Review of Internal Control Over Cash Receipts and Disbursements at the U. S. Embassy in Dacca, Bangladesh

A review of internal controls over cash receipts and disbursements at the U.S. Embassy in Dacca, Bangladesh revealed a problem regarding local national personal services contracting. An analysis of this contract disclosed that it had many elements of a personal services contract. State Department Posts do not have the authority to enter into this type of contract, and therefore, a question arose as to whether this contract was improper or, possibly illegal. The embassy questioned the propriety of the contract and asked the State Department for guidance. The State Department replied that while the contract might not be illegal, it was improper. GAO recommended that, since alternate sources for the needed services were unavailable, the contract not be terminated until a definitive opinion of propriety was obtained. In view of the questions raised about this matter, GAO believed that the Near Eastern and South Asian Affairs Bureau should have taken definitive action. In order to show that the Post in Bangladesh is in full compliance with guidelines and local national personnel ceilings, GAO requested that the Bureau inform GAO of the actions taken to rectify the contract.