._--.. _. -...-.-. -. .-..... - _- -..- .. j _ -... -. ._._._..... “. .I-__ ._ ~~.._ I__- .__. -_-- ._..--... “--- GAO United States General Accounting Office Washington, D.C. 20648 Information Management and Technology Division R-241751 December20,199O The Honorable John P. Murtha Chairman, Subcommitteeon Defense Committee on Appropriations Houseof Representatives Dear Mr. Chairman: In February 1989, the DefenseInspector General reported that the Army buys most of its automated data processing(ADP) equipment in the last quarter of the fiscal year. On February 8, 1990, you conse- quently asked us to review its managementof ADP funds. Specifically, you asked us to identify the prevalence of ADP year-end obligations, and determine whether they complied with Army policies and were cost- effective. As agreedwith your office, we only reviewed,the U.S. Army Training and Doctrine Command(TRAIXX). To determine the prevalence of year-end obligations of appropriated operation and maintenance funds, we identified fiscal years 1988 and 1989 Army annual ADP obligations and what portion of these occurred between July 1 and September30, the fourth quarter of each fiscal year. To determine compliance, we selecteda sample of fourth quarter ADP obligations at TRADOC. For cost-effectiveness,we relied upon our prior report on the Army’s managementof new ADP initiatives.1 Details of our objectives, scope,and methodology are in appendix I. In fiscal years 1988 and 1989, Army records showed that 65 to 75 per- Results in Brief cent of the operation and maintenance funds obligated for acquiring ADP hardware and software were made in the last quarter of the fiscal year. At TRADOC, year-end ADP obligations we sampled complied with Com- mand guidance.We previously reported that the Army has not com- pleted an Army-wide architecture, nor implemented its information managementplan for monitoring and controlling information initiatives at major commandsand installations. Consequently,it cannot guarantee the cost-effectivenessof individual acquisitions. 1Information Resources:Army ShouldLimit New Initiatives Until ManagementProgramIs Imple- mented(GAO/; Page 1 GAO/IMTEG91-12 Prevalence of Fourth Quarter Obligations for Army ADP - B241761 During fiscal years 1988 and 1989, the Army’s total ADP obligations Background from its operation and maintenance account2were about $1.7 billion and $1.8 billion, respectively. They were for hardware, software, leasesand maintenance, and to pay personnel. Hardware acquisitions included buying computers and peripherals. Software acquisitions included com- mercially available software to support the hardware acquired. In 1984,the Army established its Information ResourcesManagement Program to set up a commonmanagementand planning structure. It would ensure that (1) all Army information requirements are identified, validated, and ranked; (2) unnecessarily redundant information systems are eliminated; and (3) an orderly transition from the present to the future computer environment is planned. The program requires each organization to (1) develop an information architecture to serve as the frame of reference for all information managementdecisionsand (2) prepare an Information ManagementPlan of ranked initiatives. It plans to develop an overall Army information architecture from these smaller architectures. The Army is organized into major commandsthat carry out specific functions. For example, TRADOCsets equipment requirements, designs organizational structures, and trains troops for combat. In April 1985, TRADOC set up an ADP division within its contracting activity at Fort Eustis, Virginia, to award automation-related acquisitions over $2,000. Subsequently TRADOC issued an ADP Approval and Acquisition Guide to help personnel buy ADP resources.This guide requires procurement packagesto be submitted to the contracting activity, which reviews them and issuesobligation documents(e.g., purchase orders, contracts, requisitions). Before issuing an obligation document, the contracting activity must be sure each packageincludes (1) the director of informa- tion management(LIOIM) certification of review, (2) a purchase request and commitment document, and (3) command review and approval. DOIM certification documentsthat the packagehas been approved in accordancewith TRANCand Army regulations. A purchase request and commitment document ensuresfunds are available before an obligation is made. Command review and approval is given by the Office of the Deputy Chief of Staff for Information Management(DCXM). 