United States General Accounting Office 

GAO Report to Congressional Requesters


June 2004 VENDOR PAYMENTS 

Inadequate 

Management 

Oversight Hampers 

the Navy’s Ability to 

Effectively Manage Its 

Telecommunication 

Program 

GAO-04-671


a
June 2004 

VENDOR PAYMENTS 

Inadequate Management Oversight 

Hampers the Navy’s Ability to Effectively 

Manage Its Telecommunication Program 

The Navy did not know how much it spent on telecommunications and did 

not have detailed cost and inventory data needed to evaluate spending 

patterns and to leverage its buying power. Obtaining knowledge of current 

requirements and usage, as well as developing forecasts of future 

telecommunication needs, would assist Navy’s acquisition planning to 

ensure future needs were met in a more cost-effective manner. 

At the four case study sites we audited, management oversight of 

telecommunication purchases did not provide reasonable assurance that 

requirements were met in the most cost-effective manner. For local and 

long-distance services, these sites did not follow policies to biennially review 

and revalidate these requirements. As a result, they paid for services no 

longer required. Also, the Navy lacks policies to provide assurance that cell 

phone requirements are met in the most cost-effective manner. Cell phone 

usage at three sites was not monitored to determine whether plan minutes 

met users’ needs. Consequently, these sites overpaid for cell phone services. 

Also, none of the sites had adequate controls over review of invoices to 

provide assurance of payments for only valid charges. These sites failed to 

detect erroneous charges and potentially improper use of these services. 

In addition, the Navy lacks specific policies and processes addressing the 

administration and management of calling cards. Consequently, some sites 

did not know they owned and were being billed for calling cards. Other sites 

allowed calling cards to be shared and were unable to determine the 

legitimacy of the calls, and thus paid for potentially fraudulent or abusive 

long-distance charges. On one card alone, in a 3-month period, the Navy paid 

over $17,000. However, because no one was regularly monitoring the 

activity on this card, the unit was unaware of potentially fraudulent charges. 

Not until the vendor’s fraud unit raised questions about more than $11,000 in 

charges incurred during the first 6 days of July 2003 was the card suspended. 

Examples of Wasteful Telecommunication Payments 

Highlights of GAO-04-671, a report to the 

Honorable Janice D. Schakowsky, House 

of Representatives 

Problems with management 

oversight and control of DOD’s 

purchase card program led to 

concerns that similar issues exist 

for DOD’s vendor payments. As a 

result, this report focuses on the 

Navy’s telecommunication program 

and whether (1) the Navy has the 

basic cost and inventory 

information needed to oversee and 

manage these purchases and (2) 

selected Navy sites have adequate 

control to provide reasonable 

assurance that goods and services 

are purchased cost effectively and 

payments are made only for valid 

charges. 

To provide assurance that existing 

telecommunication policies are 

enforced, GAO recommends that 

the Navy (1) develop and maintain 

a complete inventory of services, 

(2) support DOD’s efforts to track 

the cost of acquiring 

telecommunication services, and 

(3) establish comprehensive 

policies governing the purchase 

and use of cell phones and calling 

cards. GAO also recommends that 

the Navy develop a strategic 

management framework for 

improving the acquisition of 

telecommunication services. For 

the selected units audited, GAO 

made several recommendations 

aimed at improving controls over 

telecommunication transactions. 

Type of service Amount Description Internal control breakdown 

Long distance 

Cellular 

Site paid for services no longer 

required over a 3-year period 

Users exceeded monthly-allotted 

minutes, thus incurring excessive 

charges for extra minutes 

Sites paid for erroneous charges 

such as vendor-assessed late fees 

and services no longer required 

Site did not review and revalidate 

requirements 

Sites did not monitor cellular plans 

for cost effectiveness 

Sites lacked adequate controls over 

the payment, receipt, and 

acceptance of telecommunications 

Local and 

long distance 

$36,000 

$34,000 

$25,732 

In written comments on a draft of 

this report, DOD agreed with 9 and 

partially agreed with the remaining 

2 GAO recommendations. 

www.gao.gov/cgi-bin/getrpt?GAO-04-671. 

To view the full product, including the scope 


and methodology, click on the link above.


For more information, contact Gregory Kutz, Source: GAO.


(202) 512-9095 or kutzg@gao.gov.

Contents


Letter 1 

Results In Brief 2 

Background 5 

The Navy Lacked Strategic Knowledge of Expenditures to More 

Efficiently Purchase Telecommunication Services 9 

Navy Sites Lacked Controls Needed to Ensure Appropriate 

Oversight and Payment of Telecommunication Services 11 

Conclusion 24 

Recommendations for Executive Action 25 

Agency Comments and Our Evaluation 26 

Appendixes 

Appendix I: Objectives, Scope, and Methodology 29 

Appendix II: Comments from the Department of Defense 35 

Appendix III: GAO Contact and Staff Acknowledgments 39 

GAO Contact 39 

Acknowledgments 39 

Tables Table 1: 

Table 2: 

Table 3: 

Table 4: 

Table 5: 

Table 6: 

Status of Review of Long-Haul Lines at Selected Navy Sites 

14 

Summary of Under- and Overutilization of Cellular 

Plans 17 

Examples of Users Underutilizing Plan Package 

Minutes 18 

Potentially Improper Long-Distance Calls Approved by 

NCTAMS Norfolk 20 

Compromised Calling Cards at Selected Sites 22 

Major Commands and Units Selected for Review 31 

Figure Figure 1: Potential Fraudulent Use of a Comprised Card 24 

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Page i GAO-04-671 Navy Control Its Telecommunication Program 
Page ii GAO-04-671 Navy Control Its Telecommunication Program 
Page 1 GAO-04-671 Navy Control Its Telecommunication Program 

A

United States General Accounting Office 

Washington, D.C. 20548 

June 14, 2004 

The Honorable Janice D. Schakowsky 

House of Representatives 

Dear Ms. Schakowsky: 

As you are aware, we have conducted a series of audits and investigations 

of the Department of Defense’s (DOD) purchase card program and found 

substantial breakdowns in internal controls that resulted in fraud, waste, 

and abuse. Concerned that similar problems may plague DOD’s vendor pay 

processes through which approximately $112 billion was spent and 

obligated in fiscal year 2003, you asked us to evaluate the effectiveness of 

DOD’s management oversight and controls in this area. As agreed with your 

staff, the scope of our audit included our assessment of the Navy’s 

oversight and controls over vendor purchases and payments for 

telecommunication service—including local and long-distance services, 

calling cards, and cellular phone service. 

This report provides you with our assessment of whether (1) the Navy has 

the basic cost and inventory information needed to manage and oversee its 

purchases from telecommunication vendors and (2) selected Navy sites 

have effective internal control to provide reasonable assurance that 

telecommunication goods and services are purchased cost effectively and 

payments are made only for valid telecommunication charges. Because the 

Navy was unable to provide us with a complete population of 

telecommunication expenditures from which we could sample, test, and 

discuss in this report as being control weaknesses, as agreed with your 

staff, we used a case-study approach to assess the adequacy of internal 

controls over vendor purchases and payments at four Navy locations, 

instead of on a Navy-wide basis. We were unable to perform statistical 

testing at these case study locations because the local databases were often 

incomplete, or they had insufficient, inconsistent, or inaccurate data. As a 

result, we evaluated the design of controls in place and relied on 

nonrepresentative selections to evaluate the effectiveness of case study 

locations’ internal controls over telecommunication programs. 

We were able to evaluate the availability of cost and inventory information 

Navy-wide, working at the Defense Information Systems Agency (DISA) 

Page 1 GAO-04-671 Navy Control Its Telecommunication Program 
and Naval Network and Space Operations Command (NNSOC),

1

 and 

evaluated the adequacy of the Navy’s expenditure reporting systems. In 

general, our assessment of purchasing and receipt and acceptance controls 

was limited to four Navy units from the following commands: (1) SPAWAR 

Systems Center, Charleston, South Carolina (SPAWAR Charleston); (2) 

Naval Air Warfare Center Aircraft Division, Patuxent, Maryland (NAVAIR 

Patuxent); (3) Naval Surface Warfare Center, Crane, Indiana (NAVSEA 

Crane); and (4) Commander-in-Chief Atlantic Fleet, Norfolk, Virginia 

(CINCLANTFLT Norfolk). We also performed limited work at HQ DISA and 

its major contracting organization—the Defense Information Technology 

Contracting Organization (DITCO Scott), and DISA CONUS (organizational 

element functionally responsible for the review and revalidation (R&R) 

process), both located at Scott Air Force Base, Illinois, pertaining to the 

review and revalidation of telephone services, and at the Naval Computer 

and Telecommunication Area Master Station Atlantic (NCTAM, Norfolk) 

related to purchasing controls. In addition, we used data-mining techniques 

to identify possible control weaknesses associated with the purchase and 

use of long-distance calling cards. This data-mining effort prompted us to 

audit selected calling card transactions at seven locations—discussed in 

detail in our objectives, scope, and methodology contained in appendix I. 

We conducted our work from May 2003 through February 2004 in 

accordance with generally accepted government auditing standards. We 

requested comments on a draft of this report from the Secretary of the 

Navy or his designee. We received written comments, which are reprinted 

in appendix II. In addition, DOD provided some technical comments, which 

we incorporated in the report as appropriate. 

Results In Brief	 The Navy lacked the basic cost and inventory information needed to 

manage and oversee its purchases from telecommunication vendors. 

