check this out.

[cisole]

That is disgusting....no one wants to hear you faint. Get ahold of yourself!

[bamagirl]

Thanks Sonny1!!!

[BJinMontreal]

That is disgusting....no one wants to hear you faint. Get ahold of yourself!

Oh come on ... we all love to hear a good THUNK once in a while !!!!

[randalln]

here is how much we are talking about FYI

SStatus of Iraq Reconstruction Funding

The cost of Iraq relief and reconstruction in the medium term has been estimated at $50-100 billion.

As of September 30, 2004, approximately $55.1 billion had been provided for Iraq relief and reconstruction from U.S. appropriated funds, Iraqi funds, and funds contributed by donor nations:

• U.S. appropriated funds: $24.1 billion, used primarily for Iraq reconstruction

• Iraqi funds: $28.2 billion, used primarily for the daily operations of the Iraqi government, but also for reconstruction projects and the relief of the Iraqi people

• Donor funds: $2.8 billion in contributions and firm commitments by donor countries and international organizations ($849 million in humanitarian aid and $1.9 billion of the $13.5 billion pledged at the Madrid International Donors Conference for Iraq Reconstruction)Sources of Fund for Iraq Reconstruction

GENERAL OVERVIEW SOURCES OF FUNDS, AS OF SEPTEMBER 30, 2004 (IN MILLIONS)

U.S. APPROPRIATED FUNDS

PUBLIC LAW 108-11 (APRIL 2003)

- IRRF ($2,475) - NRRRF ($802)

- CPA OPS ($684) - New Iraqi Army ($51)

NON-IRRF - USAID ($413)* - DoS ($66)**

PUBLIC LAW 108-06 (NOV 2003)

- IRRF ($18,439) - CPA OPS/IG ($877) - IRMO ($106) - CERP* ($140)

PUBLIC LAW 108-287 - CERP ($100/$300)***

IRAQI FUNDS

VESTED FUNDS - From Frozen Funds ($1,724)

SEIZED FUNDS

- Confiscated Cash & Property ($927)

DFI ($25,782)****

(Development fund for Iraq) - Oil Proceeds - Oil For Food (OFF) - Repatriated Funds

DONOR FUNDS

DONOR

- Pledged loans & grants from International Donors to world Bank Trust Fund (U.N.) ($13,589) (Current Bilateral Aid and IRFFI deposits $1,355)

- Humanitarian Aid ($849) - IMF EPCA ($435)

SEE GLOSSARY FOR ACRONYMS

* In addition to IRRF Funding

** Commanders Emergency Response Program

***

CERP amount of $300M appropriated with $100M currently allocated for Iraq

**** DFI total is estimate based on oil revenues and no additional repatriated funds

Figure by MIT OCW.

Status of Iraq Reconstruction Funding

The U.S. committed over $24 billion to reconstruction in Iraq. This engagement will focus on reconstruction of essential and social services sectors:

power oil health education humanitarian human services

Iraq Reconstruction Activities

Iraq relief and reconstruction activities continue under the authority of the:

Department of State (DoS), through the Iraq Reconstruction Management Office (IRMO). The IRMO is responsible for establishing requirements and setting priorities.

The Department of Defense (DoD), through the Project and Contracting Office (PCO). The PCO is responsible for contracting and program management.

These are some of the achievements highlighted by the DoS in its October 5, 2004 Section 2207 Report on Iraq Relief and Reconstruction:

• Iraqi National Airlines resumed international flights.

• The number of telephone and cell phone subscribers in Iraq reached 1.5 million, approximately 90% above pre-war levels.

• Oil production recently reached 2.5 million barrels per day.

• The United States Agency for International Development (USAID) has repaired numerous breaks in Iraq’s water networks, significantly increasing water flow.

Iraq Reconstruction and Management Office

TheIRMOisatemporaryorganizationwithintheDoS that coordinates the efforts of the various agencies performing reconstruction work in Iraq.

TheIRMOcontinuestoworktowardthreeprimarygoals: • Improve Iraq’s infrastructure.

• Increase Iraqi employment and long-term economic recovery.

• Strengthen the capabilities of Iraqi engineering and construction companies.

Project and Contracting Office

ThePCOisatemporaryorganizationwithintheDoDthat replaced the CPA’s

ProgramManagementOffice.ThePCOprovides acquisition, project management, and construction support for Iraq reconstruction priorities identified by the IRMO.

Defense support Office-Iraq

The Deputy Secretary of Defense created the Defense support Office-Iraq (DSO-Iraq) to serve as a single DoD point of contact for the U.S. Mission Iraq, and to coordinate with the Near-East Asia-Iraq Office of the DoS.

