SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION 

400 Army Navy Drive • Arlington, Virginia 22202 

January 26, 2010 

LETTER FOR U.S. AMBASSADOR TO IRAQ 

SUBJECT: Department of State Contract to Study the Iraq Reconstruction Management System 

(SIGIR 10-010) 

This letter is to bring to your attention the concerns of the Special Inspector General for Iraq 

Reconstruction (SIGIR) about a Department of State (DoS) Office of Acquisition Management 

contract that would develop a follow-on system for the Iraq Reconstruction Management System 

(IRMS). DoS awarded a $5 million contract to Enterprise Information Systems for a new system 

to be delivered in October 2010. SIGIR is concerned that the follow-on system will not be 

developed in time to achieve meaningful results and that replacing IRMS a year from now would 

not be a cost-beneficial way to track the small amount of U.S.-funded reconstruction projects that 

would remain after October 2010.1 

Background 

In late 2004, the U.S. Army Corps of Engineers Gulf Regional Division (GRD) and the Project 

and Contracting Office developed IRMS. The system provided a unified information technology 

system that all U.S. government agencies receiving Iraq Relief and Reconstruction Funds (IRRF) 

could use to track and manage U.S. government-sponsored reconstruction projects. All agencies 

spending IRRF dollars were to load and update IRRF-funded project data into the IRMS system. 

The shared information in IRMS was meant to provide a common operating picture of the 

reconstruction program, avoid duplication of effort, assist decision making, and meet Embassy 

and Congressional reporting requirements. IRMS was also intended to provide the Government 

of Iraq with information on the U.S. reconstruction effort. 

IRMS was originally intended to be a data base for IRRF-funded projects. However, through the 

years, data has been added from Iraq Security Forces Fund (ISFF) projects, Commander’s 

Emergency Response Program (CERP) projects, and Economic Support Fund (ESF) projects. 

SIGIR has issued two reports on IRMS that identify problems with the quality, accuracy, and 

completeness of its data. SIGIR’s last IRMS report was issued in July 2008 and was intended to 

assess the overall data system management, policies, procedures, uses, and benefits.2

 However, 

 

1

 Although SIGIR does not believe that a follow-on system for IRMS is needed, ITAO and GRD still need to 

identify how the existing IRMS data will be archived if a decision is made to discontinue the development of a new 

system. 

2 Comprehensive Plan Needed to Guide the Future of Iraq Reconstruction Management System, SIGIR 08-021, 

7/26/2008.
2 

in the course of conducting the review, SIGIR learned that GRD was preparing a draft plan for 

the future of IRMS. As a result, SIGIR stopped its review and issued a report to alert the 

Embassy and GRD of certain issues that needed to be addressed. 

Foremost, SIGIR pointed out that when IRMS was initiated in 2004, it had a design life of five 

years (completing in 2009). A life cycle maintenance program was not implemented, and the 

system, then in its fourth year of operation, was becoming operationally unreliable and unstable. 

SIGIR also reported that IRMS had few system upgrades and many of its critical system 

components were no longer under warranty. In some cases, the manufacturer no longer 

supported the system. SIGIR recommended that the U.S. Ambassador to Iraq and the 

Commanding General, Multi-National Forces-Iraq, jointly direct the establishment of an 

interagency planning process to address the future operation and use of IRMS. 

In written comments on a draft of our July 2008 report, GRD stated that it had authorized one of 

its contractors to conduct a study of IRMS and that the study would consider factors such as the 

system’s age, compatibility of hardware platforms, and software and network infrastructure. The 

study would also provide GRD with recommendations for the future needs of stakeholders. 

DoS did not respond to the July 2008 draft report until December 20, 2008, but concurred with 

all the report recommendations. In the response, the U.S. Ambassador appointed the Iraq 

Transition and Assistance Office (ITAO) as the executive agent for IRMS. In addition, the 

Ambassador stated that the recommendation regarding current and future system requirements of 

stakeholders and the need for a common operating picture were particularly important. 

As of November 2009, neither GRD nor ITAO had developed the plans they had committed to in 

their formal comments to SIGIR’s draft report. 

