OFFICE OF THE SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

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SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION 

400 Army Navy Drive • Arlington, Virginia 22202

January 27, 2006 

MEMORANDUM FOR DIRECTOR, IRAQ RECONSTRUCTION MANAGEMENT 

 OFFICE 

COMMANDING GENERAL, GULF REGION DIVISION, U.S. 

ARMY CORPS OF ENGINEERS 

COMMANDING GENERAL, MULTI-NATIONAL SECURITY 

TRANSITION COMMAND-IRAQ 

MISSION DIRECTOR-IRAQ, U.S. AGENCY FOR 

INTERNATIONAL DEVELOPMENT 

SUBJECT: Audit Report on Methodologies for Reporting Cost-to-Complete Estimates 

(SIGIR-05-027) 

We are providing this audit report for your information and use. We performed the audit in 

accordance with our statutory duties contained in Public Law 108-106, as amended, which 

mandates the independent and objective conduct of audits relating to the programs and 

operations funded with amounts appropriated or otherwise made available to the Iraq Relief 

and Reconstruction Fund. Public Law 108-106, as amended, requires that we provide for the 

independent and objective leadership and coordination of and recommendations on policies 

designed to promote economy, efficiency, and effectiveness in the administration of such 

programs and operations and to prevent and detect waste, fraud, and abuse. 

We considered comments from the Iraq Reconstruction Management Office; Gulf Region 

Division, U.S. Army Corps of Engineers; Multi-National Security Transition Command-Iraq; 

and U.S. Agency for International Development on the draft of this report when preparing the 

final report. 

We appreciate the courtesies extended to the staff. For additional information on this report, 

please contact Mr. Joseph T. McDermott at (914) 822-4618, or by email at 

joseph.mcdermott@iraq.centcom.mil; or Ms. Karen Bell at (703) 428-0147, or by email at 

karen.bell@sigir.mil. For the report distribution, see Appendix D. 

Stuart W. Bowen, Jr. 

Inspector General 
i 

Special Inspector General For Iraq Reconstruction 

SIGIR-05-027 January 27, 2006

 Methodologies for Reporting Cost-to-Complete Estimates 

Executive Summary 

This report is one of a series of reports that addressed the reporting of cost-to-complete 

information for projects funded by IRRF. The report discusses the need for 

improvements to the processes and procedures used to estimate and report the costs to 

complete projects funded with Iraq Relief and Reconstruction Funds. Section 2207 of 

Public Law 108-106 requires a quarterly report to Congress that includes estimates of the 

cost required to complete each project. 

Introduction. In November 2003, $18.6 billion was appropriated under the Emergency 

Supplemental Appropriations Act for Defense and the Reconstruction of Iraq and 

Afghanistan (Public Law 108-106). The law created the Iraq Relief and Reconstruction 

Fund (IRRF), of which $18.4 billion of the appropriation was designated for Iraq 

reconstruction. Section 2207 of this law requires a report to Congress every three months 

that provides updates on the uses of all Iraq Relief and Reconstruction funds on a project 

by project basis, including estimates of the cost required to complete each project. The 

report, entitled “Section 2207 Report on Iraq Relief and Reconstruction,” is compiled by 

the Department of State’s Iraq Reconstruction Management Office (IRMO) from 

information provided by the Department of State, the Department of Defense, and the 

U.S. Agency for International Development (USAID). The cost-to-complete information 

is reported through a companion report to the Section 2207 Report called the “Project 

Assessment Report” (PAR). 

Objective. The objective of this audit was to determine the adequacy of methodologies 

used to estimate and report the costs to complete for projects funded with IRRF. 

Specifically, we reviewed the cost-to-complete methodologies in the Gulf Region 

Division-Project and Contracting Office’s (GRD-PCO) Facilities and Transportation 

sector, specifically those used in the October 2005 Section 2207 Report. We also 

reviewed similar USAID projects. We also conducted follow-up on our previous 

recommendation to IRMO regarding the formalization and finalization of cost-tocomplete procedures.1

Results. The Gulf Region Division-Project and Contracting Office (GRD-PCO)2, the 

Multi-National Security Transition Command-Iraq (MNSTC-I), and USAID failed to 

estimate and report reliable and transparent cost-to-complete information for the IRRF 

projects we reviewed. MNSTC-I did not submit a report for the September 30, 2005, 

PAR, and GRD-PCO and USAID submitted reports with errors that were significant 

enough to undermine users’ confidence in the reporting. 

 

1

 SIGIR audit report, “Management of Iraq Relief and Reconstruction Fund Programs: Cost-to-Complete 

Estimate Reporting,” Report Number SIGIR-05-021, October 24, 2005. 

2

 The responsibilities of the GRD were consolidated with those of the PCO on December 4, 2005. This 

report uses the term GRD-PCO for the consolidated entity. 
ii 

This condition occurred because the IRMO did not provide formal written guidance to 

the reporting agencies, as we had previously recommended. The condition also occurred 

because the reporting agencies failed to: 

• develop and communicate effective internal guidance 

• identify and correct errors in the reports before issuance 

• maintain adequate documented support for the calculation of reported estimatesat-completion 

• adequately report project scope changes 

Failure to effectively compile and report cost-to-complete information as required by 

Public Law 108-106 excludes important project visibility essential for project 

management and Congress to make informed management decisions during IRRF 

program execution. Because the October 2005 Section 2207 Report did not contain 

accurate cost-to-complete data, Congress could not use the information to assess IRRF 

program progress or the availability of funds. 

Internal Control Weaknesses. We found internal control weaknesses. IRMO and the 

reporting agencies did not develop and communicate effective guidance, maintain 

documentation supporting significant numbers in the reports, and adequately review 

reports before issuance. 

Management Actions. Since our last cost-to-complete review on October 24, 2005, 

progress has been made in improving cost-to-complete reporting. However, challenges 

remain. For example, GRD-PCO program management stated that their cost-to-complete 

reports are now a more effective project management tool, as a result of improvements to 

the reporting over the last few months. In addition, since the beginning of the audit, 

GRD-PCO initiated a draft of guidance detailing methodology for compiling the cost-tocomplete reports. GRD-PCO has also decided not to use computer modeling as the 

methodology for determining future costs. 

Also, IRMO has recently done a more thorough analysis of data from the cost-tocomplete reports, and IRMO management stated that the result is that the reporting is 

now being used more effectively as a project management tool. IRMO management 

stated IRMO is now requiring the reporting agencies to limit the use of program 

contingency for close-out and emergencies, rather than transferring it directly to projects 

with a funding shortfall. IRMO management stated that this new requirement helps 

provide a better picture of cost-to-complete. IRMO management also stated that their 

analysis identified $7 million from closed projects that had not been transferred back to 

the pool of available funds. Those funds will now be available for use in ongoing 

projects. 

