Objective

To determine whether the Division of Military and Naval Affairs (DMNA) has adequate controls over selected financial operations to provide reasonable assurance that State assets are appropriately managed and safeguarded. The audit covered the period April 1, 2016 through September 16, 2019.

About the Program

DMNA manages the State’s military forces, which are composed of the New York Army National Guard, New York Air National Guard, New York Naval Militia, and the New York Guard. DMNA employs about 450 State and 3,880 federal employees who together manage federal and State budgets, oversee human resources, operate training, and arrange logistics. A Master Cooperative Agreement (MCA) between DMNA and the federal National Guard Bureau (NGB) allows DMNA to be reimbursed by NGB for expenses it incurs in operations and training of the State Army and Air National Guard.

Key Findings

• Weaknesses in DMNA’s handling of reimbursement requests to NGB resulted in nearly $1.27 million in lost reimbursements.
• DMNA did not maintain an internal audit function throughout the course of our audit, despite a Division of the Budget requirement that it do so.
• There were significant weaknesses in DMNA’s controls over accounting for employee credit card purchases, including no review of purchases made by individuals who no longer worked for DMNA and lack of follow-up on unsubmitted support for credit card purchases that were made up to two years prior.

Key Recommendations

• Ensure that requests to NGB for reimbursement for costs covered under the MCA are adequately documented and submitted timely, and retain the related records as required.
• Establish an internal audit function in compliance with Division of the Budget requirements.
• Implement methods to better monitor employee credit card purchases that include appropriate and timely follow-up on unsubmitted purchase support records and questionable purchases.