In May 2003, the Coalition Provisional Authority (CPA) dissolved the military organizations of the former regime and began the process of reestablishing or creating new Iraqi security forces, including the police and a new Iraqi army. Over time, multinational force commanders assumed responsibility in their areas for recruiting and training some Iraqi defense and police forces. In October 2003, the multinational force outlined a multistep plan for transferring security missions to Iraqi security forces. The plan had the objective of gradually decreasing the number of coalition forces in conjunction with neutralizing Iraq's insurgency and developing Iraqi forces capable of securing their country. Citing the growing capability of Iraqi security forces, coalition forces in Iraq began to shift responsibilities to Iraqi security forces in February 2004, earlier than planned. According to the President, senior DOD officials, and multinational force commanders, Iraqi forces were unprepared to assume security responsibilities and responded poorly to a series of anti-coalition attacks in April 2004. In western and central Iraq, insurgents attacked the multinational force in Fallujah, Baghdad, Ar Ramadi, Samarra, and Tikrit, while a radical Shi'a militia, the Mahdi Army, launched operations to dislodge multinational forces and occupy cities from Baghdad to Basra in the south. Although some Iraqi forces fought alongside coalition forces, other units abandoned their posts and responsibilities and, in some cases, assisted the insurgency. MNF-I identified a number of problems that contributed to the collapse of Iraqi security forces, including problems in training and equipping them. In May 2004, the President issued a National Security Presidential Directive, which stated that, after the transition of power to the Iraqi government, DOD would be responsible for U.S. activities relating to security and military operations. The Presidential directive established that the U.S. Central Command (CENTCOM) would direct all U.S. government efforts to organize, equip, and train Iraqi security forces. In the summer of 2004, MNF-I developed and began implementing a comprehensive campaign plan, which elaborated and refined the original strategy for transferring security responsibilities to Iraqi forces. In April 2006, MNF-I revised the campaign plan and, in conjunction with the U.S. Embassy in Baghdad, issued a new Joint Campaign Plan that contains the goal of transitioning security responsibility from MNF-I to the Iraqi security forces and government. Further details on the campaign plan are classified. In late August 2006, the MNF-I Commanding General said that the United States is helping Iraq build a force to deal with its current security threats of international terrorism and insurgency. He noted, however, that the Iraqi government is developing a long-term security plan to shape the type of armed forces that the country will need 5 to 10 years from now. Since June 2003, overall security conditions in Iraq have deteriorated and grown more complex, as evidenced by increased numbers of attacks and more recent Sunni/Shi'a sectarian strife after the February 2006 bombing of the Golden Mosque in Samarra. The deteriorating conditions threaten continued progress in U.S. and other international efforts to assist Iraq in the political and economic areas. Moreover, the Sunni insurgency and Shi'a militias have contributed to an increase in sectarian strife and large numbers of Iraqi civilian deaths and displaced individuals. Enemy-initiated attacks against the coalition and its Iraqi partners have continued to increase through July 2006 (see fig. 1). Since 2003, enemy- initiated attacks have increased around major religious or political events, including Ramadan and elections. Attack levels also follow a seasonal pattern, increasing through the spring and summer and decreasing in the fall and winter months. Overall, attacks increased by 23 percent from 2004 to 2005. After declining in the fall of 2005, the number of attacks rose to the highest level ever in July 2006. Total attacks reported from January 2006 through July 2006 were about 57 percent higher than the total reported during the same period in 2005. These data show significant increases in attacks against coalition forces, who remain the primary targets, as well as civilians and Iraqi security forces. According to a June 2006 UN report, an increasingly complex armed opposition continues to be capable of maintaining a consistently high level of violent activity across Iraq. Baghdad, Ninewa, Salahuddin, Anbar, and Diyala have been experiencing the worst of the violence. Other areas, particularly Basra and Kirkuk, have witnessed increased tension and a growing number of violent incidents. In August 2006, DOD reported that breaking the cycle of violence is the most pressing immediate goal of coalition and