Finish line in sight for agency’s first full audit; corrective actions, sustainment next steps

By Amanda Neumann DLA Public Affairs

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The Defense Logistics Agency is nearing the finish line toward its first full audit, two years ahead of the congressionally mandated 2017 target, with the signing of three audit readiness assertion letters. The signed letters will now be sent to the Office of the Under Secretary of Defense (Comptroller) for review and approval.

The Sept. 30 letters state the agency has certified that its entire financial statement is ready for a full audit starting in fiscal 2016. Signed by DLA Director Air Force Lt. Gen. Andy Busch, DLA Finance Director Anthony Poleo and DLA Vice Director Ted Case, the assertions cover DLA’s working capital fund, general fund and transaction fund processes.

The next step involves several visits to DLA locations nationwide from an independent accounting firm to check the financial statement against the Department of Defense’s Financial Improvement and Audit Readiness Guidance. If all of the FIAR’s criteria are met, and the accounting firm verifies that the agency’s numbers are accurate, then DLA is considered auditable and will become the first Department of Defense entity of its size and complexity to do so.  

In an Oct. 12 blog to the workforce, Busch reminded DLA employees that although the agency has asserted its processes, there are still several corrective actions that need to be completed before the auditors arrive in 2016.

“The most critical areas to resolve include: inventory reconciliation (in particular vendor managed inventory and stock provided to vendor), unfilled customer order and undelivered order clean-up, cash management reconciliation, budget to proprietary ledger reconciliations, and real property asset valuation for other structures.  I have full confidence that you will help us resolve these challenges by December 2015,” he wrote. “Keep pushing forward, the journey has just begun.”  

Although DLA won’t know the results from the accounting firm until next year, the signings still represent a significant milestone for the agency.

To celebrate, the agency will hold an audit readiness assertion ceremony Oct. 30 at 9:30 a.m. in the McNamara Headquarters Complex Auditorium. Hosted by Busch and Case, the ceremony will recognize employee contributions and include award presentations to audit readiness team leads and partners. All agency employees are invited and the event will be live streamed to DLA’s field activities, which will hold celebrations remotely at their respective locations.