Accountability for U.S. Equipment Provided to Pakistani Security Forces in the Western Frontier Needs to Be Improved
Gao ID: GAO-11-156R February 15, 2011Al Qaeda, the Taliban, and other extremists have used safe havens along Pakistan's Western Frontier (border) region to attack Pakistani, Afghan, U.S., and coalition troops; plan and train for attacks against U.S. interests and the U.S. homeland; destabilize Pakistan, a nuclear-armed U.S. ally; and spread radical Islamic ideologies that threaten U.S. interests. A key U.S. national security objective is to disrupt, dismantle, and defeat al Qaeda and its violent extremist affiliates in Pakistan and to deny them a safe haven. Since 2002, the United States has provided over $18 billion in assistance and reimbursement to Pakistan including (1) reimbursements to the Pakistani government for costs incurred in direct support of U.S. counterterrorism operations; (2) security assistance such as grants to Pakistan for the acquisition of military equipment; and (3) development, economic, and humanitarian assistance. Since 2006, this assistance has included $1.5 billion to improve the counterterrorism and counterinsurgency capabilities of Pakistani security forces operating along the country's border with Afghanistan, including $400 million for the Pakistan Counterinsurgency Fund (PCF) and $700 million for the Pakistan Counterinsurgency Capabilities Fund (PCCF). The President has requested an additional $1.2 billion for fiscal year (FY) 2011 and $1.1 billion for fiscal year 2012 to train and equip these forces. U.S. assistance under this initiative has provided military equipment, such as helicopters and night-vision devices; infrastructure, such as border coordination and training centers; and training. The Office of Defense Representative Pakistan (ODRP), under the U.S. Central Command (CENTCOM), manages this assistance. ODRP is responsible for the receipt and storage of U.S.-provided military equipment at a leased warehouse in Islamabad prior to the equipment's transfer to Pakistan. ODRP is also responsible for, among other things, developing and implementing policies and procedures to document the transfer of the equipment to Pakistan and to ensure that once in Pakistan's custody, items requiring enhanced monitoring are subject to periodic inventories. The Defense Security Cooperation Agency (DSCA) is responsible for ensuring that U.S. and Pakistani officials implement appropriate internal control procedures to account for sensitive defense equipment, including conducting compliance assessments. This report focuses on U.S. activities to ensure accountability of sensitive equipment provided to Pakistani security forces operating along the western border. We have previously reported on Afghan and Iraqi weapon accountability coverage, as well as the importance of accountability and oversight of U.S. efforts in Pakistan, including Coalition Support Fund reimbursements to Pakistan and the planning and documentation of U.S. development assistance in Pakistan's Federally Administered Tribal Areas.
DOD's written procedures for ensuring accountability for equipment received and stored at its Islamabad warehouse do not fully address key requirements on how to maintain accountability and management of property. Federal government standards for internal control state that federal agencies should design and document internal controls that provide safeguards to help prevent and detect the loss or misuse of equipment. Further, DOD guidance emphasizes the need to document the internal controls used to maintain accountability for property. Our analysis of the DOD guidance resulted in the identification of 17 key requirements. The key requirements focus on (1) physical controls over vulnerable assets; (2) proper execution of transactions and events; (3) management of human capital and reviews by management at the functional or activity level; and (4) controls over information processing. During a field visit to Pakistan, we observed that ODRP did not have written procedures to help ensure consistent accountability for the receipt and storage of U.S. defense articles at its Islamabad warehouse prior to their transfer to Pakistan. DSCA did not follow up in a timely manner to ensure corrective actions were taken to fix weaknesses in accountability procedures that it identified in 2008 for sensitive equipment in Pakistan's custody. U.S. government standards for internal control recommend that agencies ensure the prompt resolution of the findings of audits and other compliance reviews. Within DOD, DSCA is the principal agency responsible for implementing the Golden Sentry Program, created to meet accountability requirements under the Arms Export Control Act, for defense articles funded through traditional security assistance programs. The Golden Sentry Program requires monitoring of sensitive and nonsensitive defense equipment transferred to foreign countries.12 Sensitive equipment is subject to enhanced end-use monitoring. Some sensitive equipment, such as night-vision devices, require 100 percent inventory by serial number. DSCA carries out its responsibilities under the program by reviewing the implementation of internal control procedures intended to help maintain security and accountability over sensitive defense articles transferred to foreign countries, and by following up to ensure that its findings are implemented in a timely manner. A key element of the program is compliance assessment visits to assess host nation and U.S. security assistance personnel compliance with end-use, security, and accountability procedures. Although on-site assessments are a key element of end-use monitoring, according to a DSCA official, DSCA also relies on intelligence and other reports to accomplish its oversight and monitoring responsibilities. To improve accountability for U.S.-provided defense equipment, the Secretary of Defense should take the following three actions. The Secretary should direct (1) the Commander of U.S. Central Command to ensure ODRP's written procedures for equipment received and stored at its Islamabad warehouse incorporate key asset accountability controls, (2) the Director of the Defense Security Cooperation Agency to take follow-up action, in accordance with internal control standards, to ensure that ODRP fully addresses all of DSCA's 2008 recommendations, (3) the Director of the Defense Security Cooperation Agency to conduct a compliance assessment to verify that U.S. and Pakistani officials have fully implemented the new accountability program required by the 2010 NDAA.
RecommendationsOur recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
Director: Charles M. Johnson Jr Team: Government Accountability Office: International Affairs and Trade Phone: (202) 512-7331GAO-11-156R, Accountability for U.S. Equipment Provided to Pakistani Security Forces in the Western Frontier Needs to Be Improved
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United States Government Accountability Office:
Washington, DC 20548:
February 15, 2011:
Congressional Addressees:
Subject: Accountability for U.S. Equipment Provided to Pakistani
Security Forces in the Western Frontier Needs to Be Improved:
Al Qaeda, the Taliban, and other extremists have used safe havens
along Pakistan's Western Frontier (border) region to attack Pakistani,
Afghan, U.S., and coalition troops; plan and train for attacks against
U.S. interests and the U.S. homeland; destabilize Pakistan, a nuclear-
armed U.S. ally; and spread radical Islamic ideologies that threaten
U.S. interests. A key U.S. national security objective is to disrupt,
dismantle, and defeat al Qaeda and its violent extremist affiliates in
Pakistan and to deny them a safe haven. Since 2002, the United States
has provided over $18 billion in assistance and reimbursement to
Pakistan including (1) reimbursements to the Pakistani government for
costs incurred in direct support of U.S. counterterrorism operations;
(2) security assistance such as grants to Pakistan for the acquisition
of military equipment; and (3) development, economic, and humanitarian
assistance.
Since 2006, this assistance has included $1.5 billion to improve the
counterterrorism and counterinsurgency capabilities of Pakistani
security forces operating along the country's border with Afghanistan,
including $400 million for the Pakistan Counterinsurgency Fund (PCF)
and $700 million for the Pakistan Counterinsurgency Capabilities Fund
(PCCF).[Footnote 1] The President has requested an additional $1.2
billion for fiscal year (FY) 2011 and $1.1 billion for fiscal year
2012 to train and equip these forces. U.S. assistance under this
initiative has provided military equipment, such as helicopters and
night-vision devices; infrastructure, such as border coordination and
training centers; and training.[Footnote 2] The Office of Defense
Representative Pakistan (ODRP), under the U.S. Central Command
(CENTCOM), manages this assistance. ODRP is responsible for the
receipt and storage of U.S.-provided military equipment at a leased
warehouse in Islamabad prior to the equipment's transfer to Pakistan.
