On September 21, 2005, the OIG issued Audit Report 5-23, Audit of SBA’s Administration of its Special Appropriation Grants. The objectives of this audit were to determine if the (1) Office of Administration (OA) is exercising adequate oversight of its special appropriation grans by following its own policies and procedures, (2) appropriate documentation was provided by the grantees and reviewed by the SBA to determine compliance with applicable policies and procedures before grantee costs were reimburse, and (3) OA is ensuring that the grantees are delivering the services promised in their proposals.
The OIG determined that the OA did not exercise adequate oversight of the three grants reviewed. The OIG found that grantee claimed costs and reimbursements by the OA were not compliant with applicable policies and procedures. Further, because the OA did not enforce the financial and performance-reporting requirements of the grants, the OIG was unable to determine if the grantees were delivering the services promised in their proposals. Lastly, the OA did not have formal written procedures that guide the review, monitoring, and oversight of its sizable portfolio of special appropriate grants. The OIG found that grant applications were approved, routinely, without adequate review, and reimbursement requests were given minimal scrutiny, if any, before being processed for payment.