 

Recommendations. In order to make informed management decisions, IRRF 

management and Congress require timely, accurate and comprehensive cost-to-complete 

information. As such, we recommend that the: 

1. Director, Iraq Reconstruction Management Office, require IRMO management to 

take these actions: 

a. Formalize its cost-to-complete action plan by issuing a formal policy to 

finalize consistent procedures across all supporting IRRF organizations for 

the collection and compilation of the cost-to-complete information. 
iii 

b. In the next Department of State Section 2207 Report, provide data to 

Congress on the adequacy of cost-to-complete methodologies in the other 

sectors. 

2. Commanding General, Gulf Region Division, require the GRD-PCO sector 

management to: 

a. Finalize the draft of official written guidance covering the methodology, 

including roles and responsibilities, for generating cost-to-complete 

reports. The guidance should be issued as a policy directive and should 

cover all of the construction sub-sectors, as well as non-construction 

projects. The guidance should include a future costs projection element to 

assure full consideration of potential costs. The guidance should be 

consistent with the guidance provided by IRMO. 

b. Ensure that the decision not to use computer modeling in the calculation of 

cost-to-complete is updated and reflected in all current and future 

guidance. 

c. Develop a thorough review process to eliminate errors in the reporting 

spreadsheets. The review process should be written into the guidance. 

d. Create and maintain a permanent central file to document the calculation 

of estimates-at-completion (EAC) by project. The requirement to create 

and maintain the central file should be written into the guidance. 

e. Develop policies to define significant scope changes. For example, 

variances reflecting a 15 percent change in schedule, scope, or budget 

could be used as a metric to define “significant”. The changes should be 

reported in the quarter the changes occurred by adding supporting 

schedules to the cost-to-complete report. Require the supporting 

schedules to be sufficiently descriptive to inform users of differences 

between what is expected to be completed relative to what was planned. 

3. Commanding General, Multi-National Security Transition Command-Iraq, require 

MNSTC-I management to: 

a. Add the future cost projections component to guidance relating to the 

calculation of the EACs for construction projects. Develop guidance for 

non-construction projects including the future cost projections component 

and the requirement to document calculation of the EACs. The guidance 

should be consistent with the guidance provided by IRMO. 

b. Develop a thorough review process to eliminate errors in the reporting 

spreadsheets. The review process should be written into the guidance. 

c. Develop policies to define significant scope changes. For example, 

variances reflecting a 15 percent change in schedule, scope, or budget 

could be used as a metric to define “significant”. The changes should be 

reported in the quarter the changes occurred by adding supporting 

schedules to the cost-to-complete report. Require the supporting 

schedules to be sufficiently descriptive to inform users of differences 

between what is expected to be completed relative to what was planned. 

Identify all projects to be completed with funds other than IRRF by adding 

footnotes to the cost-to-complete report. 
iv 

4. USAID Mission Director-Iraq, require USAID management to: 

a. Develop and distribute official written guidance covering the entire 

methodology, including roles and responsibilities, for generating cost-tocomplete reports. The guidance should be issued as a policy directive. 

The guidance should cover both construction and non-construction 

projects, and should include a future costs projections component to assure 

full consideration of potential costs. This guidance should be consistent 

with guidance provided by IRMO. 

b. Develop a thorough review process to eliminate errors in the reporting 

spreadsheets. The review process should be written into the guidance. 

c. Create and maintain a permanent central file to document the calculation 

of EACs by project. The requirement to create and maintain the central 

file should be written into the guidance. 

d. Develop policies to define significant scope changes. For example, 

variances reflecting a 15 percent change in schedule, scope, or budget 

could be used as a metric to define “significant”. The changes should be 

reported in the quarter the changes occurred by adding supporting 

schedules to the cost-to-complete report. Require the supporting 

schedules to be sufficiently descriptive to inform users of differences 

between what is expected to be completed relative to what was planned. 

Management Comments and Audit Response. We did not receive written comments 

on this report from IRMO. However, in discussions with IRMO senior managers they 

stated that they would develop formal policies and procedures for the participating 

agencies. They also said that the January 2006 Section 2207 Report would report the 

adequacy of cost-to-complete methodologies in the other sectors. 

The Commanding General, Gulf Region Division, concurred with the recommendations, 

and provided information on activities that had occurred since the preparation of the draft 

of this report. In addition, GRD-PCO officials stated that because of the number of scope 

changes to projects, rather than footnoting the automated cost-to-complete report, GRDPCO will develop a supporting schedule summarizing the scope changes by quarter. 

The Mission Director-Iraq, USAID, concurred with our recommendations and provided 

some technical corrections to the report. 

MNSTC-I officials concurred with most of our recommendations, but did not concur that 

it should report cost-to-complete information for non-construction projects. 

The management comments that concurred with the findings and recommendations are 

fully responsive. Additional information and corrections provided were considered and 

the report was changed accordingly. However, we did not agree with the nonconcurrence by MNSTC-I regarding reporting for non-construction projects, because 

without information on actual program costs, decision makers cannot determine where 

future investments should be made. 
Table of Contents 

Executive Summary i 

Introduction 

Background 1 

Objective 3 

Finding 

Methodologies for Reporting Cost-to-Complete Information - 

 Facilities and Transportation Sector 4 

 

Appendixes 

A. Scope and Methodology 13 

B. Definition of Reporting Terms 15 

C. Acronyms 17 

D. Report Distribution 18 

E. Audit Team Members 20 

Management Comments 

Commanding General, Gulf Region Division 21 

Mission Director-Iraq, U.S. Agency for International Development 22 

Commanding General, Multi-National Security Transition Command-Iraq 27 
1 

Introduction 

Background 

In November 2003, $18.6 billion was appropriated under the Emergency Supplemental 

Appropriations Act for Defense and the Reconstruction of Iraq and Afghanistan (Public 

Law 108-106). The law created the Iraq Relief and Reconstruction Fund (IRRF), of 

which $18.4 billion of the appropriation was designated for Iraq reconstruction. 

Section 2207 Report. Section 2207 of Public Law 108-106 requires a report to Congress 

every three months that updates the proposed uses of all IRRF funds on a project by 

project basis, including estimates of the cost required to complete each project. The most 

recent report, entitled, “Section 2207 Report on Iraq Relief and Reconstruction” (Section 

2207 Report), released in October 2005, was prepared by the Iraq Reconstruction 

Management Office (IRMO). The Section 2207 Report is compiled by IRMO from data 

provided by the Department of State, the Department of Defense, and the U.S. Agency 

for International Development (USAID). The cost-to-complete information is reported 

quarterly through a companion report to the Section 2207 Report called the “Project 

Assessment Report” (PAR). 

