Financial Management

Reports

Department of Defense Managers' Internal Control Program (MICP)

As of September 2010, OSD-Comptroller has briefed the specific requirements/attributes of an effective Managers' Internal Control Program (in accordance with DoD Instruction 5010.40) with each of the Components that are currently required to annually submit a Statement of Assurance directly to OSD. The briefings have emphasized:

Importance of Director/Commander Support (aka "Tone-at-the-Top")

Reliance upon a "risk-based framework"

Implementation of "self-reporting concept"

Leverage of the Component's in-house expertise (e.g., those staff assigned to specific sub functions (e.g., assessable units) within organization versus dependency upon "outside" audit agencies (e.g., DoDIG, GAO and military audit agencies) to identify and report "material" internal control weaknesses and recommendations for mitigation of risk through changes in related controls.

Introduction
Tone at the Top
Tools/Techniques
Regulatory Guidance
Statement of Assurance
Training/Events - FY2013
Points of Contact
Links to Other Sites

Introduction

DoDI 5010.40 - February 22, 2010

The Office of the Under Secretary of Defense (Comptroller) is responsible for implementing and managing the Secretary of Defense's program over internal management controls.

The Federal Managers' Financial Integrity Act (FMFIA) is implemented through the DoD Managers' Internal Control Program (MICP).

The MICP requires all DoD managers to review, assess, and report on the effectiveness of internal management controls within the Department of Defense.

Tone at the top

"Tone at the Top" is a term that is used to define management's leadership and commitment towards openness, honesty, integrity, and ethical behavior. It is the most important component of the control environment. The tone at the top is set by all levels of management and has a trickle-down effect on all employees.

Examples of Tone at the Top Letters

For a Managers' Internal Control Program to be effective, the respective Component needs senior management's support through:

Communication - Management must clearly communicate its ethics and values throughout the area they manage. These values could be communicated formally through written codes of conduct and policies, staff meetings, memos, etc. or informally during day to day operations.
Active Participation - Kick-Off and Quarterly Meetings - Discussions relevant to internal controls, and associated risks
Reporting - Create and promote path for employees to self-report and feel safe from retaliation
Reward Active Participation - Creation of Commander's Award - Recognition of Successful Internal Control Activity

Tools/Techniques

Computer Based Training (CBT) for the MICP:

Regulatory Guidance

FY 2009 Guidance for the Preparation of the Statement of Assurance (SOA), November 2008

FY 2013 Guidance for the Preparation of the Statement of Assurance (SOA), Pending

FY 2013 MICP for OSD and the DoD Field Activities, November 2012

Statement of Assurance

The DoD Annual Statement of Assurance is reported to the President, the Office of Management and Budget, and Congress as part of the Agency Financial Report.