Earlier this year, the Marine Corps achieved notable success amid the Department of Defense’s (DoD) broader challenges with financial audits by adopting a new accounting system. However, a new report from the Government Accountability Office (GAO) reveals that the lack of implementation guidance for the system is presenting several cost and data migration challenges.
In October 2021, the Marine Corps began its transition to a new accounting system – the Defense Agencies Initiative – as part of a broader DoD effort to improve its financial management and achieve an unmodified – or clean – annual audit opinion.
As of February 2024, the Marine Corps and four smaller DoD components began to use the system and succeeded in achieving clean audit opinions.
However, according to the Federal watchdog agency, DoD lacks comprehensive implementation guidance and that creates ongoing concerns about the system’s adherence to leading practices in critical areas like data migration, conversion, and change management.
Additionally, the department does not require the inclusion of comprehensive cost and schedule estimates, which caused defense agencies to underestimate the complexity and duration of the transition, and resulted in the Marine Corps and other components to miss the initial launch target of December 2021.
“Until the DoD ensures that the Defense Agencies Initiative standard operating procedures fully incorporate leading practices, DoD components transitioning to the Defense Agencies Initiative risk experiencing understated costs, schedule delays, and limitations in understanding their progress toward achieving their goals,” the report states.
GAO made 14 recommendations on cost, schedule, performance measures, data migration, and change management to the department, and DoD concurred with 13 of those.
In its response to GAO, DoD explained that “given progress to date, we recommend the consolidation of two recommendations, the deletion of one recommendation, and the closure of three recommendations.”
GAO maintains that action on each of the 14 recommendations is warranted.
