Last March, the Defense Logistics Agency Installation Management Office recruited more than 330 volunteer employees to account for over 17,000 pieces of real property at 539 DLA locations worldwide.
The effort marked a significant step toward responding to the Notice of Findings and Recommendations provided as part of the audit disclaimer last year.
“Real property is real estate,” said Dr. Cliff Sands, site director for Installation Management for Energy. “DLA Energy owns 80% of DLA’s financial accountability and is responsible for more than 17,000 property assets related to fuel.”
As part of the Department of Defense’s compliance with financial audit requirements, Ernst & Young identified the DLA enterprise-wide inventory of property plant and equipment as focus areas for their fiscal year 2018 audit efforts.
Thirty DLA Energy employees volunteered to assist with the task force and proved to be valuable members of the team.
“Energy personnel provided invaluable services for some of the site visits because they were familiar with the type of assets being inventoried,” said Alfonso Soto, a DLA Installation Support Business Cycle Integration analyst who has supported the Real Property Task Force Program Management Office since its inception. “Some had contacts that were very useful when it came to scheduling the inventories across different locations.”
Terry Fleming, a DLA Energy Business Process Support Directorate business process analyst, is a nine-year DLA Energy employee who has been involved in audits for 20 years. He was assigned as a team lead to the Mid-Atlantic region.
Even with all his experience and going through the one-week of training all volunteers received, he said that sometimes it was challenging simply identifying assets.
“If you do not know what an Oily Waste System is then how would you know what to look for?” he said. “You really have to use the guidebook provided and ask the right questions to understand how the assets are used in order to catalog the asset properly.”
Employees like Robert Trusty and Allen Merritt, Real Property Officers for DLA Energy Americas at Houston, Texas, applied their expertise to help Real Property Task Force account for, identify, classify and correctly process petroleum facility assets.
“Obtaining a clean audit is going to take a lot of team work between property officers, engineers and project managers to ensure evidential matter is completed and recorded correctly,” Trusty said. “Follow established policy and always document.”
Fleming said that at first he was uncomfortable with making sure he followed the guidelines and conducted the inventories correctly.
“The more I read the guidelines and studied the material, I gained confidence in myself to lead the team in performing asset inventories,” he said. “Every time my team when out, I treated each site as if I was still in training, following the instruction, guidelines and best practices taught to me.”
The training and communication from DLA’s Property Management Office was instrumental to the team’s success, Fleming said. The process was well organized with daily teleconferences that provided important updates, addressed challenges and clarified policy requirements.
Fleming, along with other task force members including Gary Falwell, Douglas Collins, David VanWinkle and Frank Albert, focused primarily on DLA Energy assets and said the assets weren’t always straightforward to identify and account for in the process.
“The biggest challenge is the large number of requests and the large volume of documentation that must be provided to satisfy the auditors’ requests,” Falwell said.
Fleming was selected by DLA’s Property Management Office to lead DLA Director Army Lt. Gen. Darrell Williams on a tour to explain and demonstrate how task force volunteers preform asset inventories.
“I showed him how I looked up data concerning assets, took pictures and dealt with some of the challenges, such as inventorying parking lots, light poles, vehicle fueling facilities and even liquid fuel loading/unloading facilities,” Fleming said.
On the tour, Fleming showed Williams how an inventory sheet lists three parking lots and how difficult it is to identify them. Fleming said he and his team used the inventory lists as a foundation for each site they visited, and they were always looking for assets not on the inventory sheets.
Fleming explained how the team would “unbundle” assets when appropriate.
“Under the old guidelines, a vehicle refueling station was listed as one asset but included multiple fuels and items like fuel pumps, lights and overhead,” he said.
Using the new guidelines, the team would break down the refueling station so each fuel type counts as an asset with the overhead and possibly the lights or drainage.
Albert referenced one particular challenge he faced on a site visit in Japan.
“The auditors wanted to actually go on a ship,” he said. “The coordination between the control center in the U.S., the ship enroute to Japan, the military base and inclement weather delays were challenges while still conducting the full site visit.”
Another challenge with real property is the change to DoD real property financial reporting responsibilities. As of October 1, 2019 real property will be reported on the financial statements of the Military Departments. Implementing the policy will take effort, but once in practice it will yield long term value in easing reconciliations and reporting real property on a rationale and consistent basis.
Soto said other DLA Energy team members were also instrumental to the success of the task force.
“John Stublar helped coordinate and conduct several visits in the Southwest Mountain region; Devon Williams conducted several site visits in the Southeast Region and was in charge of leading the DLA Chief of Staff site visit at Key West, Florida; and Robert Trusty liaised with the field and coordinated information gathering,” he said.
Although this is not an all-encompassing list of DLA Energy individuals that made significant contributions, these folks really made a difference for the Program Management Office, Soto said.
“I had several great team members who deserve all the credit; anything I asked of them in regard to the mission of the task force, they did it without hesitation,” Fleming said.
It isn’t just about people walking around with a clipboard, rather it takes a huge team of people working behind the scenes to categorize photos, upload documentation, enter data in spreadsheets and authenticate information, Fleming said. The DLA military reserve team played a vital role, he added.
“It was a big benefit to have a team member in uniform with you during your site visits,” Fleming said.
Each team member brought unique skill sets to bear during the inventory and each team lead was grateful for the expertise they were able to draw on, particularly from their military counterparts.