Inspector General Robert P. Storch announced today that the Department of Defense Office of Inspector General released the “Audit of DoD Afghanistan Contingency Contracts Closeout.” This audit report focuses on whether DoD contracting officials closed out contingency contracts supporting DoD operations in Afghanistan in accordance with Federal and DoD guidance. Contract closeout is an important process that ensures that the DoD received what it paid for, and closeout frees up funds held in abeyance for other uses or return to the Treasury.
The DoD OIG found that DoD contracting officials did not consistently close out the contingency contracts as required. Specifically, we found that contracting officials did not close out and properly document most of the 30 contracts reviewed. Additionally, we determined that contingency contract data reported in the Federal Procurement Data System was unreliable and inaccurate. As a result, DoD contracting personnel did not always verify whether the DoD received what it contracted for or complete administrative requirements in a timely manner. The DoD also missed the opportunity to reprogram at least $3.7 million in canceled funds to support other requirements.
“DoD contracting officials did not always comply with the regulations for closing out or accurately accounting for contingency contracts that supported the efforts in Afghanistan, resulting in the DoD potentially losing the opportunity to reprogram funds,” said IG Storch.
To address the issues identified in this report, the DoD OIG made seven recommendations to the DoD, including five to the Principal Director, Defense Pricing and Contracting to implement additional controls for contracting personnel to improve tracking, training, communication, and oversight in the contract closeout process, and two to the Director, Defense Logistics Agency to update internal policies for contract closeout to comply with DoD requirements. The DoD OIG will continue to monitor the DoD’s progress toward full implementation of these recommendations.