Iraq Reconstruction Management Office (IRMO). National Security Presidential 

Directive 36, “United States Government Operations in Iraq,” May 11, 2004, delegated 

responsibility for the continuous supervision and general direction of all assistance for 

Iraq to the Secretary of State. The Directive also created a temporary organization within 

the U.S. Mission in Iraq, called the Iraq Reconstruction Management Office, to facilitate 

the transition in Iraq. 

Project and Contracting Office (GRD-PCO). National Security Presidential Directive 

36, “United States Government Operations in Iraq,” May 11, 2004, also established the 

PCO and directed the PCO to provide acquisition and project management support for 

activities in Iraq. On June 22, 2004, the Deputy Secretary of Defense established the 

PCO within the Department of the Army and directed the PCO to provide support for all 

activities associated with financial, program, and project management for both 

construction and non-construction IRRF activities. On December 4, 2005, PCO was 

consolidated with the Corps of Engineers, Gulf Region Division. As of December 15, 

2005, the total IRRF funding apportioned to GRD-PCO F&T sector was $1.49 billion. 

Multi-National Security Transition Command-Iraq (MNSTC-I). MNSTC-I is a 

component of the U.S Central Command’s Multi-National Forces-Iraq Command. 

MNSTC-I’s general mission is to help Iraq organize, train, equip, and mentor Iraqi 

Security Forces in order to transition security tasks to Iraqi control. The Coalition 

Military Assistance Training Team trains and mentors the provision of garrison support 

services at eight major division and brigade bases throughout Iraq. Provision of services 

includes constructing/refurbishing facilities, life support, communications, force 

protection, and medical support. The Civilian Police Assistance Training Team staffs, 

equips, organizes, trains, and mentors the Iraqi Police Service forces and Department of 

Border Enforcement forces. All of the projects are accounted for under the F&T sector, 

since they are all Security and Justice projects. As of December 15, 2005, the total IRRF 

funding apportioned to MNSTC-I was $5.26 billion.
2 

Corps of Engineers Financial Management System (CEFMS). GRD-PCO Finance 

and MNSTC-I use the CEFMS for IRRF financial accounting. The CEFMS was 

designed as a single entry system so the transactions update, in real time, the general 

ledger and subsidiary ledgers. In CEFMS, as in other financial accounting systems, 

general ledger amounts should be in agreement with and supported by subsidiary ledgers 

and transactions detail amounts. 

U.S. Agency for International Development (USAID). USAID assists Iraqis in 

reconstructing their country by working with Iraq's interim government. USAID 

programs are implemented in coordination with the United Nations, World Bank, 

International Monetary Fund, coalition country partners, nongovernmental organizations, 

and private sector partners. The USAID Mission in Iraq carries out programs in 

education, health care, food security, infrastructure reconstruction, economic growth, 

community development, local governance, and transition initiatives. As of September 

30, 2005, USAID had oversight over two construction projects that were similar to F&T, 

a hospital and a communications network. As of December 15, 2005, the total IRRF 

funding apportioned to USAID for those projects was $120 million. 

Phoenix Accounting System. USAID formerly obtained financial data from the Mission 

Accounting Control System (MACS). Currently, USAID is transferring to the Phoenix 

financial accounting system, which is replacing the MACS. These systems are the 

USAID-wide finance and accounting systems. 

Facilities and Transportation (F&T) Sector. IRMO reports project data grouped by ten 

sectors: Electric Sector; Oil Infrastructure; Water Resources and Sanitation; Security and 

Law Enforcement; Justice, Public Safety Infrastructure, and Civil Society; Transportation 

and Telecommunications Projects; Roads, Bridges, and Construction; Health Care; 

Private Sector Employment Development; and Education, Refugees, Human Rights, 

Democracy, and Governance. 

In April, 2005, the Gulf Region Division-Project and Contracting Office (GRD-PCO) 

consolidated the seven smaller sectors into one larger sector called Facilities and 

Transportation Sector (F&T). All, except the Oil, Water, and Electricity sectors, are 

considered to fall under F&T. Multi-National Security Transition Command-Iraq 

(MNSTC-I) projects are within the security and justice sectors; therefore, we reviewed 

those projects since they are similar to F&T. We also reviewed two USAID projects 

similar to F&T, a hospital and a communications network. 

As of December 15, 2005, the total IRRF funding apportioned to all F&T and similar 

reportable projects was approximately $6.8 billion. The total comprises GRD-PCO 

($1.45 billion), USAID ($120 million), and MNSTC-I ($5.26 billion). 

Cost-to-Complete Estimates. The cost to complete a project may be defined as the total 

estimated cost of the project less the total actual cost of work performed to date: 

• The estimated cost of a project is the actual direct cost, plus indirect costs or 

allocable costs to the contract, plus the estimate of costs (direct and indirect) for 

authorized work remaining. 

• The actual cost of work performed to date is the cost (direct and indirect) to date 

of completed work packages and the completed portion of work packages begun 

and not yet completed. 
3 

A process for reporting cost-to-complete estimates is an essential component for 

managing contract performance. Cost-to-complete estimates should be developed as 

follows: 

• Determine the progress toward contract completion to date. 

• Determine the cost of the contract work completed to date. 

• Estimate the amount of work remaining to be completed. 

• Estimate the cost of the work remaining to be completed. 

• Calculate variances between the estimated value of work remaining and the 

remaining budget. 

• Determine the reasons for variances from initial estimates and take appropriate 

action to correct the causes for the variances. 

Objective 

The objective of this audit was to determine the adequacy of methodologies used to 

estimate and report the costs to complete for projects funded with IRRF. Specifically, we 

reviewed the cost-to-complete methodologies in the GRD-PCO Facilities and 

Transportation sector, specifically those used in the October 2005 Section 2207 Report. 

We also reviewed similar USAID projects. We also conducted follow-up on our previous 

recommendation to IRMO regarding the formalization and finalization of cost-tocomplete procedures.3

 

For a discussion of the audit scope, methodology, and a summary of prior coverage, see 

Appendix A. For definitions of the acronyms used in this report, see Appendix C. For a 

list of the audit team members, see Appendix E. 

 

3

 SIGIR audit report, “Management of Iraq Relief and Reconstruction Fund Programs: Cost-to-Complete 

Estimate Reporting,” Report Number SIGIR-05-021, October 24, 2005. 
4

Methodologies for Reporting Cost-to-Complete 

Information - Facilities and Transportation Sector 

For the Department of Defense, GRD-PCO and MNSTC-I; as well as the USAID failed 

to estimate and report reliable and transparent cost-to-complete information for IRRF 

projects – F&T sector. MNSTC-I did not submit a report for the September 30, 2005, 

PAR, and GRD-PCO and USAID submitted reports with errors that were significant 

enough to undermine users’ confidence in the reporting. 

