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75–110 PDF 2012

NEW AUDIT FINDS PROBLEMS IN ARMY MILITARY 

PAY 

JOINT HEARING 

BEFORE THE

SUBCOMMITTEE ON GOVERNMENT ORGANIZATION, 

EFFICIENCY AND FINANCIAL MANAGEMENT 

OF THE

COMMITTEE ON OVERSIGHT AND 

GOVERNMENT REFORM 

HOUSE OF REPRESENTATIVES 

AND THE

SUBCOMMITTEE ON FEDERAL FINANCIAL 

MANAGEMENT, GOVERNMENT INFORMATION, 

FEDERAL SERVICES, AND INTERNATIONAL 

SECURITY 

OF THE

COMMITTEE ON HOMELAND SECURITY 

AND 

GOVERNMENTAL AFFAIRS 

U.S. SENATE 

ONE HUNDRED TWELFTH CONGRESS 

SECOND SESSION 

MARCH 22, 2012 

Serial No. 112–154 

Printed for the use of the Committees on Oversight and Government Reform 

( 

Available via the World Wide Web: http://www.fdsys.gov 

http://www.house.gov/reform 

(II) 

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM 

DARRELL E. ISSA, California, Chairman 

DAN BURTON, Indiana 

JOHN L. MICA, Florida 

TODD RUSSELL PLATTS, Pennsylvania 

MICHAEL R. TURNER, Ohio 

PATRICK T. MCHENRY, North Carolina 

JIM JORDAN, Ohio 

JASON CHAFFETZ, Utah 

CONNIE MACK, Florida 

TIM WALBERG, Michigan 

JAMES LANKFORD, Oklahoma 

JUSTIN AMASH, Michigan 

ANN MARIE BUERKLE, New York 

PAUL A. GOSAR, Arizona 

RAU ́ L R. LABRADOR, Idaho 

PATRICK MEEHAN, Pennsylvania 

SCOTT DESJARLAIS, Tennessee 

JOE WALSH, Illinois 

TREY GOWDY, South Carolina 

DENNIS A. ROSS, Florida 

FRANK C. GUINTA, New Hampshire 

BLAKE FARENTHOLD, Texas 

MIKE KELLY, Pennsylvania 

ELIJAH E. CUMMINGS, Maryland, Ranking 

Minority Member 

EDOLPHUS TOWNS, New York 

CAROLYN B. MALONEY, New York 

ELEANOR HOLMES NORTON, District of 

Columbia 

DENNIS J. KUCINICH, Ohio 

JOHN F. TIERNEY, Massachusetts 

WM. LACY CLAY, Missouri 

STEPHEN F. LYNCH, Massachusetts 

JIM COOPER, Tennessee 

GERALD E. CONNOLLY, Virginia 

MIKE QUIGLEY, Illinois 

DANNY K. DAVIS, Illinois 

BRUCE L. BRALEY, Iowa 

PETER WELCH, Vermont 

JOHN A. YARMUTH, Kentucky 

CHRISTOPHER S. MURPHY, Connecticut 

JACKIE SPEIER, California 

LAWRENCE J. BRADY, Staff Director 

JOHN D. CUADERES, Deputy Staff Director 

ROBERT BORDEN, General Counsel 

LINDA A. GOOD, Chief Clerk 

DAVID RAPALLO, Minority Staff Director 

SUBCOMMITTEE ON GOVERNMENT ORGANIZATION, EFFICIENCY AND FINANCIAL

MANAGEMENT

TODD RUSSELL PLATTS, Pennsylvania, Chairman 

CONNIE MACK, Florida, Vice Chairman 

JAMES LANKFORD, Oklahoma 

JUSTIN AMASH, Michigan 

PAUL A. GOSAR, Arizona 

FRANK C. GUINTA, New Hampshire 

BLAKE FARENTHOLD, Texas 

EDOLPHUS TOWNS, New York, Ranking 

Minority Member 

JIM COOPER, Tennessee 

GERALD E. CONNOLLY, Virginia 

ELEANOR HOLMES NORTON, District of 

Columbia 

SENATE SUBCOMMITTEE ON FEDERAL FINANCIAL MANAGEMENT, GOVERNMENT

INFORMATION, FEDERAL SERVICES, AND INTERNATIONAL SECURITY

THOMAS R. CARPER, Delaware, Chairman 

CARL LEVIN, Michigan 

DANIEL K. AKAKA, Hawaii 

MARK L. PRYOR, Arkansas 

CLAIRE MCCASKILL, Missouri 

MARK BEGICH, Alaska 

SCOTT P. BROWN, Massachusetts 

TOM COBURN, Oklahoma 

JOHN MCCAIN, Arizona 

RON JOHNSON, Wisconsin 

ROB PORTMAN, Ohio 

JOHN KILVINGTON, Staff Director 

WILLIAM WRIGHT, Minority Staff Director 

DEIRDRE G. ARMSTRONG, Chief Clerk 

(III) 

C O N T E N T S 

Page 

Hearing held on March 22, 2012 ............................................................................ 1 

WITNESSES 

Lieutenant Colonel Kirk Zecchini, U.S. Army Reserve 

Oral statement .................................................................................................. 5 

Written statement ............................................................................................ 7 

Mr. Asif Khan, Director, Financial Management and Assurance, U.S. Government Accountability Office 

Oral statement .................................................................................................. 16 

Written statement ............................................................................................ 18 

Mr. James Watkins, Director, Accountability and Audit Readiness, 

Deparment of the Army 

Oral statement .................................................................................................. 31 

Written statement ............................................................................................ 33 

Jeanne M. Brooks 

Oral statement .................................................................................................. 37 

Written statement ............................................................................................ 39 

Mr. Aaron Gillison, Acting Director, Defense Finance and Accounting Service, 

Indianapolis, Department of Defense 

Oral statement .................................................................................................. 41 

Written statement ............................................................................................ 43 

APPENDIX 

The Honorable Tom Carper, U.S. Senator from the State of Delaware, Opening Statement ....................................................................................................... 60 

The Honorable Scott Brown, U.S. Senator from the State of Massachusetts ..... 64 

The Honorable Edolphus Towns, a Member of Congress from the State of 

New York, Opening Statement ........................................................................... 66 

Follow up questions and answers ........................................................................... 68 

(1) 

NEW AUDIT FINDS PROBLEMS IN ARMY 

MILITARY PAY 

Thursday, March 22, 2012 

HOUSE OF REPRESENTATIVES, COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM, SUBCOMMITTEE ON GOVERNMENT ORGANIZATION, EFFICIENCY

AND FINANCIAL MANAGEMENT, JOINT WITH THE SENATE

SUBCOMMITTEE ON FEDERAL FINANCIAL MANAGEMENT, GOVERNMENT INFORMATION, FEDERAL SERVICES, AND

INTERNATIONAL SECURITY, Washington, D.C. 

The committees met, pursuant to notice, at 10:06 a.m. in room 

2154, Rayburn House Office Building, the Honorable Todd Platts 

[chairman of the House Subcommittee on Government Organization, Efficiency and Financial Management] presiding. 

Present: Representatives Platts, Issa, Towns and Connolly. 

Also present: Senator Carper. 

Staff Present: Kurt Bardella, Majority Senior Policy Advisor; 

Molly Boyl, Majority Parliamentarian; Linda Good, Majority Chief 

Clerk; Mark D. Marin, Majority Director of Oversight; Tegan 

Millspaw, Majority Research Analyst; Mary Pritchau, Majority Professional Staff Member; Rebecca Watkins, Majority Press Secretary; Jaron Bourke, Minority Director of Administration; Beverly 

Britton Fraser, Minority Counsel; Devon Hill, Minority Staff Assistant; Jennifer Hoffman, Minority Press Secretary; and Carla 

Hultberg, Minority Chief Clerk. 

Mr. PLATTS. We are pleased to also have the Chairman of our 

full committee, Mr. Issa, and our Ranking Member, Mr. Towns, 

with us. 

In the interest of time, I am going to submit my formal statement. 

I would highlight that our real focus here is really to achieve two 

purposes, how do we do a better job of doing right by our men and 

women in uniform and their families to make sure they are paid 

and compensated in an efficient, effective and accurate manner 

without the need for corrections after the fact repeatedly, as we 

will hear from our first witness what is, in some ways, described 

as just the norm for military personnel to expect problems with 

their pay. How do we do right by our men and women in uniform 

and their families in that regard? 

How do we better protect all American taxpayers that the funds 

they send here are efficiently handled and appropriately handled so 

that we do not have the misuse of funds or the inaccurate disbursement of funds? 

2 

We have two primary goals, do right by the military and their 

families, do right by American taxpayers and collectively through 

this hearing advance that joint effort in the coming months and 

years as we especially work towards the ability to audit the Department of Defense and all of its related entities by 2017. 

With that, I will yield to the Chairman of our Senate Subcommittee for the purpose of an opening statement. 

Senator CARPER. Thank you, Mr. Chairman. 

I would ask unanimous consent that my full statement be made 

a part of the record, if I could. 

Mr. PLATTS. Without objection. 

Senator CARPER. I will summarize very briefly. 

You are good to do this, to let an old House member come back 

and work with you, Mr. Towns, Chairman Issa and others on what 

I believe is not the sexiest issue but is a real important issue. 

Colonel, we welcome you. We are delighted to see you and are 

privileged to have served with you in the service of our country. 

I was in the Navy for five years, active duty, during the Vietnam 

War. We were in California, we were all over the U.S. In California, our squad was home-based at Moffett Field Naval Air Station and then off to Southeast Asia. We bounced all over the Pacific 

with a lot of missions in and out of Thailand, the Philippines and 

Japan and everywhere. It was hard to keep our pay straight in a 

war and given the nature of the business we were in. 

I understand it is not an easy thing to do. It is made all the more 

difficult when people are at war, people deployed and serving combat positions all over the world. It is hard. 

Having said that, we can do this better. Everything I do, I know 

I can do better. We can do a better job of this. We had a very good 

demonstration yesterday in our full committee, the Homeland Security Committee in the Senate where our witness was Janet 

Napolitano, the Secretary of the Department of Homeland Security. 

They have an obligation to become audit-ready by 2014. They are 

a new department, they are standing up and have sort of meshed 

together what a lot of folks call a dogs breakfast of a department 

because it has so many different new elements that have been kind 

of crammed together to form one. 