The DSO-Iraq supports the missions of U.S.-led forces in Iraq, coordinates actions that cross organizational lines, and represents the DoD in Iraq-related interagency meetings.

USAID

TheUSAIDMissioninIraqcarriesoutprogramsin education, health care, food security, infrastructure reconstruction, airport and seaport management, economic growth, community development, local governance, and transition initiatives.

Theorganizationreportstheprogressof reconstruction efforts on its website at: www.usaid.gov/iraq.

U.S. Appropriated Funds

The United States has appropriated $24.1 billion toward the relief and reconstruction of Iraq.

Congress appropriated funds for the reconstruction of Iraq in two supplemental appropriations acts and, most recently, the FY 2005 Defense Appropriations Act:

• Public Law 108-11 (P.L. 108-11), the Emergency Wartime Supplemental Appropriations Act, April 16, 2003

• Public Law 108-106 (P.L. 108-106), the Emergency Supplemental Appropriations Act for Defense and for the Reconstruction of Iraq and Afghanistan, November 6, 2003

• Public Law 108-287 (P.L. 108-287), the FY 2005 Defense Appropriations Act, August 2004

Public Law 108-11

P.L. 108-11 created the Natural Resources Risk Remediation Fund (NRRRF), the Iraq Relief and Reconstruction Fund (IRRF), and the Iraq Freedom Fund (IFF).

The Act established the NRRRF “for expenses necessary, in and around Iraq, to address emergency fire fighting, repair of damage to oil facilities and related infrastructure, and preserve a distribution capability.” As of September 30, 2004, $802 million of the NRRRF funding had been apportioned, $800.6 million had been committed and obligated, and $689 million had been expended.

P.L. 108-11 established the Iraq Relief and Reconstruction Fund (IRRF) “for necessary expenses for humanitarian assistance in and around Iraq and to carry out the purposes of the Foreign Assistance Act of 1961 for rehabilitation and reconstruction in Iraq.” As of September 30, 2004, the Office of Management and Budget (OMB) had apportioned 100% of the $2.475 billion IRRF 1 funds among the U.S. Agency for International Development (USAID), Department of Defense (DoD), Department of State (DoS), and the Department of the Treasury (Treasury).

Public Law 108-11

P.L. 108-11 also established the IFF “for additional expenses for ongoing military operations in Iraq...for stability operations...and for other costs.” These funds were used to provide CPA operating expenses, and $300 million was transferred to the NRRRF. Other sections of the Act funded additional relief and reconstruction activities by the DoS ($66 million) and USAID ($413 million). Funds from P.L. 108-11 were available for obligation through September 30, 2004.

Public Law 108-11

Figure by MIT OCW.

AGENCY PROGRAM NAME APPORTIONED

NRRRF FUNDS

OBLIGATED

EXPENDED

$689.0 $689.0

DoD Restore Iraq Oil (RIO) $802.0 $800.6 DoD TOTAL NRRRF FUNDS $802.0 $800.6

IRRF 1 FUNDS

Restore Critical Infrastructure

Improve Efficiency & Accountability of Gov't USAID Food Aid: Office of Food for Peace

Support Education Health and Social Services Relief: Office of Foreign Disaster Assistance Office of Transition Initiatives Expand Economic Opportunity

Prog. support & Development of Gulf Region Administrative Expenses Tranfers/Adjustments Sub-Total

Restore Iraq Electricity (RIE) DoD Restore Iraq Oil (RIO)

First Responder Network/DIILS

Sub-Total

Police/Prison Programs

Relief Efforts DoS Law Enforcement

$1.124.3 $1.124.3 $774.1 174.7 174.7 123.6 160.0 160.0 122.8

118.4 118.4 86.2 72.2 72.2 59.1 70.1 69.8 58.1 65.9 65.9 62.6 18.0 17.5 17.0 15.0 15.0 13.2 1.5 00.0 0.0 1820.3 1818.0 1316.7 300.0 299.9 299.5 166.0 166.0 158.3 52.3 52.3 0.1 518.3 518.3 457.9 61.5 61.5 37.5 27.0 27.0 12.6 24.6 24.6 20.4 12.3 12.3 12.3 125.4 125.4 82.8 6.0 6.0 3.7

5.0 5.0 0.2 11.0 11.0 3.9 $2,475.0 $2,472.6 $1,861.4

Treasury& U.S. TDA

Humanitarian Demining

Sub-Total

Technical Assistance Technical Assistance, Training Sub-Total

Total IRRF 1 Funds P.L. 108-11 FUNDS BY PROGRAM BY USAID STRATEGIC OBJECTIVES, AS OF SEPTEMBER 30, 2004 (IN MILLIONS)