This condition occurred because the IRMO did not provide formal written guidance to 

the reporting agencies. The condition also occurred because the reporting agencies failed 

to: 

• develop and communicate effective internal guidance 

• identify and correct errors in the reports before issuance 

• maintain adequate documented support for the calculation of reported estimatesat-completion 

• adequately report project scope changes 

Failure to effectively estimate and report cost-to-complete information as required by 

Public Law 108-106 excludes important project visibility essential for program and 

project management and Congress to make informed management decisions during IRRF 

program execution. As we have reported, without current and accurate cost-to-complete 

data, the funds available for the completion of the IRRF program cannot be determined 

and the availability of funds for the initiation of new projects cannot be projected. 

SIGIR requested cost-to-complete data from GRD-PCO in February, 2005, and then 

again, in May. The first monthly cost-to-complete report was produced in June, 2005. 

GRD-PCO and USAID submitted to IRMO cost-to-complete information dated 

September 30, 2005 as part of the quarterly project assessment report (PAR). 

Cost-to-complete information was not reported quarterly before the September 30, 2005 

PAR because: 

• there was a lack of guidance 

• tasks for a number of projects were not identified, or the parties had not reached 

agreement on all of the tasks that should be included 

• cost estimates for some task orders and projects had not yet been definitized 

• there was a re-prioritization of tasks to be accomplished as a result of 

reprogramming of funds 

• software was not implemented to efficiently track estimated and actual costs 

• the security situation slowed the pace of the design-and-build teams in visiting job 

sites, resulting in unanticipated costs. The full effect of those costs was not 

known 

Internal Control Weaknesses. We found internal control weaknesses. IRMO and the 

reporting agencies did not develop and communicate effective guidance, maintain 
5

documentation supporting significant numbers in the reports, and adequately review 

reports before issuance. 

Iraq Reconstruction Management Office

In the Special Inspector General for Iraq Reconstruction Audit Report Number SIGIR05-021, dated October 24, 2005, “Management of Iraq Relief and Reconstruction Fund 

Programs: Cost-to-Complete Estimate Reporting,” we recommended that the Director of 

the IRMO take action to develop procedures for eliciting cost-to-complete information. 

IRMO officials agreed and commenced discussions with reporting agencies to develop a 

formal process to provide the necessary cost-to-complete reports on a monthly basis. Our 

recommendation in the report stated that IRMO should formalize its cost-to-complete 

action plan by issuing a formal policy to finalize consistent procedures across all 

supporting IRRF organizations for the collection and compilation of cost-to-complete 

information. 

The lack of guidance resulted in inconsistency among the different activities in preparing 

quarterly reports of cost-to-complete information. For example, GRD-PCO includes 

associated close-out costs in project EACs, but USAID reported associated close-out 

costs separately and did not include them when calculating the EACs. IRMO has not 

completed its action plan to issue a formal cost-to-complete reporting policy. However, 

IRMO has recently done a more thorough analysis of data from the cost-to-complete 

reports, and IRMO management stated that the result is that the reporting is now being 

used more effectively as a project management tool. IRMO management stated IRMO is 

now requiring the reporting agencies to limit the use of program contingency for closeout and emergencies, rather than transferring it directly to projects with a funding 

shortfall. IRMO management stated that this new requirement helps provide a better 

picture of cost-to-complete. IRMO management also stated IRMO’s analysis identified 

$7 million from closed projects that had not been transferred back to the pool of available 

funds. Those funds will now be available for use in open projects. 

Appendix B represents the agreement of IRMO, OMB, and the Special Inspector General 

for Iraq Reconstruction as to the data fields needed to ensure complete and transparent 

reporting of cost-to-complete. During the course of this review, IRMO has updated the 

format of the PAR in anticipation of preparation of the report for the quarter ending 

December 31, 2005. 

Project and Contracting Office 

GRD-PCO prepared monthly cost-to-complete reports for every month from June 2005 

through September 2005, and submitted the reports to IRMO. GRD-PCO has worked to 

improve methodologies and the quality of the reporting, and we found there has been 

improvement since we last reported on GRD-PCO cost-to-complete data in October 

2005. GRD-PCO program management stated their cost-to-complete reports are now a 

more effective project management tool, as a result of improvements to the reporting over 

the last few months. However, we found that GRD-PCO has not formalized or issued 

policy or guidance, and is not validating the data it is reporting to IRMO. 

Guidance for Cost-to-Complete Reporting. In July 2005, GRD-PCO issued an 

executive summary entitled, “Cost To Complete Reporting,” that accompanied the July 

monthly cost-to-complete report. The executive summary provided an overview of 

GRD-PCO methodology for compiling cost-to-complete data. The document provides 
6

general information about cost-to-complete reporting including report format. The 

document states the EAC is developed based on the budget to complete plus the earned 

value calculations, plus future cost projections validated through computer generated 

modeling. However, the document is not official guidance because it is not signed or 

dated. GRD-PCO F&T staff stated there was no formal written guidance regarding the 

compilation of the cost-to-complete report. One staff person stated he learned the 

methodology from a predecessor and “typed up my own guidance.” 

 

In September, 2005, GRD-PCO F&T sector provided to SIGIR another document 

entitled, “Standard Practice for Developing Estimate at Completion (EAC) for 

Construction Task Orders”. Estimate-at-completion is a crucial number used to calculate 

cost-to-complete. GRD-PCO F&T personnel also stated the standard practice document 

was distributed to all F&T personnel responsible for calculating the EACs for 

construction projects. 

 

The new document was more detailed and provided information about individual 

responsibilities. However, the document was presented by GRD-PCO as a 

“memorialization” or “standard practice”, not a policy directive. The document is 

unsigned and is not dated. In addition, the document only covers development of the 

EACs for construction task orders, not the methodology for developing the entire cost-tocomplete reports. The methodology for the non-construction element has not been 

documented. 

 

Further, the standard practice document does not specifically require consideration of 

future cost projections. Also, the executive summary document states amounts are 

validated through computer modeling. However, GRD-PCO personnel stated computer 

modeling does not work for the F&T sector because, based on experience, the numbers 

generated are not realistic. GRD-PCO personnel stated while they do consider future cost 

projections, they do not validate data with computer models. 

 

Report Anomalies. The Project and Contracting Office F&T sector failed to 

satisfactorily review the September 30, 2005, cost-to-complete report submitted for the 

PAR to correct anomalies. We identified twenty-seven anomalies in the cost-to-complete 

field of the PAR for the GRD-PCO F&T projects. We defined an anomaly as any 

reported amount at least three percent different than the expected amount for the field, 

based on the arithmetic formula for cost-to-complete (EAC less cumulative 

expenditures). 

For example, the project code 32000 (Penal Facilities) contains an anomaly in the cost-tocomplete field. The reported cost-to-complete is $39,209,525. The EAC is $82,734,929. 