ODRP is also responsible for, among other things, developing and
implementing policies and procedures to document the transfer of the
equipment to Pakistan and to ensure that once in Pakistan's custody,
items requiring enhanced monitoring[Footnote 3] are subject to
periodic inventories. The Defense Security Cooperation Agency (DSCA)
is responsible for ensuring that U.S. and Pakistani officials
implement appropriate internal control procedures to account for
sensitive defense equipment, including conducting compliance
assessments.
This report focuses on U.S. activities to ensure accountability of
sensitive equipment provided to Pakistani security forces operating
along the western border. We have previously reported on Afghan and
Iraqi weapon accountability coverage, as well as the importance of
accountability and oversight of U.S. efforts in Pakistan, including
Coalition Support Fund reimbursements to Pakistan and the planning and
documentation of U.S. development assistance in Pakistan's Federally
Administered Tribal Areas.[Footnote 4]
We conducted this review under the authority of the Comptroller
General to undertake work under his own initiative because of
significant and broad congressional interest. The objectives of this
review were to determine the extent to which the Department of Defense
(DOD) has (1) ensured accountability for the receipt, storage, and
transfer to Pakistan of U.S.-provided equipment at its Islamabad
warehouse; (2) responded to reported weaknesses in accountability for
night-vision devices in Pakistan's custody; and (3) addressed new
accountability requirements established in section 1225 of the 2010
National Defense Authorization Act (NDAA) for defense articles
provided to Pakistan.[Footnote 5]
To address these objectives, we reviewed relevant U.S. laws, federal
internal control standards, DOD policies and procedures, reports and
other documents; interviewed DOD officials at the DSCA in Washington,
D.C.; the ODRP in Fort Belvoir, Virginia, and in Pakistan; at CENTCOM
in Tampa, Florida; and at a DOD-leased warehouse in Islamabad where
some U.S.-provided equipment is received and stored prior to transfer
to Pakistani security forces. To determine what accountability
procedures were adequate for equipment received and stored at the
warehouse, we used DOD Instruction 5000.64 to identify those
requirements that would be needed, at a minimum, to ensure adequate
accountability of the equipment received and stored at the Islamabad
warehouse. Our analysis resulted in the identification of 17
requirements. We assessed ODRP's standard operating procedures against
these 17 requirements to determine the adequacy of DOD's efforts to
maintain accountability for equipment. We also interviewed Department
of State officials in Washington, D.C., and at the U.S. Embassy in
Islamabad.
We completed this performance audit between June 2009 and February
2011 in accordance with generally accepted government auditing
standards. Those standards require that we plan and perform the audit
to obtain sufficient, appropriate evidence to provide a reasonable
basis for our findings based on our audit objectives. We believe that
the evidence obtained provides a reasonable basis for our findings
based on our audit objectives.
This audit was conducted as part of a larger review of U.S. assistance
to enhance the counterterrorism and counterinsurgency capabilities of
Pakistani security forces operating along the country's Western
Frontier. We plan to report separately on the status of U. S. efforts
to provide equipment, training, and infrastructure to enhance the
capabilities of these forces, including the impact of the floods on
this assistance.[Footnote 6] Additionally, we are reviewing the
President's forthcoming certification relating to Pakistan's
counterterrorism and nuclear networks cooperation with the United
States and the United States' Pakistan Assistance Strategy report in
response to congressional mandates in the Enhanced Partnership with
Pakistan Act of 2009.[Footnote 7]
Written Procedures for Ensuring Accountability for Equipment at DOD's
Islamabad Warehouse Are Incomplete, Increasing the Risk for Loss or
Misuse:
DOD's written procedures for ensuring accountability for equipment
received and stored at its Islamabad warehouse do not fully address
key requirements on how to maintain accountability and management of
property. Federal government standards for internal control[Footnote
8] state that federal agencies should design and document internal
controls that provide safeguards to help prevent and detect the loss
or misuse of equipment. Further, DOD guidance[Footnote 9] emphasizes
the need to document the internal controls used to maintain
accountability for property. Our analysis of the DOD guidance resulted
in the identification of 17 key requirements. The key requirements
focus on (1) physical controls over vulnerable assets; (2) proper
execution of transactions and events; (3) management of human capital
and reviews by management at the functional or activity level; and (4)
controls over information processing.
During a field visit to Pakistan, we observed that ODRP did not have
written procedures to help ensure consistent accountability for the
receipt and storage of U.S. defense articles at its Islamabad
warehouse prior to their transfer to Pakistan. Further, we observed
that knowledge of processes to provide accountability, including the
use of the inventory tracking database, resided primarily with the
supply officer who had developed these processes starting in May 2009.
According to ODRP officials, this officer departed Islamabad in May
2010. At the conclusion of our field work in Pakistan in February
2010, we advised embassy and ODRP officials that without written
procedures there was a risk that the inventory tracking process
implemented at the warehouse might not be consistently performed or
continued when officers rotate. U.S. military assignments to ODRP are
generally for 1 year or less and, according to DOD officials, delays
obtaining visas have prevented DOD from being able to overlap officer
rotations.
In May and November 2010, ODRP issued standard operating procedures
[Footnote 10] for the inventory management process at the warehouse in
Islamabad, including the use of an inventory tracking database.
Although ODRP's written procedures generally provide an overview of
the inventory tracking process, several of the procedures do not
provide sufficient information regarding their operational procedures
or internal controls. Our review determined that out of the 17 key
requirements, 10 were incorporated to a large extent, 2 were
incorporated to some extent, and 5 were incorporated to little or no
extent. For example,
* DOD guidance requires that certain data elements such as name,
unique item identifier (e.g., serial number), description quantity,
and location be recorded in the property system to enable the tracking
of equipment. However, the written procedures provided did not
identify the specific data elements that should be recorded in the
property system.
* DOD guidance requires that periodic internal reviews and audits of
the property accountability and management system be performed to
determine if it is operating as intended. However, the written
procedures provided do not require that such internal reviews or
audits be performed.
Without robust procedures, there is increased risk of equipment loss
or fraudulent activity. See enclosure I for more detailed information
on the extent to which the inventory tracking process incorporated the
key requirements.
DOD's Follow-Up Actions on Weaknesses in Accountability for Sensitive
Equipment in Pakistan's Custody Were Not Completed in a Timely Manner:
DSCA did not follow up in a timely manner to ensure corrective actions
were taken to fix weaknesses in accountability procedures that it
identified in 2008 for sensitive equipment in Pakistan's custody. U.S.
government standards for internal control recommend that agencies
ensure the prompt resolution of the findings of audits and other
compliance reviews. Within DOD, DSCA is the principal agency
responsible for implementing the Golden Sentry Program, created to
meet accountability requirements under the Arms Export Control Act,
for defense articles funded through traditional security assistance
programs.[Footnote 11] The Golden Sentry Program requires monitoring
of sensitive and nonsensitive defense equipment transferred to foreign
countries.[Footnote 12] Sensitive equipment is subject to enhanced end-
use monitoring. Some sensitive equipment, such as night-vision
devices, require 100 percent inventory by serial number. DSCA carries
out its responsibilities under the program by reviewing the
implementation of internal control procedures intended to help
maintain security and accountability over sensitive defense articles
transferred to foreign countries, and by following up to ensure that
its findings are implemented in a timely manner. A key element of the
program is compliance assessment visits to assess host nation and U.S.
security assistance personnel compliance with end-use, security, and
accountability procedures. Although on-site assessments are a key
element of end-use monitoring, according to a DSCA official, DSCA also
relies on intelligence and other reports to accomplish its oversight
and monitoring responsibilities.
