DOD Travel Improper Payments:

Fiscal Year 2006 Reporting Was Incomplete and Planned Improvement Efforts Face Challenges

GAO-08-16: Published: Dec 14, 2007. Publicly Released: Dec 14, 2007.

Additional Materials:

Contact:

Asif A. Khan
2025166906
contact@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

Fiscal year 2006 was the first year that the Department of Defense (DOD) reported improper payment information for its travel program under the Improper Payments Information Act of 2002 (IPIA). For fiscal year 2006, DOD reported obligations of approximately $8.5 billion for travel. Congress mandated that GAO assess the reasons why DOD is not fully in compliance with IPIA related to travel expenditures. In May 2007, GAO issued an initial report in response to this mandate. To further respond, GAO assessed (1) the completeness and accuracy of DOD's fiscal year 2006 IPIA travel disclosure in its performance and accountability report (PAR), and (2) DOD's planned efforts to improve and refine its processes for estimating and reporting on travel improper payments. To complete this work, GAO reviewed DOD's IPIA reporting, IPIA, Office of Management and Budget's (OMB) IPIA implementing guidance, and met with cognizant DOD officials.

In its fiscal year 2006 PAR, DOD reported an estimate of approximately $8 million in travel improper payments, reflecting about 1 percent of reported travel payments. While this estimate would indicate the program was not at risk of significant erroneous payments under OMB guidance, DOD's improper payment travel disclosure for fiscal year 2006 was incomplete. The DOD travel payment data used to assess the program's risk of significant improper payments only included payments processed by the Defense Travel System (DTS)--approximately 10 percent of the $8.5 billion of DOD travel obligations reported for fiscal year 2006. Further, DOD's 2006 PAR described a travel postpayment review process that may mislead readers to believe that the reported travel improper payment estimate represents more than DTS-processed travel. The travel improper payment estimate also excluded the largest user of DTS, the Army, which would likely have increased DOD's estimate by over $4 million. Finally, the statistical sampling methodology and process used by DOD to estimate DTS improper payments as reported for fiscal year 2006 had several weaknesses and did not result in statistically valid estimates of travel improper payments. DOD is taking steps to more fully assess and report on its travel program for improper payments for future IPIA reporting. DOD's planned assessment is to be based on an annual Improper Payments Survey conducted by the Office of the Undersecretary of Defense (Comptroller). However, GAO's review identified several weaknesses with the survey and reported results, including limited guidance on how to estimate travel improper payments and a lack of oversight and review over implementation of the survey and its results. As shown in the figure below, there were substantial discrepancies among the travel populations reported in the PAR, improper payment survey, and fiscal year 2006 travel obligations. The exclusion of such a significant portion of travel expenditures in the survey decreases its effectiveness as an improper payments assessment tool. DOD has also established a Program Officer for Improper Payment and Recovery Auditing, an improper payment working group, and held a "Department of Defense Improper Payments Information Act Conference."

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: In November 2007, DOD issued guidance to better ensure statistically valid reporting of the extent of the Department's improper travel payment estimates. Specifically, the guidance established procedures for ensuring components' sampling plans for travel payments provided for statistically valid reporting on improper payment estimates, including provisions for reviewing components' risk assessment analysis.

    Recommendation: In order to improve the usefulness and completeness of IPIA reporting for DOD's travel program, the Secretary of Defense should direct the DOD Comptroller to develop and implement guidance for the preparation of improper payment estimates, to include (1) how to compute a statistically valid estimate of improper payments, and (2) the consideration of risk factors associated with vulnerability to improper payments.

    Agency Affected: Department of Defense

  2. Status: Closed - Implemented

    Comments: In March 2010, DOD's Office of the Under Secretary of Defense (OUSD) (Comptroller) issued guidance for developing and reporting improper travel payment estimates in accordance with OMB guidance. As a result, DOD's fiscal year 2010 Performance Accountability Report, dated November 15, 2010, provided more complete and accurate information on the extent of its improper payments related to travel.

    Recommendation: In order to improve the usefulness and completeness of IPIA reporting for DOD's travel program, the Secretary of Defense should direct the DOD Comptroller to establish and implement policies and procedures to report a valid improper payment estimate for the population.

    Agency Affected: Department of Defense

  3. Status: Closed - Implemented

    Comments: In March 2010, DOD transitioned to the Defense Travel System for all travel payments. With that transition complete, DOD has a more relable basis for determining the full population of travel payments from which to estimate the extent of any DOD-wide improper travel payments. Consequently, for the first time, in DOD's fiscal year 2010 Performance and Accountability Report dated November 15, 2010, DOD identified a complete population of DOD travel payments; totalling about $9.3 billion.

    Recommendation: In order to improve the usefulness and completeness of IPIA reporting for DOD's travel program, the Secretary of Defense should direct the DOD Comptroller to establish and implement policies and procedures to reliably identify the complete population of DOD travel payments.

    Agency Affected: Department of Defense

  4. Status: Closed - Implemented

    Comments: In May 2008, the DOD Comptroller instituted procedures providing for quarterly asssessments of the componetns' data collection and reporting for travel improper payments.

    Recommendation: In order to improve the usefulness and completeness of IPIA reporting for DOD's travel program, the Secretary of Defense should direct the DOD Comptroller to establish and implement policies and procedures specifying actions to oversee the data collection process for travel improper payments to be included in the annual PAR, including, at a minimum: (1) periodic reviews of processes used by components to prepare improper payment estimates, and (2) reviews of information reported in the improper payment survey to assure that the population being reported is complete, and the improper payment estimate data reported are reliable and complete.

    Agency Affected: Department of Defense

 

Explore the full database of GAO's Open Recommendations »

Sep 19, 2014

Sep 18, 2014

Sep 10, 2014

Sep 9, 2014

Sep 8, 2014

Jul 31, 2014

Looking for more? Browse all our products here