The cumulative expenditures are $15,407,550. We would expect cost-to-complete to be 

$67,327,379 (82,734,929 – 15,407,550). The difference between what is expected and 

what is reported is an apparent understatement of $28,117,854 (67,327,379 – 39,209,525) 

or 41.8 percent of the expected cost-to-complete amount. The reason for the error could 

not be determined by analyzing the report. 

GRD-PCO also provided an additional data field called “extended cost-to-complete”. 

GRD-PCO defined extended cost-to-complete as cost-to-complete plus costs of 

sustainability for fiscal year 2006. However, we identified 228 anomalies out of 295 

possible lines in the report, where the reported extended cost-to-complete was different 

than the expected extended cost-to-complete. 

For example, the project code 15000 (Public Safety Training & Facilities) contains an 

anomaly in the extended cost-to-complete field. The reported extended cost-to-complete 
7

is $39,279,411. The reported cost-to-complete is $25,202,866 and the fiscal year 2006 

sustainability cost is approximately $921,703. We would expect extended cost-tocomplete to be $26,124,569 (25,202,866 + 921,703). The difference between what is 

expected and what is reported is an apparent overstatement of $13,154,842 (39,279,411 – 

26,124,569) or 50.4 percent of the expected amount. It appears, in many cases, that the 

spreadsheet adds the EAC, instead of the cost-to-complete, to the sustainability cost to 

arrive at extended cost-to-complete. 

The GRD-PCO cost-to-complete report had fields for contract completion date, 

scheduled completion date, and actual completion date. However, some projects 

contained an actual completion date after the September 30, 2005, report date. For 

example, task order 18635 in the health sector is identified as 46 percent complete, but 

the report lists an actual completion date of January 20, 2006. It is illogical to report an 

actual completion date after the report date. GRD-PCO F&T staff acknowledged there 

were errors in the reporting of actual completion dates. 

In addition to a few MNSTC-I projects contracted through GRD-PCO, the GRD-PCO 

cost-to-complete report also included data for MNSTC-I projects not contracted through 

GRD-PCO. When assembling the data for those projects, GRD-PCO simply used EACs 

that would result in a zero variance. The EACs were not properly calculated, and the 

inclusion of these projects will result in duplicate reporting when MNSTC-I starts issuing 

cost-to-complete reports. GRD-PCO personnel stated they intend to remove the nonGRD-PCO MNSTC-I projects from the reporting. 

GRD-PCO personnel agreed there were errors in the report. GRD-PCO personnel stated 

they are working to improve the reporting spreadsheets and eliminate anomalies. 

Documentation of Reported Amounts. GRD-PCO failed to maintain adequate 

documentation to support the calculation of the EAC for each project. Cost-to-complete 

is simply the result of an arithmetic equation (EAC less cumulative expenditures). 

However, EAC, which is the total expected cost of the project, must be calculated to 

arrive at cost-to-complete. 

GRD-PCO program management stated that each project manager has primary 

responsibility for the calculation of the EAC for each project under his or her authority. 

However, there is no permanent central file containing documentation of the EACs, and 

GRD-PCO personnel did not know if project managers were maintaining documentation 

of the calculations. In addition, there is no guidance requiring each project manager to 

provide written documentation supporting his or her calculation. 

The cumulative expenditures amount is drawn from a report run in CEFMS. GRD-PCO 

personnel in the F&T sector stated they do not have documentation to support cumulative 

expenditures amounts reported in the cost-to-complete reports. GRD-PCO relies upon 

the accuracy of CEFMS4

. 

Reporting project scope changes. GRD-PCO failed to provide information in the 

September 30, 2005, PAR alerting readers to significant scope changes in the projects. 

For example, the scope of a project in the health sector was significantly changed when 

GRD-PCO decided to construct fewer facilities. GRD-PCO issued monthly cost-to-

 

4

 SIGIR has not audited CEFMS; however, for more information on the reliability of data drawn from 

CEFMS, see GAO report 01-89 “Significant Weaknesses in Corps of Engineers’ Computer Controls”, 

October, 2000, and GAO follow-up report 02-589 “Corps of Engineers Making Improvements But 

Weaknesses Continue”, June, 2002. 
8

complete reports for July and August 2005 that identified the scope changes in footnotes. 

However, the submission for the September 30, 2005, PAR contained no footnotes or any 

other numbers or text to explain the change in scope of the health project. 

Multi-National Security Transition Command-Iraq 

MNSTC-I failed to submit a cost-to-complete report for the September 30, 2005, PAR. 

However, MNSTC-I developed procedures and plans to submit a report for the December 

31, 2005, PAR. 

Guidance for Cost-to-Complete Reporting. MNSTC-I issued authoritative guidance 

detailing the process for reporting cost-to-complete information for construction projects. 

The MNSTC-I guidance directs the contracting agencies, Air Force Center for 

Environmental Excellence and Gulf Region Division, regarding how to calculate the 

EACs. However, MNSTC-I failed to include a provision for future cost projections. 

Future cost projections are a critical component for assessing the total cost of the project. 

MNSTC-I has not issued guidance relating to non-construction projects. 

Documentation of Reported Amounts. Personnel at MNSTC-I stated that the 

contracting agencies are responsible for documenting calculation of the EACs. While 

MNSTC-I does not keep support for the reported EAC amounts, the issued guidance 

requires contracting agencies to maintain documentation of the calculation. 

 

Like GRD-PCO, MNSTC-I uses CEFMS to obtain the cumulative expenditures data. 

MNSTC-I personnel stated that support for the amounts drawn from CEFMS reports are 

maintained by the contracting agencies. MNSTC-I personnel stated that the contracting 

agencies are expected to keep invoices on file, and that the agencies can produce the 

invoices upon request to support a cumulative expenditures number, if necessary. 

U.S. Agency for International Development 

USAID submitted a cost-to-complete report for the September 30, 2005 PAR. However, 

we found that USAID has not formalized or issued policy or guidance, and is not 

validating the data it is reporting to IRMO. 

Guidance for Cost-to-Complete Reporting. The US Agency for International 

Development has not developed and communicated effective guidance for estimating and 

reporting cost-to-complete information. On June 2, 2005, SIGIR made a specific request 

for policies and procedures relating to cost-to-complete reporting. USAID 

communicated their procedures orally with SIGIR auditors, but USAID stated they would 

not provide cost-to-complete methodology in writing until they received instruction from 

IRMO. 

USAID obtains financial data from USAID-wide financial systems. However, the 

USAID contractor employee primarily responsible for compiling the USAID cost-tocomplete submission for the September 30, 2005, PAR stated he used data provided by 

the contractor, rather than data from USAID systems. The lack of formal guidance 

resulted in an over-reliance on information provided by a contractor. 