Complete and accurate cost and inventory information provides a 

foundation for evaluating spending patterns on a Navy-wide, Commandwide, or unit-wide basis. This information in turn would allow the Navy to 

leverage its buying power if it chose to employ a more strategic approach 

to acquiring telecommunication services based on improved knowledge of 

spending, rather than continuing to use a generally decentralized and 

fragmented approach to acquiring services to meet more localized needs. 

1

NNSOC is the major command over the regional Naval Computer and Telecommunications 

Area Master Stations (NCTAM). Prior to July 2001, NNSOC was referred to as the Naval 

Computer and Telecommunications Command (NCTC). 

Page 2 GAO-04-671 Navy Control Its Telecommunication Program 
However, we found that the Navy did not know exactly how much it was 

spending on telecommunication services nor did it know much about its 

telecommunication service vendors. Without this knowledge, the Navy 

cannot take steps to leverage its buying power and achieve significant 

savings, even though it is a large customer for telecommunication services. 

In addition, from an internal control perspective for assuring appropriate 

payments to telecommunication service vendors, the Navy lacked a 

complete and accurate inventory of its local and long-distance networks, 

and some of the Navy locations we audited did not maintain an accurate 

inventory of the number of calling cards and cell phones currently in use or 

have accurate records as to whom the cards and phones were issued. 

Without an accurate inventory of the telecommunication networks and 

services currently in operation, the Navy cannot effectively ensure that it 

pays only for services it receives and hold individuals accountable for 

unauthorized telecommunication usage. 

At the four Navy case study units we audited, management oversight or 

controls over the purchase of telecommunication goods and services did 

not provide reasonable assurance that telecommunication requirements 

were being met in the most cost-effective manner possible. For local and 

long-distance services, these units did not follow established policies to 

biennially review and revalidate their telecommunication requirements—in 

part because they lacked a complete and accurate inventory of their local 

and long-distance networks. As a result, the Navy was paying for 

telecommunication service it no longer required. For example, when we 

asked the four Navy units and DITCO Scott to review and revalidate 55 

long-distance lines that had not been reviewed in over 2 years, they found 

that 12 of the 55 lines (22 percent) were no longer needed. According to 

Navy and DITCO Scott officials, all 12 lines have since been disconnected, 

but they were unable to quantify the total waste associated with paying for 

these unneeded lines. For 3 of the lines, DITCO Scott officials estimated 

that $36,000 had been paid since fiscal year 2000 or 2001, the years the 

payments should have stopped. 

Further, the Navy had no policies to ensure that cell phone requirements 

are met in the most cost-effective manner possible. Consequently, three of 

the four sites we audited were paying too much for these services. In one 

case, the unit did not take advantage of lower, prenegotiated rates provided 

through the General Services Administration (GSA) and instead paid full 

retail, which was 12 percent more than the GSA rate. Further, because cell 

phone usage was not monitored to ensure that the plan minutes included in 

the cell phone contract cost effectively met the users’ needs, we found that 

Page 3 GAO-04-671 Navy Control Its Telecommunication Program 
many users were consistently overutilizing or underutilizing their cell 

phone plans and paying much more than necessary for these plans. For 

example, after our discussions with them, SPAWAR Charleston officials 

reassessed usage requirements for 71 of their 1,900 cell phone plans and 

determined they could save over $59,000 annually through better 

management. They also told us that they intend to reassess the remaining 

plans as soon as time permits. 

None of the four sites we audited had effectively implemented established 

policies governing the receipt and acceptance of telecommunication goods 

and services to ensure that payments were made only for valid 

telecommunication charges. DOD regulations2

 require that payments on 

invoices be supported by documentation that reflects the receipt of 

services and goods and that those goods and services conformed to the 

contractual requirements. For telecommunication payments, this involves 

reviewing telecommunication invoices and reconciling invoice charges 

with an accurate inventory of telecommunication lines, circuits, networks, 

and services currently in operation and verifying that the billing rates used 

to calculate the charges are valid. Based on our audit of selected vendor 

invoices at the Navy sites we audited, we found that two of the four sites 

had performed little or no review, while the other two sites had controls in 

place but were not effectively performing the reviews of invoices prior to 

certification of payment. As a result, the reviewing officials at these sites 

did not detect erroneous or duplicate telecommunication charges. For 

example, one Navy site did not detect charges for discontinued local 

service on five different occasions. Because this site had not consistently 

implemented controls to detect invalid charges, it overpaid by $5,600. 

Additionally, the Navy did not have specific policies addressing the 

administration and management of calling cards; as a result, the Navy has 

paid for potentially fraudulent or abusive long-distance charges. Further, 

some of the Navy sites we audited did not know they owned and were 

being billed for long-distance calling card services. In other cases, the Navy 

knew it owned the calling cards but card users in these units frequently 

shared the same calling card and personal identification number (PIN)— 

resulting in multiple calls being made throughout the world on the same 

card at approximately the same time and preventing the Navy from 

determining the legitimacy of the phone calls. According to MCI officials, 

2

DOD 7000.14-R, Financial Management Regulation, Volume 10, Chapter 1, March 2002, and 

Chapters 7, 9, February 1996. 

Page 4 GAO-04-671 Navy Control Its Telecommunication Program 
each calling card with its respective PIN should be issued to and used only 

by one individual in order to assist in monitoring calling card usage. 

Additionally, calling cards should be tracked to determine who is 

accountable for each card’s use and invoices should be reviewed to detect 

and prevent unauthorized calling card use. The sharing of calling cards 

hinders the Navy’s ability to investigate calling card misuse. For example, 

one account owner said that he routinely provided the same card number 

and PIN to some of his officers, as needed, but did not know how many 

officers he had given the numbers to or how many currently had possession 

of the numbers. For this card alone, the Navy paid over $17,000 in longdistance charges for the 3-month period from April to June 2003. According 

to Navy officials, the card has been cancelled, but despite our repeated 

inquiries, as of the date of this report the Navy had yet to provide us with 

the identity of the individuals who were using this card or assurance as to 

whether the calls were for a legitimate purpose. 

This report contains 8 recommendations to the Secretary of the Navy and 3 

recommendations to the Chief of Naval Operations (CNO) concerning 

actions needed to (1) enforce existing policies related to maintaining 

accurate inventory data and performing review and revalidation 

procedures; (2) develop and enforce comprehensive policies and guidance 

governing the purchase, issuance, and use of cell phone and calling card 

services; and (3) develop a strategic management framework for improving 

the acquisition of telecommunication services by strengthening the Navy’s 

analysis of telecommunication service requirements and spending. In 

written comments on a draft of this report, DOD concurred with 9 of the 11 

recommendations. DOD partially concurred with the 2 remaining 

recommendations. Due to the lack of clarity of the Navy’s planned actions 

on the 2 recommendations, we were unable to assess the extent to which 

its actions will comply with the intent of our recommendations. The 

department also provided some technical comments, which we 

incorporated in the report as appropriate. 

Background 	 The military services and DOD have long procured and operated multiple 

types of telecommunication services to meet their individual mission 

needs. DOD guidance3

 defines telecommunications as circuits or 

equipment used to transmit or receive information via voice, data, video, 

3

Department of Defense Instruction 4640.14, Base and Long-Haul Telecommunications 

Equipment and Services, December 6, 1991. 

Page 5 GAO-04-671 Navy Control Its Telecommunication Program 
integrated telecommunication transmission, wire, or radio. 

Telecommunication equipment and services collectively include such items 

as telephones, switching systems and circuit termination equipment. 

Overall, telecommunications can be thought of broadly in two categories— 

base and long-haul telecommunications. Also, DOD has been using and 

paying for some special category types of services—cell phones and calling 

cards—that can usually be used to access either the base or long-haul 

infrastructure or both. 

DOD defines base telecommunications as facilities, equipment, and 

services used to support the distribution, transmission, or reception of 

information via voice, data, video, integrated telecommunications, wire, or 

radio within the confines of an area, such as an installation. This may 

include local interconnecting lines to the first commercial central office 

providing service to the local community and to other DOD component 

facilities in the local area. Calls originating and ending within the local 

calling area are considered local service calls and activities pay a flat 

monthly fee for such service. The fee that is paid to vendors is based upon 

the number of circuits billed and not the number of calls made. DISA does 

not have direct responsibility for acquiring and managing base 

telecommunication equipment and services, although it does have some 

oversight responsibilities. 

Long-haul telecommunications are the facilities, equipment, and services 

(in addition to those described for base telecommunications) that are used 

for the transmission or receipt of information that crosses the boundary of 

a facility’s local calling community. DOD service components are required 

to contract for their long-haul services through DITCO, DISA’s contracting 

organization. DITCO charges the components the actual costs for the 

services it provides them, plus a surcharge (which is currently 2 percent) to 

cover DITCO’s cost of administering the program. 

Cell phones allow DOD personnel, including Navy personnel, to make 

official calls when other alternatives are unavailable or are uneconomical. 

They can be used to access a local as well as a long-distance network, but it 

is generally more economical to use other service for local service, when 

possible. Navy activities generally either contract directly for cellular 

phone service or procure the phones under an already established GSA 

negotiated contract. Vendors normally offer various service plan packages 

to their customers with a range of rates, depending on the types of service 

and options provided. Items that can cause rates to vary are geographical 

location, the user’s calling area, and the number of telephones requested. 

