This report presents the results of our audit of travel conducted outside the Commonwealth of the Northern Mariana Islands (CNMI) by personnel from the Northern Mariana Islands Retirement Fund (NMIRF). The objectives of the audit were to determine whether: (1) NMIRF's travel outside the CNMI was performed in accordance with NMIRF travel policy and applicable laws and regulations, and (2) related travel expenses were valid, necessary, and related to NMIRF operations.

Evidence gathered showed that a number of NMIRF officials and employees did not strictly comply with the agency's travel policy, and at least 21 NMIRF travelers were overpaid by about $42,776. These overpayments occurred because NMIRF management did not strictly enforce the agency's travel policy, and because NMIRF did not always implement travel procedures. As a result, there were no assurances that travel was for the intended purposes. Also, excess travel funds were held by NMIRF officials and employees longer than necessary. Finally, NMIRF travel funds totaling $42,776 may have been improperly paid to travelers.

We recommended that the NMIRF management (Board of Trustees and Fund Administrator): (1) remind all NMIRF travelers to comply with the agency's travel policy and procedures by issuing a memorandum explaining the most important requirements, such as the need to promptly submit travel vouchers and trip reports; (2) consistently enforce sanctions or remedies for travel violations by denying additional travel advances to travelers with unliquidated advances, by immediately making payroll deductions for travelers who fail to submit the required travel documents on time, and by requiring board members, including those who are not government employees, to immediately repay outstanding travel advances; (3) disallow the practice of using corporate credit cards for payment of hotel and car rentals, by using them to guarantee hotel and car reservations only when and if required by vendors, and by adopting a strict credit card policy to limit the use of corporate credit cards; (4) identify off-island meetings and conferences considered non-essential that should be eliminated, and for those to be continued, NMRIF should determine if it can achieve its objectives with a reduced number of participants; and (5) require NMIRF officials and employees to follow the Governor's Travel Directive, which states that all off-island travel must be by economy class. (Recommendation 5 was subsequently withdrawn by OPA and the issue is being referred to the Attorney General's Office.)

In the letter response dated June 8, 2001, the NMIRF Board of Trustees agreed with most of our recommendations. Based on the response received from NMIRF, we consider Recommendations 1, 4 and 5 closed, and Recommendations 2 and 3 resolved. While Recommendation 5 was closed, we are referring that matter to the Attorney General's Office. The additional information or action required to close Recommendations 2 and 3 is presented in the report.

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