Report Anomalies. USAID failed to thoroughly review the September 30, 2005, costto-complete reports to correct anomalies. USAID reported two construction task orders 
9

that were similar to the F&T sector, a hospital and a communications network, with a 

total value of $120 million. 

We identified an anomaly in the cost-to-complete field for the totals row (for all sectors) 

in the USAID PAR. The reported cost-to-complete in the totals line is $961,389,057. 

The total EACs are $1,331,211,678. The total cumulative expenditures are 

$581,194,360. We would expect cost-to-complete to be $750,017,318 (1,331,211,678 – 

581,194,360). The difference between the reported cost-to-complete and the calculated 

cost-to-complete is an apparent overstatement of $211,371,739 (961,389,057 – 

750,017,318). The report was in error by including indirect costs of $211,371,739 in the 

total cumulative expenditures, but not including the amount in the total EACs.

We also identified an anomaly in the PAR where USAID separated programmatic closeout costs from the EAC. The programmatic close-out costs are reported in a separate 

column, and the cell formula for the close-out costs is three percent of EAC. This means 

the close-out costs are not being included in the EACs, which are undervalued by three 

percent for all USAID projects as a result. The total amount of the separated close-out 

costs for all projects was approximately $19.3 million. The EAC is the total cost to 

complete the project, and the associated programmatic close-out costs are part of the total 

costs. 

Documentation of Reported Amounts. USAID failed to maintain supporting 

documentation for the calculation of the EAC for each project. It appears USAID simply 

used the budgeted amount for the project as the value of the EAC. 

The cumulative expenditures amount reported in the September 30, 2005, PAR was 

derived from data provided by the contractor managing the projects. USAID personnel 

stated they have copies of invoices on file and can support any cumulative expenditures 

number in the cost-to-complete report. 

Reporting Project Scope Changes. USAID failed to provide information in the 

September 30, 2005, PAR alerting readers to significant scope changes in the projects. 

Because we only reviewed two projects that were similar to the F&T sector and both 

were in the early stages of construction, it is possible neither had a significant scope 

change. 

Conclusion 

GRD-PCO, MNSTC-I, and USAID were required by Public Law 108-106 to submit costto-complete information to IRMO for the PAR for the quarter ending September 30, 

2005. 

However, MNSTC-I did not submit a cost-to-complete report for the quarter. In addition, 

the three reporting entities failed to develop proper guidance, adequately review reports 

before submission, document the calculation of critical numbers, and note significant 

scope changes in the reporting. 

We conclude that IRMO, as well as GRD-PCO, MNSTC-I, and USAID (the reporting 

entities) failed to develop methodologies to assure reliable and transparent cost-tocomplete reporting. Failure to effectively compile and report cost-to-complete 

information as required by Public Law 108-106 excludes important project visibility 

essential for project management and Congress to make informed management decisions 

during IRRF program execution. Because the October 2005 Section 2207 Report did not 
10

contain accurate cost-to-complete data, Congress could not use the information to assess 

IRRF program progress or the availability of funds. 

 

Recommendations, Management Comments, and Audit 

Response

In order to make informed management decisions, IRRF management and Congress 

require timely, accurate and comprehensive cost-to-complete information. As such, we 

recommend the: 

1. Director, Iraq Reconstruction Management Office, require IRMO 

management to take these actions: 

a. Formalize its cost-to-complete action plan by issuing a formal policy to 

finalize consistent procedures across all supporting IRRF organizations for 

the collection and compilation of the cost-to-complete information. 

b. In the next Department of State Section 2207 Report, provide data to 

Congress on the adequacy of cost-to-complete methodologies in the other 

sectors. 

2. Commanding General, Gulf Region Division, require the GRD-PCO sector 

management to: 

a. Finalize the draft of official written guidance covering the methodology, 

including roles and responsibilities, for generating cost-to-complete 

reports. The guidance should be issued as a policy directive and should 

cover all of the construction sub-sectors, as well as non-construction 

projects. The guidance should include a future costs projection element to 

assure full consideration of potential costs. The guidance should be 

consistent with the guidance provided by IRMO. 

b. Ensure that the decision not to use computer modeling in the calculation of 

cost-to-complete is updated and reflected in all current and future 

guidance. 

c. Develop a thorough review process to eliminate errors in the reporting 

spreadsheets. The review process should be written into the guidance. 

d. Create and maintain a permanent central file to document the calculation 

of estimates-at-completion (EAC) by project. The requirement to create 

and maintain the central file should be written into the guidance. 

e. Develop policies to define significant scope changes. For example, 

variances reflecting a 15 percent change in schedule, scope, or budget 

could be used as a metric to define “significant”. The changes should be 

reported in the quarter the changes occurred by adding supporting 

schedules to the cost-to-complete report. Require the supporting 

schedules to be sufficiently descriptive to inform users of differences 

between what is expected to be completed relative to what was planned. 

3. Commanding General, Multi-National Security Transition Command-Iraq, 

require MNSTC-I management to: 

a. Add the future cost projections component to guidance relating to the 

calculation of the EACs for construction projects. Develop guidance for 
11

non-construction projects including the future cost projections component 

and the requirement to document calculation of the EACs. The guidance 

should be consistent with the guidance provided by IRMO. 

b. Develop a thorough review process to eliminate errors in the reporting 

spreadsheets. The review process should be written into the guidance. 

c. Develop policies to define significant scope changes. For example, 

variances reflecting a 15 percent change in schedule, scope, or budget 

could be used as a metric to define “significant”. The changes should be 

reported in the quarter the changes occurred by adding supporting 

schedules to the cost-to-complete report. Require the supporting 

schedules to be sufficiently descriptive to inform users of differences 

between what is expected to be completed relative to what was planned. 

Identify all projects to be completed with funds other than IRRF by adding 

footnotes to the cost-to-complete report. 

4. USAID Mission Director-Iraq, require USAID management to: 

a. Develop and distribute official written guidance covering the entire 

methodology, including roles and responsibilities, for generating cost-tocomplete reports. The guidance should be issued as a policy directive. 

The guidance should cover both construction and non-construction 

projects, and should include a future costs projections component to assure 

full consideration of potential costs. This guidance should be consistent 

with guidance provided by IRMO. 

b. Develop a thorough review process to eliminate errors in the reporting 

spreadsheets. The review process should be written into the guidance. 

c. Create and maintain a permanent central file to document the calculation 

of EACs by project. The requirement to create and maintain the central 

file should be written into the guidance. 

d. Develop policies to define significant scope changes. For example, 

variances reflecting a 15 percent change in schedule, scope, or budget 

could be used as a metric to define “significant”. The changes should be 

reported in the quarter the changes occurred by adding supporting 

schedules to the cost-to-complete report. Require the supporting schedule 

be sufficiently descriptive to inform users of differences between what 

will be completed relative to what was planned. 