Iraqi operations. The security situation has deteriorated even as Iraq has made progress in meeting key political milestones and in developing its security forces. Since the CPA transferred power to the Iraqi interim government in June 2004, Iraq has held an election for a transitional government in January 2005, a referendum on the constitution in October 2005, and an election for a Council of Representatives in December 2005 that led to the formation of a new government in May 2006 (see fig. 2). However, according to the Director of the Defense Intelligence Agency (DIA), the December 2005 elections appeared to heighten sectarian tensions and polarize sectarian divides. According to a U.S. Institute of Peace report, the focus on ethnic and sectarian identity has sharpened as a result of Iraq's political process, while nationalism and a sense of Iraqi identity have weakened. Moreover, according to the Director of National Intelligence's February 2006 report, Iraqi security forces are experiencing difficulty in managing ethnic and sectarian divisions among their units and personnel. In addition, the DIA Director reported that many elements of the Iraqi security forces are loyal to sectarian and party interests. According to DOD's August 2006 report, sectarian lines among Iraqi security forces are drawn along geographic lines, with Sunni, Shi'a, or Kurdish soldiers mostly serving in units located in geographic areas familiar to their group. Moreover, according to the report, commanders at the battalion level tend to command only soldiers of their own sectarian or regional background. On August 7, 2006, MNF-I and Iraqi security forces began phase II of Operation Together Forward. The operation is an effort to reduce the level of murders, kidnappings, assassinations, terrorism, and sectarian violence in Baghdad and to reinforce the Iraqi government's control of the city. On August 30, 2006, the MNF-I Commanding General said that he was pleased with the operation's progress, but that there was a long way to go in bringing security to the neighborhoods of Baghdad. U.S. intelligence assessments of this operation's impact are classified. The State Department reported in July 2006 that the recent upturn in violence has hindered the U.S. government's efforts to engage fully with its Iraqi partners and to move forward on political and economic fronts. State noted that a baseline of security was a prerequisite for moving forward on these fronts, which are essential to achieving the right conditions for withdrawing U.S. forces. For example, Iraqi government efforts to foster reconciliation have become more difficult with the increase in sectarian divisions and violence during the spring and summer of 2006. According to DOD's August 2006 report, security issues--such as the attempted kidnapping of a deputy minister and threats to personnel who work with embassy teams--have made some ministers reluctant to have U.S. personnel visit them. The report also noted that the security situation in some provinces has hampered interaction between U.S.-led Provincial Reconstruction Teams and provincial leaders. Moreover, the UN reported that the lack of security has hampered reconstruction efforts. The UN reported that the diplomatic community remains under serious threat as embassy staff have been abducted and killed and facilities attacked. The UN noted that improved security is central to the normal ability of international agencies to provide assistance to the government and people of Iraq. As we reported in July 2006, the poor security conditions have also hindered U.S. and Iraqi government efforts to revitalize Iraq's economy and restore essential services in the oil and electricity sectors. According to a State Department report, during the week of August 16-22, 2006, Iraq was producing 2.17 million barrels of oil per day. This figure is below the Iraqi Oil Ministry's goal of 2.5 million barrels of oil per day and the pre-war level of 2.6 million barrels per day. Over the same time period, electricity availability averaged 5.9 hours per day in Baghdad and 10.7 hours nationwide. Electricity output for the week was about 9 percent above the same period in 2005. U.S. officials report that major oil pipelines continue to be sabotaged, shutting down oil exports and resulting in lost revenues. Current U.S. assistance is focused on strengthening the Strategic Infrastructure Battalions, which are Ministry of Defense forces that protect oil fields and pipelines. Major electrical transmission lines have also been repeatedly sabotaged, cutting power to parts of the country. Security conditions in Iraq have, in part, led to project delays and increased costs for security services. Although it is difficult to quantify the costs and delays resulting from poor security conditions, both agency and contractor officials acknowledged that security costs have diverted a