One of the failures of the intelligence community is achieving a clean audit. Pictured here: James Clapper not to happy about people auditing his books!
The following information was published in the Congressional Record concerning “auditability” of certain elements of the intelligence community.
This is important because most major intelligence agencies in the United States “failed” to achieve a clean audit in 2011, 2012, 2013, under the Director of National Intelligence.
The Director of National Intelligence serves as the head of the Intelligence Community, overseeing and directing the implementation of the National Intelligence Program and acting as the principal advisor to the President, the National Security Council, and the Homeland Security Council for intelligence matters related to national security.
“Auditability” is dependent upon the company’s financial recording practices, the transparency of the company and the forthrightness of the managers who interact with the auditors. A company with a great deal of transparency and complete records has greater “auditability” than a company whose records are incomplete and whose managers are evasive, such as the case with the intelligence community.
Auditability also refers to the degree to which transactions can be traced, verified as accurate and audited through a system.
SEC. 309. AUDITABILITY.
(a) In General.–Title V of the National Security Act of 1947 (50 U.S.C. 3091 et seq.) is amended by adding at the end the following new section:
“SEC. 509. AUDITABILITY OF CERTAIN ELEMENTS OF THE INTELLIGENCE COMMUNITY.
“(a) Requirement for Annual Audits.–The head of each covered entity shall ensure that there is a full financial audit of such covered entity each year beginning with fiscal year 2014. Such audits may be conducted by an internal or external independent accounting or auditing organization.
“(b) Requirement for Unqualified Opinion.–Beginning as early as practicable, but in no event later than the audit required under subsection (a) for fiscal year 2016, the head of each covered entity shall take all reasonable steps necessary to ensure that each audit required under subsection (a) contains an unqualified opinion on the financial statements of such covered entity for the fiscal year covered by such audit.
“(c) Reports to Congress.–The chief financial officer of each covered entity shall provide to the congressional intelligence committees an annual audit report from an accounting or auditing organization on each audit of the covered entity conducted pursuant to subsection (a).
“(d) Covered Entity Defined.–In this section, the term ‘covered entity’ means the Office of the Director of National Intelligence, the Central Intelligence Agency, the Defense Intelligence Agency, the National Security Agency, the National Reconnaissance Office, and the National Geospatial-Intelligence Agency.”.
(b) Table of Contents Amendment.–The table of contents in the first section of the National Security Act of 1947 is amended by inserting after the item relating to section 508 the following new item:
“Sec..509..Auditability of certain elements of the intelligence community.”.
SEC. 310. REPORTS OF FRAUD, WASTE, AND ABUSE.
Section 8H(a) of the Inspector General Act of 1978 (5 U.S.C. App.) is amended in paragraph (1)–
(1) by redesignating subparagraphs (B) and (C) as subparagraphs (C) and (D), respectively;
(2) by inserting after subparagraph (A) the following:
“(B) An employee of an element of the intelligence community, an employee assigned or detailed to an element of the intelligence community, or an employee of a contractor to the intelligence community, who intends to report to Congress a complaint or information with respect to an urgent concern may report such complaint or information to the Inspector General of the Intelligence Community.”; and
(3) in subparagraph (D), as redesignated by paragraph (1)–
(A) by striking “Act or section 17” and inserting “Act, section 17”; and
(B) by striking the period at the end and inserting “, or section 103H(k) of the National Security Act of 1947 (50 U.S.C. 3033(k)).”.
Source: Congressional Record http://thomas.loc.gov/
See related article: “Most major intelligence agencies failed to achieve a clean audit last year” http://www.examiner.com/article/most-major-intelligence-agencies-failed-to-achieve-a-clean-audit-last-year