She announced this week that their financials will be auditable 

this year, two years ahead of schedule. If they can do that at the 

Department of Homeland Security, we have to be able to do better 

at the Department of Defense in meeting their goal of 2017. 

God bless Leon Panetta with whom I served in the House for a 

number of years. He has a tough job, everyone knows that. The 

Secretary of that Department, the Secretary of any Department is 

a tough job but that one in the time of war is about as hard as 

it gets. He is also trying to make sure that his Department complies with the law with respect to their financials becoming 

auditable by 2017. He wants to beat the date of 2017. My firm hope 

is that will be the case. 

Among the reasons why that is so important, for him or whoever 

is going to be managing the Department in the future, if we don’t 

have good financials, if we don’t have good accounting systems, if 

we don’t have good technology, we are doomed. We look at these 

huge budget deficits of trillions of dollars coming down, but still 

3 

way too much and we have to be able to get better results for less 

money. This is a part of it, like ground zero where it starts. 

I look forward to a constructive hearing from our witnesses. We 

appreciate the work that GAO has done on this and look forward 

to hearing from our friends from the Army, too. 

Again, the spirit here is if it isn’t perfect, make it better. We 

have to do better, all of us, and that includes me. 

Thank you. 

Mr. PLATTS. Thank you, Senator Carper. 

I yield to the Chairman of the full committee, Mr. Issa. 

Mr. ISSA. Thank you and I, too, will be brief and submit for the 

record. 

I came here for two reasons. First of all, when the House of the 

people and the other house get together, it means that we have 

what it takes to move positive legislation all in one room. It is always preferable to have us hear the same thing and come away 

from a hearing knowing that we have to act and how we have to 

act. 

The second reason is that Colonel, like you, I was an enlisted 

man, paper leave and earnings statements. In 1970, it was real 

paper as it was for Senator Carper. If one piece of paper got ripped 

out of there, it was gone forever. 

My enlisted time was fairly uneventful, although I had a lot of 

TDY and a lot of different supplemental dollars as an EOD, enlisted man. When I was commissioned, I saw the other side of it. 

I was responsible for up to 200 men and women who were constantly having to get compassionate pay, having to get $25 or $50 

because when they PCSed in, the paperwork got lost. We would 

keep them sometimes for a couple of months, not getting their real 

pay because there was a problem, particularly if they were coming 

from overseas. 

That was approaching half a century ago. We have come a long 

way. We have come from paper to electronic but we haven’t come 

far enough to have the kind of proactive effort to where you should 

never have to say how do we pay this person, what do we do? Do 

we send them to USO or do we in fact, find some other way. More 

importantly, do we no longer have people who receive pay and then 

somehow, we say that was a snafu and for the next six months, we 

are going to be deducting. 

I represent Camp Pendleton. As a result, I see that happening. 

I see naval assets and private assets have to find ways to take care 

of families because there has been an overpayment and it has to 

be repaid. 

Last, but not least, I had the pleasure of leaving the Army and 

the only time I have been personally audited was the year I left 

the Army. There is nothing worse than trying to explain all these 

various per diems and pays that are tax free if x, y and z to a man 

who has never served in the military but whose job it is to try to 

get a little money out of you. 

I believe when we get to where we do the job right, it will make 

a huge difference for our men and women in uniform, especially 

those who have families who are also earning and have to bring 

these together in a predictable way to make payments. 

4 

I am glad to see that my good friend, Chairman Towns, is also 

here. That gives an awful lot of legacy of this committee to hear 

it and respond. 

Mr. Chairman, Mr. Chairman, Mr. Chairman, I thank you all for 

being here today and I yield back. Chairmen are cheap here, aren’t 

they? 

[Laughter.] 

Mr. PLATTS. Thank you, Mr. Chairman. We appreciate your interest in the important topic and your own service in uniform as 

well. 

I will now yield to the Ranking Member and former Chairman 

of the full committee as well as this subcommittee, Mr. Towns from 

New York. 

Mr. TOWNS. Thank you very much. 

Let me say you are right. I called someone Mr. Chairman on the 

elevator and about seven members looked around, you are right, 

there are a lot of folks around, ex and former chairmen and all of 

that. 

Let me just say, Mr. Zecchini, that I am really happy to see you, 

a person who served in the military more than 50 some years ago, 

ROTC and all of that. To have had problems with my own pay 

while I was in there on several occasions, every time they would 

transfer me somewhere, I would always have problems with my 

check catching up with me. I was one who needed my check in advance. To have to worry about your pay and at the same time defending this country to me is just something that should not happen. 

I want to salute you for your many, many years of service. We 

feel that we owe it to our military personnel to make certain they 

get paid on time. 

I am happy to see that we have Senator Carper, my classmate, 

here with me and of course Chairman Platts and of course the 

Chairman of the full committee as well, Chairman Issa. 

I think this is the way we go about it, hearing from people who 

have had these experiences and at the same time, folks on this side 

of aisle who are committed to trying to make certain the situation 

changes. 

On that note, Mr. Chairman, I will submit my entire statement 

for the record and look forward to hearing from the witnesses. 

Mr. PLATTS. Thank you, Mr. Towns. 

We will keep the record open for seven days for opening statements and extraneous material. 

We are going to move to our witnesses. In the interest of time, 

if I could ask not just the Colonel, but all of our witnesses on the 

second panel also, to stand and I will swear you all in at the same 

time. Please rise and raise your right hands. 

Do you solemnly swear or affirm that the testimony you are 

about to give will be the truth, the whole truth, and nothing but 

the truth? 

[Witnesses respond in the affirmative.] 

Mr. PLATTS. May the record reflect that all witnesses answered 

in the affirmative. Please be seated. 

Colonel Zecchini, we are delighted to have you here with us. The 

Colonel is currently serving with the United States Army Reserve 

5 

but soon to mark almost 30 years of service in one capacity or another in uniform to our Nation. We certainly are grateful for those 

many years of service and appreciate both your written testimony 

and your willingness to be here in person today. 

We will set the timer for all of our witnesses at five minutes. Because of time constraints, you could try to stay within that time 

limit it will help us get to a chance to have a good exchange with 

the Q and A. 

Colonel, the floor is yours. 

WITNESS STATEMENTS 

STATEMENT OF LIEUTENANT COLONEL KIRK ZECCHINI, U.S. 

ARMY RESERVE 

Colonel ZECCHINI. Chairman Platts, Chairman Carper, Ranking 

Members Towns and Brown, and members of the two subcommittees, thank you for the opportunity to appear this morning. 

During the span of my military career covering 28 years, mostly 

as a member of the Ohio National Guard, I have personally experienced a wide variety of military pay problems. Serving as a traditional Guardsman, a full-time, active duty soldier and as a federal 

technician has provided me with a broad range of opportunities 

and challenges. 

In my experience in the military, pay problems are considered a 

normal part of Army life. Very early in my career as a Second Lieutenant, I was mentored to keep a running travel log to track my 

pay, allowances, per diem and travel costs. This guidance proved 

to be valuable as I began to perform more frequent temporary duty 

and additional duties with the Ohio National Guard. 

Travel vouchers were sometimes lost or misrouted during processing. For the most part, situations like this were easily fixed at 

the unit level as long as I could reproduce original claim documents 

such as orders, pay vouchers, receipts, et cetera. 

Later, as a field grade officer, my pay problems became more 

complex during my first deployment to Afghanistan in 2003. My 

original mobilization order was not to exceed 180 days but I volunteered to extend for an additional six months. The extension order 

was published but my military pay stopped promptly at the end of 

my original order. It took approximately one and a half months to 

have this issue resolved while I continued to perform in Afghanistan without pay. 

Immediately following my combat tour in Afghanistan, I began 

a series of missions throughout Southeast Asia and the Pacific Rim 

performing humanitarian assistance and humanitarian civic assistance in various developing countries. Several of the countries in 

which I worked were designated for special allowances such as hostile fire pay and hardship duty location pay, which varied by 

amount per location. These pay types were not familiar to me. 

Upon my return to Ohio in August 2004, I inquired with my unit 

administrator pay clerk about being paid the additional allowances 

but this was also new terrain to the unit, so my inquiry was sent 

up the chain of command to the Ohio Army National Guard State 

Headquarters for review by military pay and ultimately to the 

Comptroller. 

6 

After several months of emails and non-action, I created a 

spreadsheet which reflected duty locations, orders, dates, allowances, pay and per diem. All entries were color coded to reflect status of payment. Several more months went by until I finally had 

to write a memo to the Ohio Inspector General requesting assistance. 

I eventually got paid for all requested allowances late in 2005 

while deployed in Iraq, approximately one and a half years after 

the initial performance of duty. 

During my deployment to Iraq in 2005 to 2006, I was assigned 

to an active duty unit along with a team of 10 other Ohio National 

Guardsmen. Our parent unit from Ohio was located in Baghdad. 

My team was deployed north in Tikrit. Three or four months into 

our deployment, we were notified that some particular tax was 

being withheld and that we all needed to complete additional paperwork in order to have the money refunded and the withholding 

to cease. This process was neither simple nor convenient while 

working in an austere environment. 

Dealing with pay problems while in a combat zone is not something that anyone should have to worry about, yet this was my second episode in as many tours. 

Since resigning and receiving an honorable discharge from the 

Ohio Army National Guard in June 2011, my pay problems have 

continued. Just last week, I received a leave and earnings statement for performance of duty on January 5, 2012 only to learn that 

the checking account number was entered incorrectly, so my pay 

was not deposited into my bank account. 

I just heard yesterday, two and a half months later, from the 

Army Reserve Finance Office that they think they have resolved 

the situation. I have also recently received four separate notices 

from DFAS indicating a debt collection that there is no indication 

of the reason or how I should contest these erroneous claims. These 

debt collections seem to have been initiated by the Ohio Army National Guard even though I have not been a part of this organization since June of 2011. 

Thank you once again for this opportunity to testify this morning. Now that my eldest son is serving proudly in Afghanistan, I 

am especially interested to see that he and his fellow soldiers are 

properly taken care of while performing their duties and without 

distractions of pay problems. 

He loves being a soldier as much as I have always loved being 

a soldier and I want nothing more than to see him come home safely. It is all about taking care of soldiers. 

[Prepared statement of Colonel Zecchini follows:] 

7 


Insert offset folio 1 here 75110.001
8 


Insert offset folio 2 here 75110.002
9 

Mr. PLATTS. Colonel, thanks for your testimony and especially 

your service and now your eldest son’s service as well. Certainly 

Godspeed to him and all who are out there in harms way on our 

behalf. 