considerable amount of reconstruction resources and have led to canceling or reducing the scope of some reconstruction projects. Although the Sunni insurgency has remained strong and resilient, the presence and influence of Shi'a militias have grown and led to increased sectarian violence. According to a July 2006 State Department report, the Sunni insurgency remains a pressing problem in Iraq. However, in recent months, Shi'a militia groups have grown more prominent and threaten Iraq's stability. The increase in sectarian violence has led to an increasing number of Iraqis fleeing their homes. According to the U.S. Ambassador to Iraq, the demobilization of Shi'a militias requires a corresponding reduction in the Sunni insurgency. Despite coalition efforts and the efforts of the newly formed Iraqi government, insurgents continue to demonstrate the ability to recruit new fighters, supply themselves, and attack coalition and Iraqi security forces. According to a July 2006 State Department report, the Sunni insurgency remains a pressing problem in Iraq, even after the death of Abu Musab al Zarqawi, the leader of al-Qaeda in Iraq, in early June 2006. As DOD recently reported, al-Qaeda in Iraq remains able to conduct operations due to its resilient, semi-autonomous cellular structure of command and control. The Sunni insurgency consists of former Baathists, whose goal is to return to power; terrorist groups such as al-Qaeda in Iraq, its affiliates in the Mujahadeen Shura Council, and Ansar al Sunna; and various other groups that rely on violence to achieve their objectives. Sunni insurgents have no distinct leader but share the goal of destabilizing the Iraqi government to pursue their individual and, at times, conflicting goals. Although these groups have divergent goals, some collaborate at the tactical and operational levels. DOD has reported that the relationships among insurgents, terrorists, and criminal opportunists are blurred at times but that the ideological rifts between terrorists and other resistance groups remain. DOD also reports that many insurgent groups employ a dual-track political and military strategy to subvert emerging institutions and to infiltrate and co-opt security and political organizations. These groups attempt to leverage the political process to address their core concerns and demands while attacking coalition and Iraqi security forces. The presence and influence of Shi'a militia groups have grown in recent months, as they have become more prominent and acted in ways that threaten Iraq's stability. According to the CENTCOM Commander, as of early August 2006, these militias are the largest contributors to sectarian violence in Iraq. As DOD reported in August 2006, the threat posed by Shi'a militias is growing and represents a significant challenge for the Iraqi government. The Shi'a militias that are affecting the security situation the most are the Mahdi Army and the Badr Organization. Mahdi Army: Led by radical Shi'a cleric Muqtada al-Sadr, this group was responsible for attacks against the coalition and two uprisings in April 2004 and August 2004. The militia committed abuses against Sunni civilians, which have exacerbated sectarian tensions, and were implicated in unrest following the February bombing in Samarra. Evidence exists that the Mahdi Army are supplied by sources outside Iraq, most notably Iran. As of June 2006, Sadr followers headed four of Iraq's 40 ministries--the ministries of health, transportation, agriculture, and tourism and antiquities. As DOD recently reported, this militia has popular support in Baghdad and Iraq's southern provinces and is tolerated by elements in the Iraqi government. Badr Organization: This Shi'a militia group is the paramilitary wing of the Supreme Council for the Islamic Revolution in Iraq, a prominent political party in the new government. The party was founded in Iran during the Iran-Iraq war and retains strong ties to Iran. According to DOD, the Badr Organization received financial and material support from Iran, and individuals from Badr have been implicated in death squads. The Supreme Council for the Islamic Revolution in Iraq is one of the two largest Shi'a parties in parliament. One of Iraq's two deputy presidents and the Minister of Finance are party members. According to the CENTCOM Commander, Shi'a militias must be controlled because they are nonstate actors that have the attributes of the state, yet bear no responsibility for their actions. In many cases, according to DOD, militias provide protection for people and religious sites, sometimes operating in conjunction with the Iraqi police in areas where the Iraqi police are perceived to provide inadequate support. According to a May 2006 DOD report, Shi'a militias seek to place members into army and police units as a way to serve their interests. This is particularly evident in the Shi'a dominated south where