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Probe of irregularities in defense contract audits: Pentagon

by Staff Writers
Washington (AFP) July 25, 2008
A Pentagon agency that oversees billions of dollars in defense contracts said Friday it has asked for a review of allegations that supervisors sought to pressure auditors to favor major contractors.

The Defense Contract Audit Agency (DCAA) took the step following a scathing report by a congressional audit agency this week that found numerous irregularities in a review of 14 DCAA audits between 2003 and 2007.

The Government Accountability Office (GAO) also charged that DCAA managers took actions against staff, "attempting to intimidate auditors, prevent them from speaking with investigators, and creating a generally abusive work environment."

DCAA director April Stephenson said she had asked the Defense Department's inspector general to conduct a review of the allegations.

"We take the GAO report very seriously," she said in a statement. "It is crucial that we have a clear understanding of any problems associated with our audit effort."

The GAO report said it found numerous examples where the DCAA had failed to comply with generally accepted accounting rules.

It said contractors and Defense Department officials had improperly influenced the scope, conclusions and opinions of three audits, which the report said was "a serious independence issue."

It also found evidence that working papers did not support reported opinions, that supervisors dropped findings and changed audit opinions without adequate evidence for the changes, and that insufficient work was done to support audit opinions and conclusions.

"DCAA did not agree with the 'totality' of GAO's findings, but it did acknowledge shortcomings with some audits and agreed to take corrective action," the GAO said.

The GAO report did not identify the contracts in which irregularites were found.

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Military Matters: Crisis ahead -- Part 2
Washington (UPI) Jul 24, 2008
The strategic crisis looming ahead for the United States will be compounded by the fact that the money is about to run out. The American people seem to have forgotten that no activity the state can undertake is more expensive than war. If a tanking economy cuts off the money flow, what comes next?

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