Your testimony here today throughout your almost 30 years of 

service is kind of the norm, nothing new. Can you share more often 

than not when there is an error of some degree, is it something 

that more likely you identified or questioned because of uncertainty 

and have had to initiate the efforts to correct those errors or would 

it be more the norm that the military, whether it be the Guard, the 

Reserve, active duty, units you have served with, that they have 

caught the errors and then come to you to try to correct them? 

Colonel ZECCHINI. I don’t recall anybody in the military ever 

coming to me to identify a pay issue. I would have to say you have 

to read your LES, you have to understand what you are looking at. 

Mr. PLATTS. So when those problems are identified, it is because 

you have to basically, in addition to worrying about the enemy out 

there if you are in harms way, you or your family back home looking at each pay to try to make sure you are getting what you are 

supposed to, not less, not more but the onus falls to you and all 

of our soldiers, airmen, sailors individually? 

Colonel ZECCHINI. Correct. 

Mr. PLATTS. The example you give of when you were in Iraq, in 

essence, your whole team of I think you said 10 Ohio Guardsmen 

that who were attached, in that case it was a tax issue? 

Colonel ZECCHINI. It was some sort of withholding from Ohio. 

Mr. PLATTS. Did that come from back home? 

Colonel ZECCHINI. I believe somebody in Ohio identified that this 

should have been taken care of at the mobe site at the mobilization 

station and for whatever reason, it wasn’t picked up, so we had to 

do the paperwork down range. 

Mr. PLATTS. Was it a federal tax issue? 

Colonel ZECCHINI. As I recall, it was some sort of State withholding. 

Mr. PLATTS. Did you each individually have to then move forward to correct it for your own taxes and payroll or was there assistance that applied to all of you, we will take care of it? 

Colonel ZECCHINI. Each person had to do their own paperwork 

and each person was responsible to fax it back to the unit which 

made it a challenge when we were spread all over northern Iraq. 

It was not such an easy task. 

Mr. PLATTS. I have had the privilege to visit our troops 11 times 

in Iraq and 8 in Afghanistan and I try to get to those remote 

places. I have been to Tikrit and some of the FOBS and get out 

there and one just logistically doing it and someone who is more 

remote, I think of a base in the mountains of Afghanistan where 

a young Army Captain, Adam King, leading about 70 soldiers, you 

flew in by helicopter or got there by mule but not a very easily accessible point. If they are experiencing these types of problems, all 

the more challenging to correct them and then hardship for families back home if the pay is not correct. 

In your time, have you ever had an instance where because pay 

was not properly provided to you that it caused a financial hardship because of an incorrect balance in a checking account? Are you 

10 

aware that any soldiers you have served with have had that problem? 

Colonel ZECCHINI. From my personal experience, the only real 

hardship that I encountered was when I was in Afghanistan and 

my pay just stopped for about a month and a half. I still had a 

mortgage and I still had bills to pay back home. Fortunately, I had 

a little bit of savings while I was deployed. That was a pretty tense 

period not knowing when the pay was going to be turned back on 

again. 

Mr. PLATTS. In that example where it was delayed, was there 

any compensation, meaning interest for the two months that were 

not properly paid, when it finally was? 

Colonel ZECCHINI. No, sir. 

Mr. PLATTS. Again, I appreciate your service and your efforts in 

being here today that we do right by your son and all who are and 

will be serving us. That is the goal ultimately of this hearing and 

our continued oversight work, that we do right by those who are 

so courageously serving all of us. 

With that, I yield to Senator Carper. 

Senator CARPER. Thank you, Mr. Chairman. 

My dad was a Chief Petty Officer in the Navy for many years. 

During the time I served active and reserves, about 23 years, some 

of the best officers I served with were folks who have been prior 

enlisted and earned commissions and became an officer, and for the 

most part, performed admirably. How long were you enlisted? 

Colonel ZECCHINI. Five years. 

Senator CARPER. How did you get your commission? 

Colonel ZECCHINI. Through Officer Candidate School, OCS. 

Senator CARPER. I am going to ask you a question, then make 

a comment and then I am going to ask a question. The question 

I am going to ask you so you can think about it is this. We have 

some folks gathered here today who are responsible for trying to 

fix this problem. The question I would ask you is help us help them 

fix the problem for other folks, so just be thinking about that and 

give us some practical advice as to how to do that. 

The question I want to ask before that is my guess is you weren’t 

the only person you served with who has had some problems with 

pay. We did in my unit then and I presume you had similar problems in your units. Were the problems of a nature similar to those 

you experienced or were they different, were there any commonalities, or was it just across the board, a wide variety of problems? 

Colonel ZECCHINI. I can’t say that I have ever experienced the 

same problem twice. 

Senator CARPER. When you think of your colleagues with whom 

you served, did they have similar problems or were they different 

kinds of problems? 

Colonel ZECCHINI. I would have to say different. Again, my experiences were kind of different from the typical Guardsman where 

I had a lot of active duty time, a lot of TDYs and I did a lot more 

outside of the one weekend a month, two weeks in the summer. 

Yes, I would have to say mine are probably a little bit different and 

broader than most of my peers. 

Senator CARPER. I think you said you had a period of a month 

or two where you didn’t get paid at all. When I was overseas, I was 

11 

not married and had no wife or children and the Navy pretty much 

took care of our immediate needs. They fed us and there was a 

place to sleep, there was medical care and that kind of thing, so 

guys like me were able to save every other paycheck. We didn’t 

make much money but we didn’t spend much either. I had no wife 

or children to support. I tried to help my sister a little bit to go 

to college but that was the only big obligation that I had. 

That is not the case with a lot of folks, especially today when we 

have a lot of Reservists deployed, actively deployed, we have a lot 

of Guardsmen and women actively deployed and a lot of them do 

have families. When they have problems with their pay, it is a 

whole lot more difficult, a lot more complex. 

Put yourself in the position of providing good advice sort of 

through us but with us to the folks charged with fixing these problems. I realize we will never get to perfection but that should be 

our goal. If you were to provide some good advice, friendly advice 

to the folks charged with fixing this, and our job is oversight and 

making sure that it is addressed, what would be the advice? It can 

be fairly general, doesn’t have to be very specific. 

I will give you an example. We had a guy before us testifying on 

the Finance Committee a couple months ago on deficit reduction. 

I asked him what we need to do on deficit reduction. He is Alan 

Blinder, former Vice Chairman of the Federal Reserve, Professor of 

Economics at Princeton. I said what should we do about deficit reduction? His big deal on deficit reduction is health care costs. If we 

don’t reign in health care costs, we are doomed. He said, I am not 

a health economist. 

I said what should we do about health care to reign in health 

costs. He said, I am not a health economist but here is what I 

would do. I would find out what works and I would do more of that. 

That is exactly what he said. I would find out what works and do 

more of that. I said, you mean find out what doesn’t work and do 

less of that? He said, yes. 

Actually that is pretty good advice in everything we do not just 

in reigning in health care costs. What should we do here? What 

should the folks at the Department of Defense do to help address 

this problem? 

Colonel ZECCHINI. Obviously, I have seen a lot of changes in 28 

years from paper statements to electronic statements now and 

those have all been good things. Most recently, the Defense travel 

system came online where you can enter your travel claims online 

and that was huge. That really took the paperwork piece and 

streamlined the process for travel vouchers. You get paid now in 

three or four days where it used to take a month sometimes to get 

your travel pay. 

Senator CARPER. That is a great improvement. 

Colonel ZECCHINI. DTS was, in my mind, great but not everybody 

has access to DTS. I had access to it because I was a full-time federal technician where most traditional Guardsmen and Reservists 

don’t have that system yet. 

Senator CARPER. Should they? 

Colonel ZECCHINI. I think they should especially if you are doing 

a lot of traveling. If you come back from a TDY period, then you 

have to go into your unit to submit a claim, you may or may not 

12 

be within reasonable commuting distance to your unit and you 

can’t do it at home. So things like that, everybody should have access to all the same databases and DTS especially. 

I would also think they could make some progress in connecting 

G1 to G8 maybe where if you are on orders and in a specific pay 

zone for allowances, somehow that should trigger G8 to connect the 

dots. That doesn’t seem to be taking place. 

Senator CARPER. Thank you very much for being here today. I 

appreciate those 28 years that you have shared with our Country, 

given our Country. Our very best to you and to your son. 

Mr. PLATTS. Thank you, Senator Carper. 

I will now yield to the Ranking Member, Mr. Towns, from New 

York. 

Mr. TOWNS. Let me thank you too for your many, many years of 

service. 

I recall in terms of my years that when they had trouble with 

my pay, it was that I had orders to go one place and they changed 

my orders and sent me somewhere else. Then they had trouble 

finding me. That was the problem they had. Other than that, I 

must say that I got paid pretty much on time. 

How many times did you have the problem? 

Colonel ZECCHINI. How many times? 

Mr. TOWNS. The pay problem during your years of service? 

Colonel ZECCHINI. After I started talking to Mr. Tyler last week, 

I started thinking back in my career and I gave him some good examples of the ones I just testified to, but I can think of several 

other ones that weren’t such a big deal and they were pretty easily 

fixed at the unit level. 

Mr. TOWNS. It was so many times you can’t remember, is that 

what you’re saying? 

Colonel ZECCHINI. Yes. 

Mr. TOWNS. Wow! How widespread is the problem among others? 

Colonel ZECCHINI. You hear people talking about pay issues, 

chow hall talk. Somebody always seems to have a pay issue they 

are dealing with. 

Mr. TOWNS. How long did it take, the longest period, for you to 

correct your pay? 

Colonel ZECCHINI. The example I mentioned about my one and 

a half months without pay in Afghanistan, that was the longest 

that I ever went without a paycheck. That is the longest I ever had 

to deal with a problem and getting resolution to the problem was 

the one where I didn’t get my various allowances from my missions 

in Southeast Asia. That took about a year and a half. 

Mr. TOWNS. Could you walk us through one process in terms of 

how you went about getting paid? Walk us through a process you 

had to take in order to get paid? In other words, you didn’t get your 

check and what you had to do in order to get it. 

