Audit of the Accountability and Control of Materiel Assets of the Coalition Provisional Authority in Baghdad

Abstract : This report is the first in a series resulting from our review of the management of the Logistics Civil Augmentation Program III contract and the associated Task Order 0044. This report discusses accountability and control of materiel assets used to support the Coalition Provisional Authority (CPA) in Baghdad, Iraq. The Department of the Army issued contract number DAAA09-02-D-0007, Logistics Civil Augmentation Program III on December 14, 2001, to Brown and Root Services, a Division of Kellogg Brown and Root, Inc. (KBR). The Logistics Civil Augmentation Program III contract provides civilian augmentation for base operations and supports U.S. Army operations on a global basis. Task Order 0044 was issued by the Department of the Army to KBR on March 6, 2003, to provide logistics and life support services for the CPA Regional Offices located in the North, Central/Main, South Central, and the Southern areas of Iraq and for specified CPA satellite locations. As of April 2004, KBR had performed a reported $308,529,7722 of work on Task Order 0044. The cost of actual completed work and an additional forecast for work in progress for Task Order 0044 was reported by KBR to be $633 million as of March 27, 2004. As part of Task Order 0044, KBR property records show they managed 20,531 items valued at over $61.1 million in Baghdad, Iraq. The objective of the audit was to evaluate the effectiveness of policies, procedures, and property accountability measures used to account for and control materiel at CPA branch offices, headquarters, and warehouse locations. We projected that KBR could not account for 6,975 (34 percent) property items from an inventory of 20,531 records valued at $61.1 million. Further, we projected that 1,425 (6.9 percent) property items were on-hand but were not recorded on hand receipts. In addition, we projected that 5,920 (28.8 percent) hand receipts were not on file or had not been prepared.