GAO lauds financial improvements but urges DOD to do more

Although the Defense Department has improved its ability to ferret out and fix accounting errors, it still must modernize its systems and settle on consistent performance metrics, the General Accounting Office has concluded.

GAO auditors yesterday praised department efforts that recently led DOD to report that it had reduced accounting errors in payment records, backlogs in commercial payments and delinquencies in travel card payments.

The metrics now in use by the DOD comptroller are 'consistent with or better than those used for prior reporting,' GAO said in its new report, Financial Management: DOD's Metrics Program Provides Focus for Improving Performance. Auditors succeeded in validating improvements, though GAO called the reductions less dramatic than those reported by DOD. (Click here to link to a PDF of the full report)

Why? 'We could not verify the accuracy of specific improvement percentages reported for payment recording errors and commercial payment delinquencies, in large part because of DOD's archaic and nonintegrated systems,' GAO said.

The chief architect of financial improvements within DOD is the Defense Finance and Accounting Service. Congress' audit shop noted that while a modernization effort to consolidate more than 250 disparate and outdated accounting systems will take many years, DFAS has provided interim help by revamping financial policies and supplying systems tools that help its personnel resolve payment recording problems.

Even so, GAO said, Defense must apply metrics departmentwide and in a consistent manner and do more than emphasize prompt payments to improve financial management.

Undersecretary of Defense and comptroller Dov S. Zakheim noted in a letter to GAO that DOD agreed with GAO. He said the department is working to establish crosscutting metrics for use DOD-wide. 'The DOD metrics program includes representatives from all military services,' Zakheim said.


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