In March 2008, DSCA reported that a compliance assessment had
identified weaknesses in ODRP's and Pakistan's accountability
procedures for sensitive night-vision devices. Among its findings,
DSCA reported that ODRP lacked records showing that required quarterly
100 percent inventory of sensitive night-vision devices by serial
number had been conducted and that Pakistan's inventory records lacked
serial numbers for 64 of the 687 U.S.-provided night-vision devices
that were in Pakistan's custody. During the course of the compliance
assessment, ODRP identified the missing serial numbers from its own
records and inventoried 60 of the 64 night-vision devices. Based on
information provided later by Pakistan, 4 night-vision devices were
declared lost in combat.
DSCA recommended to CENTCOM in March 2008 that ODRP correct weaknesses
identified during its compliance assessment and improve accountability
for sensitive night-vision devices in Pakistan's custody by (1)
ensuring that the status of all night-vision devices was accurately
reflected in a database used to track sensitive defense articles, (2)
updating a June 2004 U.S.-Pakistan bilateral memorandum of agreement
[Footnote 13] to reflect a revised inventory schedule for night-vision
devices, and (3) establishing procedures to ensure that Pakistan
inventoried and recorded serial numbers for all night-vision devices.
DSCA recommended steps be taken to ensure all weaknesses were
corrected within 90 days and to provide written confirmation that it
had addressed the agency's recommendations.
In April 2008, ODRP responded to DSCA that it had made significant
progress in addressing DSCA's findings and recommendations, including
ensuring the database used to track sensitive defense articles was up-
to-date and drafting a new bilateral memorandum of agreement. However,
ODRP's response did not specifically address DSCA's third
recommendation that it establish procedures to ensure that Pakistan
inventoried and recorded serial numbers for all night-vision devices,
nor did it provide any evidence of the corrective actions it reported
taking in response to DSCA's other recommendations. As of September
2010, ODRP had not addressed two of DSCA's recommendations[Footnote
14] and only partially addressed a third recommendation.[Footnote 15]
As of September 2010, DSCA had not conducted, and had no plans to
conduct, another compliance assessment of ODRP's and Pakistan's
accountability procedures for night-vision devices. In response to our
work, DSCA stated that it had initiated actions to include a risk-
based approach in prioritizing future compliance assessments and
follow-up actions. In addition to risk, DSCA would consider factors
such as the inventory of defense articles that require enhanced end-
use monitoring, the history of compliance with the Golden Sentry
Program within the host nation, the stability of the region, and
current or previous reports of concerns relative to the country's
protection of U.S.-provided defense articles. Without follow-up
actions to verify that DSCA's recommendations were fully addressed,
there continues to be a risk that sensitive night-vision devices are
not being adequately safeguarded.
DSCA's Plans for Assessing Compliance with New Accountability
Requirements for Defense Equipment Transferred to Pakistan Have Been
Postponed:
Section 1225 of the 2010 NDAA required the Secretary of Defense to
establish and carry out a program to provide accountability for
defense articles transferred to Afghanistan and Pakistan pursuant to
authorities other than the Arms Export Control Act, including
maintaining detailed records of origin, shipping, distribution, and
registration of serial numbers of all small arms.[Footnote 16] In
April 2010, the Secretary certified that DOD had established a program
to provide additional accountability for defense articles transferred
to these countries. In September 2010, DOD issued additional guidance
[Footnote 17] on the registering and end-use monitoring of defense
articles, including small arms, to ensure compliance with section 1225
requirements of the 2010 NDAA. The guidance requires DSCA to conduct a
review of DOD components to ensure consistent and proper
implementation of the guidance. In accordance with DSCA's oversight
responsibilities, DSCA planned to conduct compliance assessments in
Afghanistan and Pakistan to verify the implementation of new
accountability requirements established in section 1225 of the 2010
NDAA for defense equipment transferred to those countries. However,
several factors have led DSCA to postpone its planned assessment. DSCA
officials told us that they initially planned to conduct compliance
assessments in July 2010 to verify that U.S., Afghan, and Pakistani
officials had implemented procedures to assure compliance with the
law's requirements.[Footnote 18] However, the planned assessments were
delayed due to security concerns in Afghanistan and because the
Pakistani Army had not issued a Letter of Invitation for the
assessment team. According to a DSCA official, as of November 2010,
DSCA had not conducted a compliance assessment but planned to conduct
it in early 2011. Until DSCA takes steps to verify that the new
accountability requirements have been fully implemented, there is a
risk that defense articles like small arms may not be controlled or
used as intended.
Conclusions:
The increasing level of U.S. security assistance to Pakistan, coupled
with the potential that U.S.-provided equipment to Pakistan could fall
into the wrong hands if not fully secured, make it essential that DOD
implement robust accountability procedures for U.S.-provided
equipment. DOD needs to ensure that ODRP's written procedures include
key requirements established by the department's own guidance, such as
data requirements for the property system and periodic internal
reviews and audits of the property system, to provide reasonable
assurance that equipment received and stored at the Islamabad
warehouse is properly safeguarded. DOD also needs to ensure DSCA takes
timely action to follow up on audit findings in order to provide
reasonable assurance that U.S. and Pakistani officials have
implemented internal control procedures to prevent the loss or misuse
of sensitive night-vision devices. Further, DOD needs to ensure that
DSCA takes timely action to verify that the accountability program
required by the 2010 NDAA--and certified by the Secretary of Defense--
has been fully implemented.
Recommendations for Executive Action:
To improve accountability for U.S.-provided defense equipment, the
Secretary of Defense should take the following three actions. The
Secretary should direct:
* the Commander of U.S. Central Command to ensure ODRP's written
procedures for equipment received and stored at its Islamabad
warehouse incorporate key asset accountability controls including (1)
identifying required data elements to be recorded in the property
system to facilitate the tracking of equipment and (2) performing
periodic reviews and audits of the property accountability and
management system to ensure that it is operating as intended.
* the Director of the Defense Security Cooperation Agency to take
follow-up action, in accordance with internal control standards, to
ensure that ODRP fully addresses all of DSCA's 2008 recommendations.
* the Director of the Defense Security Cooperation Agency to conduct a
compliance assessment to verify that U.S. and Pakistani officials have
fully implemented the new accountability program required by the 2010
NDAA.
Agency Comments and Our Evaluation:
We provided a draft of this report to DOD for review and comment. DOD
provided written comments, which are reprinted in enclosure II. DOD
also provided technical comments, which we have incorporated as
appropriate. The department disagreed with our first recommendation,
partially agreed with the second, and agreed with the third.
