The Department of Labor (DOL), Employment and Training Administration (ETA), awarded its final round of Job Training Partnership Act, Title IV, Pilot and Demonstration Grant Program funds for the Youth Opportunity Area Out-of-School Youth (YOA OSY) program in April 1999. Four of the 5 programs were audited in 2000. This audit is a follow-up to the Office of Inspector General's (OIG's) March 22,2000 report on the first round YOA OSY pilot demonstration grantees' performance. The following were among the key audit findings: (1) although enrollees' participation rates had increased from the first-round grantees, nearly half the enrollees were no longer in contact with the program at the time of the audit; (2) in-school youth services and outcomes could potentially inflate performance reporting for the YOA OSY program; and (3) although performance reporting systems had improved, the documentation available to support those activities and outcomes was deficient. The following recommendations pertaining to the Workforce Investment Act-funded program Yo! (Youth Opportunity) were issued: (1) develop documentation standards and guidelines for grantees to reinforce ETA expectations; (2) assure that separate performance reporting is maintained for Yo! activities, accomplishments, and outcomes; and (3) encourage all Yo! program grantees to assess each participant's needs at enrollment, provide a wide array of quality services, and develop and implement performance incentives to high-risk program dropouts for major accomplishments. (The Deputy Assistant Secretary for Employment and Training, Raymond J. Uhalde's response to the final audit report is attached.) (MN)