Public Law 108-11

USAID

NON-IRRF 1 FUNDS

Food Aid: Office of Food for Peace USDA* Restore Critical Infrastructure support Education health and social services

Relief: Office of Foreign Disaster Assistance Operating Expenses Prog. support & Development of Gulf Region

Improve Efficiency & Accountability of Govt Expand Economic Opportunity Sub-Total Coalition support

$138.2 $136.7 $113.9

106.8 106.8 106.8

51.6 51.6 51.6

34.0 34.0 32.3

33.4 33.3 32.9 24.5 23.9 20.7

10.5 10.5 10.4

8.9 8.9 8.9 5.0 5.0 5.0

412.9 410.7 382.5 66.0 66.0 49.2 66.0 66.0 49.2

DoS TOTAL NON-IRRF 1 FUNDS $478.9

Sub-Total *Funds appropriated to U.S. Department of Agriculture, then transferred to USAID.

$476.7

$431.7

Figure by MIT OCW.

Public Law 108-106 - IRRF2

P.L. 108-106 appropriated $18.4 billion for relief and reconstruction activities in Iraq and established the Iraq Relief and Reconstruction

Fund (IRRF 2).

These funds are available for obligation until September 30, 2006.

In addition to creating IRRF 2, the Act authorized $983 million for the operations of the CPA. After the CPA ceased operations, $105.75 million was transferred to the DoS to fund U.S. Mission Iraq operations, including the Iraq Reconstruction Management Office (IRMO).

The Act also authorized the use of $180 million of Defense Operations and Maintenance (O&M) funds for the Commanders Emergency Response Programs (CERP) in Iraq and Afghanistan.

DoD allocated $140 million of the $180 million for CERP activities in Iraq. As of September 30, 2004, $139.4 million (99%) of the $140 million allocated for CERP in Iraq had been obligated, and $73.4 million (52%) had been expended.

Iraq Relief and Reconstruction Fund 2

The $18.4 billion IRRF 2 appropriation was divided among 11 sectors, based on the CPA’s request for supplemental funding developed in October 2003. Changes in these sector allocations beyond prescribed limits require congressional approval.

Iraq Relief and Reconstruction Fund 2

SECTOR

Security and Law Enforcement

Electricity

Water Resources & Sanitation

Justice, Public Safety Infrastructure, & Civil Society

Oil Infrastructure*

Private Sector Employment Development

Health Care

Transportation & Telecommunications Projects

Roads, Bridges, & Construction

Education, Refugees, Human Rights, & Governance

Administrative Expenses

TOTAL

PREVIOUS ALLOCATION

$3,235.00

5,464.50 4,246.50

1,484.00

1,701.00

183.00 786.00

499.50 367.50 259.00 213.00 $18,439.00

STRATEGIC REPROGRAMMING

$1,809.60

INCREASE/ DECREASE

$­

NEW ALLOCATION

$5,044.60

4,349.95 2,310.95

1,953.00

1,701.00

843.00 786.00

499.50 359.00 379.00 213.00 $18,439.00

(1,074.55) (40) (1,935.55) -

460.50 8.5

0*-

660.00 - --

--

- (8.5) 80.00 40

--

$0**

$0

The strategic review moved $450 million between two project lines within the oil sector. As a result, there is no net change in the amount of IRRF funds dedicated to the oil sector.

* ** Changes in the sector allocations equaled $3,460.10 million.

SUMMARY OF CHANGES TO IRRF SECTOR ALLOCATIONS, AS OF OCTOBER 12, 2004 (IN MILLIONS)

Figure by MIT OCW.

Iraqi Funds

Iraqi funds available for reconstruction can be grouped into several categories:

Seized funds were former Iraqi regime monies confiscated by coalition forces. Coalition military forces have seized a total of $926.7 million in funds from the former Iraqi regime.

Vested funds were Iraqi funds in U.S. banks that were frozen by executive order, vested in the U.S. Treasury, and authorized for use to benefit the people of Iraq. In response to a UN resolution passed after the first Gulf War, the United States froze Iraqi assets (UNSCR 661, August 1990; Presidential Executive Order 12817 of October 23, 1992).

Development Fund for Iraq - In May 2003, UNSCR 1483 noted the establishment of the DFI, which contains proceeds from Iraqi oil sales, repatriated assets from the United States and other nations, and deposits from unencumbered Oil for Food (OFF) program funds. The DFI funds the Iraqi National Budget, primarily from current oil sales.