In written comments, the Assistant Secretary of Defense for Asian and
Pacific Security Affairs disagreed with our recommendation to improve
accountability for U.S.-provided equipment by ensuring ODRP's written
procedures for equipment received and stored at the Islamabad
warehouse incorporate key accountability requirements in DOD
Instruction 5000.64. The Assistant Secretary stated that this
instruction is more applicable to U.S. property accountability and not
property that is "in transit" to Pakistani forces. The Assistant
Secretary stated that it would have been more appropriate to apply
standards relevant to supply chain management because the property,
once transferred to the Pakistanis, is no longer a U.S. possession.
The Assistant Secretary also noted that we did not find any
significant deviations from its implementation of the procedures, thus
confirming that there have been no negative consequences in terms of
equipment accountability. We modified this recommendation by deleting
reference to DOD Instruction 5000.64 and by specifying the
requirements still not addressed by ODRP's written procedures. Our
review of DOD's supply chain management standards found similar
internal control requirements as in DOD Instruction 5000.64 that we
have recommended they incorporate in ODRP's written procedures.
Accordingly, in the following paragraphs we rebut DOD's position and
summarize the basis for our conclusions and recommendations to improve
the accountability of equipment stored at the Islamabad warehouse.
As discussed in the draft report, at the time of our visit to Pakistan
in February 2010, DOD did not have written standard operating
procedures to provide safeguards to help prevent and detect the loss
or misuse of equipment in the warehouse. Because the equipment stored
in the warehouse is still U.S.-owned until the government of Pakistan
officially receives delivery of it, DOD is responsible for maintaining
controls over the safeguarding of assets. During our February 2010
visit, our review of inventory records showed equipment generally had
been stored at this warehouse for 3 to 6 months. As such, DOD retains
ownership of the property; therefore, the department is responsible
for safeguarding such equipment. We determined that DOD Instruction
5000.64 would be the appropriate criteria to use to assess any
procedures DOD developed because the United States retains possession
until the equipment is transferred to the government of Pakistan.
During an August 18, 2010, meeting, the Director-Pakistan, Office of
the Secretary of Defense Policy, agreed that our use of this
instruction was appropriate. After the meeting, DOD provided
procedures that referenced DOD Instruction 5000.64 as well as supply
chain management procedures. In addition, our review of DOD 4140.1-R,
"DOD Supply Chain Material Management Regulation," which is the
department's overarching policy and procedure for supply chain
management, found that it had requirements for safeguarding U.S.-owned
equipment similar to those in DOD Instruction 5000.64.[Footnote 19]
For example, DOD 4140.1-R explicitly states that the heads of DOD
components (e.g., combatant commands) shall:
* Establish and maintain a physical inventory control program to
provide for the economical and efficient stewardship of DOD supplies
and ensure that sufficient emphasis is placed on material
accountability and inventory accuracy to promote improved performance
of individuals directly responsible for making reports on the status
of that inventory;
* Establish and execute a physical security program to prevent or
reduce the potential for theft, fraud, sabotage, and abuse of DOD
material;[Footnote 20] and:
* Provide for visibility of the quantity, condition, and location of
in-storage, in-process, and in-transit assets through the DOD supply
chain.
Consequently, regardless of the standard that is applied (DOD
Instruction 5000.64 or DOD 4140.1-R), the fundamental principle is the
same--all property of the department must be accounted for until it is
transferred to the Pakistani security forces.
This report does not assess whether equipment has been lost or stolen
since DOD began leasing the Islamabad warehouse in December 2008.
Although we assessed the adequacy of the design of DOD's procedures
for safeguarding equipment at the Islamabad warehouse, we did not
assess the extent to which DOD had implemented these procedures,
primarily due to the absence of such procedures during our February
2010 visit. As stated in the draft report, DOD had not developed
procedures to safeguard this equipment at the time of our visit,
although the warehouse had been leased for approximately 14 months. On
August 26, 2010, DOD provided for our review three standard operating
procedures that were developed after we informed them that written
procedures to safeguard the equipment stored in the warehouse did not
exist[Footnote 21]. These procedures were used to assess the extent
that ODRP addressed DOD Instruction 5000.64 requirements. The initial
draft report provided to DOD on November 4, 2010, summarized the
results of our analysis. In response to the draft report, DOD provided
four additional standard operating procedures on December 15, 2010,
one of which was dated on November 14, 201[Footnote 22]0. Upon receipt
of these additional procedures, we included them in our assessment and
updated the draft report, which was provided to DOD for review on
December 21, 2010. As this chronology shows, subsequent to informing
ODRP during our February 2010 site visit that it lacked written
procedures, ODRP developed written procedures. Our conclusion and
recommendations are based on the updated analyses and we continue to
find that some accountability elements that are included in both DOD
Instruction 5000.64 and DOD 4140.1-R, such as performing periodic
reviews and audits of the property accountability and management
system, have not been incorporated into the procedures.
DOD partially agreed with our recommendation to improve accountability
for U.S.-provided equipment by following up to ensure that ODRP fully
addresses all of DSCA's 2008 recommendations. In written comments, the
Assistant Secretary felt (1) the report incorrectly implies that DSCA
did not follow up in a timely manner to ensure that ODRP took
corrective action regarding a recommendation noted in DSCA's March
2008 compliance assessment visit report, and (2) DSCA has ensured the
necessary corrective actions have been taken to address its 2008
recommendations. However, DSCA has only provided evidence to show that
one recommendation has been partially addressed. The other two
recommendations have not been addressed. The Assistant Secretary noted
that DOD plans to conduct a compliance assessment visit to Pakistan in
the second quarter of FY 2011. We believe this visit should include a
review whether the 2008 recommendations have all been fully addressed.
DOD concurred with our recommendation that DSCA should conduct a
compliance visit to verify that U.S. and Pakistani officials have
fully implemented the new accountability program required by the 2010
NDAA. In written comments, the Assistant Secretary stated the
assessment is planned for the second quarter of FY 2011.
We are sending copies of this report to interested congressional
committees and the Secretaries of Defense and State. In addition, the
report will be available at no charge on the GAO Web site at
[hyperlink, http://www.gao.gov].
If you or your staff members have any questions about this report,
please contact Charles Michael Johnson Jr. at (202) 512-7331 or
johnsoncm@gao.gov or Asif A. Khan at (202) 512-9095 or khana@gao.gov.
Contact points for our offices of Congressional Relations and Public
Affairs may be found on the last page of this report. GAO contacts and
staff acknowledgments are listed in enclosure III.
Signed by:
Charles Michael Johnson Jr.
