The purpose of this memorandum is to inform you of our planned oversight that will
begin immediately. The U.S. Army Corps of Engineers management requested the audits of
U.S. Army Corps of Engineers Sub-Allotted Funds. We contracted with the independent public
accounting firm of Kearney & Company, P.C. (Kearney) to audit the Financial Statements as of
and for the fiscal year ending September 30, 2026, for the funds sub-allotted to the U.S. Army
Corps of Engineers by the Defense Logistics Agency, U.S. Air Force, and U.S. Special
Operations Command. In addition, Kearney will perform audit procedures to obtain assurance
over funds sub-allotted to the U.S. Army Corps of Engineers in support of the Army General
Fund and Defense Health Program financial statement audits. The objective of Kearney’s audits
is to determine whether the FY 2026 U.S. Army Corps of Engineers Sub-Allotted Funds
Financial Statements and related notes are presented fairly and in conformity with accounting
principles generally accepted in the United States of America. The objective of our project is to
provide contract oversight of Kearney’s audits and determine whether Kearney complied with
the contract and generally accepted government auditing standards.
We will rely on the Government Accountability Office/Council of the Inspectors General
on Integrity and Efficiency, “Financial Audit Manual,” Volume 2, June 2024, Section 670, “IG
Oversight of Audits Performed by Contracted Independent Public Accounting (IPA) Firms,” to
design and perform oversight procedures to review Kearney’s audit work and, if applicable,
disclose instances in which Kearney did not comply, in all material respects, with generally
accepted government auditing standards.