single I,IHO expenditure code would increase OCP's workload unnecessarily. However, it was agreed that proper codings should be used to the extent required for OCP operations. 38 Insurance It is understood that the National Team staff handling imprest accounts are not covered by the Organizaxion's fidelity bonding insurance. OCP should consider whether it is worthwhile to arrange for their inclusion in the Organization's insurance policy, or if not, to contract for such insurance separately. A 939 Adnlnistrative Support Provlded by OCP Headquarters Ouasadoueou The operation of extension areas by National Teams started in 1989. It soon bec:me apparent through OCP's internal reviews and site visits by CAII and BFO that there was a need to provide further training to the National Teaus in adrninistration, financial reporting and administrative Eatters, including supplies and transport in order to make for successful progrrmme oPeration. In response to this need, OCP's Management has developed prograrnme courses for National Coordinators, their deputies and administrative assistants. The first management seminar for the National Team members was held in February 1990 in Ouagadougou. This seminar, which dealt with management, administration, supply and transport services, identified areas for improvement and action to be taken. Guidelines were subsequently issued, setting out OCP practi-ces for dealing with each function. Th.y covered such areas as financial accountability, reporting through imprest funding, transport maintenance, "safe driving" rules, stock and fuel control systems and several other related activities. In September 1990 the National Coordinators were provided with a series of comprehensive pamphlets provided by CAM dealing with several aspects of successful management principles and methods. A second seminar was held in February 1991. A roving Finance Officer was appointed to visit National Team offices to ensure compliance with OCP rules and regulations and provide advice on corrective actions. Audit reviews of the National Team operations were carried out in two countries, one in Bamako and a second in Sierra Leone in October 1990 at the request of the Programme Director, to exami-ne the internal control system and suggest improvements where appropriate. Audit findings reconmended were reported in the Audit Reports No. 90/314 and 90/378 which OCP Management accepted to implement. ****** Geneva, l0 February !992 fterf"",-r\ Helge K. Larsen Chief, Office of Audit and Administrative Management