Director:
International Affairs and Trade:
Signed by:
Asif A. Khan:
Director:
Financial Management and Assurance:
Enclosures (3):
List of Congressional Addressees:
The Honorable Carl Levin:
Chairman:
The Honorable John McCain:
Ranking Member:
Committee on Armed Services:
United States Senate:
The Honorable John F. Kerry:
Chairman:
The Honorable Richard G. Lugar:
Ranking Member:
Committee on Foreign Relations:
United States Senate:
The Honorable Joseph I. Lieberman:
Chairman:
The Honorable Susan M. Collins:
Ranking Member:
Committee on Homeland Security and Governmental Affairs:
United States Senate:
The Honorable Howard P. McKeon:
Chairman:
The Honorable Adam Smith:
Ranking Member:
Committee on Armed Services:
House of Representatives:
The Honorable Ileana Ros-Lehtinen:
Chairman:
The Honorable Howard L. Berman:
Ranking Member:
Committee on Foreign Affairs:
House of Representatives:
The Honorable John Tierney:
Ranking Member:
Subcommittee on National Security, Homeland Defense, and Foreign
Operations:
Committee on Oversight and Government Reform:
House of Representatives:
[End of section]
Enclosure I: Summary of GAO Analysis of Key Requirements in DOD
Instruction 5000.64:
We assessed Department of Defense (DOD) Instruction 5000.64 using
federal internal control standards to identify those requirements that
would be needed, at a minimum, to ensure adequate accountability of
the equipment received and stored at the Islamabad warehouse. Our
analysis resulted in the identification of 17 requirements. We
assessed the standard operating procedures issued in May, June, and
November 2010 by the Office of the Defense Representative in Pakistan
(ODRP) against these 17 requirements to determine the adequacy of
DOD's efforts to maintain accountability for equipment. These standard
operating procedures were:
* Standard Operating Procedure-1: Security Assistance Office J4
Responsibilities (Islamabad, Pakistan, May 1, 2010);
* Standard Operating Procedure-2: Material Accountability Program
(MAP) (Islamabad, Pakistan, May 1, 2010);
* Standard Operating Procedure-3: Material Flow into Pakistan
(Islamabad, Pakistan, May 1, 2010);
* Standard Operating Procedure-7: Material Accountability Program
Access Database (Islamabad, Pakistan, May 1, 2010);
* Standard Operating Procedure-8: Information Management (Islamabad,
Pakistan, May 1, 2010);
* Standard Operating Procedure-9: Accountability and End-use
Monitoring (Islamabad, Pakistan, May 1, 2010); and:
* Standard Operating Procedure-11: Warehouse Procedures (Islamabad,
Pakistan, November 14, 2010.
We assessed these procedures to determine the extent to which they
incorporated the 17 key requirements identified in DOD Instruction
5000.64. Table 1 presents the results of our assessment.
Table 1: Analysis of Selected ODRP Standard Operating Procedures:
Physical controls over vulnerable assets:
Key internal control elements from DOD Instruction 5000.64: 1.
Physical controls over vulnerable assets: Section 5.2.7.5 requires
that property received and issued is properly and uniquely identified;
Extent to which ODRP‘s procedures address the key element:
Incorporates the key element to a large extent.
Key internal control elements from DOD Instruction 5000.64: 2.
Physical controls over vulnerable assets: Section 5.2.7.7 requires
evaluating culpability when property has been reported lost, damaged,
misused, or stolen;
Extent to which ODRP‘s procedures address the key element:
Incorporates the key element to a large extent.
Key internal control elements from DOD Instruction 5000.64: 3.
Physical controls over vulnerable assets: Section 6.1.2 requires
accountability of property be established and maintained using
information technology[A];
Extent to which ODRP‘s procedures address the key element:
Incorporates the key element to little or no extent.
Key internal control elements from DOD Instruction 5000.64: 4.
Physical controls over vulnerable assets: Section 5.2.7.9 requires
scheduling physical inventories;
Extent to which ODRP‘s procedures address the key element:
Incorporates the key element to a large extent.
Key internal control elements from DOD Instruction 5000.64: 5.
Physical controls over vulnerable assets: Section 6.11.1.2 requires a
physical inventory plan. At a minimum, property shall be inventoried
at least every 3 years; classified or sensitive property shall be
inventoried at least annually;
Extent to which ODRP‘s procedures address the key element:
Incorporates the key element to a large extent.
Key internal control elements from DOD Instruction 5000.64: 6.
Physical controls over vulnerable assets: Section 6.11.1.3 requires a
minimum 98 percent physical inventory accuracy rate for completion;
Extent to which ODRP‘s procedures address the key element:
Incorporates the key element to a large extent.
Key internal control elements from DOD Instruction 5000.64: 7.
Physical controls over vulnerable assets: Section 6.6 requires at
least the following data elements in the property systems of record:
name, part number, and description; owner; status; quantity; general
ledger classification; value at full cost; estimated useful life (for
property to be capitalized); unique item identifier; date placed in
service; location; current condition; posting reference; transaction
type, and transaction date[A];
Extent to which ODRP‘s procedures address the key element:
Incorporates the key element to little or no extent.
Key internal control elements from DOD Instruction 5000.64: 8.
Physical controls over vulnerable assets: Section 6.13 requires
internal controls shall be established and maintained according to DOD
Instruction 5010.40 including that an agency will establish physical
control to secure and safeguard vulnerable assets;
Incorporates the key element to a large extent.
Proper Execution of Transactions and Events:
Key internal control elements from DOD Instruction 5000.64: 9.
Physical controls over vulnerable assets: Section 6.5 requires
including reference to establishing records required by law, policy,
regulation, or agency direction (e.g., small arms registration).[B];
Extent to which ODRP‘s procedures address the key element:
Incorporates the key element to some extent.
Key internal control elements from DOD Instruction 5000.64: 10.
Physical controls over vulnerable assets: Section 6.2.1 requires
records be established for property having a unit acquisition value of
$5,000 or more;
Extent to which ODRP‘s procedures address the key element:
Incorporates the key element to a large extent.
Key internal control elements from DOD Instruction 5000.64: 11.
Physical controls over vulnerable assets: Section 5.2.7.1 requires a
complete trail of all transactions, suitable for audit, and the
ability to implement and adhere to associated internal controls;
Extent to which ODRP‘s procedures address the key element:
Incorporates the key element to a large extent.
Key internal control elements from DOD Instruction 5000.64: 12.
Physical controls over vulnerable assets: Section 6.2.3 requires
original document and/or hard copies of original documentation be
maintained in a readily available location;
Extent to which ODRP‘s procedures address the key element:
Incorporates the key element to a large extent.
Management of Human Capital and Reviews by Management at the
Functional or Activity Level:
Key internal control elements from DOD Instruction 5000.64: 13.
Physical controls over vulnerable assets: Section 5.2.7.1 requires
appointment of an Accountable Property Officer in writing[A];
Extent to which ODRP‘s procedures address the key element:
Incorporates the key element to little or no extent.
Key internal control elements from DOD Instruction 5000.64: 14.
Physical controls over vulnerable assets: Section 5.2 requires the
Accountable Property Officer to among other things establish and
maintain an organization's accountable property records, systems, and/
or financial records, in connection with government property; evaluate
culpability when property has been reported lost, damaged, misused, or
stolen; report and recommend appropriate action and assist in
investigations, as required; process reports of survey and liability
investigations according to established procedures; and schedule
physical inventories and assist in their completion[C];
Extent to which ODRP‘s procedures address the key element:
Incorporates the key element to some extent.
Key internal control elements from DOD Instruction 5000.64: 15.
Physical controls over vulnerable assets: Section 5.2.3 requires
establishing implementing regulations and procedures, including the
assessment and reporting of its overall property management maturity
level[A];
Extent to which ODRP‘s procedures address the key element:
Incorporates the key element to little or no extent.
Key internal control elements from DOD Instruction 5000.64: 16.
