Panel issues preliminary advice for Defense audit agency

An independent Defense Business Board panel on Thursday unveiled draft recommendations aimed at fixing persistent management problems at the Defense Contract Audit Agency.

During a public meeting, the review panel issued 14 recommendations to various leaders from the Defense Department and DCAA. The audit agency has been under scrutiny since the release of a July report from the Government Accountability Office showing improper influence by contractors and management on the audit process.

A panel of the Defense Business Board, an independent group of corporate executives established in 2001 by then-Secretary Donald Rumsfeld to bring private sector best practices to the department, was asked to look into the DCAA issues shortly after the release of the watchdog agency's report.

The advice runs the gamut from extremely general -- such as "revise the DCAA mission to expressly identify the taxpayer as the primary customer…" and "establish a strategic plan" -- to narrow and technical -- such as "discontinue participation on integrated product teams and source selection evaluation boards."

It falls into seven categories: strategic planning, organizational structure, oversight, audit independence, business practices, workforce and independent evaluation. In the strategic planning and organizational structure categories, the panel recommended fairly sweeping changes, including the development of a strategic plan based on the modified mission. The plan would contain clearly defined qualitative and quantitative success measures. The panel also suggested DCAA create chief operating officer, chief planning and quality officer, and chief of internal review-type positions to provide "consistent governance, control and quality assurance across the agency."

Cmdr. Darryn James, a Defense spokesman, said the recommendations were discussed briefly at the Defense Business Board meeting on Thursday and minor changes may have resulted from the public discussion. The recommendations were then passed along to the deputy Defense secretary for consideration.

James said it's too soon to tell yet if the recommendations will be adopted, but Defense and DCAA leaders will consider the panel's ideas as they address the audit agency's issues.

"The [Defense Business Board] panel is a concrete example, not just words," James said. "It's something they're able to do quickly to take a look at this. If you've got a problem you can ask these very smart business leaders to take a look at it and come at it from a very thoughtful way."

But not everyone sees the recommendations as novel. One current DCAA auditor, who requested anonymity, said many appeared simply to involve re-labeling existing DCAA policies.

"As a presidential candidate said earlier this summer, 'You can put lipstick on a pig, but it is still a pig,' " the auditor said. "I look at it as a bunch of window dressing of policies we already had. The ones that got the spotlight had the names changed to protect the guilty. It does not appear that they are going to go away."

DCAA is conducting its own internal reviews and is being further investigated by the Defense inspector general and GAO.