Commanders Emergency Response Program (CERP)

TheCERPisaprogramthatcoalition military commanders can quickly use to direct money to meet humanitarian, relief, and reconstruction needs in their geographic areas of responsibility. Typical projects include:

• repairing and refurbishing water and sewer lines

• cleaning up highways by removing waste and debris

• transporting water to remote villages

• purchasing equipment for local police stations

• upgrading schools and clinics • purchasing school supplies • removing ordnance from public places, including schools • refurbishing playgrounds, youth centers, libraries, other recreational facilities, and mosques.

Iraq CERP Program Totals,

as of September 30, 2004

Seized Assets

U.S. Appropri ated

DFI Total

Total Program Funding

$177,280,923 $140,000,000

$368,578,452

$685,237,806

Cumulative Funds Obligated

$177,280,923 $139,378,431

$368,578,452

Cumulative Funds Disbursed

$175,325,647 $73,392,841

$324,544,881

$685,237,806

$573,263,369

Accelerated Iraq Reconstruction Program (AIRP)

The Accelerated Iraq Reconstruction Program (AIRP) was designed to provide funds for high-impact, high-visibility projects in selected cities and areas that offered high levels of employment opportunities for Iraqis.

Approved in April 2004,

The program received $383.8 million in DFI funds and used the money to fund projects from various programs, including the Rapid Regional Response Program, the Local Governance Fund, and the PMO, as well as CERP projects not already funded directly through CERP allocations.

The larger AIRP projects (over $100,000) have typically been associated with improvements in potable water access, sanitation, health, education, and transportation.

As of late September, more than 350 projects valued at more than $324 million were under contract, and 124 projects valued at over $25 million have been completed. Iraqi employment on

Oil for Food

Oil for Food (OFF) program - from December 1996 until December 2002.

UN Oil for Food Program (in millions)

Individual Escrow Account

Compensation Fund South and Central Iraq Three Northern Governorates UN Administrative Costs UNMOVIC UNSCR778

Percentage of Oil Reserves

25.0%1 59.0%2 13.0% 2.2% 0.7% n.a.3

Total Expenditures (or deposits)

$17,183 $34,385 $6,065 $765 $445 $200

1 Compensation fund percentage was originally 30% and lowered to 25% in 2000. 2 Percentage for South and Central Iraq was originally 53.034% and raised to 54.054% in 2000. 3 Repayment of UNSCR 778 funds was set at $10 million a quarter (suspended Dec 1999 to Dec 2000)

Donor Funds

In response to the relief and reconstruction requirements in Iraq, aid has been donated by a large number of countries, as well as several international organizations.

Periodic donor conferences are held to coordinate international activities. The first was in Madrid in October 2003, and the latest was in Tokyo, on October 14-15,

2004.

At the Madrid Donors Conference, non-U.S. donor nations and international organizations pledged $13.5 billion for the medium-term reconstruction of Iraq (2004-2007).

Individual donor nations pledged approximately $8 billion. This aid can be grouped into three categories: immediate humanitarian aid, bilateral assistance, and internationally distributed aid.

Donor Funds

Themajorityofassistancepledgedbyindividualnationstatesiscurrentlybeing channeled through international organizations.

TheMadridconferenceestablishedtheInternationalReconstructionFundFacility for Iraq (IRFFI) to give donor countries a multilateral channel for their assistance to Iraq.

TheIRFFIhastwotrustfunds,oneadministeredbytheWorldBankandtheother by the United Nations Development Group (UNDG).

ThesetwotrustfundsaretheprimarydeliverymechanismsforaidtoIraq. Currentcommitmentstothetwotrustfundsare$1.04billion:

WorldBank’scommitmentstotal$413million,

UNDG’scommitmentstotal$623million.

Depositstothosetwoorganizationstotal$927million:$373.8millionwas deposited with the World Bank, and $553.4 million was deposited with the UNDG.

World Bank

World Bank Iraqi Trust Fund Projects, as of October 14, 2004 (in millions)

Ongoing Projects

Operation

Projected Costs

$40 $60 $60 $90 $25 $20 $7 $55

Actual Costs

$3.57 $360.57

Emergency Textbooks Emergency School Rehabilitation Water Supply and Sanitation – Baghdad Water Supply and Sanitation – other than Baghdad Emergency Health Emergency Rural Infrastructure Capacity Building II Private Sector Development

Operation

Capacity Building I Total

Completed Projects

Donors

Figure by MIT OCW.