Replacing IRMS May No Longer Be Necessary or Cost Beneficial 

In SIGIR’s view, the more than one-year delay in developing and implementing our 

recommended plan to guide the future of IRMS has greatly lessened the need for a replacement 

system because more than 95% of the four major funds appropriated for Iraq reconstruction to 

date have been spent. At this time, investing resources to replace IRMS would likely be neither 

useful to IRMS users nor cost beneficial. Our view is based on the following facts: 

1. By October 2010, the earliest date that a system will be delivered, the majority of funds 

appropriated for Iraq relief and reconstruction activities will have been obligated and few 

funds will remain to be tracked or managed by the proposed replacement system. Remaining 

Department of Defense projects can be tracked by the U.S. Army Corps of Engineers 

Financial Management System (CEFMS) and Department of State and U.S. Agency for 

International Development projects can be tracked by the DoS’ Foreign Assistance 

Coordination and Tracking System. 

2. The Government of Iraq’s Ministry of Planning and Development Cooperation recently 

worked with ITAO and GRD to identify the IRMS project data that it will require for asset 

transfer and concluded that its needs can be met with existing IRMS data and it has no need 

for hardware or software support. 
3 

3. A SIGIR survey of all principal agencies involved in Iraq reconstruction found that none of 

the agencies currently use IRMS as their primary tool for financial or project reporting. 

Moreover, many of these agencies question the need for a replacement IRMS system as it 

will only require additional work for them to enter data into the system which they will not 

use. 

4. Many of the organizations responsible for reporting reconstruction information into IRMS 

are currently in the process of reorganizing, downsizing or both. As this process proceeds, 

many of the personnel from these agencies who currently work with and are familiar with 

IRMS will be departing Baghdad or reassigned to new positions thereby creating a potential 

loss of critical expertise and experience which would be needed to design a new system to 

replace IRMS. The two major organizations managing and operating IRMS, ITAO and 

GRD, have already started the process of reorganizing and downsizing. 

5. SIGIR has pointed out in numerous reports that IRMS suffers from inconsistencies in data 

quality, accuracy, and overall usefulness. Without a plan to resolve these issues, a new 

system will only perpetuate the inconsistent data quality, accuracy, and overall usefulness 

problems. 

U.S. Appropriations Remaining for Obligation 

By October 2010, the earliest date that a system will be delivered, the majority of funds 

appropriated for Iraq relief and reconstruction activities will have been obligated or will no 

longer be available for obligation. SIGIR does not believe that tracking projects funded by the 

amounts remaining warrants the development of a replacement project database system. 

The following represents SIGIR’s analysis of the reconstruction funds remaining: 

• The Iraq Relief and Reconstruction Fund (IRRF) IRRF was the largest U.S. 

reconstruction fund, comprising $20.87 billion made available through two 

appropriations: IRRF 1 ($2.48 billion) and IRRF 2 ($18.39 billion). IRRF 2 expired for 

new obligations on September 30, 2008. Consequently, a replacement project database 

system to track IRRF projects is not needed. 

• The Iraq Security Forces Fund (ISFF) The Congress has appropriated $18.04 billion to 

the ISFF to support Iraq’s Ministry of Defense and Ministry of Interior in developing 

Iraqi Security Forces. As of September 30, 2009, $16.67 billion (92%) of the ISFF had 

been obligated. ISFF funds are one-year funds and as of September 30, 2010, all ISFF 

funds appropriated to date will have expired for new obligations. The Congress has 

included no new ISFF funds in DoD’s FY 2010 appropriation bill. Consequently, a 

replacement project database system to track ISFF projects is not needed. 

• The Economic Support Fund (ESF) Since 2003, the Congress has appropriated $4.56 

billion to the ESF to improve infrastructure and community security, promote democracy 

and civil society, and promote capacity building and economic development. ESF money 

is available for two years. The Congress appropriated $439 million for ESF in FY 2009, 

and an additional $382 million in FY 2010. Thus, a new project database system, if 

available in October 2010, could only track projects funded by the second year of a FY 

2010 appropriation. In addition, other DoS and U.S. Agency for International 
4 

Development (USAID) automated systems are available to track projects such as the 

Foreign Assistance Coordination and Tracking System. 

