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Is "Resolving" DCAA Findings the Same Thing As Listening to Them?

The Minerals Management Service (MMS) isn't the only agency that struggles to ensure that it's oversight officials have the independence they need to effectively root out waste, fraud, and misconduct. When not blogging obsessively about the Deepwater Horizon disaster (I've been told recently to "get your head out of the oil for a moment"), POGO (and the Government Accountability Office, and the Department of Defense Inspector General, and the Senate Homeland Security and Governmental Affairs Committee, just to name a few) has also been concerned about the independence of auditors at the Defense Contract Audit Agency (DCAA).

Most recently, Robert Brodsky at Government Executive reports that Senator Chuck Grassley (R-IA)—admittedly, citing an OpEd written by POGO—has also raised concerns about whether DCAA is providing reliable financial audits for the Centers for Medicare and Medicaid Services.

But in addition to the concerns we raised in a letter to the Senate and an OpEd in the Federal Times, POGO recently obtained a memo that may only increase concerns about DCAA's ability to independently oversee contractors. DCAA Director Patrick Fitzgerald writes to his co-workers:

To address some of the concerns raised to me and Mr. Charlie Williams (DCMA Director) regarding the DCMA/DCAA working relationships, Mr. Williams and I have decided to jointly issue the attached memorandum to our workforces. The memorandum emphasizes the need for our organizations to work together to accomplish the Department's business. As the memorandum states, it is our strategic intent to ensure we address and deal with the issues as they arise in an open and transparent manner, and we look to each and every one of our employees to do the same. I encourage each audit team to work with your DCMA counterparts and attempt to resolve issues productively and in the best interests of the warfighter, taxpayer, and Department of Defense. If you can't resolve issues at the local levels, please elevate them through your management chain. Both Mr. Williams and I are committed to a productive working environment between our agencies, and I welcome your feedback to help us achieve this goal.

I think there are two ways to look at this memo. On the one hand, this could be an effort from the new DCAA Director to try to ensure that DCAA findings aren't ignored by the Defense Contract Management Agency (DCMA), as many at DCAA have claimed was the case in the past, and that this is a step in the right direction to make sure that both agencies work together to hold contractors accountable.

But on the other hand—and I think this is probably the case—this memo demonstrates another instance where DCAA's independent audit findings may be undermined. The memo states that auditors and contracting officers should work together to "resolve" audit issues and emphasized that even when differences occur, DCMA and DCAA should strive to work the issues within the respective organizations. This memo gives the impression that audit findings are something to be "resolved" between the two organizations rather than audit findings to be acted upon by the contracting officer. And to the degree that this is the case, or that this memo confuses the independent role of DCAA, the Director of DCAA should consider withdrawing the memo.

This is only one of many issues that the Director must tackle head on. We're hearing that DCAA is still in a state of paralysis and issuing fewer audits, and looking at the response to the recent article in Government Executive, it looks like there are many DCAA auditors that are not impressed with Mr. Fitzgerald's performance as Director.

By: Mandy Smithberger
investigator, POGO

At the time of publication, Mandy Smithberger was an investigator for the Project On Government Oversight, focusing on Department of the Interior oversight, including oil and gas royalties. Mandy also covered national security.

Topics: Contract Oversight

Related Content: Auditing (DCAA/FCAA), Defense

Authors: Mandy Smithberger

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