Page 6 GAO-04-671 Navy Control Its Telecommunication Program 
Cellular phones differ from conventional telephone systems in the way 

charges for calls accrue. For cellular phones, activities are usually charged 

a fixed fee for a specific plan package, which includes a limited number of 

available minutes. After using all of the available minutes in a month, 

activities then pay a per-minute charge for any excess minutes, not 

included in the contracted amount. When callers exceed the number of 

minutes allowed in the plan package, they generally pay a very high 

premium per minute for the minutes in excess of the plan. Generally, 

charges for cellular phone services include (1) charges for airtime for all 

completed outgoing and incoming calls and (2) charges (known as roaming 

charges) for calls made when the caller is outside his or her home service 

area. In addition, cellular phones may incur long-distance charges for calls 

made where the number called is outside the local area in which the caller 

is physically located or if this service is not included in the service contract. 

Calling cards are used to access telecommunication services at a location 

where DOD-owned services are unavailable or where it is desired that the 

calls be charged to an account other than the one from which the calls are 

being made. Navy calling cards are issued to individual Navy employees for 

their official use in conducting government business. The card provides the 

user with access to the Federal Telecommunications System (FTS)4

 and 

offers a variety of available services. Navy activities generally procure the 

calling cards through DITCO in bulk and they are stored by the activities 

until issued. DITCO obtains the calling cards through a prenegotiated GSA 

contract. The cards incur no charges until issued and activated. The Navy 

activities are responsible for issuing the cards to individuals and the 

individuals activate the cards. Once issued, the activities are responsible 

for reviewing and certifying the calling card charges, just as they are for all 

other types of telecommunication service charges. 

DOD and its components have long acquired telecommunication systems 

to meet their individual mission needs, resulting in a fragmented and 

redundant telecommunication environment. To eliminate costly 

duplication and improve the effectiveness and efficiency of its 

communication services, in 1991 DOD began to plan and implement the 

Defense Information Systems Network (DISN) as the common-user, long4

FTS is a long-distance telecommunication service available for use by U.S. government 

agencies. GSA currently provides services through contracts designated by the title 

‘FTS2001’. 

Page 7 GAO-04-671 Navy Control Its Telecommunication Program 
haul telecommunication network for all DOD components.5

 Under the 

DISN program, DOD’s service components and Defense agencies are still 

responsible for acquiring local base telecommunication services for their 

local bases and installations; however, DISA is to be the sole provider of 

long-haul telecommunication services for all DOD components. 

To improve the interoperability of DOD’s long-haul telecommunication 

networks and service as well as to reduce costs, the Assistant Secretary of 

Defense for Command, Control, Communications, and Intelligence 

(ASD/C3I)

6 established policies and procedures that (1) directed DOD 

components to develop comprehensive inventories of their own long-haul 

telecommunication networks and directed DISA to develop a Defense-wide 

inventory of long-haul networks; (2) directed DISA to report annually on 

telecommunication services, acquisitions, trends, and associated costs; (3) 

mandated components to use common-user networks such as DISN or FTS 

2000 for long-haul communications; (4) directed DISA to establish a waiver 

process to let components procure independent networks when their 

telecommunication needs could not be met by common-user networks; and 

(5) directed DOD components to periodically review and revalidate their 

long-haul telecommunication requirements. In a previous review of the 

DISN program,7 and during our work on this audit, we found that DOD had 

not effectively implemented any of these directives. In response, DOD 

agreed to address our concerns and to implement these policies and 

procedures. However, as discussed in this report, the Navy has not yet 

established an accurate and complete telecommunication inventory or 

created a database of information on acquisition, trends, and associated 

costs, which are necessary to plan for future growth and cost effectively 

purchase new telecommunication equipment and services. 

5

A common-user long-haul network is one that provides long-distance communication 

service to a large, general population of users, rather than being dedicated to a small and 

specialized community. 

6

This organization has been renamed and is now called the Assistant Secretary of Defense 

(Networks and Information Integration), (ASD (NII))/Chief Information Officer. 

7

U.S. General Accounting Office, Defense Networks: Management Information Shortfalls 

Hinder Defense Efforts to Meet DISN Goals, GAO/AIMD-98-202 (Washington, D.C.: July 

1998). 

Page 8 GAO-04-671 Navy Control Its Telecommunication Program 
The Navy Lacked 

Strategic Knowledge of 

Expenditures to More 

Efficiently Purchase 

Telecommunication 

Services 

The Navy did not know exactly how much it was spending on 

telecommunication services nor did it know much about its 

telecommunication service vendors. The Navy’s lack of detailed cost data 

prevented us from analyzing its telecommunication expenditures on an 

aggregate level. For this reason, we were unable to comprehensively 

sample and test the adequacy of the Navy’s controls or perform effective 

data mining of its telecommunication expenditures. More importantly, this 

lack of adequate information also prevented the Navy from obtaining the 

knowledge needed to take steps to leverage its buying power, even though 

it is a large customer for telecommunication services. Moreover, obtaining 

knowledge of current requirements and usage, as well as developing 

forecasts of users’ future telecommunication needs, would assist Navy 

acquisition planning to ensure those future needs can be met in a more 

cost-effective manner. 

Our past work has identified specific practices that can be employed by 

DOD agencies to manage services acquisitions—including 

telecommunication services—from a more strategic perspective, thereby 

enabling DOD organizations to leverage buying power and achieve 

significant savings.8 These include establishing a central agent or manager 

for acquiring services, gaining visibility over spending, and revising 

business processes to enable the organization to leverage its buying power. 

Our past work showed that leading organizations that applied a strategic 

approach to their purchases of services found it necessary to develop new 

“spend analysis” information systems that could provide them with reliable 

data in a timely fashion. Spend analysis is a tool that answers basic 

questions about how much is being spent for what goods and services and 

helps to identify both buyers and suppliers, as well as opportunities to 

leverage buying, save money, and improve performance. 

Having the type of information discussed above would enable the Navy to 

perform spend analysis on the purchase and use of its telecommunication 

assets, which would provide the Navy with a complete picture of what is 

being spent on telecommunications—the cornerstone to identifying what 

8

U.S. General Accounting Office, Best Practices: Taking a Strategic Approach Could 

Improve DOD’s Acquisition of Services, GAO-02-230 (Washington, D.C.: January 2002); Best 

Practices: Improved Knowledge of DOD Service Contracts Could Reveal Significant 

Savings, GAO-03-661 (Washington, D.C.: June 2003); and Contract Management: High-Level 

Attention Needed to Transform DOD Services Acquisition, GAO-03-935 (Washington, D.C.: 

September 2003). 

Page 9 GAO-04-671 Navy Control Its Telecommunication Program 
can be done to improve the purchasing process and to leverage the Navy’s 

buying power. The task of gaining accurate visibility over spending will be 

difficult for the Navy given the lack of information systems available to 

provide spending data and the magnitude, breadth, and complexity of 

spending involved with multiple types and sources of telecommunication 

services. However, leading companies we studied that developed formal, 

centralized spend analysis programs found that they could overcome 

similar difficulties of piecing together incomplete and inaccurate data from 

various information systems through the use of key processes involving 

automating, extracting, supplementing, organizing, and analyzing data.

9 

Currently, the Navy lacks the needed information to perform effective 

cost/spend analysis. 

Recognizing that the best practices experiences of leading companies 

could help improve the cost effectiveness of DOD’s acquisition of services, 

Congress included10 provisions in the National Defense Authorization Act 

for Fiscal Year 200211 that require, among other things, that DOD establish 

an automated system to collect and analyze data to support management 

decisions in contracting for services. The provisions were intended to put 

DOD in a position to gain visibility over services contract spending and 

more effectively leverage its buying power, thus (1) improving the 

performance of its service contractors, (2) organizing its supplier base, and 

(3) achieving significant savings and ensuring that its dollars are used more 

effectively.

12 Although DOD is in the early stages of responding to these 

legislative requirements, DOD has a departmentwide spend analysis pilot 

underway and has called on agencies to embrace a strategic approach for 

acquiring services.13 Based on our assessment of the Navy’s payment and 

expenditure reporting systems, the Navy’s current process for acquiring 

telecommunication services is not strategic and its ability to use spend 

analysis to support a strategic approach is hampered by the lack of 

9

GAO-03-661. 

10S. Rep. No. 107-62, at 325-27 (2001); H.R. Conf. Rep. No. 107-333, at 687-88 (2001). 

11National Defense Authorization Act for Fiscal Year 2002, Pub. L. No. 107-107, §§ 801, 802, 

115 Stat. 1174-78 (December 28, 2001) (codified at 10 U.S.C. §§ 2330, 2330a, and 2331, and 

2330 Note). Congress expressed a preference for a single system to collect data on purchase 

of both services and information technology in excess of the simplified acquisition 

threshold. 10 U.S.C. § 2330a(c). 

12GAO-03-935. 

13GAO-03-661, GAO-03-935. 

Page 10 GAO-04-671 Navy Control Its Telecommunication Program 
centrally available and detailed telecommunications expenditure data. 

Because the Navy does not budget or account for telecommunication 

requirements separately from other nontelecommunication requirements, 

the Navy’s automated systems are not designed to track the cost associated 

with purchasing telecommunication services in total or by network or by 

type of service provided. Consequently, the Navy is unable to perform the 

kind of meaningful spend analysis envisioned by the act. 

The Navy has yet to take steps to perform the kind of meaningful spend 

analysis employed by leading companies to better manage its purchasing of 

telecommunication services. Much earlier, in 1991, DOD directed DISA to 

establish a central inventory of all long-haul telecommunication equipment 

and services and directed the heads of DOD components to establish and 

maintain an inventory of all base telecommunication equipment and 

services. However, we found in several instances that DISA’s long-haul 

database was incomplete and contained numerous errors and that the Navy 

had yet to establish a base communications database as directed. 

