Audit of Accounting Corrections on the SF 1081

Submitting OIG:

Department of Defense OIG

Date Issued:

Friday, June 25, 2021

Agency Reviewed / Investigated:

Department of Defense

Submitting OIG-Specific Report Number:

DODIG-2021-095

Component, if applicable:

Defense Finance and Accounting Service (DFAS)

Under Secretary of Defense Comptroller/Chief Financial Officer

United States Air Force (USAF)

United States Army (USA)

United States Navy (USN)

Location(s):

Agency-Wide

Type of Report:

Audit

Questioned Costs:

Funds for Better Use:

Number of Recommendations:

View Document:

Attachment	Size
DODIG-2021-095.pdf	19.8 MB

Recommendation Number	Recommendation Status	Significant Recommendation	Additional Details
D-2021-0095-D000FP-0001-0001.A1a	Open
Rec. A.1.a: The DoD OIG recommended that the Under Secretary of Defense (Comptroller)/Chief Financial Officer, DoD, work with the Directors of the Defense Finance and Accounting Service and DoD Components to establish and implement business rules between all the systems that create, process, or store SF 1081 transactions and the Advancing Analytics tool to ensure that the DoD maintains a universe of SF 1081 transactions in a centralized database.
D-2021-0095-D000FP-0001-0001.A1b	Open
Rec. A.1.b: The DoD OIG recommended that the Under Secretary of Defense (Comptroller)/ Chief Financial Officer, DoD, work with the Directors of the Defense Finance and Accounting Service and DoD Components to establish memorandums of understanding with the system owners and the Advancing Analytics owners to define roles and responsibilities for managing the SF 1081 transactions.
D-2021-0095-D000FP-0001-0001.A1c	Open
Rec. A.1.c: The DoD OIG recommended that the Under Secretary of Defense (Comptroller)/Chief Financial Officer, DoD, work with the Directors of the Defense Finance and Accounting Service and DoD Components to develop and implement a plan to test SF 1081 transactions on a reoccurring basis to ensure that transactions are necessary, accurate, and supported by an audit trail.
D-2021-0095-D000FP-0001-0001.A1d	Open
Rec. A.1.d: The DoD OIG recommended that the Under Secretary of Defense (Comptroller)/Chief Financial Officer, DoD, work with the Directors of the Defense Finance and Accounting Service and DoD Components to develop metric reports that track the net and absolute dollar amount, and number of SF 1081 transactions by each system that creates, processes, and stores SF 1081 transactions.
D-2021-0095-D000FP-0001-0001.A1e	Open
Rec. A.1.e: The DoD OIG recommended that the Under Secretary of Defense (Comptroller)/Chief Financial Officer, DoD, work with the Directors of the Defense Finance and Accounting Service and DoD Components to develop and implement a plan to reduce the number of SF 1081 transactions for each system that creates, processes, and stores SF 1081 transactions.
D-2021-0095-D000FP-0001-0001.A1f	Open
Rec. A.1.f: The DoD OIG recommended that the Under Secretary of Defense (Comptroller)/Chief Financial Officer, DoD, work with the Directors of the Defense Finance and Accounting Service and DoD Components to ensure that all systems that create, process, or store SF 1081 transactions can differentiate between SF 1081 transactions and other types of transactions. In addition, the systems should have the capability to differentiate between SF 1081 transactions used to correct errors and those used to transfer funds.
D-2021-0095-D000FP-0001-0002.A2a	Open
Rec. A.2.a: The DoD OIG recommended that the Director of the Defense Finance and Accounting Service design and implement internal controls in the Defense Finance and Accounting Service Transaction Interface Module to ensure that transactions are created, stored, and cataloged in a complete and accurate manner. The Director should document the controls in standard operating procedures, process narratives, and process maps.
D-2021-0095-D000FP-0002-0001.B1	Open
Rec. B.1: The DoD OIG recommended that the Under Secretary of Defense (Comptroller)/Chief Financial Officer, DoD, work with the Director of the Defense Finance and Accounting Service to either update the Defense Joint Military Pay System to ensure that all disbursements cite the correct accounting information or develop alternative automated solutions.
D-2021-0095-D000FP-0002-0002.B2a	Open
Rec. B.2.a: The DoD OIG recommended that the Director of the Defense Finance and Accounting Service perform a comprehensive review of the Defense Finance and Accounting Service commercial pay processes to identify procedures that rely on manual inputs and implement automated solutions, when feasible.
D-2021-0095-D000FP-0002-0002.B2b	Open
Rec. B.2.b: The DoD OIG recommended that the Director of the Defense Finance and Accounting Service develop, implement, and document compensating and preventative internal controls, when automated solutions are not feasible, to ensure that errors are identified before the transactions are processed.

Recommendation Number

Recommendation Status

Significant Recommendation

Additional Details

D-2021-0095-D000FP-0001-0001.A1a

Open

Rec. A.1.a: The DoD OIG recommended that the Under Secretary of Defense (Comptroller)/Chief Financial Officer, DoD, work with the Directors of the Defense Finance and Accounting Service and DoD Components to establish and implement business rules between all the systems that create, process, or store SF 1081 transactions and the Advancing Analytics tool to ensure that the DoD maintains a universe of SF 1081 transactions in a centralized database.

D-2021-0095-D000FP-0001-0001.A1b

Open

Rec. A.1.b: The DoD OIG recommended that the Under Secretary of Defense (Comptroller)/ Chief Financial Officer, DoD, work with the Directors of the Defense Finance and Accounting Service and DoD Components to establish memorandums of understanding with the system owners and the Advancing Analytics owners to define roles and responsibilities for managing the SF 1081 transactions.

D-2021-0095-D000FP-0001-0001.A1c

Open