Colonel ZECCHINI. The example I mentioned about the pay and 

allowances from Southeast Asia, I was working in Bangladesh, the 

Philippines and all through Southeast Asia. Each of these different 

countries has a different rate for hostile fire pay in the Philippines 

as hardship duty location pay in Bangladesh and I wasn’t even 

aware that these allowances were there when I was performing the 

duty. It was just through talking to my active duty counterparts 

13 

who were there with me, I was informed that we were entitled to 

these allowances. 

When I got back to Ohio, I went to my unit and inquired about 

getting these allowances. I actually had to look through the regulations. There is a chart they have in the reg that tells you if you 

are in this location during this time of year, you are entitled to this 

much money. It was a pretty complex set of numbers. My unit 

clerk, my unit administrator certainly didn’t know how to process 

that, so that is when it got pushed up the chain of command and 

went to Military Pay. Military Pay didn’t seem to know anything 

about it. 

Time went on and I put together a spreadsheet, actually did a 

lot of the legwork for them to make it easier to understand what 

I was supposed to get versus what I did get. It languished and 

eventually I wrote a letter to the Ohio Inspector General requesting assistance. That is when I finally got some action. 

Mr. TOWNS. Let me ask, as a Lieutenant Colonel, did folks come 

to you asking you to help them get their pay, to help them resolve 

their problems? 

Colonel ZECCHINI. When I was a Company Commander years 

ago, I routinely worked with pay issues with my soldiers. 

Mr. TOWNS. Did you get a lot of complaints? 

Colonel ZECCHINI. I was a Company Commander for five years, 

so it was a little bit longer than usual. Yes, I would have to say 

that over five years, I got a fair number of pay issues that we 

worked through. Most of that we were able to fix most of that at 

the unit level. I had a unit administrator, a pay clerk, who was 

able to fix most of the pay problems at our level. 

Mr. TOWNS. Do you have any suggestions for us or to the folks 

that will be testifying later as to what might be done to eliminate 

some of this? Do you have any suggestions? You have had 28 years 

of this. I didn’t stick around that long. 

Colonel ZECCHINI. Again, the guidance I give to my son is the 

same guidance I received as a young soldier, keep track of all your 

records, keep track of all your pay documents, your orders. You 

never know when you might need this stuff again some day. 

Mr. TOWNS. Thank you very much for service. 

On that note, I yield. 

Mr. PLATTS. Thank you, Mr. Towns. 

Before I go to Mr. Connolly, just a quick follow up. You said on 

the example of your Southeast Asia time, you were not even aware 

of the allowances. Other than active duty soldiers that you were 

serving with who then said, are you aware, you were not given any 

formal notification of what you were entitled to relating to those 

deployments? 

Colonel ZECCHINI. That is correct. 

Mr. PLATTS. As you worked through it, you mentioned ultimately 

you had to go the Ohio Inspector General to assist. At what point 

in that year and a half long process, how long had you tried working through the channels before you went that route to get it taken 

care of? 

Colonel ZECCHINI. I went to my unit initially in August 2004. I 

would say the very next month, in September, it got pushed up the 

chain to the Ohio State Headquarters. I worked the issue with 

14 

them until probably August 2005 when I was getting ready to go 

to Iraq. I knew I was going to be deployed again, so at that point 

I really had to do something. 

Mr. PLATTS. So for about a year, you kind of worked through 

their regular channels without success? 

Colonel ZECCHINI. Right. 

Mr. PLATTS. This was something, once you were aware, seemed 

pretty straight forward. You were in this country, you qualified, yet 

a year later you still weren’t being compensated appropriately. 

Colonel ZECCHINI. It was a significant dollar amount too. 

Mr. PLATTS. Roughly, a round number? 

Colonel ZECCHINI. As I recall, it was a couple thousand dollars 

allowances. 

Mr. PLATTS. Thank you. 

I yield to the gentleman from Virginia, Mr. Connolly. 

Mr. CONNOLLY. Thank you, Mr. Chairman. 

I want to welcome our colleague from the Senate, Senator Carper, who has been a great ally on so many other issues including 

postal issues. We thank him for being here today. 

Welcome to you, Lieutenant Colonel Zecchini. Thank you for your 

service and thank you for being here. 

You have a family? 

Colonel ZECCHINI. Yes, I do. 

Mr. CONNOLLY. Mortgage? 

Colonel ZECCHINI. Yes. 

Mr. CONNOLLY. Maybe a car loan, student loans? 

Colonel ZECCHINI. Not currently. 

Mr. CONNOLLY. Not currently, but maybe you did? 

Colonel ZECCHINI. I did. 

Mr. CONNOLLY. Delay in pay could be kind of significant not just 

for you, it is more inconvenient is the point, and actually could be 

pretty disruptive to the family household and its budget? 

Colonel ZECCHINI. Yes. 

Mr. CONNOLLY. Are you aware of cases, either your own or others, where that was the case? 

Colonel ZECCHINI. The example I mentioned of being in Afghanistan where I went about a month and a half without pay, that was 

a tense period, not knowing how long that was going to continue 

without pay. That was the only thing. I was working with my wife 

who was back home trying to pay the bills and stretch the savings 

we had for as long as we could. 

Mr. CONNOLLY. While you were on a war front? 

Colonel ZECCHINI. Yes, sir. 

Mr. CONNOLLY. Why do you think there are these problems? I 

have to tell you, I spent 20 years in the private sector and I never 

once had a paycheck problem. They never once made a mistake 

about my amounts, my withholding or what name to send it to, 

whether it be electronic transfer or a paycheck. Why do you think 

we have a problem in the Pentagon? 

Colonel ZECCHINI. In that example, I was on orders for 180 days 

and I may have over complicated the situation by volunteering to 

extend that when the order was cut authorizing the extension, in 

my mind, everything else should have fallen into place but pay 

didn’t catch up with the orders. 

15 

Mr. CONNOLLY. You mentioned that you went to, I think you 

said, the company clerk but the clerk was not really equipped to 

resolve the problem and you had to go to a higher level? 

Colonel ZECCHINI. Right. 

Mr. CONNOLLY. Does the Army not have or do other services not 

have people designated as ombudsmen to try to help the men and 

women in uniform when they have this kind of problem? 

Colonel ZECCHINI. At the State Headquarters, that is my understanding. 

Mr. CONNOLLY. The State Headquarters? 

Colonel ZECCHINI. The Ohio National Guard State Headquarters. 

Mr. CONNOLLY. If you are in Afghanistan, going back to State 

Headquarters in Ohio is a bit of a challenge. 

Colonel ZECCHINI. The pay issues I had in Afghanistan, the active duty finance people did work with me on that one and got that 

one resolved in the end. 

Mr. CONNOLLY. On-site? 

Colonel ZECCHINI. On-site. 

Mr. CONNOLLY. But you still went a month and a half, you said? 

Colonel ZECCHINI. A month and a half. 

Mr. CONNOLLY. Mr. Chairman, I am so struck by the fact that 

Lieutenant Colonel Zecchini puts on the uniform, is active duty in 

a war front in Afghanistan on behalf of his Country because his 

Country called, and we can’t resolve his compensation. He and his 

family back home suffering the anxiety of the war front now have 

to add to that anxiety can we meet the mortgage or other family 

household obligations. It seems to me no way to treat our men and 

women in uniform and it also seems to me this is not rocket 

science. The private sector somehow manages to do this every day 

of the week. 

As I said, I worked for 20 years in the private sector, I never 

once heard a complaint about a mistake. Maybe there were some 

and I am sure there were, but it certainly was not commonplace. 

It is very troubling to hear that is not the case in the U.S. military. 

I look forward to the next panel’s testimony but I think Lieutenant Colonel Zecchini and his fellow men and women in uniform deserve better from their country. 

Thank you, Mr. Chairman. I yield back. 

Mr. PLATTS. I thank the gentleman and would echo the concern. 

As you well highlighted, that impacts not just the men and women 

in uniform but the family and certainly with deployments, enough 

stress associated with overseas deployments for the whole military 

family, let alone adding a pack issue and financial stress that 

comes with that. 

Colonel, again, we thank you for your almost 30 years of service 

in uniform to our Nation as well as your willingness to be here as 

we work to try to make sure we do better by you and all who are 

serving us and will continue to serve as your son is in harms way 

as we speak. Please convey to your wife as well for her service on 

the home front while you have been serving us far from home, our 

thanks. 

We are going to take a very brief recess while we reset for the 

second panel. We stand in recess momentarily. 

[Recess.] 

16 

Mr. PLATTS. We will reconvene. We appreciate the quickness of 

our witnesses getting settled. Again, I apologize for the time restraints we are working under. I would ask you to try stay within 

your five minutes and if you want to yield back any of that time 

so we can get to exchange Q and A with you, we welcome that. 

I want to add my thanks to each of you for your current service 

as well as I know a number of you who have served in uniform for 

many years as well. We are very fortunate to have your commitment to your Nation and your fellow citizens both now as well as 

in the past in uniform. Thanks for being here and being a part of 

this process. 

We are going to go right to your testimony. Asif Khan is Director, 

Financial Management and Assurance, U.S. Government Accountability Office. 

STATEMENT OF ASIF KHAN 

Mr. KHAN. Thank you, Chairman Platts, Chairman Carper, 

Ranking Member Towns and Congressman Connolly. It is a pleasure to be here today to discuss our work on the challenges in assuring the accuracy and the validity of Army’s military payroll. 

Deficiencies in Army payroll processes and control were most recently reported by GAO in 2009 and by the DOD Inspector General 

in 2011. Such deficiencies increase the risk of inaccurate and invalid payments to Army military personnel and impede the Army’s 

efforts to prepare an auditable statement of the budget, the SBR. 

The SBR is one of the principal financial statements required of 

major government agencies including the military components of 

DOD. According to the Defense Finance Accounting Service, DFAS 

the Army fiscal year 2010 active duty military payroll was $46.1 

billion, a material amount in the Army’s SBR. 

We found there continues to be significant deficiencies in the 

Army and DFAS processes and systems. Today, I will focus on 

three problem areas highlighted in our report: first, significant deficiencies in the processes used to maintain and retrieve payroll 

records for active duty military personnel; second, problems in the 

automated systems used to store, process and reporting these 

records; and third, lack of supporting documentation for payroll 

transactions. 

To test whether Army’s payroll processes were effective in making data readily available for an audit, we requested a list of service members who had received active duty pay in fiscal year 2010. 