Specifically, we found that (1) the DISA database did not track long-haul 

equipment and services that were purchased outside of DISA channels, (2) 

networks and services were still reflected in the DISA database long after 

they had been discontinued, and (3) point of contact or ownership 

information often had not been updated in years. In addition, some of the 

Navy locations we audited did not maintain an accurate inventory of the 

number of calling cards and cell phones currently in use or maintain 

adequate records of to whom the cards and phones were issued. As 

discussed later, our case-study work at four Navy locations demonstrated 

that this lack of reliable inventory data combined with other breakdowns in 

basic controls creates a fertile environment for fraud, waste, and abuse. 

Navy Sites Lacked 

Controls Needed to 

Ensure Appropriate 

Oversight and Payment 

of Telecommunication 

Services 

Although DOD established a policy in 1991 requiring that DOD components 

biennially review and revalidate their local and long-distance 

telecommunication requirements, none of the four Navy locations we 

visited or DITCO Scott had established effective review and revalidation 

programs to ensure that they were not paying for capacity or services they 

no longer needed or they were not paying too much for the needed services 

used. In addition, the Navy did not have policies to ensure the cost-effective 

purchase and use of cell phone services. Consequently, we found that the 

four Navy sites we audited had established their own policies for the 

procurement and management of cellular services and equipment. These 

policies varied greatly, due to the differences in size, capability, and 

requirements of the cellular program at each site, which resulted in some of 

Page 11 GAO-04-671 Navy Control Its Telecommunication Program 
these sites paying more for these equipment and services than was 

necessary. Further, although DOD financial management regulations 

require proper receipt and acceptance of goods and services and the 

reconciliation of bills prior to payment, we found that the Navy activities 

we visited were improperly approving payments for telecommunication 

services without appropriate review. Failure to properly reconcile the bills 

has allowed payment to be made for inappropriate and irregular local and 

long-distance charges and has allowed the activities to improperly make 

overpayments and duplicate payment to telecommunication vendors. 

Finally, we found that the Navy does not have policies addressing the 

administration and management of calling cards. This has resulted in either 

inconsistent policies or a total lack of policies from one command to the 

next. Because of this lack of control, we identified several instances where 

the Navy had paid bills for calling card services that appeared to us to be 

potentially fraudulent or abusive, a situation that will likely be repeated 

unless changes are made. 

Navy Sites Were Not 

Performing Effective 

Review and Revalidation of 

Local and Long-Distance 

Requirements 

The review and revalidation process is important because it enables an 

activity to determine, based on empirical data, whether it is meeting its 

local and long-distance telecommunication needs in the most cost-effective 

means possible. According to DOD instructions14 this involves (1) assessing 

telecommunication traffic or usage to determine whether 

telecommunication services are still needed, (2) conducting market 

surveys to determine if current telecommunication contracts provide the 

most cost-effective solution for satisfying usage requirements, and 

(3) updating the appropriate inventory database to indicate that the 

requirement for the local and long-distance lines has been revalidated. It is 

particularly important that Navy personnel routinely review and revalidate 

their needs for the local and long-distance services they currently have and 

are paying for, and that they promptly cancel any unnecessary lines to 

avoid paying monthly usage fees for unneeded services. Activities are 

assessed fees for a line based either on the usage, a flat rate regardless of 

usage, or a combination of both. Therefore, if lines are not promptly 

canceled and if they have a monthly charge, the Navy will continue to 

receive and pay for these services indefinitely until they are canceled. 

14Department of Defense Instruction 4640.14, Base and Long-Haul Telecommunications 

Equipment and Services, December 6, 1991, and Department of Defense Directive 4640.13, 

Management of Base and Long-Haul Telecommunications Equipment and Services, 

December 5, 1991. 

Page 12 GAO-04-671 Navy Control Its Telecommunication Program 
None of the Navy sites we visited or DITCO Scott had effectively 

implemented existing policies to perform all three of the review and 

revalidation procedures mentioned earlier. At NAVSEA Crane, officials had 

recently assessed their telecommunication traffic to determine whether the 

services for which they were currently contracted were still needed. 

However, they had not conducted a market survey and, therefore, had no 

assurance that they were meeting their telecommunication needs in the 

most economical way possible. Two other sites, NAVAIR Patuxent and 

SPAWAR Charleston, had assessed their telecommunication traffic and 

performed a market survey but had failed to update the database to reflect 

that they had taken the required actions. As mentioned previously, these 

failures undermine DISA’s ability to monitor and effectively manage the 

DISN program and to maintain the quality of the database. For example, 

according to DISA’s long-haul database, as of February 17, 2004, 

approximately 3,100 of the Navy’s 26,000 long-haul lines had either not been 

revalidated in over 2 years or had not been properly updated. Some of these 

records indicated that the lines had been past due for revalidation for 

decades—in one case since March 1969. According to agency officials, as a 

result of our review, both NAVAIR Patuxent and SPAWAR Charleston have 

implemented corrective actions to ensure that the appropriate inventory 

database is updated whenever they revalidate their local and long-distance 

lines. 

As shown in table 1, at two of the four sites, we identified 37 long-distance 

lines that had not been reviewed and revalidated in over 2 years. When we 

asked the appropriate Navy personnel to review these 37 long-distance 

lines to determine if they were still needed, they found that 8 of the 37 lines 

for which they had been paying a total monthly usage fee of $4,969 were no 

longer needed. We relied on the accuracy of their responses and did not 

perform an independent review to determine their validity. 

Page 13 GAO-04-671 Navy Control Its Telecommunication Program 
Table 1: Status of Review of Long-Haul Lines at Selected Navy Sites 

Number of lines the Monthly 

Number of lines Navy determined charges for 

reviewed within should be unneeded 

Unit 2-year period disconnected lines 

SPAWAR 60 of 84 0 N/A 

Charleston 

NAVAIR Patuxent 136 of 136 N/A N/A 

NAVSEA Crane 20 of 20 N/A N/A 

CINCLANFLT 12 of 25 8 $4,969 

Norfolk 

Total 228 of 265 (37 lines 8 $4,969 

had not been reviewed 

in over 2 years) 

Source: GAO’s calculation using DISA’s long-haul database. 

Subsequent to our inquiry, Navy officials told us that the 8 lines shown in 

table 1 have now been disconnected. For these 8 lines, they were unable to 

quantify the total unnecessary cost that had been incurred to operate them 

because they were unable to determine exactly how long the lines had been 

operating without a valid need. To further demonstrate the risk of not 

promptly reviewing and revalidating existing lines, DITCO Scott officials 

were able to tell us that 4 of their 18 past-due lines for revalidation should 

have been discontinued in fiscal year 2000 or 2001. Instead, they continued 

to incur and pay monthly charges of $917 for 3 of these lines for about 3 

years—incurring about $36,000 in unnecessary charges—until we raised 

the issue in fiscal year 2003 and the lines were discontinued. For the fourth 

line, DITCO was unable to quantify the cost for unnecessary usage. 

Similarly, two of the four Navy sites we audited had not reviewed or 

revalidated their base communication networks as required; however, the 

immediate financial impact of not doing so is not as evident. Base 

telecommunication networks are the equipment or services used to 

support the transmission of data within the confines of an installation. 

According to a Navy official, because a unit is not charged specifically for 

individual base communication lines, there are no unit cost savings 

associated with the deletion of a few unused individual lines. However, 

over time, the number of unused lines may become significant enough to 

warrant resizing a unit’s base communication network. For this reason, it is 

important that the Navy also implement an effective review and 

revalidation program for its base as well as its long-distance 

Page 14 GAO-04-671 Navy Control Its Telecommunication Program 
telecommunications. When we asked Navy officials at the two sites why 

they were not routinely reviewing and revalidating their 

telecommunication needs, we found that they were not aware of the 

requirement or did not see it as a top priority. The remaining two locations, 

NAVSEA Crane and NAVAIR Patuxent, had reviewed and revalidated their 

base communication network as required. 

The Navy Lacked Policies 

for the Cost-Effective 

Purchase and Usage of Cell 

Phone Services 

The Navy’s use of cell phones has increased dramatically in recent years, 

allowing Navy personnel to make official calls when other alternatives are 

unavailable or uneconomical. In 1997, on the basis of a recommendation of 

the Naval Audit Service, NCTC, in conjunction with the Chief of Navy 

Operations, agreed to develop and issue specific guidelines and procedures 

relating to acquisition, accountability, and use of cellular phones. However, 

at the time we did our work for this assignment, neither DOD nor the Navy 

had taken the required actions to establish comprehensive policies or 

guidance governing the purchase and use of cell phone services, including 

guidance on (1) using prenegotiated or centrally negotiated rates or (2) 

requiring periodic assessment of cell phone usage to determine if plan 

packages provide the most cost-effective means to satisfy its usage 

requirements. Consequently, three of the four sites we audited were either 

paying retail prices for their cell phones when lower prenegotiated rates 

were available or were paying too much for cell phone services because 

they were not monitoring the use and thus had no basis for aligning the 

contracts with expected use. 

In the absence of DOD- and Navy-wide policies and procedures for the 

purchase of cell phones, individual Navy units have had to develop their 

own approaches for the procurement and management of cellular services 

and equipment. While three of the four sites we visited made a concerted 

effort to either (1) purchase cell phones at the GSA-negotiated rate— 

currently 12 percent discount off retail—or (2) establish their own 

negotiated contract with local cellular service providers, the remaining 

location, NAVSEA Crane, did neither. Instead, at NAVSEA Crane, 

individuals responsible for the procurement as well as cell phone users 

themselves bought their cell phones directly from retail sources using their 

purchase cards. As a result, NAVSEA Crane in some instances was paying a 

higher rate for cell phones—12 percent higher—than that established by 

GSA and in some cases paying taxes that should not be paid by government 

entities. 

