NEW CUMBERLAND, Pa. –
Defense Logistics Agency Distribution hosted the agency’s first virtual business process overview audit during the COVID-19 crisis. While the planning of audits does fall to other DLA organizations, the DLA Distribution team led the effort for the planning, coordination and execution of this fiscal year’s inventory and revenue/expenses business process overview held virtually due to the worldwide COVID-19 pandemic.
The task was a huge undertaking and DLA Distribution’s Chief of Financial Audit & Compliance, Denise Parker-Kanelos, wondered if they were going to be able to pull it off virtually. “We did,” she said.
It took about three weeks to prepare and pull all the evidentiary matter and screen shots. “We are getting data from DLA Finance, Information Technology, Operations, Contracting, distribution centers and our own team here at DLA Distribution headquarters. It takes transaction information from every element, department, and major subordinate command within the agency to respond to a virtual audit. It’s a huge amount of coordination; it’s not just a DLA Distribution venture. It’s just a phenomenal amount of data,” said Parker-Kanelos.
The effort included personnel going into systems and grabbing items and scanning those items into documents. Additionally, validation was required of every piece of data. Then the team pulled all the information into PowerPoint briefs, which were organized into one very large brief with over 83 files and over 700 charts.
“Everybody is pulling pieces of data that goes with the same specific transaction, as requested by the auditors. My auditing team would have to make sure that we ordered all the data, screens and evidential matter correctly so that the final product told the story of the transaction for DLA – good, bad or otherwise,” said Parker-Kanelos.
“I think the great part about it was instead of just observing live transactions, and only seeing one part of the transactions ‘story,’ the auditors selected transactions in advance that were posted in the agency’s books, and then the DLA team performed the research of what occurred. It was a great way to accomplish the goal, but virtually was more effective than the many physical trips performed in the past years, and it was much more cost effective, and thorough in the quality of information provided on each transaction, because the ‘complete’ story was assembled. Information was pulled from procurement, inbound receiving, physical inventory, storage, shipping, revenue, and expense data from our financial folks to include postings in the ledgers. It was phenomenal, we are talking thousands of charts of information just to demonstrate a handful of transactions.”
The live audit went very smoothly start to finish, said Parker-Kanelos. “We used the defense collaboration system and telephone call-in lines that connected briefers aligned for their respective sessions. It took about a week to walk the auditors through all the transactions and we had very little follow-on taskers because everybody across DLA did such a great job of pulling the data the first time around. Also, with everyone working from home it was pretty amazing, as we had no problems with defense collaboration services or the phone lines, everything worked like clockwork and there were zero glitches. COVID forced us to figure it out and it worked.”
“It just shows how far the agency has come in understanding when an auditor requests something we now know what we need to provide,” said Parker-Kanelos, adding, “If we would have done this five years ago, it would have been a disaster, but now you can tell people really are starting to understand the financial audit and know what transactions to pull for specific requests. People can go in and find the evidential matter. In the old days – which are only just a couple of years back – we would not have been able to find all that evidential matter in our data repository, but now it's very easy to do. Our Information Technology division does a great job with all that scanning and retention – I’m impressed with how far the agency has come as one team.”
I think virtually walking thru the transactions and explaining to the auditors what occurred in our business process is much better than a physical walk thru where you only see one piece of a transaction and you aren’t able to see the complete picture of the entire transaction,” said Parker-Kanelos. “I think this a more successful way for the auditors to perform that portion of the audit work. Certainly they have to go on-site and do other types of audits for other audit elements, but for business process walk throughs, I think this should be an annual requirement to do it virtually, because then you really can put together the entire story of a transaction.”
The audit process is improving the quality of our enterprise data used to drive decision-making and ensuring we remain good stewards of government resources – and accountable to the American people.