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Excellence in Marine Corps Financial Management

Recognizing that government has a responsibility to use timely, reliable, and comprehensive financial information when making decisions, Congress mandated reform by enacting the Chief Financial Officers Act of 1990. This act lays the foundation for comprehensive reform of federal financial management—establishing a leadership structure, requiring audited financial statements, and strengthening accountability reporting. The Office of the Secretary of Defense has designated the Marine Corps a financial statement reporting entity, requiring it to prepare standalone financial statements that can withstand audit scrutiny. To meet this requirement, the Marine Corps must also comply with the Federal Managers’ Financial Integrity Act of 1982, which requires federal agencies to establish internal control programs, assess their effectiveness, and report material weaknesses annually.

LMI currently supports the Fiscal Director of the Marine Corps initiatives to re-engineer its entire internal control program, ensuring that adequate management and oversight techniques are in place. We have identified 24 critical control points in accounts payable, accounts receivable, personal property, environmental liabilities, and military pay. We have designed and helped the Marine Corps conduct independent tests to determine the reliability of these controls. LMI also administered a web pilot questionnaire to help document management vulnerabilities. We also support Marine Corps cultural change efforts to institutionalize a robust internal control environment to improve resource management effectiveness and get maximum use from every dollar.

As a result of our efforts supporting the new Marine Corps Managers’ Internal Control program, the Fiscal Director of the Marine Corps will assert a “Qualified” Statement of Assurance over Financial Reporting for FY 2007. Operationally, Marine Corps managers and decision makers are better prepared to identify weaknesses, target and focus on risks, prioritize resource allocations, and invite the scrutiny of financial statements subject to independent audit.