Program Has Reached a Large, Diverse Audience, but Measuring Improvements in Mutual Understanding Is Difficult

As of December 2003, Open World reported bringing 6,800 Russian  delegates from seven geographic regions to visit over 1,200 communities in  all U.S. states. Stakeholders Generally Cite Positive Impacts of Program

Based on our analysis of responses to participant surveys conducted by  Open World, as well as our interviews with Open World alumni in Russia,  delegates generally hold highly favorable views of their experience in the  program. While measuring the impact of exchange  programs is difficult because the full effects of such programs may not be  known for years, Open World officials agree that such an evaluation is  necessary and hope to conduct one in the near future. Open World Lacks Formalized Financial Management and Accountability Mechanisms

Open World does not have the formalized financial management and  accountability mechanisms—formalized policies, audited financial  statements, an audit or financial management advisory committee, or full  program data—that would provide Congress and other decision makers  with the timely, reliable cost and performance information that is especially  important for a permanent, expanding program. Although Open World has  established procedures for reviewing and approving transactions and  analyzing financial reports, these procedures have not been formalized in  written policies. Most delegates viewed their program experiences very  favorably, and many say they have taken concrete actions to adapt what  they learned from their U.S. visits to the Russian environment. However, because the program does not have formalized  strategic and performance plans with systematic performance  measurement indicators, it is difficult to determine the extent to which  Open World is targeting and reaching the right people and providing  delegates with the right types of experiences, including those that result in  improved mutual understanding. Now that Open World has permanent  status and is expanding its scope, it is appropriate for the program to turn  its attention to enhancing its strategic and performance planning and  financial management and accountability mechanisms. Recommendations

To enhance Open World’s management, particularly in light of the  program’s expansion, this report makes recommendations to the Chairman  of the Board of Trustees of the Open World Leadership Center to (1)  establish strategic and performance plans that articulate Open World’s  direction and set measurable goals and indicators; (2) strengthen the  program’s mechanisms for collecting data and reporting on program  performance; (3) assess whether the current procedures provide adequate  internal control over expenditures and grantee oversight; (4) develop and  implement written, management-approved policies, procedures, and  internal controls for Open World’s resources and expenditures; (5) develop  and implement controls and requirements for grantees to provide  accountability for grant expenditures to ensure that funds are spent for  their intended purposes; (6) develop and implement plans for routinely  preparing financial statements that are annually subject to an independent  audit; (7) consider establishing an audit committee or financial  management advisory committee to provide the Board of Trustees and  management with independent advice on financial management,  accountability, and internal control issues; and (8) estimate and disclose  the value of contributed services from U.S. volunteers to better reflect the  total scope of the program.
Why GAO Did This Study

Congress created the Russian Leadership Program in 1999 as a pilot project to promote mutual understanding by exposing emerging Russian leaders to the American economic system and democratic institutions. In 2003, Congress renamed the program the Open World Leadership Center, expanded its scope, and extended eligibility to a number of other countries. Because Open World had not been independently evaluated, GAO was asked to review (1) the program's progress toward achieving its overall purpose and (2) whether it has appropriate financial management and accountability mechanisms in place.

What GAO Found

Open World has exposed a large, broad, and diverse group of Russians to U.S. economic and political systems. As of December 2003, the program brought about 6,800 men and women from Russia's seven geographic regions to more than 1,200 U.S. communities. Our analysis found that most delegates generally hold highly favorable views of their experience in the program. Many found ways to adapt what they learned to the Russian environment. Also, embassy officials said Open World complemented U.S. mission activities. However, because the program does not have formalized strategic and performance plans with measurable indicators, it is difficult to determine the extent to which it is targeting and reaching the right people and giving them experiences that result in improved mutual understanding. While Open World does survey delegates about their experiences, it has not yet conducted a full program evaluation to determine progress toward its long-term goals. Open World officials agree that such an evaluation is necessary and hope to conduct one in the near future. Open World does not have the formalized financial management and accountability mechanisms that would provide Congress and other decision makers with timely and reliable information about its cost and performance. Now that Open World has permanent status and is expanding its scope, it is appropriate for the program to turn its attention to enhancing these mechanisms. Its procedures for reviewing program transactions and analyzing financial reports have neither been evaluated for their adequacy nor formalized in writing; and it does not prepare financial statements that can be subject to an independent audit. In addition, Open World does not have an audit or financial management advisory committee to advise the Board of Trustees on financial management, accountability, and internal control issues. Finally, Open World is not disclosing the value of services contributed by U.S. volunteers who support the program--information that generally accepted accounting principles encourage entities to disclose, if practicable.