• The Commander’s Emergency Response Program (CERP) Since 2004, the Congress 

has appropriated $4.05 billion to the CERP to enable U.S. military commanders to 

provide targeted local relief and reconstruction throughout Iraq. Appropriated CERP 

funds are available for obligation for one year. In FY 2008 the Congress appropriated 

$994 million for CERP and in FY2010 appropriated $200 million. Consequently, a new 

project database to track CERP projects is not needed since the new system would not be 

available after the availability of FY 2010 CERP funds ends. 

Providing Project Information to the Government of Iraq is No 

Longer Necessary 

The original IRMS requirement to provide information to the Government of Iraq is no longer 

necessary. ITAO recently worked with the Government of Iraq’s Ministry of Planning and 

Development Cooperation to identify its reconstruction project information needs for projects 

completed and transferred to the Ministry. The first transfer to the Ministry under the 

memorandum of understanding occurred on November 11, 2009, and provided information on 

4,321 projects. The transmittal letter that accompanied this transfer identified the data fields in 

the project record along with a description of the data in each field. According to DoS officials, 

Ministry officials stated that their information needs can be met with existing IRMS data and 

they have no need for either hardware or software to support the asset transfer process. 

U.S. Reconstruction Agencies Do Not Use IRMS as a Primary 

Information System for Reconstruction Data 

A SIGIR survey of all principal agencies involved in Iraq reconstruction found that none of the 

agencies currently use IRMS as their primary management information system for financial or 

project information. As such, many of these agencies question the need for IRMS as it requires 

additional work for them to enter data into IRMS though they do not use the system. According 

to USAID officials, the DoS already maintains a management information system known as the 

Foreign Assistance Coordination and Tracking System to address its mandate to gather and store 

information on all Foreign Assistance money being spent in any country in the world. 

Additionally, USAID maintains information on its projects, both past and present, in other 

management information systems. 

In addition, other agencies have indicated to SIGIR that they use other internal systems to report 

financial or project information to their agency management. The Multi-National Security 

Transition Command-Iraq uses a spreadsheet software package and GRD’s Resident 

Management System software to review and track project status. The Multi-National Corps-Iraq 

uses the Department of the Army’s Standard Financial System and Combined Information Data 
5 

Network Exchange system along with spreadsheet software to track and report its reconstruction 

projects.3

Agencies Responsible for Reconstruction Information Are 

Downsizing 

Many of the organizations responsible for reporting reconstruction information into IRMS are 

currently in the process of reorganizing, downsizing, or both. As this process proceeds, many of 

the personnel from these agencies who currently work with and are familiar with IRMS will be 

departing Baghdad or reassigned to new positions thereby creating a potential loss of critical 

expertise and experience which would be needed to design a new system to replace IRMS. The 

two major organizations managing and operating IRMS, ITAO and GRD, have already started 

the process of reorganizing and downsizing. 

In an August 21, 2009 memorandum, the GRD Commanding General stated that as of October 

2010, GRD would no longer have the capability to manage IRMS. The memorandum goes on to 

state “...that DoS assumes full control of IRMS and/or the follow on system on 1 October 2010. 

This includes financing, awarding of contracts, and hiring Program Managers as required.” 

Conclusion 

As the executive agent for IRMS, ITAO is responsible for leadership and strategic guidance 

regarding IRMS requirements. The Ambassador’s December 2008 response to SIGIR’s July 

2008 report stated that ITAO, working with other IRMS users, would produce an analysis of 

IRMS information requirements. However, to date, this analysis has not been done. 

SIGIR believes that the long delay in taking action to improve IRMS has largely negated any 

potential benefits from improving or developing a replacement for IRMS. About 95% of the 

funds appropriated for the reconstruction of Iraq to date have been spent, and the need for an 

improved management information system for the remaining funds is likely to be marginal. 

Additionally, the plan to turn IRMS hardware and software over to the Government of Iraq has 

been dropped. Given this, investing $5 million for a replacement system that will not be 

available until October 2010 at the earliest will not likely provide any meaningful improvements 

or benefits to either the Embassy or any other IRMS users. Moreover, the principal agencies that 

will be involved in reconstruction beyond October 2010 have existing systems that can track 

reconstruction activities. 

Recommendation 

SIGIR recommends that, absent information showing the need to develop a replacement system 

for IRMS, the U.S. Ambassador to Iraq direct that the Iraq Transition Assistance Office cancel 

that part of the contract with Enterprise Information Systems to develop a new web-based system 

to replace Iraq Reconstruction Management System. 

