Defense Finance and Accounting Service Needs to Improve the Process for Reconciling the Other Defense Organizations' Fund Balance with Treasury

reportActive / Technical Report | Accession Number: ADA562352 | Open PDF

Abstract:

We evaluated the adequacy of audit trails and assessed the Other Defense Organizations ODO Fund Balance with Treasury FBWT reconciliation processes. This is one in a series of reports relating to the reconciliation of the ODO FBWT accounts. The first report concluded that the Cash Management Report CMR was not complete or accurate. We found that the Defense Finance and Accounting Service DFAS Indianapolis did not perform adequate, transaction-level reconciliations of the ODO FBWT general ledger accounts. Specifically, DFAS Indianapolis did not develop processes for the following retrieving the detailed transactions supporting the CMR in a timely manner matching the transactions supporting the CMR to the detailed transactions recorded in the accounting systems and researching, and if necessary, resolving the variances between the two sets of data. This occurred because DFAS Indianapolis did not develop the systems infrastructure, implement systemic processes, or fully dedicate the necessary resources for performing transaction-level reconciliations of the ODO FBWT accounts. DFAS Indianapolis reported that it was responsible for reconciling 723 ODO appropriations with disbursements and collections, totaling approximately 141 billion. Without adequate FBWT reconciliations, DFAS Indianapolis could not support the adjustments it was making to the ODO FBWT accounts, which caused amounts reported on the ODO financial statements to be unreliable. Unreliable financial statements will impede DoDs ability to achieve audit readiness for the Statements of Budgetary Resources by the end of 2014. Unlike DFAS Indianapolis, DFAS Columbus was performing complete, transaction-level reconciliations. In addition, other than allowing 16.1 million in Defense Information Systems Agency disbursements and collections to remain unmatched for more than 4 years, DFAS Columbus provided evidence that it had adequate procedures for researching and resolving variances.

Author(s):
Frontz, Amy J.
Author Organization(s):
DEPARTMENT OF DEFENSE ALEXANDRIA VA OFFICE OF THE INSPECTOR GENERAL
Descriptive Note:
Audit rept.
Pagination:
0030

Security Markings

DOCUMENT & CONTEXTUAL SUMMARY

Distribution:
Approved For Public Release
Distribution Statement:
Approved For Public Release; Distribution Is Unlimited.

RECORD

Collection: TR
Identifying Numbers
Report Number(s):
DODIG-2012-107
Project Number(s):
D2010-D000FA-0097.001
Monitor Series:
DODIG
 Subject Terms
Joint Capability Areas:
JCA_5_Command and Control; JCA_5.3_Planning; JCA_6.4.1_Secure Information Exchange; JCA_6_Net Centric; JCA_6.4_Information Assurance; JCA_5.6.3_Assess Achievement of Objectives; JCA_5.6_Monitor; JCA_4.6.1_General Engineering; JCA_4.6_Engineering; JCA_5.3.4_Develop Courses of Action; JCA_5.3.5_Analyze Courses of Action; JCA_5.3.3_Develop Strategy; JCA_6.2.3_Core Enterprise Services; JCA_1_Force Support; JCA_4.3_Maintain; JCA_1.1.1_Global Force Management; JCA_1.1_Force Management; JCA_6.2_Enterprise Services; JCA_1.2.5_Lessons Learned; JCA_3.2_Engagement; JCA_3_Force Application
Modernization Areas:
Space
Communities of Interest:
Human Systems
Descriptor(s):
*ACCOUNTING, *AUDITING, *DEPARTMENT OF DEFENSE, *DISBURSEMENTS, *FINANCIAL MANAGEMENT, *MILITARY BUDGETS, ACCURACY, RECORDS MANAGEMENT, RELIABILITY
Field(s)/Group(s):
Administration and Management, Economics and Cost Analysis, Military Forces and Organizations
Keyword(s):
*DEFENSE FINANCE AND ACCOUNTING SERVICE INDIANAPOLIS, *OTHER DEFENSE ORGANIZATIONS FUND BALANCE WITH TREASURY RECONCILIATIONS, *DEFENSE FINANCE AND ACCOUNTING SERVICE COLUMBUS, *APPROPRIATIONS, *COLLECTIONS, INACCURATE ADJUSTMENTS, CASH MANAGEMENT REPORT, INTERNAL CONTROLS, UNITED STATES TREASURY, REPORTING, AUDIT READINESS
Report Date:
2012 Jul 09
Creation Date:
2012 Aug 13