UNDG

UNDG Iraqi Trust Cluster Totals for Approved Projects as of October 14, 2004

Cluster

Infrastructure and Housing Health Education and Culture Agriculture, Water Resources, and Environment support to the Electoral Process

Water and Sanitation IDPs and Refugees Governance and Civil Society Poverty Reduction and Human Development Total

Amount

$115,921,443 $66,944,083 $62,261,341 $59,582,636 $46,078,944 $30,762,094 $16,867,515 $3,464,224 $321,000 $402,203,280

UNDG

UN Development Group Iraq Trust Fund In early 2004, the UN Country Team for Iraq developed a strategic assistance plan that has been formally approved by the Iraqi government and the donor community.

These are the key elements of the plan: • grouping sectoral activities into 10 clusters

• encouraging joint logistical support across cluster activities • soliciting Iraqi prioritization of reconstruction needs as part of the planning process

UN Organizations Participating in Iraq Reconstruction by Project Total, as of October 14, 2004 (in millions)

Participating UN Organizations

UN Development Program World Health Organization UN Children’s Fund UN Development Program (EAD) Food and Agriculture Organization (UN) UN Centre for Human Settlements

UN Environment Program

UN Educational, Scientific, and Cultural Organization

UN Population Fund

UN Office for Project Services

UN Industrial Development Organization

UN High Commissioner for Refugees

Economic and Social Commission for Western Asia

International Labour Organization

Total Approved Funding

Amount

$111.69 60.60 55.75 46.08 35.59 23.55 15.70 12.71

12.60 11.46 8.01 7.13 1.00

0.32

$402.2

im waiting on a reply from a friend if this has happened they would not unprotect if they weren't planing something big

[Texas1]

Oh come on ... we all love to hear a good THUNK once in a while !!!!

Next thing you know they'll blame Sonny1 for the faint.

[igotafew]

"the cindy loppers"

[Atheist]

That was way over my head randalln but thanks for taking the time to share it.

[Sun Devil]

That was way over my head randalln but thanks for taking the time to share it.

Trust me, you're not alone.

[despain]

Wooooooooow! You have my attention now! Holy COW!

[randalln]

This money is in the billions

[FarmersDaughter]

Thanks Sonny1. Sounds very promising.

Easy, you are a bad boy! LOL

[Terrill]

/

[randalln]

When we worked on the OFF,RIO and RIW in the first days of the reconstruction KBR was in-charge of staffing the projects no one really knows how much there is in these accounts

This is also part of what Bush means when he says it will pay for itself ..............hope i did not say to much (black suburban guys)but it is past time to get this done.....................

[sonny1]

Wouldn't this indicate a higher rate than a 1:1 or 1:1.17?

i dont know what rate it would indicate, i am sure they just converted enough to cover what we are expecting, i dont know how much, all i know is it wasnt all, they need a u.s reserve, but i was just told a chunk...... but hey its there's they can do what they want with it, it had something to do with shabbs having another bank account for this reason.... i wish i knew more...

[Bobbydee]

Right on Sonny. I wish there was a way to research this. This would be awesome if confirmed. Praise God. Thank you Jesus. Let it be. God Bless Semper Fi ++++

[leola]

MAN ,THAT WAS SOME ACCOUNTING GOING ON,,, YOU HAVE TO BE A CERTFIED INTERNATIONAL ACCOUNTANT,,,OR,,,BE CERTIFIABLY INSANE..............GREAT STUFF...

[DRV1804]

Ok someone please explain...i want to be excited!!!!! thank you DV friends!!

[randalln]

MAN ,THAT WAS SOME ACCOUNTING GOING ON,,, YOU HAVE TO BE A CERTFIED INTERNATIONAL ACCOUNTANT,,,OR,,,BE CERTIFIABLY INSANE..............GREAT STUFF...

No just pay attention in school and dont eat the books

O and be from southeast Texas its in the water (OIL) that is black gold Texas "T"

[truthful1]

Ok someone please explain...i want to be excited!!!!! thank you DV friends!!

If they converted part of the 250 million USD into dinar, that means that when they hit the rv button they will be able to cover the cost of the rv. There money will revalue as well.

[RICK C]

it was brought to my attention today, that iraq has converted a large portion of there dfi money elecronicly into dinar. i wont give the gentlemans name but he works for a middle eastern newspaper. (one of the middle east guys i talk too)

the dfi payback to iraq was in u.s.d (oil money) and they converted a large chunk to dinar, not all, but a very large chunk.........i know what this means, you all can do your own math....

i posted this in rumors because i do not have a link due it was my personal conversation, and i know the cindy loppers, would have a stroke if i posted in news. (which is fair)

and woody called me today, and he said he read on another site that some guy said i was in iraq, this guy is a total idiot, i am in the paradise of east troy wisconsin. lol

Sonny do we have any idea OF A RATE THEY MIGHT HAVE TALKED ABOUT OVER SAY-COFFEE

[DogDoc94]

Big Texas Aggie Whooooooop!!!