2TheArmy alsocan acquireADP resourcesfrom at leasttwo other funding sources-other procure- ment appropriationsand research,development,test, and evaluation appropriations. Page 2 GAO/IMTEGfU-12 Prevalence of Fourth Quarter Obligations for Army ADP Army’s annual obligations from its operation and maintenance appropri- Obligations for ation for ADP hardware and software for fiscal years 1988 and 1989 Hardware and were about $115 million and $147 million, respectively. As table 1 shows, 76 and 65 percent of these obligations occurred in the fourth ‘Oftware Preva1ent in quarter of these fiscal years. the Fourth Quarter Table 1: Percent of Fourth Quarter ADP Obligations Percent obligated in fourth quarter ADP Acquisitions FY 1988 FY 1989 Hardware 77 62 Software 65 79 Total 75 65 Unlike hardware and software purchases,operation and maintenance obligations for salaries and travel were spread out fairly evenly throughout the year. Obligations for leasesand maintenance fluctuated. Operation and maintenance funds obligated for salaries and travel were about 25 percent each quarter during both years; obligations for leases and maintenance did not exceed33 percent in the fourth quarter of either year. Army officials said that they planned to obligate funds for ADP hard- ware and software at year end to be sure they can cover other essential items such as salaries. In May 1989 HouseAppropriations Subcommittee hearings, the Army’s Director of Information Systemsfor Command, Control, Communications, and Computers stated that commandersmust ensure that salaries are paid and that soldiers are trained, fed, and clothed. Sometimes,he said, it is late in the fiscal year before com- manders know whether they will have enough money to do other things such as to pave streets, restock supplies, or buy personal computers, Basedon our sample, TRADOC'S fiscal year 1988 and 1989 fourth quarter Obligations at ADP obligations comply with the Command’sADP Guide. Also, each sam- TRADOCInstallations pled obligation was supported by the appropriate obligation document Comply With TRADOC as required by the Army’s Accounting and Fund Control regulation. In fiscal years 1988 and 1989, TRADOC'S contracting activity processed Guidance 1,633 fourth quarter ADP obligations. Having selectedand reviewed 53 I of these, which represented at least one of the largest procurements for each TRAIIOC installation and activity, we found that every procurement packageincluded the required documents.Each package (1) received Page 3 GAO/lMTECXU-12 Prevalence of Fourth Quarter Obligations for Army ADP B-241751 DOIM certification, (2) contained a purchase request and commitment document, and (3) received architectural approval from TRADOC head- quarters.3Also, each obligation was supported by a purchase order. * Although TRADOC has met the paperwork requirements for obligating Army Lacks the funds for the sample we reviewed, the Army lacks the tools to ensure Necessary Tools to that TRADOC'S acquisitions are cost-effective. As we reported in June Ensure Cost-Effective 1990, neither Army headquarters nor TRADOC has completed its informa- tion architecture. Also, the Army has not established an effective pro- Acquisitions cessfor monitoring and controlling information initiatives service-wide. Without an information architecture, the Army has not established an adequate framework that defines the relationships of all elements involved in information resourcesmanagement.An information archi- tecture should establish objectives, develop guidance, evaluate initia- tives, and identify and rank requirements. Architecture development has been hindered at all levels by (1) the lack of a complete headquar- ters architecture to guide major commandsand installations, (2) a lack of specific implementation guidance and milestones,(3) local com- manders’ lack of commitment to the program, and (4) an emphasison new systems initiatives over architecture development. Recognizingthe need for a headquarters architecture, they plan to complete it by March 1991. We also reported in June 1990 that the Army has not established an effective processfor monitoring and controlling information initiatives. As a result, it cannot consistently ensure that its automation initiatives are basedon valid requirements, conform to an Army information archi- tecture, and minimize duplication. Without an effective processand information architecture, the Army lacks the necessarytools which would assist in ensuring cost-effectiveness. Our previous report contains recommendationsto correct weaknessesin the Army’s ADP management.Accordingly, we are not making any fur- ther recommendationsat this time. 3TRADOChas not establishedan information architecturein accordancewith Army guidance,how- ever, a proprietary operatingenvironment(hardware,operatingsystems,and communicationsnet- work protocols)has beenmandatedfor all of its installations.Accordingto a DCSIMofficial, they review the procurementpackageto ensurecompliancewith this mandatedenvironment. Page 4 GAO/IMTEIG91-12 Prevalence of Fourth Quarter Obligations for Army ADP EL241761 We did not obtain written agency commentson a draft of this report. We did, however, discussits contents with Army officials and have included their commentswhere appropriate. We are providing copiesof this report to the Chairmen, SenateCom- mittee on Appropriations, House and SenateCommitteeson Armed Ser- vices, HouseCommittee on Government Operations, and Senate Committee on Governmental Affairs. Should you have any questions about this report or require additional information, please contact me at (202) 275-4649.Major contributors to this report are listed in appendix II. Sincerely yours, Samuel W. Bowlin Director, Defenseand Security Information Systems Page 6 GAO/IMTEG91-12 Prevalence of Fourth Quarter Obligations for Army