Physical controls over vulnerable assets: Section 5.2.5 requires that
periodic internal review and audits necessary to assess property
accountability and management system effectiveness to be performed[A];
Extent to which ODRP‘s procedures address the key element:
Incorporates the key element to little or no extent.
Controls Over Information Processing:
Key internal control elements from DOD Instruction 5000.64: 17.
Physical controls over vulnerable assets: Section 6.13 requires that
internal controls shall be established and maintained according to DOD
Instruction 5010 including that access to resources and records be
limited to authorized individuals, and accountability for their
custody and use be assigned and maintained;
Extent to which ODRP‘s procedures address the key element:
Incorporates the key element to a large extent.
Source: GAO analysis of Selected ODRP Standard Operating Procedures.
[A] These key elements are applicable to DOD 4140.1-R, DOD Supply
Chain Materiel Management Regulation.
[B] Standard Operating Procedure-9, Accountability and End-use
Monitoring, includes references to the U.S. Arms Export Control Act of
1961, DOD 5105.38-M, Security Assistance Management Manual, among
others, but does not include reference to the 2010 National Defense
Authorization Act (Pub. L. 111-84, Sec. 1225).
[C] Standard Operating Procedure-1, Security Assistance Office J4
Responsibilities, does not reference DOD Instruction 5000.64 Section
5.2, which requires the Accountable Property Officer to evaluate lost,
damaged, or stolen property; to ensure property received and issued is
properly and uniquely identified; and schedule physical inventories.
[End of table]
Enclosure II: Comments from the Department of Defense:
Assistant Secretary Of Defense:
Asian & Pacific Security Affairs:
2700 Defense Pentagon:
Washington, DC 20301-2700:
Charles Michael Johnson Jr.
Director, International Affairs and Trade:
U.S. Government Accountability Office:
441 G Street, N.W.
Washington, DC 20548:
Mr. Johnson:
This is the Department of Defense (DoD) response to the draft GAO
Report, GAO-II-156R, "Accountability for U.S. Equipment Provided to
Pakistani Security Forces in the Western Frontier Needs to be
Improved," dated December 21, 2010 (GAO Code 320796).
We have attached comments addressing the report. My point of contact
is Mr. Dan Folliard, (703) 695-8272 or daniel.folliard@osd.mil.
Sincerely,
Signed by:
Wallace C. Gregson:
[End of letter]
GAO Draft Report Dated December 21, 2010:
GAO-11-156R (GAO Code 320796):
"Accountability for U.S. Equipment Provided to Pakistani Security
Forces in the Western Frontier Needs to be Improved"
Department Of Defense Comments On GAO Draft Report On Equipment
Accountability In Pakistan:
The Department of Defense (DoD) appreciates the opportunity to comment
on this draft report. DoD welcomes periodic reviews of critical
national security efforts, such as the provision of equipment to
Pakistan's security forces, and looks forward to receiving
recommendations meant to enhance the oversight and effectiveness of
these efforts. DoD sees some value in certain recommendations made in
this draft report, but is concerned that other recommendations appear
to be based on incorrect analytical judgments and thus are not seen as
useful recommendations.
Pakistan is an essential partner in the U.S. Government's efforts to
combat violent extremist organizations. Pakistan has committed 140,000
security forces personnel to the fight along its western border, and
the people of Pakistan continue to be the victims of terrorist
attacks. The United States has increased its civilian and military
assistance to Pakistan since 2008, and we continue to work
collaboratively with the Pakistan Government and its military to
counter groups that threaten Pakistan, Afghanistan, other regional
partners, and the U.S. homeland. The majority of U.S. security
assistance to the Pakistan military is designed to enhance its
counterinsurgency and counterterrorism capabilities, which are
critical to the Government of Pakistan's efforts to deny safe haven to
violent extremists within its borders.
Material assistance to the Pakistan military has increased
significantly in recent years, and the demand on the Office of the
Defense Representative-Pakistan (ODRP) to maintain appropriate,
statutorily required accountability standards has remained steady and,
pursuant to the requirements of Section 1225 of the National Defense
Authorization Act for FY2010, has even increased. The report does not
adequately highlight the complex and challenging security environment
that DoD operates within while working and operating in Pakistan. In
addition, Pakistan is a sovereign state that has a history of mistrust
over U.S. intentions, which DoD is working hard to overcome by
building a long-term strategic partnership.
Despite these challenges, it is a testament to the professionalism of
DoD personnel involved in the provision of security assistance to
Pakistan that the draft report found no significant deviations from
the accountability standards required by current policy or by
statute ” only areas where GAO believes that DoD could do a more
thorough job in mitigating potential risks to equipment
accountability. Unlike other programs designed to equip partners
during wartime, which have resulted in the identification of several
problematic practices, the draft report confirms that DoD's efforts in
Pakistan have not produced the negative consequences of terms of
equipment accountability that some may have feared. [See comment 1]
The thrust of the draft report is a recommendation to apply the
Federal internal control standards-”those contained in DoD Instruction
5000.64 that are used by DoD for equipment owned by DoD, stored in
U.S.-controlled facilities, and operated by U.S. forces-”to a DoD-
leased warehouse in Islamabad where material is received and stored
prior to transfer to the Pakistani security forces. In essence, we
believe it is infeasible in practice to apply the requirements of DoD
Instruction 5000.64 to the situation in Pakistan because the equipment
essentially remains "in transit" to Pakistani forces while it is in
the leased warehouse, and, therefore, supply chain management
standards, not equipment accountability standards, should apply.
Following transfer, U.S. responsibility shifts to end-use monitoring
as the equipment is no longer U.S.-owned.
Significant processes that are prescribed for U.S. property, such as
listing items in unit property books and appointment of property book
officers, etc., are not applicable to equipment being provided to
Pakistani forces under the Pakistan Counterinsurgency Fund (PCF) and
Pakistan Counterinsurgency Capability Fund (PCCF) authority and is
still in transit, as explained above. While such equipment is in a
warehouse awaiting transfer, supply chain management processes apply.
The applicable accountability requirements upon which to evaluate the
ODRP procedures for the storage of such equipment should be based on
supply chain management instructions, not property accountability
instructions. Maintaining current accountability requires possession
of an item and periodic inventories. Once equipment is transferred to
the Pakistanis, the United States does not possess the equipment and
can no longer be accountable for the equipment; instead, U.S.
responsibility shills to monitoring. Some equipment will be subject to
Enhanced End Use Monitoring (EEUM), requiring periodic inventories.
The United States is responsible to monitor equipment transferred to
Pakistan, but the United States is not accountable for that equipment
once transferred (although, the United States is responsible for
reporting any losses of EEUM items to DSCA).
PCF and PCCF-acquired equipment is not DOD property once it is
transferred to the Pakistani military. Similarly, FMF-procured
equipment is not USG property once it is transferred to the host
nation. Therefore, the term "accountability" for equipment after it
has been turned over to Pakistan requires clarification. The materiel
provided to Pakistan via PCF and PCCF falls under Pakistani control,
once transferred. We believe that the distinction between "control"
and "monitoring" is necessary if an evaluation of DoD's accountability
for PCF/PCCF equipment, once transferred to Pakistan, is to be
meaningful. The United States retains the authority to conduct End Use
Monitoring on materiel provided via the Foreign Military Sales (FMS)
process. This is standard in FMS Letters of Offer and Acceptance
(LOAs) between the Pakistan government and the U.S. End Use Monitoring
requirements are included in LOAs for pseudo-FMS cases, such as for
PCF equipment, even though those LOAs do not constitute an agreement
between the government of Pakistan and the United States but are
instead agreements between the U.S. implementing agencies and the U.S.
security cooperation office. The United States generally retains
possession of material acquired under PCF/PCCF and similar programs
for only short periods of time. The materiel is, in effect, still in
transit while temporarily awaiting final delivery to the Pakistani
users.