Thanks Sonny

[Dalite]

i dont know what rate it would indicate, i am sure they just converted enough to cover what we are expecting, i dont know how much, all i know is it wasnt all, they need a u.s reserve, but i was just told a chunk...... but hey its there's they can do what they want with it, it had something to do with shabbs having another bank account for this reason.... i wish i knew more...

Sonny,

FWIW, It had been reported that Shabibi had established a separate Federal Reserve Bank account to deposit the spread between buying and selling Dinar through CBI auctions. The spread was a commission of 13 dinar per dollar. This was reported to have been done when the CBI started the auctions. I don't have the link, and always considered this to be an "off budget" account.

Don't know if this is what you are looking for, and I don't have have any proof...

[ronberta]

thanks sonny1 for keeping us up todate,and this is Great news my friend,very glad you still come in here to inform!! Thanks a Million

[randalln]

For those who dont Know what the DFI was for. And if there where accurate counts of the MONEY

The US has always controlled the count till now

OFFICE OF THE SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

DDEVELOPMENT FUND FOR IRAQ DEVELOPMENT FUND FOR IRAQ

CASH ACCOUNTABILITY REVIEW: CASH ACCOUNTABILITY REVIEW:

JOINT AREA SUPPORT GROUP- JOINT AREA support GROUP-

CENTRAL/FALLUJA CENTRAL/FALLUJA

SIGIR-06-012 SIGIR-06-012

APRIL 28, 2006 APRIL 28, 2006SPECIAL INSPECTOR GENERAL FOR IRAQ RECONSTRUCTION

April 28, 2006 MEMORANDUM FOR COMMANDER, JOINT AREA support GROUP – CENTRAL

SUBJECT: Audit Report on Development Fund for Iraq Cash Accountability Review: Joint Area support Group-Central/Falluja (SIGIR-06-012)

We are providing this audit report for your information and use. We performed the audit in accordance with our statutory duties contained in Public Law 108-106, as amended, which requires that we provide for the independent and objective conduct of audits, as well as leadership and coordination of and recommendations on policies designed to promote economy, efficiency, and effectiveness in the administration of Iraq relief and reconstruction programs and operations and to prevent and detect waste, fraud, and abuse.

This report does not contain recommendations; therefore no written response to this report is required. We appreciate the courtesies extended to the staff. For additional information on this report, please contact Mr. Joseph T. McDermott at (703) 343-7926, or by email at joseph.mcdermott@iraq.centcom.mil; or Mr. Clifton Spruill at (703) 343-9275, or by email at clifton.spruill@iraq.centcom.mil. For the report distribution, see Appendix C.

cc: Distribution

Stuart W. Bowen, Jr. Inspector General

400 Army Navy Drive • Arlington, Virginia 22202

SIGIR-06-012

April 28, 2006

Development Fund for Iraq Cash Accountability Review: Joint Area support Group-Central/Falluja

Executive Summary

Special Inspector General for Iraq Reconstruction

Introduction. This audit report is one of a series of reports addressing controls by U.S. government officials over cash in Iraq. This audit report discusses the accountability for the Development Fund for Iraq (DFI) cash controlled by the Joint Area support Group - Central (JASG-C) Comptroller, who also serves as the DFI Account Manager.

The DFI fund was established to meet: • the humanitarian needs of the Iraqi people • the economic reconstruction and repair of Iraq’s infrastructure • the continued disarmament of Iraq • the costs of Iraqi civilian administration • other purposes benefiting the people of Iraq

This particular audit addressed DFI cash held by the Division Level Agent (DLA) in Falluja, Iraq. The DLAs are responsible for issuing cash payments to designated entities (individuals and/or businesses) and for clearing their accounts with the JASG-C Disbursing Officer. The JASG-C Disbursing Officer maintains an accounting ledger of cash accountability that included evidence of cash issued and receipts returned. Due to the availability of Electronic Funds Transfer, the DLA for Falluja, Iraq, no longer needs to maintain cash on site.

Objective. The overall audit objective was to provide assurance that DFI funds turned in by the Falluja DLA agreed with government records. We specifically looked at whether Department of Defense (DoD) polices and procedures for cash accountability and disposition were being complied with.

