Requirements for cooperating sponsors’ reporting of loss, damage, or misuse of commodities to USAID or the diplomatic post are set forth in 22 CFR 211.9(f)(e). Specifically, the regulation delineates the information that cooperating sponsors must provide to USAID in loss reports.
The regulation requires that quarterly loss reports to USAID or the diplomatic post provide information on losses valued over $500, including the kind and quantity of commodities; the size and type of containers; the time and place of loss, damage, or misuse; the current location of the commodities; the estimated value of the loss, damage, or misuse; and other pertinent information. If any of this information is not available, the cooperating sponsors must explain why.
In addition, the Food for Peace Handbook, formally known as USAID Handbook 9, Chapter 10 D.2.b, states that the cooperating sponsor must review every loss to determine if a claim was warranted against a third party, and submitted loss reports should include the reason(s) for either instituting or not instituting claim action.
It is extremely important that consultation and discussions with the USAID mission take place on a regular basis to review the criteria that are being used to determine if claim action is justified. Missions are also responsible for determining the validity or propriety of each commodity loss claim, including whether the loss or damage could have been prevented. If the cooperating sponsor is found to be responsible for the loss, 22 CFR 211.9(d) requires the cooperating sponsor to pay the U.S. Government for the value of any commodities lost or damaged, unless USAID determines that the loss could not have been prevented by proper exercise of the cooperating sponsor’s responsibility.
Source:AUDIT REPORT NO. 7-685-10-003-P February 11, 2010
This information is derived from audit reports of the Office of the Inspector General. The source refers to the audit report, which is available on this site as part of the Audit Database Project: an educational tool for compliance with USAID regulations. Please see the disclaimer of this site before using this information.
- Conduct Property End-Use Checks - Code of Federal Regulations, Title 22: Foreign Relations, Part 226.34 - ADS 324
- Adequate Controls Over Food Distribution Were Not Fully Implemented - Principle IV-2 of the Generally Accepted Commodity Accountability Principles - 22 CFR 211.10(a) - Principle II-3 of the Generally Accepted Commodity Accountability
- Storage Conditions for Food Commodities Need Improvement - Generally Accepted Commodity Accountability Principles - 22 CFR 211.10(c) - 22 CFR 211.5(a)
- Requiring Containerization Has Not Been Fully Considered - Principle IV-2 of the Generally Accepted Commodity Accountability Principles
- Assets May Have Been Diverted - GAO’s “Standards for Internal Control in the Federal Government
- Strengthen Commodity Controls - P.L. 480 Handbook
- Options for Unused Equipment - ADS 324.5.4b
- Adequate Controls Over Food Distribution Were Not Fully Implemented - Principle II-3 of the Generally Accepted Commodity Accountability Principles - 22 CFR 211.10(a)
- Storage Conditions for Food Commodities Need Improvement - Generally Accepted Commodity Accountability Principles, Principle IV-2,11 - 22 CFR 211.5(b) - USAID Commodity Reference Guide
- Assets Were Missing, Diverted, and Sold for Profit - GAO publication Standards for Internal Control in the Federal Government, pages 14 and 15
- Partner Did Not Track or Manage Inventory Effectively - ADS 596.3.1 - GAO’s publication Standards for Internal Control in the Federal Government