militia members have hindered the implementation of law enforcement. Militia leaders also influence the political process through intimidation and hope to gain influence with the Iraqi people through politically based social welfare programs. In areas where they provide social services and contribute to local security, they operate openly and with popular support. According to the Director of National Intelligence, Iran provides guidance and training to select Iraqi Shi'a political groups and provides weapons and training to Shi'a militant groups to enable anticoalition attacks. Iran also has contributed to the increasing lethality and effectiveness of anticoalition attacks by enabling Shi'a militants to build improvised explosive devices with explosively formed projectiles, similar to those developed by Lebanese Hezbollah. Iranian support for Shi'a militias reinforces Sunni fears of Iranian domination, further elevating sectarian violence. According to the August 2006 DOD report, Sunni Arabs do not have formally organized militias. Instead, they rely on neighborhood watches, Sunni insurgents, and increasingly, al-Qaeda in Iraq. The rise of sectarian attacks is driving some Sunni and Shi'a civilians in Baghdad and in ethnically mixed provinces to support militias. Such support is likely to continue, according to DOD's report, in areas where the population perceives Iraqi institutions and forces as unable to provide essential services or meet security requirements. According to DOD's August 2006 report, rising sectarian strife defines the emerging nature of violence in mid-2006, with the core conflict in Iraq now a struggle between Sunni and Shi'a extremists seeking to control key areas in Baghdad, create or protect sectarian enclaves, divert economic resources, and impose their own respective political and religious agendas. The UN reported in March 2006 that the deteriorating security situation is evidenced by increased levels of sectarian strife and the sectarian nature of the violence, particularly in ethnically mixed areas. Figure 3 shows the ethnic distribution of the population in Iraq. Baghdad, Kirkuk, Mosul, and southwest of Basra are key ethnically mixed areas. In June 2006, the UN reported that much of the sectarian violence has been committed by both sides of the Sunni-Shi'a sectarian divide and has resulted in increased civilian deaths. The UN reported that the number of Iraqi civilian casualties continues to increase, with a total of about 14,300 civilians killed in Iraq from January to June 2006. The overwhelming majority of casualties were reported in Baghdad, according to the report. Specifically targeted groups included prominent Sunni and Shi'a Iraqis, government workers and their families, members of the middle class (such as merchants and academics), people working for or associated with MNF- I, and Christians. According to the UN, daily reports of intercommunal intimidation and murder include regular incidents of bodies of Sunni and Shi'a men found to be tortured and summarily executed in Baghdad and its surrounding areas. Violence against Kurds and Arabs has also been reported in Kirkuk, while the abduction and intimidation of ordinary Iraqis is a growing problem. According to the report, repeated bombings against civilians, mosques, and more recently against churches are creating fear, animosity, and feelings of revenge within Iraq's sectarian communities. Moreover, according to a July 2006 UN report, the increase in sectarian violence has resulted in a growing number of Iraqis fleeing their homes. The UN estimated that about 150,000 individuals had been displaced as of June 30, 2006. The UN reported that people left their community of origin primarily because of direct or indirect threats against them or attacks on family members and their community. According to the report, displaced persons are vulnerable, lack many basic rights, and compete for limited services. This in turn can increase intercommunal animosities and can generate further displacement. Although U.S. and UN officials recognize the importance of demobilizing the militias, the U.S. Ambassador to Iraq has stated that the demobilization of the Shi'a militias depends on a reduction in the Sunni insurgency. According to the Ambassador, a comprehensive plan for demobilizing all the militias and reintegrating them into Iraqi society is needed to ensure Iraq's stability and success. However, the Sunni insurgent groups now see themselves as protectors of the Sunni community, and the Shi'a militias see themselves as protectors of the Shi'a community. As DOD reported in August 2006, Sunni and Shi'a extremists are locked in mutually reinforcing cycles of sectarian strife, with each portraying themselves as the defenders of their respective sectarian groups. DOD and State report progress in developing capable Iraqi security forces and transferring security