Defense Transportation: More Reliable Information Key to Managing Airlift Services More Efficiently
NSIAD-00-6
Published: Mar 06, 2000. Publicly Released: Mar 06, 2000.
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Highlights
Pursuant to a congressional request, GAO reviewed the Air Mobility Command's airlift rates, focusing on the: (1) extent to which the Air Mobility Command has reliable financial information for managing airlift transportation services; and (2) factors affecting efficient cost control of airlift services.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Defense | The Secretary of Defense should direct the Commander, U.S. Transportation Command, to take action to improve the Command's airlift financial cost information and develop annual airlift operations cost reduction goals as an incentive for improving airlift operations. In the short term, the Command should form a team to assess and recommend ways to address data accuracy problems within its financial management systems. The team should focus on data input controls and methods for ensuring the accuracy of information accumulated from a variety of sources and locations. In the long term, the Command needs to assess the costs and benefits of developing an architecture that either integrates existing data systems or develops new systems and new methods for capturing the costs of its operations and charging its customers. |
Closed – Implemented
The Department agrees with the need to improve the quality of its airlift financial cost information, but disagrees that the Secretary of Defense should direct the Commander, U.S. Transportation Command, to take action as several courses of action are already being pursued. The initiatives the Transportation Command has taken to improve data accuracy and systems integration include: (1) reengineering defense transportation documentation and financial processes, to include transportation working capital fund payments; (2) participating in a pilot project for improving managerial cost accounting systems; and (3) establishing a program office to develop an integrated financial reporting and overview system called the Transportation Financial Management System. This financial information management system is being developed by the Transportation Command in collaboration with the Defense Finance and Accounting Service and is expected to facilitate more informed decision-making by providing greater visibility into the Command's cost, revenue, budgeting, and financial performance date. The financial system was partly operational capability in Sept. 2003, and is planned to be fully operational by Dec. 2005. The Department does not plan to develop annual cost reduction goals as an incentive for improving airlift operations.
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| Department of Defense | The Secretary of Defense should direct the Defense Working Capital Funds Task Force to include the airlift portion of the transportation working capital fund in its work. The group should place particular attention to addressing ways to improve airlift cost information and the disincentives to controlling and recovering costs. |
Closed – Not Implemented
The Department of Defense disagrees with this recommendation. The Department also disagrees with GAO's assessment that its financial management policies and practices create disincentives to control and recover costs, and is planning no action to address this concern. The Defense Working Capital Task Force concluded its work in February 2000, and according to Department officials, the Task Force considered the airlift portion of the transportation working capital fund in its deliberations and recommendations. The Task Force developed 11 recommendations, of which 10 were approved by the Deputy Secretary Defense to improve the delivery of goods and services to its Defense Working Capital Fund customers.
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Topics
Accounting standardsCombat readinessData integrityDefense cost controlFinancial management systemsIndustrial fundsMilitary airlift operationsPrices and pricingReporting requirementsStrategic mobility forcesTransportation policies