Management Comments and Audit Response. We received written comments to the 

draft of this report from officials at GRD-PCO, USAID, and MNSTC-I. We did not 

receive written comments from IRMO, but discussed the report and its recommendations 

with senior IRMO managers. 

IRMO managers told us that they concurred with our recommendation to issue a formal 

policy to finalize consistent procedures across all supporting IRRF organizations. They 

also said that the January 2006 Section 2207 Report would discuss the adequacy of costto-complete methodologies in the other sectors. 

The Commanding General, Gulf Region Division, concurred with the recommendations, 

and provided more recent information on activities that had occurred since the 

preparation of the draft of this report. In addition, GRD-PCO officials stated that because 

of the number of scope changes to projects, rather than footnoting the automated cost-to-
12

complete report, GRD-PCO will develop a supporting schedule summarizing the scope 

changes by quarter. Comments were fully responsive. 

The Mission Director-Iraq, USAID, concurred with our recommendations and stated that 

they would develop a written mission policy and procedures for estimating CTC that 

included controls for validating and revalidating estimates. USAID also said that it 

would seek to coordinate with IRMO to develop a mutually agreeable methodology for 

calculating CTC estimates. However, they said that any methodology used by USAID 

would reflect USAID’s definition of a project and USAID’s requirements, policies, 

procedures and limitations. USAID also stated that it would create and maintain a 

permanent central file to document the calculation of EACs by project. USAID did 

question our use of the term facilities and transportation sector projects, stating that it is 

not a term used by USAID. Consequently, they questioned whether the anomalies we 

identified pertained to USAID projects. We agree, and have changed our report as 

appropriate. However, standardized reporting still applies to USAID activities, as it has 

construction projects that must be included in Section 2207 Reports. These include one 

hospital project and one communication project. Comments were fully responsive. 

MNSTC-I officials concurred with most of our recommendations, but did not concur that 

it should provide cost-to-complete information for non-construction projects. MNSTC-I 

stated that it already reported cost-to-complete information in the quarterly Section 2207 

Reports in the form of obligation and outlay data. However, we believe this information 

does not provide decision makers with the necessary transparency as to the actual cost to 

complete non-construction projects. For example, MNSTC-I sometimes uses non-IRRF 

funds to complete projects after IRRF funds are fully expended. Without information on 

actual program costs, decision makers cannot determine where future investments should 

be made. 
13

 

Appendix A. Scope and Methodology 

In March 2005, we initiated an audit to determine whether the information systems used 

by U.S. government organizations result in effective and reliable program management 

information. This audit report is the third report on cost-to-complete (Project No. SIGIR2005-08.2). It discusses procedures and processes used to develop and report cost-tocomplete estimates for IRRF projects. 

Due to time and resource considerations, we limited the scope of the audit to GRDPCO’s F&T sector and similar projects in MNSTC-I and USAID. Furthermore, we 

limited the scope of the audit to the three organizations that received the largest 

apportionment of funds – GRD-PCO, USAID, and MNSTC-I. 

To gain an understanding of each entity’s operations and processes for developing and 

reporting cost-to-complete information, we interviewed management personnel from 

IRMO, GRD-PCO; MNSTC-I and USAID. We also reviewed organization charts and 

websites to obtain background information and to determine responsibilities. 

We met with IRMO management, GRD-PCO Project Management, GRD-PCO Financial 

Management, USAID Directors, and MNSTC-I Commanders to discuss the contractual 

requirements and agency methodologies used to determine project status and to calculate 

and report cost-to-complete estimates. We also held discussions with OMB and IRMO 

on management requirements of cost-to-complete. Appendix B represents the agreement 

of IRMO, OMB, and the Special Inspector General for Iraq Reconstruction as to the data 

fields needed to ensure complete and transparent reporting of cost-to-complete. 

We reviewed available procedures, both formal and in-progress, that described the 

processes, methodology, responsibilities, documentation standards and formats for costto-complete reporting. 

We analyzed GRD-PCO F&T and USAID cost-to-complete reports submitted to IRMO 

for the September 30, 2005, PAR to determine if data is properly reflected in the report, if 

the arithmetic calculations were correct, and if significant project scope changes were 

reported. We also analyzed GRD-PCO F&T cost-to-complete monthly reports for July 

and August, 2005. 

We met with representatives from GRD-PCO and Air Force Center for Environmental 

Excellence to review contract management procedures. 

We performed this audit from May 14, 2005 through December 31, 2005, in accordance 

with generally accepted government auditing standards. 

Use of Computer-Processed Data. We reviewed cost-to-complete reports that were 

compiled in Excel spreadsheets based on data taken from reports run in financial 

accounting computer systems. The data in the GRD-PCO cost-to-complete report was 

taken from reports run in CEFMS. We did not audit CEFMS5

. USAID’s financial 

 

5

 For more information on the reliability of data drawn from CEFMS, see GAO report 01-89 “Significant 

Weaknesses in Corps of Engineers’ Computer Controls”, October, 2000, and GAO follow-up report 02-589 

“Corps of Engineers Making Improvements But Weaknesses Continue”, June, 2002. 
14

accounting system was formerly the MACS, but USAID is currently transitioning to the 

Phoenix accounting system. We did not audit MACS or Phoenix. Moreover, the person 

primarily responsible for compiling the USAID submission for the September 30, 2005, 

PAR stated he used data provided by the contractor managing the projects. 

Prior Coverage. Special Inspector General for Iraq Reconstruction Audit Report 

Number SIGIR-05-021, dated October 24, 2005, “Management of Iraq Relief and 

Reconstruction Fund Programs: Cost-to-Complete Estimate Reporting”, concluded the 

three organizations responsible for IRRF projects – PCO, USAID, and the MNSTC-I – 

have been required, since January 2004, to report cost-to-complete information for their 

IRRF projects in quarterly reports to the Congress. However, these organizations did not 

begin providing reasonably comprehensive cost-to-complete data to IRMO until the 

summer of 2005. 