responsibilities to them and the Iraqi government in three key areas: (1) the number of trained and equipped forces, (2) the number of Iraqi army units and provincial governments that have assumed responsibility for security of specific geographic areas, and (3) the assessed capabilities of operational units, as reported in aggregate Transition Readiness Assessment (TRA) reports. While all three provide some information on the development of Iraqi security forces, they do not provide detailed information on specific capabilities that affect individual units' readiness levels. Unit-level TRA reports provide that information. We are currently working with DOD to obtain these reports because they would more fully inform both GAO and the Congress on the capabilities and needs of Iraq's security forces. DOD and State have reported progress toward the current goal of training and equipping about 325,000 Iraqi security forces by December 2006. As shown in table 1, the State Department reports that the number of trained army and police forces has increased from about 174,000 in July 2005 to about 294,000 as of August 2006. According to State, the Ministries of Defense and Interior are on track to complete the initial training and equipping of all their authorized end-strength forces by the end of 2006. The authorized end-strength is 137,000 military personnel in the Ministry of Defense and about 188,000 in Ministry of Interior police and other forces. However, as we previously reported, the number of trained and equipped security forces does not provide a complete picture of their capabilities and may overstate the number of forces on duty. For example, Ministry of Interior data include police who are absent without leave. Ministry of Defense data exclude absent military personnel. In spring 2005, MNF-I recognized that the number of trained and equipped forces did not reflect their capability to assume responsibility for security. MNF-I began to develop and refine the TRA system as a means of assessing the capabilities of Iraqi security forces. It also started a program to place transition teams with Iraqi army and special police units. DOD also assesses progress in the number of Iraqi army units and provincial governments that have assumed responsibility for the security of specific geographic areas in Iraq. The joint MNF-I/U.S. Embassy Campaign Plan calls for the Iraqi army to assume the lead for counterinsurgency operations in specific geographic areas and Iraqi civil authorities to assume security responsibility for their provinces. The transition of security responsibilities concludes when the Iraq government assumes responsibility for security throughout Iraq. As shown in table 2, DOD reports that an increasing number of Iraqi army units are capable of leading counterinsurgency operations in specific geographic areas. DOD reports more detailed information on this transition in a classified format. However, when an Iraqi army unit assumes the lead, it does not mean that the unit is capable of conducting independent operations since it may need to develop additional capabilities and may require the support of coalition forces. According to DOD's May 2006 report, it will take time before a substantial number of Iraqi units are assessed as fully independent and requiring no assistance considering the need for further development of Iraqi logistical elements, ministry capacity and capability, intelligence structures, and command and control. Table 2 also shows that one provincial government--Muthanna--had assumed responsibility for security operations, as of August 2006. According to a July 2006 State Department report, when a provincial government can assume security responsibilities depends on the (1) threat level in the province, (2) capabilities of the Iraqi security forces, (3) capabilities of the provincial government, and (4) posture of MNF-I forces, that is, MNF-I's ability to respond to major threats, if needed. Once the provincial government assumes security responsibilities, the provincial governor and police are in charge of domestic security. According to an MNF-I official, MNF-I forces will then move out of all urban areas and assume a supporting role. In August 2006, DOD reported that security responsibility for as many as nine of Iraq's provinces could transition to Iraqi government authority by the end of 2006. DOD has provided GAO with aggregate information on the overall TRA levels for Iraqi security forces and the number of Iraqi units in the lead for counterinsurgency operations. DOD's aggregate data on the capabilities and readiness of Iraqi security forces do not provide information on shortfalls in personnel, command and control, equipment, and leadership. Unit-level TRA reports provide more insight into Iraqi army capabilities and development needs in personnel, leadership, and logistics than do the overall TRA