text: Chapter 7
  An unqualified statement of assurance where no material weaknesses are being reported:
  
  I am able to provide an unqualified statement of reasonable assurance that my organization
  
  internal controls meet the objectives of FMFIA overall programs, administrative, and
  operations.
  A qualified statement of assurance in which one or more material weakness is reported:
  
  I am able to provide a qualified statement of assurance that internal controls meet the
  
  objectives of FMFIA overall programs, administrative and operations with the exception of (the
  number) material weaknesses.
  A statement of no assurance in which no processes are in place to assess the internal
  
  controls or there exist a pervasive amount of material weaknesses that cannot be assessed:
  I can provide no assurance that my organization’s internal controls meet the objectives of
  
  FMFIA overall programs, administrative, and operations.
  * Additional supporting information required.
  How the assessment was conducted to include the basis for reasonable assurance and any
  
  other pertinent information and internal control program accomplishments.
  Listing of any corrected or uncorrected material weaknesses being reported.
  
  Use of Audit and Inspection Reports
  7-43. Commanders are required to take corrective or preventive action based on the results of external
  audits and inspections. Due to the amount of resources required to conduct operations, commanders must
  expect Congressional interest in the form of GAO or other external audit agencies to report on the use of
  resources during deployed operations. These outside audits provide valuable assessments of management
  controls and are distributed to the organizations being audited. Commanders have to respond with their
  action plan to correct the deficiencies.
  SECTION II – AUDIT READINESS
  7-44. Congress requires the Department of Defense to obtain an unqualified audit opinion of all financial
  statements. Department of assured Congress that all of the services will have an auditable SBR.
  7-45. The Under Secretary of the Army (USA), directed the Office of the Assistant Secretary of the Army
  (Financial Management & Comptroller) (OASA(FM&C)) to develop a plan to address the Office of the
  Under Secretary of Defense (Comptroller) (OUSD(C)) audit readiness requirements. OUSD(C) Financial
  Improvement and Audit Readiness (FIAR) Guidance, (http://comptroller.defense.gov/fiar) was developed
  to improve financial management, prioritize improvement activities, strengthen internal controls, and
  ultimately achieve auditability. To achieve the FIAR Guidance objectives, the OUSD(C) has identified
  three major financial improvement priorities:
  * Improving the budget execution processes that affect the SBR.
  * Verifying the E&C of mission critical assets and asset records.
  * Maximizing the investment in enterprise resource planning (ERP) systems (e.g., the Global
  Combat Support System—Army).
  7-46. Army commands and installations can become audit ready by providing the following:
  * An overview of audit readiness
  * A description of key supporting resources available to commands and installations for becoming
  audit ready
  * A description of key internal control activities identified for each command and installation,
  including authoritative guidance and/or policies related to the internal control activities and
  internal control deviations discovered by Army audit readiness teams during testing.
  7-47. One of the tools available to assist commanders is the Audit Readiness Checklist that provides
  questions Commanders should ask leaders within their organization to ensure they have the records needed
  to make sound resource decisions and the Department has the records needed to succeed in coming audits.
  The checklist provides Commanders with the basic actions their organization should take to determine