Army's Progress in Implementing the Federal Managers' Financial Integrity Act

NSIAD-85-149: Published: Sep 27, 1985. Publicly Released: Sep 27, 1985.

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GAO reviewed the Army's compliance with the Federal Managers' Financial Integrity Act (FMFIA) to: (1) determine whether actions taken by the Army as a result of FMFIA are improving its internal controls and accounting systems; (2) evaluate the Army's progress in implementing its internal controls and accounting systems; and (3) assess the adequacy of the Army's basis for determining that the requirements of FMFIA have been met.

GAO found that: (1) the commitment of Army managers to the goals of FMFIA is evidenced by the large number of material weaknesses reported by a variety of Army sources; (2) many of the material weaknesses identified by the Army are program- or location-specific; and (3) Army managers appear to be taking corrective actions to correct reported material weaknesses. However, GAO also found that the Army has had difficulties in evaluating compliance with FMFIA because of: (1) inconsistent and unclear field evaluation guidance; (2) the lack of supporting documentation for vulnerability assessments; and (3) its failure to provide guidance on what organizational units should be evaluated. In addition, GAO found that the Army's reviews of its accounting systems were inconsistent and incomplete and did not provide an adequate basis for reporting that certain accounting subsystems were in conformance with the Comptroller General's standards for accounting systems.

Recommendations for Executive Action

  1. Status: Closed - Not Implemented

    Comments: The Army's fiscal year (FY) 1986 annual FMFIA report is much more explict as to how the Secretary reached this judgment that his systems provide reasonable assurance. In addition, GAO has not reviewed the Army's FMFIA program in 3 years. Without specific findings, this particular recommendation should be dropped.

    Recommendation: The Secretary of the Army should not report that the Army's systems of internal accounting and administrative control meet the requirements of FMFIA until the evaluation program has developed to a point where a coordinated Army-wide analysis of all functions is performed.

    Agency Affected: Department of Defense: Department of the Army

  2. Status: Closed - Implemented

    Comments: During 1984 and 1985, the Army developed and implemented a comprehensive methodology for evaluating and reporting on operating accounting systems. The Army believes that it accurately presented the status of its accounting systems.

    Recommendation: Until the Army's accounting systems have been tested in operation, the Secretary of the Army should not report them as: (1) being in conformance with the Comptroller General's requirements; and (2) providing adequate financial control and reporting features to support the Army's fiscal accounting responsibilities.

    Agency Affected: Department of Defense: Department of the Army

  3. Status: Closed - Implemented

    Comments: The Army's automated system specifications were developed based on perceived Army needs. Although the system differs slightly from GAO recommendations, it will provide all of the GAO information requirements.

    Recommendation: The Secretary of the Army should direct that a comprehensive tracking and follow-up system be established and used to ensure correction of accounting systems deficiencies before the systems are reported in conformance.

    Agency Affected: Department of Defense: Department of the Army

  4. Status: Closed - Implemented

    Comments: The Army agreed to consider known system problems when determining conformance.

    Recommendation: The Secretary of the Army should direct that the civil works accounting system not be reported as in conformance until known system problems are corrected and the related civilian pay system is brought into conformance.

    Agency Affected: Department of Defense: Department of the Army

 

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