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FORSCOM INTERNAL REVIEW REENGINEERING INITIATIVE

FORSCOM INTERNAL REVIEW REENGINEERING INITIATIVE. Initiative. FORSCOM Viewed USAAA as Viable Alternative to Internal Review Transfer Internal Review Spaces and Workload to The Auditor General Save Money? Improve Effectiveness and Efficiency?. Background.

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FORSCOM INTERNAL REVIEW REENGINEERING INITIATIVE

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  1. FORSCOM INTERNAL REVIEW REENGINEERING INITIATIVE

  2. Initiative • FORSCOM Viewed USAAA as Viable Alternative to Internal Review • Transfer Internal Review Spaces and Workload to The Auditor General • Save Money? • Improve Effectiveness and Efficiency?

  3. Background • FORSCOM Designated Reinvention Center • Follow-on to Earlier Initiative to Consolidate IR with IG • Rejected Due to Legal Implications • ASA(FM&C) Approved Test • FORSCOM Transferred $700,000 to USAAA for Test

  4. Background (continued) • Evaluation Plan Drafted and Approved by • ASA(FM&C) • The Auditor General • HQ, FORSCOM • TIG to Lead Evaluation • Evaluation Team Also Selected and Approved by Principals

  5. Five Test Sites (Volunteer) HQ, FORSCOM Fort Drum Fort Hood Fort Lewis Fort Stewart Five Control Sites Fort Bragg Fort Campbell Fort Carson Fort Polk Fort Riley Test Period (1June 1995 - 31 May 1996)

  6. Evaluation Criteria • Objective: “To determine the most efficient and effective means for FORSCOM commanders to obtain internal audit services.” • Success Criteria: • Highest Return on Investment • Highest Rate of Productivity • Highest Degree of Customer Satisfaction

  7. Evaluation Team • DAIG - Lead • ASA(FM&C) • USAAA • HQ, FORSCOM • Fort Sam Houston

  8. PRODUCTIVITY INVESTMENT CUST SATFCTN Evaluation Methodology • Products # • Costs * • Interviews • Questionnaire # Productivity Data Period - 1 October 95 thru 31 March 96 * Investment Data Period - 1 August 95 thru 31 March 96

  9. Productivity Results Products Generated During Test Period • Total Audit Engagements Per Staff Year • Internal Review - 7.89 • Command Audit - 6.10

  10. Cost Results • Cost of Operations (1AUG95 - 31MAR96) • Internal Review - $826.4K • Command Audit - $687.8K • Purchased • Internal Review - 11.4 Staff-Years • Command Audit - 8.5 Staff-Years • Cost Per Staff-Year • Internal Review - $52.6 K • Command Audit - $61.0 K Difference 21%

  11. Cost • Savings Generated • Internal Review - $1.79M Per Staff-Year • Command Audit - $1.46M Per Staff-Year* • Return on Investment • Internal Review - $28.4 to $1 • Command Audit - $22.9 to $1* Difference 24% * $8M Added as Revised Figure- Added 0.94 Per Staff-Year

  12. Customer Satisfaction • Interviews • All Satisfied With Services Rendered • Questionnaires • Advantage Internal Review

  13. Summary • Is Command Audit a Viable Option for Internal Audit? • Yes • Do Test Results Indicate That Command Audit Is The Most Effective and Efficient Option? • No. Internal Review Offices Cost Less Per Staff-Year, Produced More Products and Provided a Greater Return on Investment for Their Commanders

  14. Considerations Not Addressed • Legal Issues • National Performance Review • HQ Redesign • GAO Standards • Unity of Command ?

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