U.S. Coast Guard, Military Pay and Allowances

Published by the Government Accountability Office on 1971-09-16.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                                    UNITED STAT= GENERAL ACCOUNTING OFFICE
                                               WASHINGTON,     D.C.   2054ei

                                                                SEP   I G 9971

                     Dear Admiral    Bender:

                           We have completed an examination   at Coast Guard Headquarters,
                     Washington,   D.C. of a statistical  sample of Coast Guard military
                     pay records closed during the period January 1 to June 30, 1970.
                     The examination   included a review of 266 F&y records of Coast
                     Guardsmen on active duty during the period.

                             We found that there were 72 errors amounting to about $1,035
                     contained     in 65 of the 266 pay records included           in our sample.        A
                     statistical      projection   of the results     of our examination     indicates
                     that there may have been about 10,450 errors amounting to an esti-
                     mated $151,8QG contained        in the pay records/of       the 38,567 members
                     on active duty as of June 30, 1970. More specifically,                our com-
                     putations     showed that there was a 95-percent         probability    that
                     <iI Lne nUi2iX2~     or errors In Liie pzy iecoras     rangea ircXIl  ZDCjUL    D,UOU
                     to about 12,800 and was more likely            to be about 10,4SO and (21 the
                     probable dollar       amount of these errors ranged from about $53,500 to
                     about $250,500 and was more likely           to be about $151,800.         A summary
                     of the types and frequency of the errors found is contained                  in
                     Attachment I.

                            During the course of our examination     we reported  our findings
                     in detail    to the Coast Guard Payments and Claims Division        so that
                     corrective    action could be initiated   promptly.    That Division    has
                     taken corrective     action on all errors  reported,

                             We also examined the pay        records of those members among the
                     266 in our sample who received            reenlistment and variable reenl.ist-
                     ment bonuses prior to January           1, 1970. This review disclosed      two
                     members who were paid bonuses           for greater amounts than they were
                     entitled.      These cases and the        actions taken by the Payments and
                     Claims Divisj.on are discussed          in Attachment Ii.

                           Our examination    did not include an overall     evaluation    of
                     Coast Guard's payroll     operations   since we considered     only those
                     records available     at Headquarters.     We plan to initiate     a review
.       l
    ‘   .


                         of pertinent  source documents in the field    in the near future.    We
                         are currently  examining pay records available    at Headquarters  of
                         those members separated from active duty during the six month period
                         ended December 31, 1970, and we plan to report to you on the results
                         of this examination.

                              We appreciate       the cooperation and courtesies   extended to us by
                         Headquarters   officials     during our examination.    We would appreciate
                         your advice as to any actions the Coast Guard plans to take to reduce
                         the incidence   of the types of errors discussed in this letter.

                                                              Sincerely   yours,

                                                              Richard W. Kelley

                         Admiral Chester R. Bender
                         The Coast Guard


                                                                                               ATTACHMENT I
                                                                                               Page 1

                                                                 --SWMARY OF ERRORS
                                                        SAMPLE OF 266 MILITARY FAY RECORDS

                        Type of Error                                Number    Overpayment     Underpayment       Total
         Federal income tax incorrectly
           withheld  (a)                                               45       $ 383.93        $ 94.95       $    478.88

         FICA tax computed incorrectly                                  3              2.05                           2.05
         Basic allowance    for quarters                                                s
           incorrectly   recorded                                       1                         45.00             45.00‘
         Sea duty        incorrectly         recorded                   5              3.60        8.80              12.40
         Foreign        duty   incorrectly        computed              2                .80                              -80
         Incorrect        number of days
            entitled       to leave rations                             1               4.17                          4,.17
                                                                                       8 '
         Incorrect      determination   of
            entitlement      of basic and
            standard maintenance
            clothing     monetary allowances                            4             56.06       10.80              66,86

         Basic allowance    for subsistence                and
           commuted rations     incorrectly
           computed                                                     2                         10.14              10.14
     Overwithheld              allotment                                                           1.00               1.00
     Proficiency     pay awarded before
       member had met eligibility
        requirements    (b)                                                       308.00                           308.00
     Member paid family separation
       allowance while on leave and
       proceed time                                                     1             34.00                         34.00
         Base pay incorrectly                computed (c)               3             17.77       53.90             71.67
     Taxable            income incorrectly          computed (d)        3