 

3

 Both of these commands were subsumed into U.S. Forces-Iraq on January 1, 2010. 
6 

Management Comments and Audit Response 

In written comments on a draft of this letter report, the Embassy stated that it did not concur with 

our recommendation that it cancel the contract with Enterprise Information Systems. According 

to the Embassy, it believes it should continue the contract because it “hopes to get a fresh 

perspective from [Enterprise Information Systems] and the possible directions ITAO can take on 

the future of the IRMS information.” The Embassy’s comments are reprinted in their entirety in 

Appendix D. 

As discussed earlier, the contract directs Enterprise Information System to “develop a follow-on 

system that incorporates up to 5 additional databases” and to “Develop a new web based system 

to replace IRMS and assistance databases.” The contract also directs Enterprise Information 

Systems to “interview key personnel from the agencies currently involved in tracking and 

disseminating data for Iraq relief and reconstruction.” 

In assessing the contract, SIGIR interpreted the requirement to interview personnel as a part of 

the new system-development effort called for in the contract. In its comments, however, the 

Embassy said that this is not the case and that this information is needed to determine a course of 

action for the existing IRMS information. When viewed as a requirement to gain information on 

the future of IRMS rather than a part of a new system development effort, and since this 

information has been gathered, SIGIR agrees that this information should be considered by the 

Embassy. Thus, while SIGIR continues to believe that the primary purpose of the contract was 

the development of a new system we do recognize that developing a course of action for IRMS 

information is important. Therefore, SIGIR modified its draft recommendation to make it clear 

that unless the information gathered under the contract provides some sound reasons to continue 

IRMS, we continue to believe that the Embassy should cancel the remaining system development 

tasks. 

- - - - 

 
7 

We appreciate the courtesies extended to the SIGIR staff. For additional information on the 

report, please contact David Warren, Assistant Inspector General for Audits, (703) 604-0982/ 

david.warren@sigir.mil or Glenn Furbish, Principal Deputy Assistant Inspector General for 

Audits (Washington, DC), (703) 604-1388/ glenn.furbish@sigir.mil. 

Stuart W. Bowen, Jr. 

Inspector General 

cc: U.S. Secretary of State 

Deputy Chief of Mission for Assistance Transition 

U.S. Secretary of Defense 

Commander, U.S. Central Command 

Commanding General, U.S. Forces-Iraq 

Administrator, U.S. Agency for International Development 
8 

Appendix A—Scope and Methodology 

In November 2009, the Special Inspector General for Iraq Reconstruction (SIGIR) initiated 

Project 1001 to addresses concerns SIGIR identified in a July 2008 report on the Iraq 

Reconstruction Management System (IRMS). The objectives of this report are to determine 

whether plans for storing and maintaining data contained in IRMS over the long-term have been 

developed. This review was performed by SIGIR under the authority of Public Law 108-106, as 

amended, which also incorporates the duties and responsibilities of inspectors general under the 

Inspector General Act of 1978. SIGIR conducted its work from November through December 

2009 in Baghdad, Iraq. 

To accomplish our objectives we held discussions with officials from the Department of State, 

U.S. Agency for International Development, and U.S. Forces-Iraq in addition to reviewing prior 

audit reports. We reviewed the Iraq Reconstruction Funding Sources as of September 30, 2009, 

and conducted analysis of the U.S. Appropriations remaining obligations and the FY 2010 

Appropriations Request and Recommendations to determine whether replacing IRMS is still 

necessary and cost beneficial. SIGIR’s analysis of the U.S. appropriations remaining for 

obligations included (1) Iraq Relief and Reconstruction Fund, (2) Iraq Security Forces Fund, (3) 

Economic Support Fund, and (4) Commander’s Emergency Response Program. 

Our analysis considered what Congress had appropriated and the amount of funds expired for 

new obligations, along with the most recent appropriated funds availability for obligations, and 

also the amount of funds the Senate Appropriations Committee recommended for Fiscal Year 

2010. 

The audit was conducted in accordance with generally accepted government auditing standards. 

Those standards require that we plan and perform the audit to obtain sufficient, appropriate 

evidence to provide a reasonable basis for our findings and conclusions based on our objectives. 