Page 15 GAO-04-671 Navy Control Its Telecommunication Program 
In contrast, CINCLANFLT Norfolk negotiated a contract with one vendor 

using a shared minute plan, which allows multiple individuals to be on the 

same plan using an allocated number of minutes. The advantage of this 

plan is that if one individual goes over his or her allocated number of 

minutes and another individual uses fewer than his or her allotted number 

of minutes, charges for additional usage are not incurred. As a result of this 

plan, excess minutes were eliminated and CINCLANFLT Norfolk’s monthly 

access charges were reduced from $45.65 to $33.19. To take it one step 

further, the NAVAIR Command was able to achieve a large saving for all 

seven of its subcommands because it leveraged its buying power as a 

command to negotiate a better deal with a single service provider. Under 

this contract, NAVAIR Patuxent, a participating subcommand, received a 23 

percent discount off retail—almost twice the amount of the GSAnegotiated discount rate—and free standard cell phones. NAVAIR 

Command was able to negotiate such a favorable contract because it had 

the information it needed on its cell phone users, allowing it to negotiate 

with different local vendors and select the vendor with the best rate. This 

information included such factors as the number of cell phone users, the 

total number of plan minutes used, and the amount spent annually for cell 

phone equipment and services. As a result of the negotiated contract, 

NAVAIR Patuxent estimated that it saved approximately $110,000 in fiscal 

year 2003 and projects that it will save over $200,000 in fiscal year 2004 for 

its cell phone services and equipment requirements. The differences in the 

three procurement methods illustrated show that even on a small level, 

information consolidation and centralization is the foundation for 

implementing cost-effective methods for procuring cell phones and related 

services. Realizing this, NAVSEA Crane is currently developing a 

centralized procurement contract with a local vendor. 

In addition, three of the four Navy locations we audited paid too much for 

cell phone services because they were not monitoring individual plan 

usage. As shown in table 2, we identified selected cases at three of the four 

sites we audited where cell phone users were either (1) consistently 

exceeding their monthly allotment of minutes, thus incurring excessive 

charges for extra minutes (overutilization); or (2) consistently using only a 

small portion of their allotted minutes, thus incurring high charges per 

minute actually used because they contracted for substantially more 

minutes than needed (underutilization). At the fourth location, as 

previously mentioned, CINCLANFLT Norfolk negotiated a contract with 

one vendor using the shared minute plan, which allows multiple individuals 

to be on the same plan using an allocated amount of minutes—eliminating 

their charges for over- and underutilization of cellular plans. 

Page 16 GAO-04-671 Navy Control Its Telecommunication Program 
Table 2: Summary of Under- and Overutilization of Cellular Plans 

Number of plans Number of Plans 

Number of overutilized in fiscal underutilized in fiscal Percentage of over- or 

Units plans tested year 2002 year 2002 underutilized plans 

SPAWAR Charleston 54 12 4 30% 

NAVAIR Patuxent 14 3 3 43% 

NAVSEA Crane 28 0 5 18% 

CINCLANFLT Norfolk N/A N/A N/A N/A 

Total 96 15 12 28% 

Source: GAO’s calculation using unit-provided data. 

Note: Overutilized: Individuals who exceeded their plans 5 months or more in a year. 

Underutilized: Individuals who consistently used less than 30 percent of their plan for the year. 

Overutilization of cellular plans can result in considerable additional costs 

to the government. We found that management personnel at these sites 

were not routinely comparing cell phone plans and usage to identify 

possible savings. For example, we found at one unit listed in table 2 that for 

some cellular plans, excess minute charges ranged from 20 to 35 cents per 

minute. This is more than twice the cost of the plans’ allowable per minute 

charges, which ranged from 7 to 15 cents per minute. For the 15 

overutilized plans, these two sites incurred over $34,000 in excess minute 

charges in fiscal year 2002. Officials at NAVAIR Patuxent, concerned over 

our finding regarding the overutilization of cellular plans at their site, 

implemented a quarterly review process where they monitor cell phone 

usage with respect to allotted minutes and modify individual cell phone 

plans to achieve maximum cost effectiveness. According to these officials, 

for the first quarter of fiscal year 2004, NAVAIR Patuxent saw a reduction of 

39 percent in its excess minute costs. Similarly, SPAWAR Charleston is in 

the process of negotiating a contract with a vendor for shared pool minutes 

to reduce its excess minute costs. 

While the monetary impact of underutilizing cell phone minutes is not as 

significant as consistently exceeding plan minutes, at one site in 

particular—NAVSEA Crane—using data-mining techniques15 on vendor 

invoices, we found instances where cell phone users were paying $95 per 

month for service plans in which they were using less than an average of 2 

15Data mining involved the manual or electronic sorting of vendor invoice data to identify 

and select for further follow-up and analysis transactions with unusual or questionable 

characteristics. 

Page 17 GAO-04-671 Navy Control Its Telecommunication Program 
percent of their allotted monthly minutes for fiscal year 2002. As shown in 

table 3, the average cost per minute on these underutilized cell phone plans 

was extremely high. 

Table 3: Examples of Users Underutilizing Plan Package Minutes 

Number of months Average monthly Average cost per 

plans were Plan monthly minute usage for fiscal minute (rounded to the 

underutilized Cost of plan allowed minutes year 2002 nearest dollar) 

$95.00 650 1.23 minutes $76.00 

$95.00 650 22.17 minutes $4.00 

$95.00 650 9.1 minutes $10.00 

Source: GAO calculation using units’ vendor invoices for fiscal year 2002. 

When we saw similar issues at SPAWAR Charleston, officials reviewed the 

usage requirements for 71 of their 1,900 cell phone users and determined 

that these users had either significant over- or underutilization. They 

further determined that they could save over $59,000 annually on these 71 

plans alone if they changed the individual users to plans that more 

accurately matched their actual usage. According to these officials, they 

intended to review the remaining plans to achieve additional savings. 

Vendor Payments Approved 

Without Appropriate Review 

None of the four sites we audited had consistently implemented 

procedures that complied with DOD policies regarding reconciliation of 

telecommunication invoices. DOD regulations16 require that payments on 

invoices be supported by documentation that reflects the receipt of 

services and goods and that those goods and services conform to the 

contractual requirements. These documents must be reconciled prior to 

payment unless special circumstances warrant otherwise. For 

telecommunication, this reconciliation process involves reviewing 

telecommunication invoices and reconciling invoice charges with an 

accurate inventory of telecommunication lines, circuits, networks, and 

services currently in operation and verifying that the billing rates used to 

calculate the charges are valid. However, we found that two of the Navy 

sites we audited had few or no controls in place, while the other two sites 

16DOD 7000.14-R, Financial Management Regulation, Volume 10, Chapter 1, March 2002, and 

Chapters 7-9, February 1996. 

Page 18 GAO-04-671 Navy Control Its Telecommunication Program 

12 

12 

10 
were not consistently implementing their established controls to review 

vendor invoices prior to certification of payment. Consequently, approving 

officials at these sites failed to detect inappropriate and irregular 

telecommunication charges, which allowed overpayments and duplicate 

payments to be made to vendors. 

Two of the four sites we audited had few or no controls in place to review 

and reconcile vendor invoices prior to certification of payment. At NAVSEA 

Crane, we reviewed the payment information for fiscal year 2002 and the 

first 6 months of fiscal year 2003 and found that officials reviewed the total 

amount billed per invoice and did not review specific charges to determine 

whether the charges were valid. Consequently, NAVSEA Crane paid almost 

$1,700 in vendor-assessed late fees. According to agency officials, only 

DFAS can approve late fees for past due Navy payments, and therefore 

NAVSEA Crane failed to ensure that any review of late fees was completed 

prior to payment. The other site, CINCLANFLT Norfolk, which procured its 

local and long-distance services via NCTAMS, had its invoices certified for 

payment by NCTAMS for more than 1 year without proper review. This 

occurred because CINCLANFLT Norfolk had not received billing 

information from NCTAMS that would allow it to review and reconcile its 

detailed charges with the services currently in operation. 

According to NCTAMS officials, billing information, such as service 

charges and long-distance call details, is e-mailed to the respective units’ 

contact point using the same e-mail address used by the vendor. However, 

NCTAMS officials did not confirm that the units were receiving the billing 

information or if the e-mail address was correct. Instead, these officials 

stated that they assumed the billing information was correct unless they 

were contacted by the activity within 15 days. However, relying on negative 

assurance prevents these sites from properly reviewing and reconciling 

invoices in accordance with DOD policies. For example, at NCTAMS, we 

found 52 long-distance calls on a July 2003 invoice that were 24 hours or 

over in length. These calls included 4-day, 10-day, and 12-day phone calls, 

which all originated from different phone numbers at different times. The 

length of these calls alone should have prompted further investigation but, 

because the invoice was never properly reviewed, the billing errors went 

unnoticed until we called the issue to the attention of NCTAMS officials. As 

shown in table 4, we further investigated 10 of the 52 calls to determine 

what caused the apparent billing errors. In 7 of the 10 cases, NCTAMS 

officials who approved the invoices could neither provide us with an 

explanation for the length of the calls nor could they provide us with valid 

points of contact for the activities responsible for the calls. 

Page 19 GAO-04-671 Navy Control Its Telecommunication Program 
Table 4: Potentially Improper Long-Distance Calls Approved by NCTAMS Norfolk 

Destination of Total consecutive Total 

Date (2003) call minutes hours Cost of call Explanation provided by installation 

July 15 Richmond, Va. 18,282 304 $414 The lengthy duration of the call was due to a circuit 

malfunction. The installation asked the vendor for a 

refund after our inquiry. 