DFAS staff made three attempts to provide us with a complete and 

accurate file. The first attempt included more than 11,000 duplicate accounts; the second attempt found over 28,000 more accounts 

than the first; and finally, with a third attempt, we were able to 

perform reconciliation procedures that satisfied us that the data 

were reasonably complete. 

The inability to readily provide this information, if not effectively 

addressed, will impede the Army’s ability to meet the 2014 SBR 

audit readiness goal. Non-integrated systems and cumbersome 

processes also contribute to the Army’s difficulty in maintaining 

and reporting timely, accurate and complete data. 

The Army’s pay and personnel system for example are not integrated. Active duty payroll data is maintained in one system; the 

17 

personnel data is compiled from several systems that are fed data 

from the recruit reception office in each battalion and from at least 

45 other feeder systems and spreadsheets. 

Comparing and reconciling the pay and personnel data requires 

labor intensive research. It took the data center over two months 

to confirm that all service members who received active duty military pay in fiscal year 2010 had an active duty personnel file for 

one of the personnel systems. 

The third problem is supporting documentation which is the fundamental control over all financial accounting and reporting. It provides evidence that a recorded transaction is accurate and valid. To 

test this control, we selected a sample of 250 service members’ 

records and requested the related leave and earnings statements, 

and also documents that support basic pay allowances and entitlements. 

After initial difficulties in locating the documents, we suggested 

the Army focus on the first 20 pay account sample items. After further delay, we narrowed our request for documents to the first five 

sample items. As of the end of September 2011, six months after 

our initial request, we were able to obtain a complete documentation for 2 of the 250 sample items, partial support for 3, and no 

support for the remaining 245. 

Without support documentation, the Army cannot verify the validity of its payment and is at increased risk of payments to the 

wrong persons or in the wrong amounts. Further, without documentation, the Army will not be able to pass an audit of its SBR. 

DOD has recently taken important steps toward improving financial management at the Department and its components. The Army 

has begun efforts to prepare for the audit of its SBR by 2014 and 

ultimately, all principal statements by 2017. 

Other military components such as the Air Force and the Navy 

share some of the same processes and system risks as the Army. 

They also will need to resolve significant problems before their 

SBRs are auditable. 

Chairman Platts, Senator Carper, Ranking Member Towns, Congressman Connolly, this concludes my prepared statement. I would 

be happy to answer any questions you may have at this time. 

Thank you. 

[Prepared statement of Mr. Khan follows:] 

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Mr. PLATTS. Thank you, Mr. Khan. 

Next is Mr. James Watkins, Director, Accountability and Audit 

Readiness, Department of the Army. 

STATEMENT OF JAMES WATKINS 

Mr. WATKINS. Thank you. 

Chairman Platts, Chairman Carper, Ranking Member Towns, 

members of the committee, especially my own representative in 

Congress, Representative Connolly, thank you for the opportunity 

to testify today regarding Army military pay, audit readiness and 

our commitment to achieving auditable financial statements. 

Secretary McHugh, Army Chief of Staff Odierno, Under Secretary Dr. Westphal, the Assistant Secretary for Financial Management and Comptroller, Dr. Matiella; and all of our senior leaders 

are committed to achieving auditable financial statements including the Army’s military pay business processes. 

I also thank the Government Accountability Office for their military pay audit. We concur that the Army faces challenges in 

achieving audit readiness for military pay. The military pay audit 

provided additional insight with specific recommendations to address deficiencies. We concur with the GAO findings and have included their recommendations in the Army’s Financial Improvement Plan. 

While we are confident that we do a good job paying our soldiers 

the right amount of money at the right times. We know we have 

a lot of work to do to prove it via an audit. Military pay at approximately $50 billion annually represents a significant component of 

the Army’s Statement of Budgetary Resources. Because of the 

amount of resources dedicated to and the importance of military 

pay, the Army and the Defense Finance and Accounting Service 

must ensure controls are in place to continue paying soldiers the 

right entitlements, the right amounts at the right time and to accurately report these transactions on the financial statements. This 

requires teamwork between the Army, DFAS and the Office of the 

Under Secretary Defense Comptroller. 

Our progress to date includes working with DFAS to develop and 

document a repeatable process for identifying the total population 

of active duty military payroll accounts each fiscal year. In fact, the 

Army and DFAS, in October 2011, implemented a monthly reconciliation of all detailed military pay transactions to the summary 

financial reporting records. This process improvement represents a 

significant accomplishment in advancing the Army’s audit readiness efforts. 

Other initiatives include documenting the military personnel and 

payroll business processes; identifying the key pay-related substantiating documents; and standardizing the procedures for maintaining these documents. As part of this effort, we are creating a matrix that identifies the relevant substantiating documents and the 

retention location of those documents for each payroll entitlement. 

The matrix will simplify the retrieval of documents, demonstrate 

proof of military pay and assist in our response in future audit requests. 

Finally, we are reviewing all policies governing the storage and 

retention of key documents to ensure policies, processes and supVerDate Aug 31 2005 08:38 Aug 02, 2012 Jkt 000000 PO 00000 Frm 00035 Fmt 6633 Sfmt 6633 C:\DOCS\75110.TXT APRIL
32 

porting business systems enable timely access to substantiating 

documentation in a cost effective manner. 

The pace at which the Army has supported financial improvement the past three years is unprecedented in the more than 30 

years I have served in the Army, including 27 years as an infantryman and finance officer, and 6 as a civilian in the financial management and audit readiness community. 

With critical help from Congress, GAO, OSD and DFAS, we have 

generated the necessary momentum across the Army to achieve the 

goal of financial improvement in audit readiness. We have dedicated appropriate funding to meet this goal; we have established a 

robust government structure; we have shifted the culture of the 

Army toward greater personal and collective accountability. 

The Army’s senior leaders are actively engaged in ensuring we 

meet Secretary Panetta’s directive of an auditable statement of 

budgetary resources in 2014 and all financial statements by 2017. 

I met with congressional staff in the spring of 2010 to describe the 

Army’s financial improvement plan and the milestones between 

that time and 2017 that would demonstrate progress. 

I am proud to report that we have met our interim goals since 

that time and we continue to prove we are on the right path. To 

meet Secretary Panetta’s 2014 deadline, we have accelerated some 

milestones, all of which I am very confident we will achieve. 

While we have made great progress, a tremendous amount of 

challenges lie before us. As Mr. Khan pointed out last July 2011 

in front of the Senate Committee on Armed Services, I am personally committed to this historic effort to improve financial management in the Army, to enhance support to soldiers and to improve 

accountability to the American taxpayers. 

I look forward to working with you to ensure the Army’s success 

and I welcome your questions. 

[Prepared statement of Mr. Watkins follows:] 

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Mr. PLATTS. Thank you, Mr. Watkins. 

Next, we have Ms. Jeanne Brooks, Director, Technology & Business Architecture Integration, Office of the Deputy Chief of Staff, 

G–1, Department of the Army. Thank you for being here, Ms. 

Brooks. 

STATEMENT OF JEANNE M. BROOKS 

Ms. BROOKS. Good morning. 

Chairman Platts, Chairman Carper, Ranking Member Towns, 

and Congressman Connolly, thank you for the opportunity to testify today regarding the audit readiness of the Army’s military pay 

appropriation and the draft report issued by the Government Accountability Office. 

Military pay is a significant portion of the Army’s budget authority and we are committed to providing an accurate and comprehensive accountability of the monies authorized and appropriated by 

Congress for the purpose of paying our most viable assets, our soldiers. 

The Army G–1 is working diligently with the Assistant Secretary 

of the Army for Financial Management, Dr. Matiella, and her point 

person on audit readiness, Mr. Jim Watkins, to ensure that our G– 

1 processes, systems and procedures that impact military pay fully 

support the effort to be audit ready for the Statement of Budgetary 

Resources by 2014 and for all financial statements by 2017. 

We are using the Financial Improvement and Audit Readiness 

principles to guide our efforts. We appreciate the balanced and constructive approach used by GAO in assessing our audit readiness 

for active duty military pay. The dual focus of GAO was to validate 

the accuracy of the population paid and to verify all documentation 

for entitlements received. GAO highlighted that these two areas 

currently being worked in support of the overall audit readiness require significant additional emphasis. 

In the short term, we are aggressively analyzing the expansion 

of our Personnel Integrated Records Management System or IPPS– 

A to address the GAO finding of the document storage shortcomings. This analysis has focused on the inclusion of pay supporting documentation as well as the personnel documentation already being captured. 

Our current process for capturing pay documentation is paper 

centric and it relies on the National Archives and Records Administration storage facility. This process is outmoded and cumbersome 

and does not support our move to the auditable environment. 

Additionally, the Defense Finance and Accounting Service and 

the Army’s Human Resources Command have processes in place 

outlining the procedures that are required to validate the Army’s 

pay accounts against official personnel records. These agreements 

have been in place for a number of years. Currently, we are validating the efficacy of these comparisons in today’s environment. 

The Army’s Integrated Personnel and Pay System Program 

IPPS–A is our major effort to address these shortcomings in the 

long term. The initial release of IPPS–A will give us an integrated 

database of all active Guard and Reserve soldiers. Subsequently releases will eventually get us to an Integrated Personnel and Pay 

System. This implementation of the commercial PeopleSoft Human 

38 

Resources Management System will be configured to meet the 

Army’s needs and will strengthen our internal controls and ensure 

that our entire population is paid accurately. 

No longer will there be separate personnel and pay databases. 

Digital signatures, strong audit capabilities, a built-in business engine rule, and a strict roles and permissions structure will further 

ensure accuracy and internal control rigor for military pay. 

Expanding IPERMS and validating that personnel and pay comparisons are routinely performed will prepare the Army for the fiscal year 2014 SBR audit as well as address the GAO audit findings 

in the short term. IPPS–A will be the Army’s long term solution 

to eliminate the need for personnel and payroll comparisons. This 

coupled with the enhanced iPERMS capabilities will prepare the 

Army for the full audit in fiscal year 2017. 

This concludes my statement. I welcome your questions. 

[Prepared statement of Ms. Brooks follows:] 

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Mr. PLATTS. Thank you, Ms. Brooks. 

Next, we have Mr. Aaron Gillison, Acting Director, Defense Finance and Accounting Service, Indianapolis, Department of Defense. Mr. Gillison? 

STATEMENT OF AARON P. GILLISON 

Mr. GILLISON. Chairman Platts, Chairman Carper, Ranking 

Member Towns, and Representative Connolly, thank you for the 

opportunity to speak at this hearing. 

