"Unreasonable" Accounting in Iraq

In my younger and, admittedly, more naïve days, I once interviewed a candidate for a local election who’d come under fire for allegedly mismanaging a children’s hospital fund.

When I inquired about the charges, he replied in his best political-speak, “I’m reasonably confident that the money is going where it should.”

I wondered at the time why someone in charge would use the word, “reasonably.” It was like a bank manager saying “I’m reasonably certain all our depositors’ money is there.”

As it turned out, the erstwhile candidate was later indicted for bilking the charity for nearly $500,000.
More than 20 years later, that term “reasonably” surfaced again in a financial investigation.

This time however on a decidedly broader scale as a Pentagon-led audit into a $5.2 billion fund that was purportedly used to train and equip Iraqi soldiers, revealed that U.S. commanders used sloppy accounting procedures and failed on several occasions to show that equipment, services and construction were delivered properly.

The report compiled by the Defense Department Inspector General's office said the entity in question, known as the Multi-National Security Transition Command-Iraq, was unable to provide "reasonable assurance" (there’s that word again) that the money was used to achieve the intended results.

The report was based on an auditor’s three-month visit to Iraq earlier this year and included such findings as:
• The inspector general audited equipment purchases valued at more than $1 billion for armored vehicles, weapons, ammunition and other items, from two sets of supply sources. Of $643.1 million from one supplier, the inspector general was able to follow a paper trail for nearly 13 percent of it, or $82.9 million. Of $438.2 million from the second set, an audit trail was available for a scant 1 percent.

• The command couldn't account for 18 of 31 heavy-tracked recovery vehicles valued at more than $10 million. Also, the command couldn't prove that Iraqi security personnel received 70 percent of the nearly 3,000 generators valued at $7.0 million. It also couldn't account for six of 18 garbage trucks valued at $700,000.

I think there’s a Sopranos joke in there somewhere.

To be fair, the auditors did conclude that the loose accounting stems partly from the fact that there are few onsite comptrollers and related oversight resources than domestic-based commands. And the forces in charge were able to document the majority of services-related purchases.

But I learned that when folks in charge of finances begin mixing the words “reasonable” and “assurance” in the same sentence, it’s probably time to take a closer look at the books.

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