July 09 Richmond, Va. 6,201 103 $140 The lengthy duration of the call was due to a circuit 

malfunction. The installation asked the vendor for a 

refund after our inquiry. 

July 24 Elizabeth City, 6,338 106 $214 Navy official indicated that the call was valid and 

N.C. was made to provide support for testing research 

and development programs. 

July 15 Norfolk, Va. 14,648 244 $440 No explanation provided. 

July 25 Herndon, Va. 6 separate 4,269 71 $580 No explanations provided. 

minute calls 

Sources: GAO calculation using NCTAM-provided data. 

The other two sites, SPAWAR Charleston and NAVAIR Patuxent, had 

procedures in place to review and reconcile telecommunication invoices 

prior to payment, but these procedures were not consistently implemented. 

As a result, we found these reviewing officials had not detected irregular 

charges, which resulted in overpayments and duplicate payments being 

made to vendors. For example, at SPAWAR Charleston, officials paid $5,600 

over a 5-month period for services that had been discontinued. Further, we 

found that both SPAWAR Charleston and NAVAIR Patuxent had made 

duplicate payments on invoices because they did not follow the procedures 

in place to pay only the current charges on an invoice. Instead, on two 

occasions, these units paid the total balance due. As a result, officials at 

both of these two sites paid a total of $17,855 (SPAWAR, Charleston-­

$17,382 and NAVAIR Patuxent--$473) in duplicate payments for prior 

months’ charges, which had been previously paid. If SPAWAR Charleston 

and NAVAIR Patuxent had consistently followed their procedures for 

reviewing and reconciling telecommunication invoices, the overpayments 

would not have occurred. 

These examples illustrate the types of potential billing errors that 

telecommunication managers should be able to avoid with more detailed 

reviews of invoices. According to some Navy officials, reviewing and 

reconciling detailed telecommunication charges each month is timeconsuming and impractical given the number of telecommunication local 

and long-distance transactions occurring monthly. In addition, they stated 

that the rate structures used to calculate the invoice charges were often so 

Page 20 GAO-04-671 Navy Control Its Telecommunication Program 
complex that they were unable to determine how the final charges were 

calculated or whether they were, in fact, correct. 

Controls over Issuance and 

Use of Calling Cards Were 

Inadequate 

As part of their long-haul service contract provided through DISA, DOD 

components may also order and receive long-distance calling card services. 

Long-distance calling card charges are then billed, along with other longhaul services, on the components’ monthly invoices. According to an MCI 

official, each calling card with its respective PIN should be issued to and 

used only by one individual in order to assist in monitoring calling card 

usage. Additionally, calling cards should be tracked to determine who is 

accountable for each card’s usage, and invoices should be reviewed to 

detect and prevent unauthorized calling card use. However, some of the 

Navy sites we audited were unaware they owned calling cards. 

Furthermore, neither DOD nor the Navy had specific policies addressing 

the administration and management of calling cards. This lack of policies, 

combined with the ineffective controls over payments to 

telecommunication vendors, discussed previously, creates a fertile 

environment for fraud, waste, and abuse. 

To identify possible calling card misuse, we analyzed 3 months of the 

Navy’s calling card activity and used data-mining techniques to select seven 

calling card accounts from seven Navy activities that had either 

overlapping calls (two or more calls occurring at the same time with 

different originating numbers) or calls originating from different 

geographic locations at approximately the same time—using the same 

calling card number. Such cases would indicate calling cards that were 

being shared and/or compromised. As shown in table 5, five of the seven 

cards had been compromised. 

Page 21 GAO-04-671 Navy Control Its Telecommunication Program 
Table 5: Compromised Calling Cards at Selected Sites 

Unit’s response as a result of Calling card 

Description of suspicious calling the identified suspicious vendor (MCI) 

Unit card activity at selected sites Control breakdown activity actions 

NACTAMS On June 15, 2003, calls made from Not aware of calling card Based on our inquiry, unit None 

Norfolk Arkansas, Puerto Rico, and Ecuador Did not review invoices canceled 35 cards including 

within 2 hours of each other selected card in December 

2003 

NCTSSD On May 19, 2003, calls made from Not aware of calling card Based on our inquiry, unit MCI’s fraud 

Hawaii and Japan within 3 hours of Did not receive or review canceled 5 cards including detection unit 

each other invoices selected card in February 2004 suspended use of 

the card on July 26, 

2003, due to 

simultaneous usage 

MCB Camp On May 25, 2003, calls made from Not aware of calling card Based on our inquiry, unit MCI’s fraud 

Pendleton Florida and Virginia within hours Did not receive or review canceled 13 cards including detection unit 

from each other invoices selected card in September suspended use of 

2003 the card on July 7, 

2003, due to 

simultaneous usage 

USS Mitscher On May 17, 2003, calls occurred at Not aware of calling card Due to the vendor’s alert, unit As a result of MCI’s 

the same time from New York and Did not receive or review canceled calling card in July fraud detection unit 

Virginia invoices 2003 alert for suspected 

fraud use, unit 

cancelled the card 

on July 7, 2003 

NAVAIR On April 1, 2003, calls occurred at Unit identified control Unit conducted an investigation None 

Lakehurst the same time from New York and breakdown through review and determined that the card 

Puerto Rico of its vendor invoices and number had been stolen and 

determined that the card therefore canceled the card 

had been stolen 

Source: DISA/DITCO Columbus calling card transactional database from April through June 2003. 

When we contacted the Navy officials and account owners responsible for 

managing and reviewing telecommunication invoices, we found that for 

four of the five calling cards shown in table 5, they were unaware that their 

unit owned or used calling cards. Further, according to these officials, they 

had not receive detailed information on calling card charges from either the 

vendor or from NACTAMS and therefore did not know that they were 

paying for these charges. Consequently, these officials could not determine 

if the calling cards had been compromised because they did not know who 

had possession of the cards and many did not have documentation 

supporting the use of these cards for the time period in question. Also, 

NCTSSD and MCB Camp Pendleton were unaware that in July 2003 the 

vendor’s fraud detection unit had suspended the calling cards we reviewed. 

Page 22 GAO-04-671 Navy Control Its Telecommunication Program 
As a result of our review, NCTAMS Norfolk, NCTSSD, and MCB Camp 

Pendleton identified and cancelled a total of 52 calling cards, including the 

3 we selected, which they were unaware that they owned. However, neither 

MCI nor DISA was able to tell us how many dollars of charges had been 

made on these 52 calling cards since the cards had been activated. The 

remaining two units either canceled their card due to an MCI fraud alert as 

mentioned above or an internal investigation. 

Although the account owners for the two remaining calling card accounts 

we audited were aware that their unit owned and used calling cards, they 

did not have policies restricting the sharing of the cards. In many cases, 

card users within the same units shared the same calling cards and PIN. 

For example, at NAVAIR Patuxent, officials told us that they believed the 

selected card’s transactions were due to shared use and as a result of our 

review have changed their local calling card policies to prevent the sharing 

of calling cards in the future and to hold individuals accountable if 

unauthorized usage is found. At BCO Philadelphia, agency officials told us 

that the cards were shared because the unit’s cell phones were down. 

However, after the cell phones were reactivated, the sharing of calling 

cards was discontinued. As a result of the sharing of calling cards, officials 

at both of these locations could not subsequently determine whether these 

two calling cards were used for legitimate business reasons and whether all 

the charges were accurate. Further, because these cards were shared and 

thus the numbers compromised, these officials could not identify the 

responsible party for the questionable calls. 

Overall, these seven units lacked effective management oversight and 

adequate internal controls, which left them vulnerable to potential 

fraudulent and abusive calling card transactions. For example, an official at 

the USS Mitscher said that he routinely provided the same card number and 

PIN to several of his officers, as needed, but he did not know how many 

officers he had given the numbers to or how many currently had possession 

of the numbers. For this one card alone, between April and June of 2003, 

the Navy paid over $17,000 in long-distance charges. However, because no 

one was monitoring the activity on this card regularly, the unit was 

unaware of the excessive charges. Instead, it was not until the vendor’s 

fraud unit raised questions about more than $11,000 in charges during the 

first 6 days of July 2003 that the card was suspended. As shown in figure 1, 

on July 6, 2003, the card had 189 calls that originated from 12 different 

cities in five different states and Canada to 12 different countries for a total 

of over $5,000. In this 24-hour period, the card incurred over 55 hours of 

calling card charges. 

Page 23 GAO-04-671 Navy Control Its Telecommunication Program 
Page 24 GAO-04-671 Navy Control Its Telecommunication Program

Figure 1: otential Fraudulent Use of a Comprised Card

Denver, CO

8 calls coming

from 1 number

Ontario, Canada

Toronto, ON - 10 calls

coming from 2 numbers

Stratford, ON - 6 calls

coming from 1 number

Kitchner, ON - 2 calls

coming from 1 number

Hamilton, ON - 7 calls

coming from 2 numbers

New York City, NY

25 calls coming

from 15 numbers

Norfolk, VA

1 call coming

from 1 number

Atlanta, GA

5 calls coming

from 1 number

Coral Springs, FL

1 call coming

from 1 number

Albany, NY

20 calls coming

from 4 numbers

Call

origins

Call

destinations

Africa: Ghana,

Togo, Benin,

Nigeria,

Cameroon,

Congo, Zaire,

Angola

Europe: France,

Belgium, Germany

Canada:

Ontario

United States: New York, New

Jersey, Nebraska, Maryland,

Massachusetts

Quebec, Canada

Montreal, QC - 86 calls

coming from 12 numbers

Verdun, QC - 7 calls

coming from 1 number

Unknown, QC - 11 calls

coming from 1 number

Source: GAO.