We believe that the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives. 

Use of Computer-processed Data 

Computer-processed data was not used for any aspect of the audit. 

Internal Controls 

In conducting the audit, we assessed certain internal controls to the audit objectives with respect 

to IRMS. Specifically, we identified and assessed internal or management controls including 

processes for: 

• reporting reconstruction information into IRMS, and 

• maintaining the reliability of reconstruction data. 
9 

Prior Coverage 

We reviewed the following reports by SIGIR for this audit: 

Asset-Transfer Process for Iraq Reconstruction Projects Lacks Unity and Accountability, SIGIR 

09-016, 4/26/2009.

Comprehensive Plan Needed to Guide the Future of Iraq Reconstruction Management System,

SIGIR 08-021, 7/26/2008. 

Interim Report on Iraq Reconstruction Contract Terminations, SIGIR 08-013, 4/28/2008. 

Review of Data Entry and General Controls in the Collecting and Reporting of the Iraq Relief 

and Reconstruction Fund, SIGIR 06-003, 4/28/2006. 

Management of Iraq Relief and Reconstruction Fund Program: The Evolution of the Iraq 

Reconstruction Management System, SIGIR 06-001, 4/24/2006. 

Issues Related to the Use of the $50 Million Appropriation to Support the Management and 

Reporting of the Iraq Relief and Reconstruction Fund, SIGIR 05-026, 1/26/2006. 

 
10 

Appendix B—Acronyms 

Acronym Description 

CERP Commander’s Emergency Response Program 

DoS U.S. Department of State 

ESF Economic Support Fund 

FY Fiscal Year 

GRD U.S. Army Corps of Engineers Gulf Region Division 

IRMS Iraq Reconstruction Management System 

IRRF Iraq Relief and Reconstruction Fund 

ISFF Iraq Security Forces Funds 

SIGIR Special Inspector General for Iraq Reconstruction 

ITAO Iraq Transition and Assistance Office 

USAID U.S. Agency for International Development 

 
11 

Appendix C—Audit Team Members 

This report was prepared and the review conducted under the direction of David R. Warren, 

Assistant Inspector General for Audits, Office of the Special Inspector General for Iraq 

Reconstruction. 

The staff members who conducted the review and contributed to the report include: 

Arthur Granger 

W. Dan Haigler 

Nancee Needham 

 
12 

Appendix D—Management Comments 
13 

 
14 

Appendix E—SIGIR Mission and Contact Information 

SIGIR’s Mission Regarding the U.S. reconstruction plans, programs, and 

operations in Iraq, the Special Inspector General for Iraq 

Reconstruction provides independent and objective: 

• oversight and review through comprehensive audits, 

inspections, and investigations 

• advice and recommendations on policies to promote 

economy, efficiency, and effectiveness 

• deterrence of malfeasance through the prevention and 

detection of fraud, waste, and abuse 

• information and analysis to the Secretary of State, the 

Secretary of Defense, the Congress, and the American 

people through Quarterly Reports 

Obtaining Copies of SIGIR 

Reports and Testimonies 

To obtain copies of SIGIR documents at no cost, go to 

SIGIR’s Web site (www.sigir.mil). 

To Report Fraud, Waste, and 

Abuse in Iraq Relief and 

Reconstruction Programs 

Help prevent fraud, waste, and abuse by reporting 

suspicious or illegal activities to the SIGIR Hotline: 

• Web: www.sigir.mil/submit_fraud.html 

• Phone: 703-602-4063 

• Toll Free: 866-301-2003 

Congressional Affairs Hillel Weinberg 

Assistant Inspector General for Congressional 

 Affairs 

Mail: Office of the Special Inspector General 

 for Iraq Reconstruction 

 400 Army Navy Drive 

 Arlington, VA 22202-4704 

Phone: 703-428-1059 

Email: hillel.weinberg@sigir.mil 

Public Affairs Danny Kopp 

Office of Public Affairs 

Mail: Office of the Special Inspector General 

 for Iraq Reconstruction 

 400 Army Navy Drive 

 Arlington, VA 22202-4704 

Phone: 703-428-1217 

Fax: 703-428-0818 

Email: PublicAffairs@sigir.mil