It is also important to recognize that the Host Nation imposes
limitations on certain ODRP operations. We believe that had the GAO
auditors applied risk-based modeling using inherent risks, control
risks and detection risks, of loss in conjunction with their key
stated requirements, if is likely that existing SOP's, contracts, and
real world experience would have proved sufficient in light of the
requirements identified and the host nation imposed limitations.
As the final draft report shows, DoD has used elements of its own
equipment storage practices, such as those set out in DoD Instruction
5000.64, to shape the way it handles equipment destined to be provided
to our Pakistani partners. However, the use of DoD Instruction 5000.64
as a reference to guide DoD procedures is not appropriate to cover
equipment that is only temporarily in U.S. possession while awaiting
transfer to the Pakistan military.
On August 26 and again on December 15, 2010, DoD provided GAO copies
of its standard operating procedures for maintaining equipment
accountability while at the warehouse in Islamabad. Such procedures
have been informed by existing DoD practice for handling its own
equipment as well as the unique operating environment in Pakistan. DoD
notes that GAO did update an earlier draft of its analysis based on
input provided on December 15 to reflect more accurately the controls
in place in Islamabad and the degree to which DoD Instruction 5000.64
has informed ODRP's standard operating procedures (SOPS). Still, we
are concerned that the draft report identifies the Pakistan case as an
example to justify the imposition of an accountability framework”
designed for U.S. equipment for U.S. forces”on equipment being
provided as foreign assistance for foreign forces, with little regard
to particular circumstances. [See comment 2]
ODRP is in compliance with existing statutes and policy guidance, and
its practices have not resulted in a loss of accountability for U.S.-
supplied equipment.
Additional technical details and factual corrections have been
provided to GAO through separate correspondence. This information
caused GAO to revise parts of its analysis in its final report, which
DoD received from GAO on December 21 with a request for comment by
January 4, 2011.
DoD Responses to GAO Recommendations:
Recommendation 1: To improve accountability for U.S.-provided defense
equipment, the GAO recommends that the Secretary of Defense should
direct the Commander of the U.S. Central Command to ensure that the
Office of Defense Representative Pakistan's (ODRP) written procedures
for equipment received and stored at its Islamabad warehouse
incorporate all of the key requirements contained in DoD Instruction
5000.64, such as requirements focused on security issues involving the
receipt, storage, and handling of sensitive items. (See page 9/GAO
Draft Report.)
DOD Response: Non-concur. As noted above, DoD Instruction 5000.64 is
not an appropriate guide for the case of equipment being transferred
to Pakistan. The equipment essentially remains in transit to Pakistani
forces while it is in the leased warehouses, and therefore, supply
chain management standards, not equipment accountability standards,
should apply.
GAO Recommendation 2: To improve accountability for U.S.-provided
defense equipment, the GAO recommends that the Secretary of Defense
should direct the Director of the Defense Security Cooperation Agency
(DSCA) to follow up, in accordance with U.S internal control
standards, to ensure that ODR-P fully addresses all of DSCA's 2008
recommendations.
DOD Response: Partially Concur. The report incorrectly implies that
DSCA did not follow up in a timely manner to ensure that the Office of
the Defense Representative-Pakistan (ODRP) took corrective action
regarding a recommendation noted in a 2008 Compliance Assessment Visit
(CAV) report. Although a follow-on CAV has not been conducted in
Pakistan as recommended in the report due to other CAV commitments
world-wide, DSCA ensured that the ODRP took the necessary corrective
actions to comply with the report's recommendations regarding the
security of night vision devices (NVDs) transferred to Pakistan. ODRP
has signed a Memorandum of Agreement (MOA) with Pakistan that
delineates procedures for safeguarding NVDs. ODRP also conducts annual
100 percent inventories to ensure accountability and enters all
inventories into a DSCA-maintained database. DSCA personnel
continually monitor the database to verify compliance with the
inventory requirements. Additionally, commitments to conduct CAVs in
other USCENTCOM countries such as Saudi Arabia, Oman, Egypt, and the
UAE prevented a follow-on assessment of Pakistan earlier than the
currently planned visit during the second quarter of FY 2011.
GAO Recommendation 3: To improve accountability for U.S.-provided
defense equipment, the GAO recommends that the Secretary of Defense
should direct the Director of DSCA to conduct a compliance assessment
to verify that U.S. and Pakistani officials have fully implemented the
new accountability program required by the National Defense
Authorization Act (NDAA) for FY 2010. (See page 9/GAO Draft Report.)
DOD Response: Concur, DSCA drafted and coordinated DoD Instruction
(DoDI) 4140.66, which established policy and procedures within DoD to
ensure compliance with the Registration and Monitoring Program
required by Section 1225 of the NDAA for FY 2010 for the transfer or
export of defense articles and services to Pakistan. As the DoD
organization responsible to review whether DoD Components have
implemented the necessary procedures to comply with the guidance
prescribed in DoD Instruction 4140.66, DSCA will conduct periodic
assessments of the ODRP in Pakistan. An assessment is planned during
the second quarter of FY 2011.
The following are GAO's comments on the Department of Defense letter,
dated December 21, 2010.
GAO Comments:
1. This report does not assess whether equipment has been lost or
stolen since DOD began leasing the Islamabad warehouse in December
2008. Although we assessed the adequacy of the design of DOD's
procedures for safeguarding equipment at the Islamabad warehouse, we
did not assess the extent to which DOD had implemented these
procedures, primarily due to the absence of such procedures during our
February 2010 visit. As stated in the draft report, DOD had not
developed procedures to safeguard this equipment at the time of our
visit, although the warehouse had been leased for approximately 14
months.
2. On August 26, 2010, DOD provided for our review three standard
operating procedures (SOP-01, SOP-7, SOP-9) that were developed after
we informed them that written procedures to safeguard the equipment
stored in the warehouse did not exist. These procedures were used to
assess the extent that ODRP addressed DOD Instruction 5000.64
requirements. The initial draft report provided to DOD on November 4,
2010, summarized the results of our analysis. In response to the draft
report, DOD provided four additional standard operating procedures on
December 15, 2010 (SOP-2, SOP-3, SOP-8, SOP-11), one of which was
dated on November 14, 2010. Upon receipt of these additional
procedures, we included them in our assessment and updated the draft
report, which was provided to DOD for review on December 21, 2010. As
this chronology shows, DOD developed applicable procedures as a result
of our work throughout the course of our audit. Our conclusion and
recommendations are based on the updated analyses and we continue to
find that some accountability elements that are included in both DOD
Instruction 5000.64 and DOD 4140.1-R, such as performing periodic
reviews and audits of the property accountability and management
system, have not been incorporated into the procedures.
