What We Did
The objective of the audit was to determine whether improper payments processed through the One Pay system at Navy activities were identified and reported.
What We Found
The Naples Commercial Bill Pay Office did not perform a review to identify or report improper payments from any of the 18,688 payments, valued at $712.7 million, processed through the One Pay system from July 1, 2011 to June 30, 2012. In addition, the Naples Commercial Bill Pay Office did not use the available automated tool to assist in identifying potential improper payments. This occurred because the Assistant Secretary of the Navy (Financial Management and Comptroller) did not clearly establish which organizations, offices, and personnel were responsible for identifying and reporting improper payments at this unique payment-processing location.
As a result, the Navy and DoD understated the amount of improper payments reported. From a nonstatistical review of 25 payments valued at $2.5 million, we identified five improper payments, valued at $158,602 that the Naples Commercial Bill Pay Office neither identified nor reported. Therefore, Navy and DoD management did not have an accurate reporting of the improper payments made through the One Pay system.
What We Recommend
We recommend that the Assistant Secretary of the Navy (Financial Management and Comptroller):
- update guidance to clarify which organizations, offices, and personnel are responsible for processing payments in One Pay;
- develop procedures for improper payment identification and reporting;
- establish roles and responsibilities with the Director Defense Finance and Accounting Service Operations for access to and the review of potential improper payments; and
- initiate review of improper payments identified by the Business Activity Monitoring tool since 2009 to identify additional improper payments.
Management Comments Required
Management comments to the report were unofficial, which could not be considered or included in the final report. We request that the Navy and the Defense Finance and Accounting Service provide official comments to all the recommendations by May 30, 2013.