levels that DOD reports in classified format. The TRA rating for individual Iraqi army units is a key factor in determining the ability of the unit to conduct and assume the lead for counterinsurgency operations. According to Multinational Corps-Iraq (MNC-I) guidance, the TRA is intended to provide commanders with a method to consistently evaluate Iraqi units, as well as to identify factors hindering progress, determine resource issues, make resource allocation decisions, and determine when Iraqi army units are prepared to assume the lead for security responsibilities. The TRA is prepared jointly on a monthly basis by the unit's military transition team chief and Iraqi security forces commander. In completing TRA reports, commanders assess the unit's capabilities in six subcategories--personnel, command and control, training, sustainment/logistics, equipment, and leadership (see app. 1). After considering the unit's subcategory ratings, commanders then give each Iraqi army unit an overall TRA rating that describes the unit's overall readiness to assume the lead for counterinsurgency operations. The overall ratings go from TRA level 1 through TRA level 4. To be able to assume the lead for counterinsurgency operations, Iraqi army units are required to obtain an overall rating of TRA level 2 as assessed by their commanders. Commanders also provide a narrative assessment that describes key shortfalls and impediments to the unit's ability to assume the lead for counterinsurgency operations and estimate the number of months needed for the unit to assume the lead. The purpose of the narrative is to clarify and provide additional support for the overall TRA rating. The aggregate data on overall TRA ratings for Iraqi security forces are classified. DOD has provided us with classified data on the aggregate number of Iraqi units at each TRA level and more detailed information on which Iraqi army units have assumed the lead for counterinsurgency operations. We are currently working with DOD to obtain the unit-level TRA reports. These unit-level reports would provide GAO and Congress with more complete information on the status of developing effective Iraqi security forces. Specifically, unit-level TRA reports would allow us to (1) determine if the TRA reports are useful and if changes are needed; (2) verify if aggregate data on overall TRA ratings reflect unit-level TRA reports; and (3) determine if shortfalls exist in key areas, such as personnel, equipment, logistics, training, and leadership. 1. What are the key political, economic, and security conditions that must be achieved before U.S. forces can draw down and ultimately withdraw from Iraq? What target dates, if any, has the administration established for drawing down U.S. forces? 2. The continued deterioration of security conditions in Iraq has hindered U.S. political and economic efforts in Iraq. According to the State Department, a baseline of security is a prerequisite for moving forward on the political and economic tasks essential to achieving the right conditions for withdrawing U.S. forces. Why have security conditions continued to deteriorate in Iraq even as the country has met political milestones, increased the number of trained and equipped security forces, and increasingly assumed the lead for security? What is the baseline of security that is required for moving forward on political and economic tasks? What progress, if any, can be made in the political and economic areas without a significant improvement in current security conditions? If existing U.S. political, economic, and security measures are not reducing violence in Iraq, what additional measures, if any, will the administration propose for stemming the violence? 3. In February 2006, the Director of National Intelligence reported that Iraqi security forces were experiencing difficulty in managing ethnic and sectarian divisions among their units and personnel. The DIA Director reported that many elements of the Iraqi security forces are loyal to sectarian and party interests. How does the U.S. government assess the extent to which personnel in the Iraqi security forces are loyal to groups other than the Iraqi government or are operating along sectarian lines, rather than as unified national forces? What do these assessments show? How would DOD modify its program to train and equip Iraqi security forces if evidence emerges that Iraqi military and police are supporting sectarian rather than national interests? 4. MNF-I established the TRA system to assess the capabilities and readiness of Iraqi security forces. How does DOD assess the reliability of TRAs and ensure that they present an accurate picture of Iraq security forces' capabilities and readiness? At what TRA rating level would Iraqi army units not require any U.S. military support? What U.S. military support would Iraqi units still require at TRA levels 1 and 2? How does DOD use unit-level TRAs to assess shortfalls in Iraqi capabilities? What do DOD assessments show about the developmental needs of Iraqi security forces? 