I would like to thank the Government Accountability Office for 

their work on the study. I am pleased to be here to discuss DFAS 

commitment and actions to achieve audit readiness. 

The GAO report confirms the Army and DFAS have more work 

to do to be ready for an Army military pay audit assertion. Today, 

I will discuss the services DFAS provides the Department, DFAS 

specific improvements in support of an Army military pay audit, 

and how DFAS is collaborating with customers to support audit 

readiness and prepare for assertions. 

As background, DFAS proudly pays America’s military, government civilians and commercial vendors. We also pay travelers and 

perform accounting and financial reporting services including the 

summary level financial reports for the Department. DFAS is applying the Financial Improvement and Audit Readiness Plan to 

help our customers achieve auditability. 

In fiscal year 2010, the active Army payroll accounted for $46.1 

billion in Army resources or 20 percent of Army net outlays. This 

included about $9.6 million Army military pay transactions. The 

GAO report confirmed the active duty military members paid in fiscal year 2010 had an active duty personnel file. We recognize all 

process partners must provide documentation within reasonable 

time lines. 

While we have made improvements, we are committed to executing additional DFAS owned actions identified in the Army’s Financial Improvement Plan. To improve the audit process, the Army 

and DFAS will use data query capability against the Master Military Pay Account which is the backbone of the Joint Military Pay 

System. 

In addition, our team is developing a matrix that includes entitlements, supporting document location and the responsible organizations. We will use this matrix to clarify roles, responsibilities and 

acceptable standard retrieval time lines. These steps coupled with 

the Army’s Electronic Document Repository for Personnel Actions 

will help get documents to auditors more quickly. 

There is a weekly reconciliation of Army military pay directly to 

the personnel system. In October 2011, DFAS also implemented 

monthly payroll reconciliations that traced active duty Army payroll from the military pay system to the accounting system. This 

extracts soldier level data for all pay and allowance categories and 

includes all records. 

Generated and archived each month, reconciliations can be extracted for a single payroll period or combined to create a population for broader time periods providing an easier way to sample 

the transactions. DFAS established a senior executive as Director 

42 

of Audit Readiness to provide oversight and guidance for agency 

support to the Department’s audit readiness. 

DFAS is collaborating with process partners on systems we have 

used using the GAO Federal Information Systems Control Audit 

Manual. We are also using the American Institute of Certified Public Accountants Standards to prepare for and conduct audits of 

DFAS common processes in civilian pay, in military pay, disbursing 

and contract pay to ensure systems and controls are operated as 

intended. 

In addition, we are using lessons learned to reduce or eliminate 

repeat audit findings. We have dedicated teams at DFAS sites to 

coordinate all audit readiness efforts. While a number of these 

team members are certified public accountants, our training strategy must instill an audit ready every day philosophy into every employee. 

All DFAS senior executives now have audit readiness goals and 

performance plans. We are making progress toward financial 

auditability. Collaboration with our process partners and continuous improvement with an all in philosophy of leaders and employees is key to achieving military payroll audit readiness. 

Chairman Platts, Chairman Carper, Ranking Member Towns, 

Representative Connolly, and distinguished members, thank you 

for your time today. I look forward to your questions. 

[Prepared statement of Mr. Gillison follows:] 

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Mr. PLATTS. Thank you, Mr. Gillison. 

I will go directly to questions. I will give myself five minutes as 

again we try to beat the clock with the Floor votes. 

I want to say up front that I certainly appreciate that each and 

every one of you is committed and determined to make sure we get 

this right. We all share that goal and our exchange here is trying 

to identify how do we better achieve that goal. 

Mr. Gillison, I am going to start with your written testimony and 

your reference here. Mr. Watkins, you alluded to it as it well. Mr. 

Gillison, in your written testimony, you make the statement ‘‘While 

we did pay these members correctly.’’ When I read the GAO’s report, their testimony here today and in writing as well, how do you 

know that to be able to make that statement because of the lack 

of documentation that they uncovered related to their 2010 study 

or report? How do you have the certainty to be able to make the 

statement that you know you paid correctly? 

Mr. GILLISON. Number one, I do have confidence in the backbone 

of the system, the Match Military Pay Account. I can trace the actual computer update that it was processed on, I can trace back to 

which office processed it. What we could not do at the time was actually present some of those documents. 

I was as frustrated as the GAO was when I looked at it and 

asked questions. The team came together and said, have we 

thought about this system? Have we thought about it might be located over here in this other system. Over the course of the last 

two weeks, we have identified the documents for all those five 

cases. 

Mr. PLATTS. But there were 250 total though and that goes to the 

point that for 5, pulling together 2 completely initially, three partially, 245 is my understanding, no documentation. 

Mr. GILLISON. Mr. Chairman, what I would say to that is the 

human element that’s involved in this process, all of us, that is 

why I say really all in, we have to do our job every day. That is 

the audit ready every day component. Quickly, I will say this. 

Those documents are there the day it is processed into the computer system and they are retained at the respective finance office 

for one year. That very next morning, you know it is there because 

you do a comparison, then we ship it off. 

Mr. PLATTS. I apologize for interrupting, but I think that is the 

issue here. One, for internal controls to work, you have to be able 

to go back and say not just that we believe when that payment was 

made the document was there to justify the payment, we can go 

back and do the audit and say, yes, it was and still is. Otherwise, 

today we really don’t know that it was. We are taking the word of 

whoever processed it that they looked at documentation. 

That is a significant internal control breakdown. That is why I 

asked you about the statement because we really cannot say, when 

we look at the number, on average in 2010, 364,000 cases that 

were not all directly payroll related but my understanding is the 

majority, we have some serious challenges here. 

I appreciate that is what we are working through and trying to 

address. I think we have to be cautious. We cannot say today that 

we know we paid all of our military accurately because we know 

50 

we haven’t based on facts brought to your attention and that is 

what we are really trying to get after here. 

You also talked about and there was reference in a couple testimonies, the changes in October 2011. If we made the same request 

today that GAO made for the 2010 records, how quickly could you 

provide me, if I picked out any soldier who was paid in February 

of this year, how quickly could you provide me the backup documentation to show this is why he was paid what he was paid? 

Mr. GILLISON. It is a three part answer, sir. We do affirm every 

month, first off, that we are paying the correct soldiers the correct 

pay and identified those that we are not. 

Mr. PLATTS. How do you do that every month? 

Mr. GILLISON. We use the Unit Commander’s finance report and 

pay is also a Commander’s responsibility. That Commander and 

First Sergeant in every unit, affirms to us, signs off on the document that comes back and says I have 100 soldiers, this is the pay 

by category. We hold that document on hand for six months. 

Mr. PLATTS. So it is the Commander’s assertion at that point, not 

the root documentation or the source documentation, you don’t 

have at that point? 

Mr. GILLISON. We also are supposed to retain it, the key word 

is supposed to retain it, within the finance office for one year and 

then we ship it to the records holding. 

As far as being able to support a GAO audit or a public accounting firm audit at this point, with the capability we have built, we 

can pull out and say that the following 1,000 soldiers or 600,000 

or 590,000 soldiers have received this amount of pay by this category of entitlements and allowances traced to the accounting system. 

Where we are still deficient is, this is what we are building, we 

have this table we are working on right now that then says who 

is responsible for the source document, where is it located, how do 

I get there from here, and we are going to have to expand the horizons of all of our individuals so they understand what the person 

left and the person right is doing and give them the accesses to 

that computer system. 

Mr. PLATTS. I am going to run out of time. I already am out of 

time. Hopefully I can come back to that issue because ultimately 

that is where we have to get. I know the iPERMS system is intended to help us do that, that we are going to have, as the Colonel 

testified, with the travel system, technology is a good thing if we 

are able to properly and efficiently implement it so that all that 

documentation is there, electronically stored and able to be pulled 

up. 

When you mentioned in the last two weeks, I won’t ask how 

many hours you would calculate you and how many others put in 

to try to document just five soldiers? We do need to do it for all 

500,000-plus that we are talking about. We have to get away from 

the labor intensive. This should be when you are working towards 

a system when you want that information on one soldier, last 

month you pulled up the source documentation and saw everything 

that we ultimately get to that. 

It is not heroic efforts because a hearing or heroic efforts because 

an audit is going to be done. It is so it is just routine. I know that 

51 

is what you and all of you are working toward. I don’t want to minimize that the commitment is there, starting with the Secretary of 

Defense and his commitment that we are going to do this and do 

it right. 

I am way over my time. Senator Carper has asked because of 

what may happen on the Floor with votes, I am going to yield to 

Mr. Connolly from Virginia. 

Mr. CONNOLLY. Thank you, Mr. Chairman, and I thank the Senator. 

Thank you all for your testimony and your service, especially my 

constituent, Mr. Watkins, whose outstanding testimony I think 

should be framed, Mr. Chairman. 

Mr. PLATTS. With the exception of that chairman remark, trying 

to push me out of my seat here. 

[Laughter.] 

Mr. CONNOLLY. I guess one of the things I would say to the panel 

is it seems to me progress achieved, not withstanding, we need to 

move from sort of the administrative clutter to the human level. No 

soldier on the ground in Afghanistan, Iraq or anywhere else serving in uniform ought to, on top of everything else, we worried about 

whether the spouse and kids back home can pay the bills. That 

ought to be our goal bottom line. That part, don’t worry about, 

focus on the mission. We got the rest of it. 

It is very difficult to hear testimony, as we did this morning from 

Lieutenant Colonel Zecchini that in the middle of Afghanistan in 

a war front, he is worried about trying to pay the bills back home 

and so is his spouse and his kids. That is a very human concern 

and a very legitimate one. 

We may never get to perfection, it is a big, complex system with 

lots of change orders, bigger than any private sector enterprise. I 

understand, but that ought to be our goal. It is a human goal. We 

need to be seized with the mission. This isn’t about numbers; this 

is about men and women and their lives. 

I say that as someone who has managed a big enterprise. If that 

is our mentality, we will fix this problem. I commend it to you. I 

know you are committed but we need to redouble that commitment 

so that we never have that kind of testimony again and Lieutenant 

Colonel Zecchini and his colleagues never have to worry about that 

again. 

Mr. Watkins, in your outstanding testimony you indicated you 

were pretty confident that we were going to meet the deadlines we 

have set for ourselves to finally have a certifiable audit like most 

other federal agencies. The Pentagon is not like every other federal 

agency, so we understand the complications. On a scale of 1 to 10, 

how confident are you that we, in fact, will meet that deadline finally? 

