For Immediate Release


Keith Rutter
Phone: 202-347-1122

Watchdog Says Defense Contract Audit Agency Resisting Meaningful Reform

WASHINGTON - The Project On Government Oversight (POGO) sent a letter
today to Senate committees urging them to continue to conduct oversight
over the Defense Contract Audit Agency (DCAA), warning the committees
that they feared that the reforms occurring at the agency were only
superficial responses to political pressure.

The letter, based on concerns several DCAA auditors brought to POGO,
focuses on whether DCAA is meaningfully addressing human capital
management challenges that the Government Accountability Office found
had a "detrimental effect on audit quality." In particular, the group
cites DCAA headquarters' stonewalling a grassroots group established
within the agency to analyze the promotion system as a possible
indication that DCAA headquarters is not committed to fixing the
agency's problems. The group was disbanded after DCAA management
refused to give them the information they needed to test the promotion
system, though a new group with a more limited methodology has been
formed since this group was disbanded.

Additionally, POGO argues, the DCAA hotline for auditors to report
management problems, established to ensure audit quality, may be
serving as a tool for retaliation against the kind of independence in
auditing that DCAA should be fostering by relying on managers that may
be accused of wrongdoing to act upon the hotline's findings, presenting
an obvious conflict of interest.


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"The Defense Contract Audit Agency's management culture is
continuing to avoid conflict, rather than confront its problems to
implement meaningful reform," said POGO Executive Director Danielle

Fearing that in the long run DCAA can never operate independently
within the Department of Defense, POGO recommended Congress make DCAA
part of an independent federal contract audit agency. In the
short-term, POGO also urged the committees to address the agency's
systemic problems by advising DCAA to restructure their hotline program
to increase independence and continuing to pressure DCAA to hold
accountable managers or supervisors that inappropriately changed audit
opinions, facilitated "cozy" relationships with contractors, or created
an abusive work environment.


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The Project On Government Oversight (POGO) is an independent nonprofit that investigates and exposes corruption and other misconduct in order to achieve a more effective, accountable, open and honest federal government.

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