Sunday, September 14, 2008

How Not to Audit

The Defense Contract Audit Agency (DCAA) appeared before the Senate Committee and Homeland Security and Governmental Affairs last week. DCAA has been the subject of reprimands from GAO for its mishandling of audits as reported by whistleblowers within DCAA.

It looks as though there are two basic operational problems. The primary goal of the audit is to finish it as quickly as possible, rather than assay the quality and reliability of the financial statements. since DCAA is part of DOD, whose efforts are being audited, there is not the level of independence needed for a real audit.

Even the IG for DCAA was criticized by the Senators for revealing the name of the whistleblower to those complained about and for sitting on the complaint for three months.

Will any changes be made? Administration after administration has been mouthing threats to cut staff and make DCAA more effective. Results to date - nada.

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