Mr. WATKINS. Representative Connolly, I am very confident. I 

would rate it about 8. 

Mr. CONNOLLY. Ok Thank you. 

Mr. Khan, your testimony, if I understood you correctly, has the 

GAO found appreciable progress has been made on the fronts we 

are talking about, is that correct? 

Mr. KHAN. Some progress has been made but there is a lot more 

work which needs to be done to be able to meet the 2014 deadline. 

52 

Mr. CONNOLLY. That is on the audit? 

Mr. KHAN. Correct. 

Mr. CONNOLLY. What about the issue of accurate pay? 

Mr. KHAN. That continues to be a problem. 

Mr. CONNOLLY. Statistically, how much of a problem is it from 

GAO’s point of view? The Chairman was talking about 250, but obviously the problem has to be bigger than that given the size of our 

armed forces. 

Mr. KHAN. Let me just pick up where you left off. Our sample 

of 250 was a statistical sample. That means the results could be 

generalized or extrapolated. 

Mr. CONNOLLY. If we extrapolate, what would we say? 

Mr. KHAN. We could not say anything on the accuracy or validity 

of Army’s military active duty pay for fiscal year 2010. 

Mr. CONNOLLY. If we don’t have some metrics for these folks to 

measure against and to gauge progress, then it remains anecdotal. 

Based on that statistical sample, what percentage of active duty 

military do we feel suffer from mistakes in their payroll? 

Mr. KHAN. Based on our work, that would be very difficult to say. 

Getting two payroll records out of 250 doesn’t really say much. 

Mr. CONNOLLY. Right. 

Mr. Chairman, I have to go vote. I thank the Senator for his consideration. I just do think the GAO could be helpful here in helping 

to try to get our arms around some of the metrics so that we know 

what we are measuring against and we know what goals we need 

to be setting for ourselves. Is it 20 percent at any given time of active duty who are having payroll complications, the severity of 

which obviously is another spectrum. Is it 5 percent, is it 2 percent? What is it? 

If we don’t know that or have some way of trying to measure 

that, it seems to me it remains an illusive goal to try to get to zero 

so that Lieutenant Colonel Zecchini and his colleagues never suffer 

from that kind of malady again. I commend it to the GAO to try 

to work with us a little bit on more substantial metrics that we can 

use as a tool. So can the Pentagon in terms of a management tool. 

I yield back and I thank the Chair. 

Mr. PLATTS. I thank the gentleman. Because we don’t actually 

know the total breadth of the number of cases, that means we also 

don’t know how much time, effort and money we are spending on 

trying to correct the problems when they do occur. If we get the 

system right up front, we can avoid it in the long term. 

With that, I yield to Senator Carper. 

Senator CARPER. Thank you, Mr. Chairman. 

Take a few seconds each of you and react to what we heard from 

Colonel Zecchini today. Mr. Khan, just a brief reaction to what you 

heard from him. 

Mr. KHAN. I am sorry, Senator Carper? 

Senator CARPER. I am going to ask you to briefly react to what 

you heard in the testimony of Colonel Zecchini, just your off-thecuff reaction. 

Mr. KHAN. That was pretty consistent with our observations on 

the deficiencies in the systems and payroll processes in the Army, 

that there is a high risk of incorrect payments, whether the 

amounts are wrong or they could be paid to the wrong person. 

53 

Senator CARPER. Mr. Watkins? 

Mr. WATKINS. Yes, sir. First of all, I would say that is unacceptable, that is going on in more than one isolated case is unacceptable to the Army, it is unacceptable to the people in the Finance 

Corps and to the people doing the payroll. 

I spent 27 years on active duty. For 15 years, I have been receiving retired pay and four 4 years, I was in ROTC, different payroll 

systems, all administered by DFAS. I never had a pay complaint. 

I don’t know if I am the oddball or if the pay issues that were 

brought up today is the oddball, but I do know we keep statistics 

on the pay time and pay accuracy. DFAS can provide those. 

I was a Commander, a platoon leader, Company Commander, 

Battalion Commander, Brigade Commander, I was the Commandant of the Army’s Finance School and the Chief of the Finance Corps and I dealt with paying hundreds of thousands of soldiers and we did not have rampant problems with pay. 

First of all, I can tell you as a Commander, if you have a soldier 

that has a pay problem, you have a problem because he is not focused on the mission and you have to get that problem fixed. When 

I was the Finance Officer at the 5th Corps in Germany, at the 2nd 

Division in Korea and in I Corps at Ft. Lewis, if on payday we had 

long lines that indicated we had a problem but we didn’t have long 

lines. The number of pay complaints were small compared to the 

number of people we paid. 

Senator CARPER. Ms. Brooks, same question. Be brief. 

Ms. BROOKS. I agree the situation is unacceptable. That is one 

of the reasons we are passionate and working very, very hard to 

correct our personnel systems and processes so that we can fix this 

problem. We truly need an integrated, active component, reserve 

component personnel and payroll system and we are working very 

hard toward that goal. 

Senator CARPER. Mr. Gillison? 

Mr. GILLISON. Any pay problem is an issue for us. I will say that 

during the time frame 2003 to 2004, we did react to the audit then 

and put in a 65-point action plan to address those deficiencies and 

put more speed on paying soldiers properly in all components. 

Today, we are data and metric rich. We pay 97 percent on time and 

we aggressively go after that other 3 percent. We are aggressive 

about this and we are looking forward to making further changes. 

Continuous improvement is the name of this game and everyone all 

in to get this done right. 

Mr. CONNOLLY. Would the Senator yield? 

Senator CARPER. Sure. 

Mr. CONNOLLY. Mr. Gillison, your response to Senator Carper 

would suggest that you do have metrics in terms of error rate. If 

I heard you correctly, it is 3 percent? 

Mr. GILLISON. Sir, we do have metrics we measure at each 

month and we report the metrics to OSD level. It is part of the 

Military Pay Improvement Action Plan that started in April 2006. 

Our timeliness was much lower in that period of time, about 88 

percent, and we have moved it to close to 97 percent. We are all 

about collaboration with all process partners and the continuous 

improvement. We are identifying these targets as soon as we can 

and trying to automate as much as we can. We are committed. 

54 

Mr. CONNOLLY. Thank you and I thank the Senator. 

Senator CARPER. Sure. 

Mr. Khan, you heard the testimonies of Mr. Watkins, Ms. Brooks 

and Mr. Gillison and how they responded to GAO’s work and to our 

questions. What did you hear that were happy to hear and what 

did you hear you weren’t so pleased with? 

Mr. KHAN. I was pleased to hear the response both from DFAS 

and the Army and the expectation is if they follow through with 

the commitment, they should be able to see some results in the 

short term. 

At the same time, this is a real problem. The length of time it 

took to produce the documentation is not going to enable an auditor 

to stay there and be able to give a valid audit opinion in a timely 

fashion. 

The other is the issue of supporting documentation. Regardless 

of the robustness of the system, the auditor will need access to the 

supporting documentation, the underlying records of the information which is maintained in the system. 

Those are the two points which need to be recognized. One is the 

timeliness and the other one is the accuracy and validity of the information in the system. 

Senator CARPER. Mr. Khan, I think in responding to the GAO’s 

work, the Army official letter to GAO said, ‘‘We appreciate your 

confirmation that no significant issues were identified in your review of the military pay accounts for the Army.’’ That is part of 

what it said. Based on what we heard from you and some from the 

Colonel, it seems a bit of an odd comment based on your testimony. 

Do you believe, as the Army stated, that your audit showed no significant issues? 

Mr. KHAN. Our report has been very clear in highlighting the deficiencies in the Army’s processes and systems. The deficiencies in 

the systems and processes really increase the risk of inaccurate 

payments as I mentioned before. Along with the timeliness with 

which the information that is provided, those are very significant 

issues, both towards the accuracy and validity of the information 

in the system and also to be able to get ready for an audit whether 

it is 2014 or 2017. The issues we highlighted are very significant. 

Senator CARPER. Thank you. 

Mr. PLATTS. I am going to ask one question and then yield to 

Senator Carper before wrapping this up. We may have some follow 

up in writing because of time constraint. 

Ms. Brooks, key here is the Integrated Personnel Pay System you 

are moving forward with that ultimately will combine both active, 

Reserve, Guard and ultimately also payroll and personnel records. 

You talk in your testimony about that is in process. What is the 

time frame we see for that implementation? 

Ms. BROOKS. The IPPS–A Program will be fielded in five different releases. Acquisition-wise, there are two increments. The 

first release will be an integrated database. It will be populated 

from the existing legacy databases. That first capability will be 

available around March 2013. Then each year, we have increasing 

capability. In 2014 and 2015, we have added personnel transactions. Those transactions are critical to eventually get to payroll. 

55 

In fiscal year 2016, we will move on to the payroll piece of the program and move off DJMS, the DFAS-based system. 

Mr. PLATTS. When we look at the 2014 mid step to getting to a 

full audit of budgetary resources, we really are going to be in the 

early stages of this system even being started? 

Ms. BROOKS. Correct. 

Mr. PLATTS. That is not going to help us really get to that audit 

capability we are talking about in 2014 that Secretary Panetta has 

laid out? 

Ms. BROOKS. That is correct. The integrated database will help 

us to some extent but it will not give us those transactions. 

Mr. PLATTS. One final question related to access to information. 

You reference also that you are studying the expansion of the Personnel Electronic Records Management System, iPERMS, to include all the supporting documentation. Where is that study and 

what do you anticipate coming from that? 

Ms. BROOKS. We still have a long ways to go on that study. The 

regulation that governs that system is up for review right now and 

under revision. The system itself will have to be changed once we 

determine what the policies are. It takes quite a bit of time because 

there are a large number of stakeholders involved in changing the 

policies that exist right now to include the Reserve components. 

As we do that, we have to take a look at the level of intrusion 

we are considering with documentation going into this electronic 

system. When we talk about birth certificates and marriage licenses, that does not seem very intrusive but certain pay events 

are also driven or authorized by documents such as divorce decrees, 

custody suits, paternity suits. It is going to take us some time to 

work with all of our stakeholders and get to the right level of documentation that is not so intrusive but is still authorizing. 