Results. We conducted an unannounced cash count on March 30, 2006, and as a result provided assurance that the $7.9 million in cash and payment packets turned in by the Falluja DLA agreed with government records. The Falluja DLA was accountable for DFI cash assets and complied with the DoD requirements for the disposition of cash to the JASG-C Disbursing Officer. We found that the processes employed by the DLA and the JASG-C Disbursing Officer for completing, controlling, and maintaining accurate records for the cash (DFI/Falluja) and the clearing of cash account balances were acceptable.

Recommendations. We made no recommendations in this report.

i

Table of Contents

Executive Summary i Introduction

Background 1 Objective 2

Finding

Control of the Development Fund of Iraq Cash Accountability and Disposition 3

Appendices

A. Scope and Methodology 6 B. Acronyms 7 C. ReportDistribution 8 D. Audit Team Members 10

Introduction

Background

United Nations Security Council Resolution 1483, dated May 22, 2003, assigned responsibility for managing the Development Fund for Iraq (DFI) to the Coalition Provisional Authority (CPA). Resolution 1483 noted that DFI funds should be disbursed at the direction of the CPA, in consultation with the Iraqi interim administration. It also required that the DFI funds be used in a transparent manner to meet the humanitarian needs of the Iraqi people, for the economic reconstruction and repair of Iraq’s infrastructure, for the continued disarmament of Iraq, for the costs of Iraqi civilian administration, and for other purposes benefiting the people of Iraq. The DFI was the primary financial vehicle to channel revenue from ongoing Iraqi oil sales, unencumbered Oil for Food deposits, and repatriated Iraqi assets to the relief and reconstruction efforts for Iraq.

During the CPA administration of Iraq, the CPA Comptroller managed DFI funds. When the CPA was disestablished in June 2004, responsibility for administering DFI funds shifted to the U.S. Army’s Joint Area support Group-Central (JASG-C). The CPA Comptroller was realigned as the JASG-C Comptroller, and assumed responsibility for cash control of the DFI and continued to perform the same duties for that portion of the DFI still being administered by the U.S. government.

CPA Regulation Number 2, “Development Fund for Iraq,” dated June 10, 2003, described the responsibilities for the administration, use, accounting, and auditing of the DFI. The regulation was intended to ensure that the DFI was managed in a transparent manner for and on behalf of the Iraqi people, consistent with Resolution 1483, and that all DFI disbursements would be for purposes benefiting the people of Iraq.

The United States used DFI cash funds to help fund the Commanders’ Emergency Response Program and the Rapid Regional Response Program. The Commanders’ Emergency Response Program enables U.S. military commanders in Iraq to respond to urgent humanitarian relief and reconstruction requirements of the local population by providing funds for repairs and condolence payments after combat operations; providing equipment such as electrical generators to support critical infrastructure, and large scale civic cleanup and construction activities to employ as many Iraqis as possible. The Rapid Regional Response Program was conceived as a civilian equivalent of the Commanders’ Emergency Response Program fund intended to create local jobs, support local industries, and stimulate the economy.

Military regulations and guidance provide additional requirements for managing cash funds. Department of Defense Financial Management Regulation Volume 5 establishes disbursing policy principles, standards, responsibilities, procedures, practices, and liability for disbursing officers, certifying officers and accountable officials throughout the Department. The military also issued an instruction titled Guidance on the Use of the Development Fund for Iraq In support of the Commanders’ Emergency Response Program, dated August 2003. The guidance applied to all parties involved in receiving, disbursing, accounting for, securing, and reporting for the DFI. It designates the CPA Comptroller as the DFI Account Manager with the responsibilities of overall financial and program accountability for the use of DFI monies in the Commanders’ Emergency Response Program. The CPA Comptroller’s responsibilities included accounting and reconciling DFI monies that were used in the Commanders’ Emergency Response Fund

1

and appointing Division Level Agents. The JASG-C Comptroller assumed the role of the DFI Account Manager when the CPA was disestablished.

The JASG-C Comptroller/DFI Account Manager’s office is required to maintain an accounting ledger of cash accountability that included evidence of cash issued and receipts returned. The JASG-C Comptroller/DFI Account Manager’s office advances cash to the appointed Division Level Agents, recording the transaction on the Department of Defense (DD) Form 1081, “Statement of Agent Officer’s Account.”

The Division Level Agents (DLAs) are responsible for receiving and disbursing DFI cash payments to designated entities (individuals and/or businesses) in support of the Commanders’ Emergency Response Program and the Rapid Regional Response Program. The DLAs are required to maintain cash accountability and payment packets, and to reconcile and clear the disposition of cash advances with the JASG-C Disbursing Officer at least monthly.