ADP Contents Letter 1 Appendix I 8 Objectives, Scope,and Methodology Appendix II Major Contributors to This Report Table Table 1: Percent of Fourth Quarter ADP Obligations 3 Abbreviations ADP automated data processing IXSIM Deputy Chief of Staff for Information Management DOIM Director of Information Management GAO General Accounting Office IMTEC Information Managementand Technology Division mm Training and Doctrine Command Page 6 GAO/lMTECdl-12 Prevalence of Fourth Quarter Obll6diona for Army ADP Page 7 GAO/IMTEG91-12 Prevalence of Fourth Quarter Obligations for Army ADP Appendix I Objectives;Scope,and Methodology On February 8,1990, the Chairman, Subcommitteeon Defense,House Committee on Appropriations, asked that we review the Army’s man- agementof ADP funds at its major commandsand installations. On the basis of further discussionswith a member of the Subcommitteestaff, we were asked to (1) identify the prevalence of year-end ADP obligations and (2) determine whether these obligations complied with Army poli- cies and resulted in cost-effective acquisitions. To accomplish these objectives, we reviewed Army ADP obligation proce- dures and data related to the sustaining baseenvironment for fiscal years 1988 and 1989. The term sustaining baserefers to information used to manageArmy resourcesand installations and deploy and sus- tain fighting forces. We did not review obligations for strategic or tac- tical automation. We performed our work at the Department of Army headquarters in the Washington, DC., area; TRADOC, Fort Monroe, Vir- ginia; TRADOC'S installations at Fort Leavenworth, Kansas,and Fort Leo- nard Wood, Missouri; and the TRADOC Contracting Activity, Fort Eustis, Virginia. We interviewed appropriate agencyofficials and reviewed reports by the Department of DefenseInspector General, Department of the Army Inspector General,Army Audit Agency, and the Congress.We reviewed laws, policies, and documentsto identify criteria for year-end obligations. To determine the prevalence of fiscal years 1988 and 1989 year-end ADP obligations, we interviewed Army officials and reviewed annual and fourth-quarter obligations data from Army headquarters. This informa- tion listed how much money major commandsobligated for ADP hard- ware, software, salaries, leases,and maintenance.We did not independently assessthe accuracy of this data. To determine whether obligations complied with Army regulations, we limited our review to TRADOC, which is one of the Army’s 11 major com- mands. We interviewed officials and reviewed a judgmental sample of TRALIOC fourth quarter ADP obligations for fiscal years 1988 and 1989. To select our sample, we obtained computer-generatedreports of all fourth- quarter obligations for ADP acquisitions made by the TRADOC contracting activity. The reports showed 663 and 970 acquisitions for fiscal years 1988 and 1989, respectively. We identified at least one of the largest dollar obligations for acquisition for each installation during the fourth quarter of each fiscal year, and reviewed a total of 53 acquisitions to see Page 9 GAO/IMTEGgl-12 Prevalence of Fourth Quarter Obligations for Army ADP Appendix I Objectives, Scope, and Methodology if they followed Army regulations. But we did not independently assess the accuracy of TRADOC’S data. Our criteria for determining compliance was TRADOC’S ADP Approval and Acquisition Guide and chapter 12-3 of Army Regulation 37-l. We checkedthat each procurement packagereceived DOIM certification and command review and approval, contained a purchase request and com- mitment form, and was supported by an obligation document. To addressthe cost-effectivenessquestion, we used information gath- ered from our prior work and the subsequentreport, Information Resources:Army Should Limit New Initiatives Until ManagementPro- gram Is Implemented (GAOmTEC-90-58, June 29, 1990). We conducted our review between April 1990 and September 1990, in accordancewith generally acceptedgovernment auditing standards, with the exception noted above about independently assessingdata accuracy. We did not obtain written comments from the Department of the Army on a draft of this report. However, we discussedthe contents of this report with Army officials, and have included their comments where appropriate. Page 9 GAO/IMTEC-91-12 Prevalence of Fourth Quarter Obligations for Army ADP Appendix II Major Contributors to This Report JosephT. McDermott, Assistant Director Information Thomas J. Howard, Assistant Director Management and Sondra F. McCauley,Senior Evaluator Technology Division, Washington, D.C. JosephJ. Watkins, Evaluator-in-Charge Norfolk Regional Connie W. Sawyer, Jr., Senior Evaluator Office (alonrn) Page 10 GAO/IMTEG91-12 Prevalence of Fourth Quarter Obligations for Army ADP -_I . ..---__ - ._.. --.- .__..- - --.. ._._ .._ -. _“.. “, ,.-..“ll . . . . ..-.- - -._..- -..--.----- ITS (;c*nc~rat Ac+countiug Office P. 0. 130x GO15 (;ail.hc*rst)urg, MI) 20877 Orttc~rs m;ty ;dso hc placed; by catting (202) 275624 1.
Army ADP: Prevalence of Fourth Quarter Obligations
Published by the Government Accountability Office on 1990-12-20.
Below is a raw (and likely hideous) rendition of the original report. (PDF)