[End of section]
Enclosure III: GAO Contact and Staff Acknowledgments:
GAO Contacts:
Charles Michael Johnson Jr., (202) 512-4128 or Johnsoncm@gao.gov Asif
A. Khan, (202) 512-9095 or Khana@gao.gov:
Staff Acknowledgments:
Major contributors to this report were Mary Ellen Chervenic, Jeffrey
Isaacs, Hynek Kalkus, Ophelia Robinson, Michael Rohrback, Kira Self,
Darby Smith, Sally Williamson, and Tom Zingale.
[End of section]
Related GAO Products:
Combating Terrorism: Planning and Documentation of U.S. Development
Assistance in Pakistan's Federally Administered Tribal Areas Need to
Be Improved. [hyperlink, http://www.gao.gov/products/GAO-10-289].
Washington, D.C.: April 15, 2010.
Securing, Stabilizing, and Developing Pakistan's Border Area with
Afghanistan: Key Issues for Congressional Oversight. [hyperlink,
http://www.gao.gov/products/GAO-09-263SP]. Washington, D.C.: February
23, 2009.
Combating Terrorism: Increased Oversight and Accountability Needed
over Pakistan Reimbursement Claims for Coalition Support Funds.
[hyperlink, http://www.gao.gov/products/GAO-08-806]. Washington, D.C.:
June 24, 2008.
Combating Terrorism: U.S. Oversight of Pakistan Reimbursement Claims
for Coalition Support Funds. [hyperlink,
http://www.gao.gov/products/GAO-08-932T]. Washington, D.C.: June 24,
2008.
Combating Terrorism: U.S. Efforts to Address the Terrorist Threat in
Pakistan's Federally Administered Tribal Areas Require a Comprehensive
Plan and Continued Oversight. [hyperlink,
http://www.gao.gov/products/GAO-08-820T]. Washington, D.C.: May 20,
2008.
Preliminary Observations on the Use and Oversight of U.S. Coalition
Support Funds Provided to Pakistan. [hyperlink,
http://www.gao.gov/products/GAO-08-735R]. Washington, D.C.: May 6,
2008.
Combating Terrorism: The United States Lacks Comprehensive Plan to
Destroy the Terrorist Threat and Close the Safe Haven in Pakistan's
Federally Administered Tribal Areas. [hyperlink,
http://www.gao.gov/products/GAO-08-622]. Washington, D.C.: April 17,
2008.
[End of section]
Footnotes:
[1] On June 24, 2009, Congress appropriated funding for PCF and PCCF
(P.L. 111-32). The PCF appropriation was available on June 24, 2009,
but expired on September 30, 2010, while the PCCF appropriation was
not available until September 30, 2009, but is available until
September 30, 2011.
[2] According to DOD, security conditions and rough terrain in
Pakistan's western border areas have made the provision of this
assistance challenging.
[3] Enhanced end-use monitoring is required for sensitive defense
articles, services, and technologies, such as night-vision devices,
transferred to foreign security forces.
[4] GAO, Afghanistan Security: Lack of Systemic Tracking Raises
Significant Accountability Concerns about Weapons Provided to Afghan
National Security Forces, [hyperlink,
http://www.gao.gov/products/GAO-09-267] (Washington, D.C.: Jan. 30,
2009); GAO, Stabilizing Iraq: DOD Cannot Ensure That U.S.-Funded
Equipment Has Reached Iraqi Security Forces, [hyperlink,
http://www.gao.gov/products/GAO-07-711] (Washington, D.C.: July 31,
2007); GAO, Combating Terrorism: Increased Oversight and
Accountability Needed over Pakistan Reimbursement Claims for Coalition
Support Funds, [hyperlink, http://www.gao.gov/products/GAO-08-806]
(Washington, D.C.: June 24, 2008); and GAO, Combating Terrorism:
Planning and Documentation of U.S. Development Assistance in
Pakistan's Federally Administered Tribal Areas Need to Be Improved,
[hyperlink, http://www.gao.gov/products/GAO-10-289] (Washington, D.C.:
Apr. 15, 2010).
[5] Pub L. 111-84, sec. 1225.
[6] In late summer 2010, monsoon rains caused massive flooding
throughout Pakistan. Our field work in Pakistan preceded the flooding;
however, in October 2010, DOD officials confirmed that flooding had
affected U.S. assistance efforts in Pakistan.
[7] Pub. L. 111-73.
[8] GAO, Standards for Internal Control in the Federal Government,
[hyperlink, http://www.gao.gov/products/GAO/AIMD-00-21.3.1]
(Washington, D.C., November 1999).
[9] DOD, Accountability and Management of DOD-Owned Equipment and
Other Accountable Property, DOD Instruction 5000.64, (Washington D.C.,
November 2006). This guidance incorporates by reference [hyperlink,
http://www.gao.gov/products/GAO/AIMD-00-21.3.1].
[10] These procedures include Standard Operating Procedure (SOP)-1:
Security Assistance Office J4 Responsibilities (Islamabad, Pakistan,
May 1, 2010); SOP-2: Material Accountability Program (Islamabad,
Pakistan, May 1, 2010); SOP-3: Material Flow into Pakistan (Islamabad,
Pakistan, May 1, 2010); SOP-7: Material Accountability Program Access
Database (Islamabad, Pakistan, May 1, 2010); SOP-8: Information
Management (Islamabad, Pakistan, May 1, 2010); SOP-9: Accountability
and End-use Monitoring (Islamabad, Pakistan, May 1, 2010); and SOP-11:
Warehouse Procedures (Islamabad, Pakistan, Nov. 14, 2010).
[11] Arms Export Control Act, sec. 40A (codified at 22 U.S.C. 2785).
[12] DSCA, Security Assistance Management Manual, DOD 5105.38-M,
(Washington D.C., October 2003). End-use monitoring responsibilities
are performed in conjunction with other required security assistance
duties and consist of noting the quality, general physical condition,
and use of U.S.-provided equipment.
[13] The revised memorandum of agreement would outline ODRP's and
Pakistan's responsibilities for maintaining security and
accountability of night-vision devices in Pakistan's custody.
[14] The bilateral agreement had not been updated to reflect a revised
inventory schedule for night-vision devices and new procedures to
ensure that Pakistan inventoried and recorded serial numbers for all
night-vision devices had not been established.
[15] ODRP and Pakistan had taken some steps to ensure that the status
of all night-vision devices was accurately reflected in a database
used to track sensitive defense articles. However, some equipment
losses were not recorded until 9 months after the date of loss or were
recorded without noting the date of loss.
[16] Pub. L. 111-84, sec. 1225.
[17] DOD, Registration and End-Use Monitoring of Defense Articles and/
or Defense Services, DOD Instruction 4140.66 (Washington D.C., Sept.
7, 2010).
[18] DSCA is responsible for reviewing the implementation of
procedures intended to maintain accountability over defense articles
transferred to foreign countries.
[19] DOD, Office of the Deputy Under Secretary of Defense for
Logistics and Materiel Readiness, DOD Supply Chain Material Management
Regulation, DOD 4140.1-R (Washington D.C., May 23, 2003).
[20] DOD 4140.1-R, paragraph C5.7.8 "Security of Material."
[21] DOD SOP-1, SOP-7, and SOP-9.
[22] DOD SOP-2, SOP-3, SOP-8, and SOP-11.
[End of section]
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