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Report | Sept. 19, 2022

Management Advisory: The DoD’s Use of Additional Ukraine Supplemental Appropriations Act, 2022 Funds (DODIG-2022-133)

Audit

Publicly Released: September 20, 2022

This management advisory provides the results of the DoD Office of Inspector General’s research project on the DoD’s use of Additional Ukraine Supplemental Appropriations Act, 2022 funds.

We determined that the Office of the Under Secretary of Defense (Comptroller)/Chief Financial Officer, DoD (OUSD[C]/CFO), continued to implement and improve procedures for DoD Components to follow in reporting, through Advancing Analytics (Advana), the execution of the additional $20.1 billion in funds appropriated to the DoD to provide further assistance to Ukraine. We reported in a July 8, 2022 management advisory that the OUSD(C)/CFO had implemented procedures for reporting the execution of the $6.5 billion in funds appropriated to the DoD in the Ukraine Supplemental Appropriations Act, 2022, (referred to as disaster emergency fund code [DEFC]-3 funds). We determined that the reporting process for the $20.1 billion in funds appropriated to the DoD in the Additional Ukraine Supplemental Appropriations Act, 2022 (referred to as DEFC-6 funds), is nearly identical to the processes used to report the initial $6.5 billion in DEFC-3 funds. However, the Additional Ukraine Supplemental Appropriations Act, 2022, provided $6 billion in DEFC-6 funds to the Ukraine Security Assistance Initiative (USAI), which requires additional reporting processes not reviewed or discussed in the July 8, 2022 management advisory. We identified an area of concern with the DoD’s process for providing funds to the Foreign Military Sales (FMS) Trust Fund for the USAI.

We continued to observe that the DoD’s use of systems that are not compliant with Standard Financial Information Structure (SFIS) 11.2 limited the reporting details in Advana and required the DoD to use journal vouchers to account for budget execution of the Ukraine supplemental funds. This was an area of concern that we identified in the July 8, 2022 management advisory for DEFC-3 funds, and we determined that this concern also applies to the $20.1 billion in DEFC-6 funds. In addition, we determined that Advana business rules did not accurately capture the budget execution status of the Ukraine supplemental funds.

While these topics are areas of concern, OUSD(C)/CFO personnel have made improvements to the functionality of Advana to increase the traceability, transparency, and reporting of Ukraine supplemental funds execution.