Special Inspector General for Iraq Reconstruction Audit Report Number SIGIR-05-011, 

dated July 26, 2005, “Cost-to-Complete Estimates and Financial Reporting for the 

Management of the Iraq Relief and Reconstruction Fund”, included a review of PCO’s 

input to the April 2005 Section 2207 Report and found that PCO did not provide cost-tocomplete information to IRMO for the Section 2207 Report. PCO maintained that (1) 

project data was not sufficiently mature to develop reasonable estimates at completion; an 

(2) they could not consolidate information from their management information systems 

because they were not integrated. 
15

 

Appendix B. Definition of Reporting Terms6

DATA FIELD DEFINITION 

Task Order 

An order for the performance of a task during the period of a task order indefinite delivery 

contract for services that do not procure or specify a firm quantity of services (other than a 

minimum or maximum quantity) 

Sector PL 108-106 Section 2207 report sector 

Sub-Sector PL 108-106 Section 2207 subsector 

URI Unique Requirements code 

Project Name/ Description Name and short description of project 

DB/Prime Contractor Name of prime contractor to which US Agency awarded contract 

Sub or other contract Name(s) of any subs or other contractors the prime is using 

Original Start Date Original date when project was supposed to begin under the original Project Identification 

Form (PIF) or original estimate 

Actual Start date Date by which project is currently scheduled to begin 

Target completion date Original date by which project was to have been completed 

Projected completion date Current date by which project is projected to be complete 

Authorized Amount Amount Authorized and Apportioned for the Project Code 

Original PIF Value Project Identification Form Amount budgeted for project when the original PIF was 

completed (for the first 2207 report) 

Definitized (Y/N) Yes, if a project has been completely definitized 

Definitized Value The dollar amount budgeted for the project, according to the definitization of the project 

Contingency % Percent of PIF, revised estimate or definitized amount that includes built-in contingency 

amount. 

Committed to Date Amount committed for the project 

Obligated to Date Amount of Contract Award 

Reserve 

Any reserve (security, strategic, floating, etc.) that is not included in current project estimate 

but is allocated against each specific project. If such a reserve is not allocated by project, but 

by sector or task order (ATO), please add a separate line item to data call, labeling it as a 

reserve. 

Associated Close Out Costs The current estimate of project close-out costs, or contract close-out costs that will be booked 

against each project. 

Demobilization Costs The current estimate of project demobilization costs, or contractor demobilization costs that 

will be booked against each project. 

Cumulative Expenditures Amount of Contract Expenditures (includes accounts payable plus disbursements, work that 

is completed) 

Certified Commitments Requirements not yet obligated (project contingencies or pending modifications) 

Undelivered Orders Amount of Unexpended Balance on the Contract (work yet to be accomplished) 

Budget to Complete Undelivered Orders Amount plus Certified Amount 

cost-to-complete Estimated cost to complete the project based on the difference between the Estimate to 

Complete and the Current cost incurred to date. 

Variance Indicates sufficiency of program funds for estimated cost to complete 

Earned Value or % Complete The % of the project complete, as measured against the baseline schedule, cost and scope 

Most Recent Estimate Date The date of the most recent estimate at completion 

 

6

 The list is current as of the September 30, 2005, PAR. As a result of efforts by IRMO to improve cost-tocomplete, the reporting terms list will change for the December 31, 2005, PAR. 
16

DATA FIELD DEFINITION 

Value of Most Recent Estimate The dollar amount budgeted for the project, according to the most recent estimate (if no new 

estimate has been done from the original PIF, leave blank) 

Estimate At Completion The estimate of what the project is expected to cost by the time it is completed 

Variance explanation Rationale of variance between estimate/definitized value and EAC 

 
17

Appendix C. Acronyms 

CEFMS U.S. Army Corps of Engineers Financial Management System 

EAC Estimate at Completion 

F&T Facilities and Transportation Sector 

GRD-PCO Gulf Region Division-Project and Contracting Office 

IRMO Iraq Reconstruction Management Office 

IRRF Iraq Relief and Reconstruction Fund 

MACS Mission Accounting Control System 

MNSTC-I Multi-National Security Transition Command-Iraq 

PAR Project Assessment Report 

USAID U.S. Agency for International Development 
18

Appendix D. Report Distribution 

Department of State 

Secretary of State 

Senior Advisor to the Secretary and Coordinator for Iraq 

U.S. Ambassador to Iraq 

Director, Iraq Reconstruction Management Office 

Inspector General, Department of State 

Department of Defense 

Secretary of Defense 

Deputy Secretary of Defense 

Director, Defense Reconstruction Support Office 

Under Secretary of Defense (Comptroller)/Chief Financial Officer 

 Deputy Chief Financial Officer 

 Deputy Comptroller (Program/Budget) 

Inspector General, Department of Defense 

Department of the Army 

Assistant Secretary of the Army for Acquisition, Logistics, and Technology 

Principal Deputy to the Assistant Secretary of the Army for Acquisition, 

Logistics, and Technology 

Deputy Assistant Secretary of the Army (Policy and Procurement) 

Director, Project and Contracting Office 

Commanding General, Joint Contracting Command – Iraq/Afghanistan 

Assistant Secretary of the Army for Financial Management and Comptroller 

Chief of Engineers and Commander, U.S. Army Corps of Engineers 

 Commander, Gulf Region Division 

Auditor General of the Army 

U.S. Central Command

Commanding General, Multi-National Force – Iraq 

 Commanding General, Multi-National Security Transition Command – Iraq Commander, Joint Area Support Group – Central 

Other Defense Organizations

Director, Defense Contract Audit Agency 
19

Other Federal Government Organizations 

Director, Office of Management and Budget 

Comptroller General of the United States 

Inspector General, Department of the Treasury 

Inspector General, Department of Commerce 

Inspector General, Department of Health and Human Services 

Inspector General, U.S. Agency for International Development 

Mission Director – Iraq, U.S. Agency for International Development 

Congressional Committees and Subcommittees, Chairman and 

Ranking Minority Member 

U.S. Senate 

Senate Committee on Appropriations 

Subcommittee on Defense 

Subcommittee on State, Foreign Operations and Related Programs 

Senate Committee on Armed Services 

Senate Committee on Foreign Relations 

Subcommittee on International Operations and Terrorism 

Subcommittee on Near Eastern and South Asian Affairs 

Senate Committee on Homeland Security and Governmental Affairs 

Subcommittee on Federal Financial Management, Government Information and 

International Security 

Subcommittee on Oversight of Government Management, the Federal 

Workforce, and the District of Columbia 

U.S. House of Representatives 

House Committee on Appropriations 

Subcommittee on Defense 

Subcommittee on Foreign Operations, Export Financing and Related Programs 

Subcommittee on Science, State, Justice and Commerce and Related Agencies 

House Committee on Armed Services 

House Committee on Government Reform 

Subcommittee on Management, Finance and Accountability 

Subcommittee on National Security, Emerging Threats and International 

Relations 

House Committee on International Relations 

Subcommittee on Middle East and Central Asia 

 

 
20

Appendix E. Audit Team Members 

This audit report was prepared and the audit work was conducted under the 

direction of Joseph T. McDermott, the Assistant Inspector General for Auditing, 

Office of the Special Inspector General for Iraq Reconstruction. The staff members 

who contributed to the report include: 

Glenn Furbish 

William Shimp 

 
21

Management Comments 

Commanding General, Gulf Region Division, U.S. 

Army Corp of Engineers 
22

Management Comments 

Mission Director-Iraq, U.S. Agency for 

International Development 
23
24
25
26
27

Management Comments 

Commanding General, Multi-National Security 

Transition Command-Iraq 
28
29
30