NEW CUMBERLAND, Pennsylvania –
DLA Distribution, along with DLA Aviation and DLA Headquarters J3, J6, and J8 personnel, hosted Kearney & Company, the CPA firm that will perform the independent public audit at DLA Distribution.
The initial entrance conference on April 6 included an overview of DLA Distribution’s plan to stock processes, which include receiving, warehousing, stock readiness, physical inventory, order to cash, transportation shipment control, and driver sign off. The Distribution team provided flow charts, described activities and the operational/financial and manual/automated process controls in the functional areas.
The next step is the walk-through on the floor at DLA Distribution Susquehanna. Kearney is in the planning phase and the initial walk-through will allow the firm to see how DLA Distribution’s work activities and controls are performed in the distribution center environment. Kearney expects to schedule more interviews and follow-on sessions to have more detailed dialog following the walk-through. Testing of controls at distribution centers will begin on or around mid-April and initial distribution centers identified for testing include: DLA Distribution Albany; DLA Distribution Norfolk; DLA Distribution Tobyhanna; DLA Distribution Warner Robins; and DLA Distribution Susquehanna.
During the entrance conference, DLA Distribution described how inventory is received, warehoused, inventoried, and shipped using the same process, that there is no difference whether DLA or military service-owned. Processes and controls in the process are performed in a standard manner.
From June through September, Kearney will focus on learning DLA's business. This means they will be pulling documentation, reading all the PCMs and SOPs. Then in October, the IPA will begin their audit of DLA, all business cycles, and all controls. The normal process is for the IPA(s) to audit in line with each fiscal year and to release their final report the November following the audit. The first audit report is scheduled to be issued in November of 2017.
According to Edwin Caron with Kearney & Company, “An assessment will be conducted to determine any risks and then recommendations will be made to DLA Distribution to create a plan of action.”
Scott Rosbaugh, DLA Distribution Future Plans director concluded that “The report will be a catalyst for continued process improvement.”