Ineffective internal controls include such things as missing documentation, missing signatures from certifying officials, receiving officials, and payees; and missing voucher information. Ineffective internal controls could create an environment where duplicative payments, fraudulent activity, or improper use of funds takes place and is not identified and corrected in the normal course of business. A lack of internal controls can result in either no audit trail or in a complex audit trail, which hinders the search for supporting documents. Ineffective internal controls can result in missing or inadequate documentation. Also, ineffective internal controls can result in unreliable accounts payable and expense amounts reported on DOD financial statements.

We identified material internal control weaknesses related to out-of-country payments made in support of the Global War on Terror and for the Iraq Security Forces Fund as defined by DOD Instruction 5010.40, "Managers' Internal Control Program Procedures." The Army's internal controls did not ensure proper support for the commercial payments and that funds were used as intended. Multi-National Security Transition Command – Iraq did not have adequate procedures in place to provide reasonable assurance that equipment, construction, and services procured through the Iraq Security Forces Funds were provided to the Iraq Security Forces.