5. In late August 2006, the MNF-I Commanding General said that the United States is helping Iraq build a force to deal with its current security threats of international terrorism and insurgency. However, he noted that the Iraqi government is developing a long-term security plan to shape the type of armed forces the country will need 5 to 10 years from now. What are the current resource requirements for developing Iraqi security forces capable of dealing with international terrorism and insurgency? What have been the U.S. and Iraqi financial contributions to this effort thus far? What U.S. and Iraqi contributions will be needed over the next several years? What are the projected resource requirements for the future Iraqi force? What are the projected U.S. and Iraqi financial contributions for this effort? For further information, please contact Joseph A. Christoff on (202) 512- 8979. Key contributors to this testimony were Nanette J. Barton, Lynn Cothern, Tracey Cross, Martin De Alteriis, Whitney Havens, Brent Helt, Rhonda Horried, Judith McCloskey, Mary Moutsos, Jason Pogacnik, and Jena Sinkfield. This appendix provides information on the TRA reports used to assess the capabilities of Iraqi army units. Commanders provide ratings in each of 6 subcategories (see fig. 4). For each subcategory, a green rating corresponds to TRA level 1, yellow to TRA level 2, orange to TRA level 3, and red to TRA level 4. The commanders consider the subcategory ratings in deciding the overall TRA rating for each unit.

Summary:
From fiscal years 2003 through 2006, U.S. government agencies have reported significant costs for U.S. stabilization and reconstruction efforts in Iraq. In addition, the United States currently has committed about 138,000 military personnel to the U.S.-led Multinational Force in Iraq (MNF-I). Over the past 3 years, worsening security conditions have made it difficult for the United States to achieve its goals in Iraq. In this statement, we discuss (1) the trends in the security environment in Iraq, and (2) progress in developing Iraqi security forces, as reported by the Departments of Defense (DOD) and State. We also present key questions for congressional oversight, including what political, economic, and security conditions must be achieved before the United States can draw down and withdraw? Why have security conditions continued to deteriorate even as Iraq has met political milestones, increased the number of trained and equipped forces, and increasingly assumed the lead for security? If existing U.S. political, economic, and security measures are not reducing violence in Iraq, what additional measures, if any, will the administration propose for stemming the violence? Since June 2003, the overall security conditions in Iraq have deteriorated and grown more complex, as evidenced by increased numbers of attacks and Sunni/Shi'a sectarian strife, which has grown since the February 2006 bombing in Samarra. As shown in the figure below, attacks against the coalition and its Iraqi partners reached an all time high during July 2006. The deteriorating conditions threaten the progress of U.S. and international efforts to assist Iraq in the political and economic areas. In July 2006, the State Department reported that the recent upturn in violence has hindered efforts to engage with Iraqi partners and noted that a certain level of security was a prerequisite to accomplishing the political and economic conditions necessary for U.S. withdrawal. Moreover, the Sunni insurgency and Shi'a militias have contributed to growing sectarian strife that has resulted in increased numbers of Iraqi civilian deaths and displaced individuals. DOD uses three factors to measure progress in developing capable Iraqi security forces and transferring security responsibilities to the Iraqi government: (1) the number of trained and equipped forces, (2) the number of Iraqi army units and provincial governments that have assumed responsibility for security in specific geographic areas, and (3) the capabilities of operational units, as reported in unit-level and aggregate Transition Readiness Assessments (TRA). Although the State Department reported that the number of trained and equipped Iraqi security forces has increased, these numbers do not address their capabilities. As of August 2006, 115 Iraqi army units had assumed the lead for counterinsurgency operations in specific areas, and one province had assumed control for security. Unit-level TRA reports provide insight into the Iraqi army units' training, equipment, and logistical capabilities. GAO is working with DOD to obtain the unit-level TRA reports. Such information would inform the Congress on the capabilities and needs of Iraq's security forces.