Mr. PLATTS. Getting through all that is going to be key to getting 

to ultimately one which is having in the system, easily accessible 

proper documentation to support whatever actions we take. With 

the study of that issue and iPERMS as well as the long term Integrated Personnel pay system, it is going to be critically important 

to achieving what we are all after. The bottom line is paying our 

soldiers and doing right by them and their families. 

I will yield to Senator Carper. 

Senator CARPER. One of the things Mr. Connolly knows I sometimes like to do when I chair hearings over in the Senate is we get 

to the end of the hearing, I ask the witnesses given what you have 

heard, what you have said and what we have asked and some 

thoughts you have had, make a brief closing statement. 

We always ask you to make an opening statement, we give five 

minutes and then we ask you to consider making just a brief closing statement for 30 to 60 seconds about what you would like to 

have us walk out of here thinking about as well. 

Mr. Khan, we heard a fair amount from Mr. Watkins, Ms. Brooks 

and Mr. Gillison here today through testimony. I am sure a lot of 

work has gone into them preparing for today. As we listen to what 

they are saying and watch what they are doing, what kind of actions will say, boy, they have it, they are on the right track? They 

have turned the corner, they are going to do this. What should we 

be looking for? 

56 

Mr. KHAN. It is encouraging with the response we got from the 

Army that they are taking the steps they should be taking to identify their process. That is the key to really understanding where 

the internal controls are. However, they really need to go beyond 

that, just working with DFAS, and also include the system owners 

and human resources, so it should not really be in isolation. 

I am encouraged that they are heading in the right direction but 

I guess it is first, one step at a time. The only thing is the time 

line is compressed and 2014 is going to be here before we know it. 

Senator CARPER. So there is a sense of urgency. In the Senate, 

we don’t always operate with a sense of urgency as my friend from 

Pennsylvania knows. As a recovering governor, it drives me crazy 

sometimes and I am sure I drive my colleagues crazy as well sometimes. As much as anything I want to really impart a sense of urgency to you. I think that is what Secretary Panetta was trying to 

do as he takes on his responsibilities here. 

Speaking of Secretary Panetta, in my opening statement, I mentioned he had been very vocal in his support for improved financial 

information and financial management at the Department he now 

leads. I very much applaud his commitment to that goal. We will 

work with him during my time as chairman of our subcommittee 

in the Senate while we continue to try to partner with the Department of Defense and also with GAO towards supporting the goal 

of better accountability. I just think knowing that war fighters 

need our best efforts on this, so do the taxpayers. 

Mr. Watkins, you sort of alluded to this already. Can you again 

tell us what changes are forthcoming and how the new Army payroll and other related systems will be improved to meet Secretary 

Panetta’s commitment to not only meet the 2017 goal of 

auditability but to meet the Secretary’s challenge to the Department of being auditable before 2017? For example, how have your 

goals changed to meet the new goal to audit the Statement of 

Budgetary Resources by 2014? 

Mr. WATKINS. Sir, that is a multi-faceted question. I will try and 

address each part. 

First of all, the changes you will see in the Army’s rolling out its 

Enterprise Resource Planning Systems, the first thing we need to 

do in order to be auditable by 2017 is we need enterprise systems, 

not stovepipe systems that are old. The problems the Lieutenant 

Colonel brought up today, a lot of those are because of the builtin inefficiencies and ineffectiveness of some of our old systems, so 

these enterprise systems are key. That is number one. 

Number two is change management. We have a huge issue before us of change management because we are changing systems, 

we are changing processes, we are changing procedures and we are 

changing standard operating systems. Change management requires a competent workforce because what we are asking the 

workforce to do is different than what we used to ask them to do. 

We need more analysts and more people that have credentials than 

data entry folks because the systems allow different inputs and different analysis. We need training, so we have stepped up the training. We are doing a lot of training across the Army for this audit 

readiness. 

57 

In 237 years, the Army has never had a financial statement 

audit. We have never been asked until recently the passage of the 

recent laws. We have had a lot of compliance audits and program 

audits, but a financial statement audit is a different beast. As GAO 

points out one of the biggest things is having the documentation to 

prove we are doing it right. We can’t prove it today and that is the 

weakness we have. That is what we are about doing. 

To the second piece of your question concerning 2014, because we 

don’t have an integrated pay and personnel system for 2014, we 

have to look at our current system which we call our legacy system, 

the Defense Joint Military Pay System. Our intention was not to 

use DJMS to go to audit in 2017; our intention was to use IPPS– 

A. 

Now that we are not going to have IPPS–A, we have to get these 

problems with our legacy system fixed and those are the recent activities I mentioned in my statement, the successes we have had 

about tying up detailed transactions to the General, summary data 

and tying the disbursing data to the accounting system so it is 

transaction-driven. We can drill it all the way down and get the 

proof for it. 

Senator CARPER. I said earlier I would ask you all each to just 

give a closing statement, if it is all right with you, Mr. Chairman. 

I will start with you Mr. Gillison. Use no more than a minute, 

please. 

Mr. GILLISON. Yes, sir. 

First, I appreciate being here today and telling the story of the 

proud Americans, some who have served in uniform, some who 

have not, that are committed to continuous improvement in paying 

our soldiers, sailors, airmen and Marines properly. 

We live in two worlds. We live in the current world where we 

have to be ready by 2014 for the SBR military pay. We have to continue to improve on our current system and we have to be able to 

show proof that we have the documents. We will get there. We are 

committed. 

We had a mock audit out briefing this week from a public accounting firm looking at some of the very same things identified 

and they think we can get there. They believe we can get there. 

We are going to do an SSA–16 study with accounting looking at 

military pay by September 2012. That will position us so we can 

do corrective actions in 2013 and we are ready in 2014. I am more 

on the scale of a paratrooper on top of a hill knowing that we are 

going to achieve the mission. I have no doubt about that with the 

personnel we have and the commitment. 

Thank you. 

Senator CARPER. From your lips to God’s ears. 

Ms. Brooks. 

Ms. BROOKS. Again, I would like to thank you for the opportunity 

to appear here this morning. We are very, very committed to making sure that things are correct on the personnel side and on the 

pay side and eventually, the integration of the personnel and payrolls. 

We need the additional support for our ERP programs, as Mr. 

Watkins has explained, and we appreciate the oversight that we 

are getting from GAO because they are going to collaborate with 

58 

us and help us so that we achieve our eventual goal whether it is 

in the near term with things that are less automated and in the 

long term when we get our fully fielded personnel and pay system. 

Senator CARPER. Thank you. 

Mr. Watkins? 

Mr. WATKINS. First, I would like to thank you and the Committee and the staffers who worked in preparation of this hearing. 

Senator CARPER. Even Peter Tyler? 

Mr. WATKINS. Even Peter. I have been working with Peter for 

over two years now because of other hearings on your side. 

Senator CARPER. My heart goes out to you. He is great. 

Mr. WATKINS. He is and I have enjoyed working with him and 

enjoy looking forward to the continuing relationship. 

My message is there is an old expression when I first came in 

the Army that said the organization only does well those things 

that the boss checks. I think it is very important for the Congress 

to continue it’s oversight and conduct these hearings because that 

has given impetus to this change that we are undergoing. I think 

it is important that Congress continues that because our leaders 

have the message. Our leaders are committed to it and we are 

checking and getting better. I think the future is brighter today 

than it was two years ago. 

Senator CARPER. Thank you. 

Mr. Khan? 

Mr. KHAN. Thank you very much. 

I have really been encouraged with the tone of this hearing and 

with how the Army and DEFAS responded to our findings. At the 

same time, it is very important that they follow through and commitment exists. We obviously will be providing our oversight. Our 

work is done with the spirit of providing constructive advice. At the 

same time, exactly as Mr. Watkins said those charged with government and oversight it is very important that they stay involved so 

that the pace of progress continues and if there is any help needed 

by the audit team, that is provided on a timely basis. 

Thank you. 

Senator CARPER. We appreciate very much the work that you 

and your colleagues at GAO continue to do with us for the American people on so many fronts. I would also say that I am encouraged by the tone of the testimony here and the comments we received from everyone. 

Sometimes Mr. Chairman, I have seen, as I am sure you have, 

where GAO comes in and has done a very good job on an audit and 

the folks who come from the agency about whom the hearing is 

being held are in like a state of denial and not really acknowledging they have a problem. It’s usually somebody elses and we’re 

not hearing that today. 

As we leave here I just want us to keep in mind the men and 

women who are serving us all around the world in some places not 

in the middle of hostility are not in imminent danger but in some 

places, they are in real danger. In some cases, they are single and 

have no wife, no husband, no children, no dependents. But in some 

cases, they have all of the above. The last thing we want them to 

have to worry about is how are we going to pay our bills, how is 

my family getting by, they are depending on me and I am not able 

59 

to help them. That is a problem we don’t need. They don’t need 

that and we don’t need that as a country. 

As we look at these goals that we set ahead to 2014 and 2017, 

let us keep in mind this is not so much about complying with the 

law, staying in line with the GAO audit; there are real people involved in this. 

Thank you. 

Mr. PLATTS. Chairman Carper, I certainly thank you and your 

staff for partnering with our House Subcommittee. 

Senator CARPER. We love doing it. 

Mr. PLATTS. It is a good example. Maybe in the public eye, they 

think Republicans and Democrats, House and Senate, just can 

never agree on anything and work together. This is a good example 

where we can and do, not just within the committees but with the 

witnesses here today, GAO, the DFAS and the Army, Colonel 

Zecchini and his testimony, how it impacts a soldier and a family 

ultimately when we don’t get it right. I know we are all on the 

same page of what we are after and we are committed to getting 

there. 

While I can’t make a commitment for myself beyond the end of 

this year because my chairmanship and tenure here will end in the 

House for at least the remainder of this year, I know Senator Carper and others, House and Senate, will continue well beyond the 

end of this year working with each of you in that partnership. 

I like the motto about what the boss checks. I think it is a good 

approach and certainly we try in our Oversight Committee, and I 

know Chairman Carper does it as well on the Senate side, is doing 

oversight, it is not a gotcha, it is just trying to make sure we are 

keeping an eye on the ball. In this case, it is good financial management that ultimately means we do right by our courageous men 

and women in uniform. 

We appreciate all of your testimonies and we will keep the record 

open for seven days for any additional information you can submit. 

We do look forward to continuing to work with each of you along 

with our staffs in moving forward. 

This joint hearing stands adjourned. 

[Whereupon, at 11:44 a.m., the committees were adjourned.] 

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Æ 


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