We determined whether DoD complied with Public Law No. 107-300, “Improper Payments Information Act of 2002,” November 26, 2002, as amended by Public Law No. 111?204, “Improper Payments Elimination and Recovery Act of 2010,” July 22, 2010 (IPERA). The audit was required by Public Law 111-204.
The Office of the Under Secretary of Defense (Comptroller)/Chief Financial Officer, DoD (USD[C]/CFO) met five of the six requirements of the IPERA.
- published an Annual Financial Report,
- conducted program-specific risk assessments,
- published corrective action plans,
- published improper payment estimates, and
- reported improper payment rates of less than 10 percent.
However, DoD’s inability to ensure all required payments were reviewed resulted in unreliable estimates and rates (We plan to issue another report that will address the completeness of the payments used for the estimates).
Furthermore, DoD did not meet the reduction targets for five of its eight payment programs with established targets.
The USD(C)/CFO also met the Office of Management and Budget requirement to report information on its efforts to recapture improper payments within the DoD FY 2013 Annual Financial Report.
We recommend that the Under Secretary of Defense (Comptroller)/Chief Financial Officer, DoD:
- work with Military Departments and Defense Agencies to develop metrics and quality assurance goals as well as programmatic corrective action plans, including holding those officials financially liable where appropriate;
- submit a remediation plan to the appropriate congressional committees as required by IPERA; and
- coordinate with the Director of Office of Management and Budget to review the Defense Finance and Accounting Service Travel Pay program and determine whether additional funding would help the agency comply with Public Law 111?204 for meeting payment reduction targets.
Management Comments and Our Response
The Deputy Chief Financial Officer provided comments in response to a discussion draft of this report. Management comments addressed all specifics of the recommendations and no further comments are required.