Conclusion The lack of management oversight and accountability combined with

inadequate internal controls over payments to telecommunication vendors

has created an environment that is vulnerable to fraud, waste, and abuse. 

Until the Navy enforces existing policies related to maintaining accurate 

inventory data and designs automated systems capable of tracking cost

data, the Navy has no assurance that telecommunication goods and 

services are purchased in the most cost-effective way possible. Further, the 

failure of the units we audited to follow existing policies related to

reviewing and revalidating telecommunication requirements and 

performing adequate receipt and acceptance procedures puts these units at

risk of making payments for erroneous or improper telecommunication 

charges. Finally, although we performed audit work only at selected units, 

the Navy’s lack of comprehensive policies and guidance governing the 

purchase, issuance, and use of cell phone and calling card services 

P
increases the likelihood that the problems we identified at these units may 

exist elsewhere within the Navy. 

Recommendations for 

Executive Action 

To improve the Navy’s management oversight of its telecommunication 

program, we recommend that the Secretary of the Navy take eight 

corrective actions and the CNO take three corrective actions. 

We recommend that the Secretary of the Navy direct the CNO to ensure 

that existing policies are enforced. Specifically, the CNO should ensure that 

the Navy: 

•	 develops and maintains a comprehensive inventory of the Navy’s base 

telecommunication equipment and services; 

•	 supports DISA efforts to track acquisitions of telecommunication 

services throughout DOD, actual costs of those services, and trends in 

usage (that is, the volume and types of traffic that networks carry). 

We further recommend that the Secretary of the Navy direct the CNO to 

establish comprehensive policies and guidance governing the purchase and 

use of: 

•	 cell phone services, which should include (1) the use of prenegotiated or 

centrally negotiated rates and (2) periodic assessment of cell phone 

usage to determine if plan packages provide the most cost-effective 

means to satisfy the Navy’s usage requirements; and 

•	 calling card services, which should include policies about 

accountability, the proper review of invoices, and the prohibition of 

sharing of calling cards. 

To strengthen the Navy’s ability to acquire telecommunication services 

effectively and efficiently, we recommend that the Secretary of the Navy 

direct the CNO to develop, in coordination with the Navy commands, a 

strategic management framework for improving the acquisition of 

telecommunication services. This framework should include provisions for 

•	 inventorying current and potential users of telecommunication services 

to determine existing and future requirements; 

Page 25 GAO-04-671 Navy Control Its Telecommunication Program 
•	 identifying and exploiting opportunities to consolidate requirements 

among Navy commands; and 

•	 adopting, when appropriate, commonly used commercial practices, 

such as conducting spend analyses and competing and negotiating 

pricing discounts based on overall Navy volume, to strengthen the 

Navy’s bargaining position in acquiring telecommunication services. 

To ensure the successful implementation of this strategic management 

framework and to better leverage Navy buying power, we recommend that 

the Secretary of the Navy direct the CNO to strengthen analysis of 

telecommunication service requirements, spending, and the capabilities of 

telecommunication service providers by enhancing core internal technical 

expertise and information systems. 

At the selected units that we audited, we recommend that the CNO direct 

the commanders to provide assurance that existing policies are enforced 

and fully evaluate the internal controls over the 

• review and revalidation of telecommunication requirements, 

•	 reconciliation of telecommunication invoices with a current inventory 

of telecommunication equipment and services, and 

•	 distribution and use of calling cards and cancellation of cards that are 

not properly controlled. 

Agency Comments and 

Our Evaluation 

DOD provided written comments on a draft of this report, which are 

reprinted in appendix II. 

DOD concurred with 9 of our 11 recommendations and partially concurred 

with the remaining 2 recommendations. These latter recommendations 

were that the Navy (1) support DISA efforts to track acquisitions of 

telecommunication services, the actual cost of those services, and trends in 

usage of telecommunication services throughout DOD; and (2) strengthen 

the analysis of telecommunication services requirements, spending, and 

the capabilities of telecommunication service providers by enhancing core 

internal technical expertise and information systems. Although the Navy 

said it plans to take actions on these 2 recommendations, it was unclear 

whether these planned actions will satisfy our recommendations. The 

Page 26 GAO-04-671 Navy Control Its Telecommunication Program 
department also provided technical comments, which we have 

incorporated in the report as appropriate. 

Concerning Navy support of DISA efforts to track acquisition of 

telecommunication services throughout DOD, the actual costs of those 

services, and trends in usage, DOD responded that the Secretary of the 

Navy will direct cognizant senior Department of the Navy officials to 

support DISA tracking efforts to the maximum extent practicable. Such 

measures are an important aspect of the management of 

telecommunication programs and appear to be responsive to our 

recommendation. However, since we are uncertain of the meaning of 

“maximum extent practicable”, we cannot evaluate the extent to which 

DOD plans to implement this recommendation. We continue to strongly 

encourage the Navy to track all acquisitions of telecommunication 

equipment and services in order to enable it, in conjunction with DISA, to 

successfully develop an enterprisewide governance process for 

telecommunication, meet DOD expectations for major management 

reform, and obtain the maximum savings in its procurement services. 

Regarding the Navy enhancing core internal technical expertise and 

information systems, DOD stated that requirements would be analyzed and 

considered as part of DOD’s efforts to develop a management framework 

for improving the efficiency of the Navy’s acquisition and use of 

telecommunication services. Although it appears the DOD’s response may 

address the intent of this recommendation, the extent of its efforts is 

unclear. We continue to believe that the Navy could benefit from a 

strengthened analysis of its telecommunication service requirements, 

spending, and the capabilities of its service providers, which could be aided 

by enhancing its core technical expertise and information systems. 

As agreed with your office, unless you announce the contents of this report 

earlier, we will not distribute it until 30 days from its issuance date. At that 

time, we will send copies of this report to other interested congressional 

committees, the Secretary of the Navy, the Chief of Naval Operations, and 

the Assistant Secretary for Financial Management (Comptroller) for the 

Navy. Copies will be made available to others upon request. 

Page 27 GAO-04-671 Navy Control Its Telecommunication Program 
Please contact me at (202) 512-9505 or kutzg@gao.gov if you or your staffs


have any questions about this report. Other GAO contacts and key 


contributors to this report are listed in appendix III.


Sincerely yours,


Gregory D. Kutz


Director


Financial Management and Assurance


Page 28 GAO-04-671 Navy Control Its Telecommunication Program 
Appendix I 

Objectives, Scope, and Methodology


We reviewed selected aspects of DOD’s and the Navy’s management of their 

telecommunication programs. We modified the scope of our work, in 

process, because in some cases the information needed to perform 

comprehensive analyses was lacking and in other cases the data were so 

fragmented that they could not be analyzed in the aggregate. Thus, in many 

cases, we had to rely on case studies and nonrepresentative selections of 

transactions to illustrate the internal control problems we identified. 

This assignment originated because of congressional concerns that DOD’s 

vendor pay process, which accounted for approximately $112 billion in 

fiscal year 2003, might suffer from many of the same types of pervasive 

problems that we uncovered during our previous work on DOD’s purchase 

card program. Specifically, we were asked to evaluate the effectiveness of 

DOD’s management oversight and controls of payments to its vendors. 

Initially, we intended to assess DOD’s oversight and controls over vendor 

purchases and payments for telecommunication goods and services— 

including local and long-distance services, calling cards, and cellular phone 

services. However, because it was not feasible to provide a comprehensive 

assessment of the adequacy of all 17 of DOD’s vendor payment systems or 

the multitude of varying controls and processes over the 

telecommunication purchases and processes that we encountered, we 

subsequently focused our effort primarily on the Navy. Then, because the 

Navy was unable to provide us with a complete population of 

telecommunication expenditures from which to perform statistical 

sampling and testing of transactions, we used a case-study approach to 

assess the adequacy of management oversight and internal controls. This 

lack of information with which to do statistical sampling and testing 

applied at all levels, including the unit level. Even at the case study 

locations selected, we were unable to perform statistical testing because 

the local databases were often incomplete, or they had insufficient, 

inconsistent, or inaccurate data. Because of this, we evaluated the design 

of controls in place and relied on nonrepresentative selections to evaluate 

the effectiveness of the case study locations’ internal controls of their 

telecommunication programs. Consequently, we were unable to gauge the 

extent of the problem from a DOD, Navy, or even unit perspective. 

Our objectives were to determine (1) whether the Navy has the basic cost 

and inventory information needed to oversee and manage its purchases 

from telecommunication vendors and (2) whether selected Navy sites have 

adequate controls to provide reasonable assurance that telecommunication 

goods and services are purchased cost effectively and payments are made 

only for valid telecommunication charges. We reviewed current DOD and 

Page 29 GAO-04-671 Navy Control Its Telecommunication Program 
Appendix I


Objectives, Scope, and Methodology


Navy guidance contained in applicable regulations, directives, instructions, 

or other guidance concerning the procurement, management, and use of 

common-user networks. We also reviewed our own prior reports as well as 

prior DOD Inspector General and other DOD military audit services’ 

reports. We met and had numerous discussions with officials from DISA— 

DOD’s major telecommunication manager—and at DITCO Scott, the 

primary contracting organization in DISA. 

To determine whether the Navy’s controls of expenditures are adequate to 

provide reasonable assurance that telecommunication goods and services 

are purchased cost effectively and that payments are made only for valid 

transactions, we audited the effectiveness of the Navy’s internal controls 

over its fiscal year 2002 telecommunication transactions at selected sites. 

