Amid growing concern over mis-management and potential abuse of federal resources, in 1990 Congress passed the Chief Financial Officers (CFO) Act to improve Federal Government financial management capabilities, with an emphasis on more effective financial management practices, improvement of financial management systems/internal controls and the production of complete, reliable, timely and consistent financial management information. To be better stewards of taxpayer dollars – by continuously improving its financial management, accountability and transparency – the Department of Defense has been making concentrated efforts to comply with the CFO Act, including the key requirement to undergo a full financial statement audit. As part of these efforts, DoD established the Financial Improvement and Audit Readiness (FIAR) Office with a focus on improving financial management, demonstrating reliable and well-controlled business processes, and providing supporting documentation to auditors in a timely and consistent manner. While the focus remains on unmodified full financial statement audits, the stepping stone to achieving that for our defense agency customers includes relying on a compliant, auditable accounting system that contains all the accounting events to support the financial statements. Achieving an unmodified opinion is not possible without a compliant, auditable accounting system. The initial step in eliminating the barriers to successful audit results is obtaining an unmodified opinion of the accounting system under the American Institute of Certified Public Accountants Auditing Standards Board Statement on Standards for Attestation Engagements (SSAE-18) Service Control (SOC) Type II Report
For over eight years, CACI has partnered with the Defense Logistics Agency Defense Agency Initiative Program Management Office (DLA DAI PMO), the service provider responsible for providing an end-to-end compliant federal standard financial management and accounting system to 22 defense agencies used by over 40,000 DoD employees. CACI resources have delivered solution and domain expertise used in the design, development, implementation, and sustainment of the DAI Oracle EBS solution, the Accounting System of Record where all financial and accounting events are recorded to support the individual financial statements — the cornerstone upon which the defense agencies’ audit posture resides. CACI’s audit and solution resources worked with program leadership to deliver artifacts and evidentiary information used in three years’ worth of SSAE-18 (and its predecessor SSAE-16) Service Provider Audits. In addition, CACI requirements and audit resources worked with the DLA DAI PMO in identifying 10 specific control objectives that if achieved should provide reasonable assurance to the defense agencies that their accounting system of record is processing and securing their financial/accounting events. These control objectives span security management, access controls, configuration management, and segregation of duties, to I\interface processing, computer operations, and logical separation of data (or implementation for new defense agencies).
For the period, from October 1, 2016 through June 30, 2017, the DoD Inspector General engaged an independent audit firm to conduct an SSAE-18 for the DLA DAI PMO. During this process, CACI’s audit and solution resources worked with program leadership, all program teams, and the independent auditor in reviewing the effectiveness of the design of the control environment and tested operating effectiveness of the 10 specific control objectives. The results for 2017 concluded August 15, 2017 and identified that no exceptions were noted during the audit, resulting in an Unmodified (Clean) Opinion for the DAI program and solution.
The significance of this achievement reverberates through both the DLA as a service provider and the defense agencies that can now rely on the control environment in which their accounting system of record operates to support their financial statement audits. CACI’s DAI team ensured successful achievement of this major milestone for the department as a whole by delivering a compliant, auditable accounting system of record to 22 defense agencies, which positions the agencies for the first time to be fully compliant with the CFO Act. According to DAI Program Manager Ricky McClary, “Every DAI PMO employee works untiringly to help transform the budget, finance, and accounting operations of the defense agencies to achieve accurate and reliable information. The result of the audit is a positive indicator that we’re headed in the right direction.”
For more information contact Bryan Jester, Senior Vice President of CACI Financial Management Solutions, firstname.lastname@example.org.