                                                                 I   -- 72     $810.38          $224.59       -% 034.y
                                                                                        ATTACHMENT Z
                                                                                        Page 2

                  (a)      Withholding     of Federal income tax errors included cases
                           where (1) no amounts or incorrect       amounts were withheld               .
                           from retroactive     pay increases,  (2) sea duty was not
                           included as income for withholding       tax computation  pur-
                           poses, and (3) no amounts were withheld        on taxable

                  (b)       Proficiency  pay was awarded before the member met the
                            eligibility  requirement  of demonstrating  superior per-
                            for?mance in assignment for a minimum period of 6 months,

                  (cl     Errors in base pay were (1) failure   &-reduce     pay for being
                          AWOL, (2) rate of pay not increased when promoted, and
                          (3) wrong pay base used for computation    of retroactive   pay
                        , adjustment.

                  (d)       Consists         of an overstatement   of $847.32#and   understatements
                            totaling         $181.00.

              ,         .‘._-     . .
                                                                            ATTACHMENT II
                                                                            Page 1

                          INFORMATQXX ON Ci%ERPAYMENTS

Case 1

        A member was paid a reex&fstm~~ir bonus by the Air Force in 1956.
He subsequently       enlisted     in a   Coast Guard and after  completing his
initial    enlistment,      reenlist-z& in @?&ober 1966 and was awarded a
reenlistment      bonus and a varii&fe      rzzenlistment bonus.

       The amount of the reenli%tmen%t bonus paid the member was incorrect
because the Coast Guard did n&t conEiider the prior             reenlistment      bonus             .
paid by the Air Force in the. B-am;luscxnnputation as required             by 37 U.S.C.
308(a).     Also, the member wszs mast enzttitled to-.the variable         reenlistment
bonus since he did not meet t&m? re@rements             of 37 U.S.C. 308(g).         At
the time of our review,    the m~&er-~.s       overpaid     $4,175.75 and had not
been paid $666.67 representi*      the- remaining       installment      of the variable
reenlistment     bonus.

         We reported   this matter rtno th f%yments and Claims Division.  A
    pay adjustment   was authorize&l again&t the member's pay. In April  1971,
    the Coast Guard approved the membe:rr% request for remission of indebtedness.

    Case 2

       An enlisted   member entered Of-r    Candidate School (OCS) in
September 1966 and was award&B a r.=listment          and variable      reenlistment
bonus.    He was paid $305.40 Eox+ztti Brst     installment       of the variable
bonus in October 1966. This member &ad been selected to attend OCS
prior to the date of his reezdiistm~,       Inasmuch as the purpose of the
variable   reenlistment   bonus i& to wide      the services       with the continued
use of enlisted     men who posse   ceztmin critical      skills,     we believe     that
the bonus payment was improper,

           A Comptroller    General's    a&xFsiion~ dated February 8, 1968, (47 Comp.
    Gen. 4141, states that the vmtiable           reenlistment    bonus is not authorized
    to enlisted     members who are seEect& for college training               under the Navy
    Enlisted    Scientific    EducatioJm E%ogrzm or other similar          programs and who
    reenlist    for the purpose of meeting: the obligated          service      requirements
    for such training.        The decis&rxx St&es further       that in view of an
    apparent misunderstanding         by &a mi.l&rtary departments       of the proper
    application     of a previous     Com@~rolIem General's     decision      regarding     the
    subject,    we would not questions bonus payments otherwise             correct that
    were made incident      to such reem$istmmts.          However, the decision         required
    that further      payments, includtig    yearly installments       for such reenlist-.
    ments already entered into, XE~VZ to be promptly discontinued,
                                                                       ATTACHMENT II
                                                                       Page 2

           Since this variable       reenlistment       bonus was paid prior to
    47 Comp. Gen. 414, dated February 9, 1968, we did not request
    that collection     action be initiated.            However, we alerted   the
    Payments and Claims Division           to the need to comply with the
    decision    in the future.      Also,the      Division   agreed to review
    the pay records of all members who attended OCS subsequent to
    the effective     date of the decision         in order-to    determine
    whether any variable       reenlistment       bonuses were improperly'