FORT GREGG-ADAMS, Va. –
Defense Contract Management Agency’s Office of Internal Audit and Inspector General is commonly referred to as the inspector general’s office or OIG. But when people hear OIG, inspections come to mind and they forget auditing is also a vital part of the office’s mission.
“One of the biggest misconceptions is that the Inspections and Evaluation Team and the Internal Audit Team are one in the same and perform the same work,” said Alex Sloss, DCMA’s assistant inspector general for auditing and IAT supervisor. “The IAT conducts audits of DCMA programs and processes in accordance with the Government Accountability Office’s Generally Accepted Government Auditing Standards. GAGAS and the required Department of Defense Office of Inspector General peer review every three years provide the highest level of assurance of effectiveness of these programs and processes.”
Conversely, the IET conducts assessments of DCMA mission and business support processes at contract management offices to ensure compliance with agency policies. Bob Conforto, DCMA’s inspector general, added IETs and IATs have the same goal — improving the agency’s efficiency and effectiveness — but the execution is different.
“Reviews or inspections are not conducted with the same level of in-depth scrutiny, investigation or analysis as independent audits,” said Conforto. “Audits provide the highest level of assurance that an organization’s internal controls are working effectively.”
Like all teams within the agency, IAT’s work directly supports DCMA’s mission of being the independent eyes and ears of DoD and its partners.
“Internal audits help the agency run like a well-oiled machine,” said Darryl Hayes, one of the IAT’s six auditors. “My team helps identify internal gaps and provides recommendations on how to address them to mitigate risk and enhance what DCMA already has.”
Some of the audited areas include potential Antideficiency Act violations; Government Purchase Card Program; gainsharing program; cybersecurity workforce; Sexual Assault Prevention and Response; non-tactical vehicle program; utilization of government-owned vehicles; tuition assistance; Centralized Development Program; workload acceptance process; Acquisition Review Board process; and the virtual non-traditional quality assurance surveillance process. Non-audit services include personnel accountability and intelligence oversight.
The IAT’s scope of work also extends beyond the agency. The team maintains and coordinates all points of contact, draft and final reports, and DCMA’s responses to several external audit agencies including the Government Accountability Office; the DOD OIG; the Army, Navy and Air Force audit agencies; and the Special Inspector General for Afghanistan Reconstruction.
Typically, the inspector general and DCMA director review and approve all audits a year in advance. They’re usually conducted with a team of two members, or four if the audits are more complex. This configuration allows one member to be free to conduct the mandatory independent review upon project completion.
There are many steps and processes the IAT follows to conduct a successful audit. They must complete required analysis, interviews and work papers in the following 10 mandatory areas: planning, criteria, risk assessment, internal controls, test of information system controls and data reliability, fraud risk, background, meetings, potential monetary benefit, and fieldwork.
The six IAT members rotate roles for each audit. The lead plans the event; assigns areas of responsibility; coordinates fieldwork; conducts the entrance and exit conferences; writes draft and final reports; and provides the final briefing to the agency director. The supporting auditors are responsible for various work to include planning, interviewing, conducting analyses and writing work papers detailing the conducted work.
“Every audit is like getting a new job,” said Michael Chembars, IAT auditor. “We look at the program being audited to learn what the program is supposed to be accomplishing. No two audits are the same.”
Using DCMA’s Workload Acceptance as an example, Sloss outlined how a typical audit is conducted from beginning to end.
“The team planned and conducted 15 virtual and onsite visits and interviews with key personnel from headquarters, the regions and 17 contract management offices worldwide,” he said. “There were 29 separate interviews held across DCMA that resulted in more than 137 work papers, and multiple briefings for the deputy director, the chief of staff and Contracts Directorate management.”
Once the fieldwork stage is complete and the audit team has compiled enough evidence to support the findings based on the audit objective, Sloss said the team prepares a formal draft report to outline what was found and any recommendations for change. They issue the report to management personnel responsible for implementing any corrective actions for the program, and they are given up to four weeks to provide a written response to the recommendations with a timeline for completing those actions.
“We prepare and issue the final report after we receive comments back from management,” said Sloss. “The lead auditor will then follow up with management based on the timeframe they provided in their written response to complete corrective actions and verify that the actions have been completed before closing the recommendations.”
The IAT has had many success stories over the years in identifying deficiencies that hinder DCMA’s efficiency or effectiveness. Julie Slaughter, one of the team’s senior auditors, said she feels a sense of pride when her team’s work leads to a change that boosts the agency’s efficiency and resource management.
“We recently performed a travel gainshare audit where my team identified many incorrect gainshare requests that resulted in employees being overcompensated,” she said. “Based on our recommendations, the agency suspended the Gainshare Program and is revising internal guidance to prevent this issue from happening again after the program is reinstated.”
The Total Force Directorate’s Centralized Development Program is another example of positive change resulting from an audit.
“Since the CDP program audit began, the directorate has already taken actions to increase the workforce’s awareness of the program and the opportunities available to them,” said Douglas Slaughter, a senior auditor. “So far, they’ve held lunch and learn sessions, announced updates on the DCMA 365 homepage and provided more information on the CDP 365 webpage.”
Knowing a visit is coming can make those being audited nervous or anxious. But as with inspection and evaluation site visits, audits were never meant to be “GOTCHA!” missions.
“We’re here to help, not punish” said Chembars. “We’re not trying to cut someone’s budget or program, nor are we trying to promote or sell a program. Our bottom line is to improve DCMA, one audit at a time. That’s a positive, not a negative.”
There are best practices auditees can implement in advance to help ease the tension of an upcoming audit.
“One significant thing they can do is have all documentation and records for their program or process maintained in a central location, are properly secured and meet documentation retention standards,” said Takia M. Jones, IAT senior auditor. “They can also ensure policies, guidance, and standard operating procedures are current, and have personnel available to meet with auditors when requested.”
Hayes said understanding IAT’s mission and processes can also help reduce pre-audit fear or anxiety. He said the quarterly OIG newsletter is a great source of information about the IAT and the audits they’re conducting. It also has a yearly tasker to all DCMA employees to submit audit ideas for consideration in the following fiscal year’s audit plan.
As meticulous and precise as auditing seems, Jones said there is a light-hearted and fun aspect to her line of work.
“Auditing is my passion,” she said. “I have enjoyed all 22 years I’ve had so far in this career field. I’ve traveled throughout the United States and abroad, learning and helping to improve an array of programs across DCMA and the military services. I’ve also been very fortunate to have worked with great people who care about the work we do.”
Editor’s note: Read OIG inspections focus on assisting, enhancing capabilities to learn more about the Inspections and Evaluation Team’s mission.