Because the Navy lacked a consolidated source for telecommunication 

data, we were unable to obtain complete and accurate information for 

telecommunication disbursements Navy-wide. Instead, we identified the 

approximate amount spent by the Navy on telecommunications for fiscal 

year 2002 by manually identifying known telecommunication vendors and 

matching this list against the information contained in the Standard 

Accounting and Reporting System (STARS), the Financial Accounting 

Budget System (FABS), and the purchase card accounting database. 

Using these three databases, we were able to determine that the Navy paid 

at least $271 million to telecommunication vendors in 2002. Because the 

STARS database contained the highest dollar amount of 

telecommunication payments, we summarized the STARS payments by the 

Authorized Accounting Activity (AAA) code to identify the organizations 

having responsibility for providing the funding for the payments. However, 

these accounting organizations were not necessarily the users of the goods 

and services for which they made payments. Using the information 

developed from this methodology, we identified the four major commands 

having the largest telecommunication payments in 2002. They were the 

Space and Naval Warfare Systems Command (SPAWAR), the Naval 

Network and Space Operations Command (NNSOC),

1 the Naval Air 

Systems Command (NAVAIR), and the Naval Sea Systems Command 

1

To get to the user level at NNSOC, we visited Naval Computer and Telecommunications 

Area Master Station Atlantic-Virginia (NCTAMSLANT). We obtained a list of member 

activities within the command, which NCTAMSLANT has responsibility for making 

payments for telecommunication services and equipment. From this list we chose to do 

further work at the Commander-in-Chief US Atlantic Fleet (CINCLANTFLT), primarily 

based on the variety of telecommunication services being paid for. 

Page 30 GAO-04-671 Navy Control Its Telecommunication Program 
Appendix I


Objectives, Scope, and Methodology


(NAVSEA). We then selected one activity (or subactivity, if necessary) 

within each command at which to do further detailed work. Using our 

methodology, the four major commands selected accounted for about $114 

million of the Navy’s total $271 million in telecommunication payments, or 

42 percent of fiscal year 2002 Navy telecommunication payments. (These 

amounts may include tactical and nontactical telecommunication.) The 

four activities selected accounted for $63 million of the $114 million (55 

percent) of the total for the four commands. 

Table 6: Major Commands and Units Selected for Review 

Dollars in millions 

Total fiscal year 

Total fiscal year 2002 2002 

Major telecommunication telecommunication 

command disbursements Selected unit disbursements 

SPAWAR $24 SPAWAR Charleston $13 

NAVAIR 20 NAVAIR Patuxent 

NAVSEA 21 NSWC Crane 

NNSOC 49 NCTAMSLANT 32a 

(including 

CINCLANTFLT Norfolk) 

Total $114 $63 

Source: GAO calculations of the Navy’s fiscal year 2002 vendor pay systems. 

a NCTAMSLANT fiscal year 2002 disbursement included $243,000 for CINCLANFLT Norfolk. 

At the four navy activities, we used a case study approach. At the sites, we 

obtained and reviewed information from directives, policies, and 

procedures governing their telecommunication programs. We evaluated the 

documentation provided and had numerous meetings and follow-up 

discussions with personnel responsible for various aspects of the 

telecommunication programs at the sites we visited as well as at remote 

locations, if applicable. 

To assess the overall control environment governing telecommunications 

to determine if it provides reasonable assurance that telecommunication 

goods and services are purchased and paid for cost effectively, the primary 

criteria we used were applicable laws and regulations; our Standards for 

Internal Control in Federal Government (GAO/AIMD-00-21.3.1, November 

1999); and our Internal Control Standards: Internal Control Management 

and Evaluation Tool (GAO-01-1008G, August 2001). To assess the 

Page 31 GAO-04-671 Navy Control Its Telecommunication Program 

14 

4 
Appendix I


Objectives, Scope, and Methodology


management control environment, we evaluated DOD and Navy 

management practices using the fundamental concepts and standards 

contained in GAO’s Internal Control Standards. To test the 

implementation of key control activities during fiscal year 2002 at the four 

installations we audited, we performed the following detailed testing. 

•	 Base Communications—At each site visited, we obtained a database 

or list of base (local service) circuits. For each base circuit, we 

requested information such as the installation date, the validation date, 

the service end date, and the discontinue date (if applicable), the 

physical location of the circuit (building), the responsible point of 

contact and organization, the vendor, and billing information for fiscal 

year 2002 and the first 6 months of fiscal year 2003. From each local 

database, we selected nonrepresentative selections of base circuits to 

test for compliance with DOD, Navy, and local policies. For each 

selected transaction, we compared the total number of circuits and total 

disbursements for selected months in order to perform a reconciliation 

of the invoice totals. For months in which the totals did not agree, we 

analyzed detailed information in the reconciliation and invoices to test 

for (1) inaccuracy of data, (2) payment for items not currently owned or 

being used, (3) differences in invoice amounts versus reconciliation and 

database amounts, and (4) payments for excess lines. We also analyzed 

invoices after circuits had been discontinued to determine whether the 

vendor was still charging for disconnected circuits, and we analyzed 

selected invoices to determine if the vendor had assessed late fees and 

whether those late fees had been certified for payment by the selected 

case study sites. 

•	 Long-Haul Communications—Using the DISA2 database, we obtained 

a list of circuits with past due validation dates as of July 9, 2003, for the 

activities and major commands. We compared the long-haul inventory 

information in DISA’s database to the installation’s long-haul inventory 

information in order to determine (1) if long-haul circuits were being 

reviewed and revalidated every 2 years, as required by regulation; (2) 

the accuracy of DITCO’s long-haul inventory information; and (3) 

whether the installations had procured long-haul services or equipment 

without going through DITCO. We spoke with numerous agency officials 

2

DISA, through an organization located at Scott Air Force Base, Illinois, maintains DOD’s 

long-haul database. 

Page 32 GAO-04-671 Navy Control Its Telecommunication Program 
Appendix I


Objectives, Scope, and Methodology


on site and in follow-up discussions in order to try to resolve any 

discrepancies. 

•	 Cell Phones—Further, at three of the four case study sites,

3

 we 

determined if cell phones were monitored to detect significant over- or 

underuse of plan minutes and for compliance with DOD, Navy, and local 

policies. To determine if cell phones were being monitored for over- or 

underuse of plan minutes, we first obtained a list of cell phone users. 

Next, we obtained detailed monthly billing for each user selected for 

fiscal year 2002 and May 2003 and through data mining compared the 

monthly minutes used to cell plan minutes to identify if the cellular plan 

was being under- or over utilized. To test for compliance, we selected a 

nonrepresentative selection of cell phone transactions (request for 

service, authorization, receipt and acceptance, and payment) and 

compared the transactions against DOD, Navy, and local policies. 

•	 Calling Cards—We analyzed the DISA/DITCO Columbus calling card 

transactional database, which contained DOD’s calling card transactions 

from April through June 2003. However, due to the scope of our audit, 

we focused our review only on the Navy’s calling card transactions. 

Through data mining, we identified Navy calling card numbers that (1) 

had overlapping calls or calls from different geographical areas within 

an hour. From this population, we selected seven calling card accounts 

and spoke with officials from the following seven activities and the 

telecommunication vendor, MCI, to determine why there were 

overlapping calls or calls placed from different geographical areas. The 

seven activities were (1) NCTAMS Norfolk, (2) Base Communications 

Office (BCO) Philadelphia, (3) Naval Computer and Telecommunication 

Station San Diego (NCTSSD), (4) Marine Corps Base (MCB) Camp 

Pendleton, (5) USS Mitscher, (6) Naval Air Lakehurst, and (7) NAWCAD 

Patuxent. At these locations, we spoke with Navy officials and their 

telecommunications vendor, MCI, to determine why there were 

overlapping calls or calls placed from different geographical areas at 

almost the same time. 

We requested comments on a draft of this report from the Secretary of the 

Navy or his designee. DOD provided written comments, which are 

3

We were unable to perform any testing at CINCLANTFLT to determine if individuals were 

under- or overutilizing their plans because CINCLANTFLT uses the shared minute cellular 

plans. 

Page 33 GAO-04-671 Navy Control Its Telecommunication Program 
Appendix I


Objectives, Scope, and Methodology


presented and evaluated in the “Agency Comments and Our Evaluation” 

section and are reprinted in appendix II. We conducted our work from May 

2003 through February 2004 in accordance with generally accepted 

government auditing standards. 

Page 34 GAO-04-671 Navy Control Its Telecommunication Program 
Appendix II 

Comments from the Department of Defense


Page 35 GAO-04-671 Navy Control Its Telecommunication Program 
Appendix II


Comments from the Department of Defense


Page 36 GAO-04-671 Navy Control Its Telecommunication Program 
Appendix II


Comments from the Department of Defense


Page 37 GAO-04-671 Navy Control Its Telecommunication Program 
Appendix II


Comments from the Department of Defense


Page 38 GAO-04-671 Navy Control Its Telecommunication Program 
Appendix III 

GAO Contact and Staff Acknowledgments


GAO Contact	 Diane Handley, (404) 679-1986 

Rathi Bose, (404) 679-1996 

Acknowledgments	 In addition to those named above, Art Brouk, Michael Chambless, Francine 

DelVecchio, Johnny Clark, Carmen Harris, John Ledford, and John Ryan 

made key contributions to this report. 

(192097) Page 39 GAO-04-671 Navy Control Its Telecommunication Program 
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