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Senate panel to hear from auditors at troubled Defense agency

By Robert Brodsky rbrodsky@govexec.com September 9, 2008

Two veteran auditors are expected to provide an inside perspective on recently reported management problems at the Defense Contract Audit Agency during a Senate oversight hearing on Wednesday.

Paul Hackler, a supervisory auditor at DCAA, and Diem Thi Le, a senior auditor at the agency, are among the witnesses scheduled to testify at the Senate Homeland Security and Governmental Affairs session. Both cooperated with a recent Government Accountability Office investigation that found DCAA managers had improperly influenced some audits in favor of large contractors, a committee source said.

The hearing primarily will explore whether the agency overemphasizes job performance metrics and moves audits through the system too quickly without consideration of their size or relative importance, the committee source said. But the panel also will review the July GAO report.

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The two auditors will be joined at the witness table by DCAA Director April Stephenson; Gregory Kutz, GAO's managing director of forensic audits and special investigations; and Gordon Heddell, the Defense Department's acting inspector general.

The IG is investigating the allegations raised in the GAO report. The Defense Business Board, an independent panel of corporate executives, has been asked to examine the overall performance of the agency, and DCAA is conducting its own internal investigation.

Stephenson can expect tough questions from committee member Sen. Claire McCaskill, D-Mo., a former Missouri state auditor. McCaskill has said she believes GAO may have uncovered the "biggest auditing scandal in the history of this town."

The senator has asked Defense to fire supervisors cited in the report immediately, including those who reportedly threatened DCAA employees with personnel action if they cooperated with the GAO investigation.

Committee chairman Joseph Lieberman, I-Conn., and ranking member Susan Collins, R-Maine, also have been highly critical of DCAA. Collins said in July that the "GAO investigation raises serious concerns about DCAA's ability to effectively fulfill its critical oversight mission."

The focus of the hearing appears to be shaped by complaints about performance metrics leveled by former DCAA employees. Nearly a dozen former staffers told Government Executive in August that the audit agency is beholden more to its metrics than it is to saving taxpayer dollars.

The employees recalled times where managers pushed unfinished audits -- often with serious overbilling mistakes -- out the door in order to meet internal quotas and timetables. Meanwhile, supervisors worried about audits written in the wrong font or with minor spelling errors, the employees said.

In a memorandum to her staff last month, Stephenson acknowledged that internal performance measures could have compromised the quality of the agency's audits at times.

The director wrote that the agency would reassess its metrics to determine if they are appropriate and if supervisors are implementing them correctly. DCAA officials also are conducting a comprehensive assessment of staffing to ensure the agency has the right number of employees and distribution of offices.

Both reviews are expected to be complete by the end of September.

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COMMENTS

  • OSC and MSPB will not protect whistleblower reports by auditors. Due to court rulings, auditor disclosures are considered part of their regular job duties and merely a disagreement with management decisions. If Congress really wanted to know about fraud and abuse in government programs, they would immediately take action to change the whistleblower protection. Instead they discuss proposed bills for years and take no action. Everyone needs to contact every member of Congress. The contacts need to be repeated. In addition, media coverage is needed.
    Sheri Posted September 11, 2008 12:50 PM
  • The only way DCAA will ever become a respected audit agency again, is if there is a house cleaning at Headquarters and DCAA is moved outside of DoD so that it can really be independent. Ms. Stephenson’s rapid ascent to the top of the agency happened because she was developed and groomed to thrive in this current culture. Her entire career experience has been at DCAA, so it’s not likely that she will be able to make the drastic changes required, but I wish her luck. A good start, would be to start respecting and really “listen” to the auditors in the trenches and not believe everything your buddies tell you.
    Jeanne Posted September 11, 2008 12:20 PM
  • The GAO uncovered evidence from years of abuse by many auditors, techncial specialist, and few supervisors. It's amazing that once again management is protected by the DCAA attorneys during the investigation. Never mind that one of the alleged supervisors who threaten the auditor was also being rewarded with a promotion to (you guessed it) Headquarters. What about the the hundreds of auditors who lost their jobs (region-wide) by not only being harrassed but placed on a Performance Improvement Plan (PIP) which requires a person to improve their work performance based of their failure to achieve one of five key elements(do not overrun any assignments for the next 90 days over 20%) or you will be removed from your positions and those that survived the PIP (threaten with any violation of the five key elements of job performance within one year could result in immediate termination). Now you know why this was kept quiet for so long. Some management personnel were promoted or given bonuses while auditors, technical specialist, and few supervisors, departed the agency in total disgust and frustration. Not only were supervisors being promoted but those auditors that were "the favorites" were also promoted over seasonal auditors even though they had less experience and little knowledge of the technical area they were assigned as specialist (grounds for a grievance). Regional Human Resource specialists knew about the high turnovers, no alarms bells rung out because it was swept under the carpet. Potential new hires were standing at door to get in but longevity on the job no longer exist because the younger generation will not tolerate the mess. Thanks to the two auditors that spoke out. I know they were mentally abused by "powers that be" but there are many behind you saying thanks. As for the supervisor who's "promotion has been delayed", give me a break. Find out how many auditors were placed under a PIP or forced to retire and you will find a class action suit in the making. By the way, the new thing is to transfer management to another office until the smoke clears. Same pay performing work as an auditor? Where is the punishment. It's less stress for them and they still get paid. How many grievances have been filed against personnel in the Eastern Region? Why?
    Former Senior Auditor Posted September 11, 2008 10:22 AM
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