Objective

The overall audit objective was to provide assurance that DFI funds turned in by the Falluja DLA agreed with government records. We specifically looked at whether DoD polices and procedures for cash accountability and disposition were being complied with.

For a discussion of the audit scope, methodology, and a summary of prior coverage, see Appendix A. For definitions of the acronyms used in this report, see Appendix B. For a list of the audit team members, see Appendix D.

2

Control of the Development Fund for Iraq Cash Accountability and Disposition

This audit report discusses control of DFI cash controlled by the JASG-C Comptroller, who also serves as the DFI Account Manager. The JASG-C Comptroller/DFI Manager has designated physical accountability over the DFI cash funds to the Disbursing Officer. The Disbursing Officer is responsible for cash-on-hand held in the Palace vault (located at the U.S. Embassy Annex, Baghdad, Iraq), disbursing the funds, and for maintaining security for the funds. Also, the Disbursing Officer is responsible for the reconciliation of the funds held by the DLAs.

The DLAs are required to maintain cash accountability and payment packets, and to reconcile and clear the disposition of cash advances with the JASG-C Disbursing Officer at least monthly. Due to the availability of Electronic Funds Transfer, the DLA for Falluja, Iraq, no longer needed to maintain DFI cash on site, and therefore, this was the final reconciliation for this account.

Cash Accountability

We conducted an unannounced cash count of the DFI funds being turned in by the Falluja DLA to the JASG-C Disbursing Officer’s vault at approximately 0800 hours on March 30, 2006. We were given access to the funds immediately and we were observed by the Disbursing Officer and the DLA during the entire cash count. A full cash count was conducted to ascertain completeness of the funds. The cash was segregated by dollar denomination and loose coins. The amount of cash turned in by the Falluja DLA is shown in the following table.

3

Table: Results of Cash Count of DFI Funds on March 30, 2006 (in U.S. Currency)

Source: SIGIR

The actual DFI cash on hand turned in by the Falluja DLA was $7,222,330.09, which matched the accountability records maintained on the JASG-C Comptroller. The Disbursing Officer performed a cash count immediately after our cash count. The totals of each cash count were the same.

The JASG-C Comptroller’s office follows the guidance from the DoD Financial Management Regulation (FMR) Volume 5 in regards to cash controls. A Department of Defense Form 1081, “Statement of Agent Officer’s Account,” is prepared to document cash withdrawals, deposits, and reconciliation of the DFI fund. Additionally, the JASG-C Comptroller’s office maintains an Excel spreadsheet to track the DFI cash totals.

Cash Disposition: Payment Packets

The JASG-C Comptroller/DFI Account Manager has established policies and procedures for appointing the DLA. In accordance with these policies and procedures, via the appointment letter, the DLA is authorized to take custody and make disbursement of DFI Funds. The DLAs must provide, in their payment packets, the following documentation to the Disbursing Officer to reconcile their accounts. Specifically,

Denomination

Quantity

Amount

Currency

Hundreds

66,672 Bills @$100.00

$6,667,200.00

Fifties

11,101 Bills @ $50.00

$555,050.00

Twenties

4 Bills @ $20.00

$80.00

Tens

0 Bills @ $10.00

$0.00

Fives

0 Bills @ $5.00

$0.00

Ones

0 Bills @ $1.00

$0.00

Loose Coin

$.09

TOTAL as of

March 30, 2006

$7,222,330.09

• • •

the signed contract detailed invoices Material Inspection and Receiving Report/Certificate of Completion document

The Falluja DLA presented four payment packets to the JASG-C to reconcile with the cash turn in. Our review found that the payment packets contained the above documents and were accurate. In reconciling the account we added the amount of each payment packet to the cash. The amount of the four payment packets was $697,418.31. This

4

amount added to the cash amount equaled $7,919,748.40. The JASG-C Disbursing Officer reconciled the payment packets. The totals from the cash count and the payment packets were compared, and were the same.

The JASG-C Disbursing Officer reconciled the cash and payment packets turned in for the Falluja DLA’s account against the DD Form 1081, reducing that account to zero. The JASG-C Disbursing Officer, using the Excel spreadsheet, increased the amount of cash returned to the vault by $7,222,330.09.

Conclusion

We conducted an unannounced cash count on March 30, 2006, and as a result provided assurance that the $7.9 million cash and payment packets turned in by the Falluja DLA agreed with U.S. government records. The JASG-C Disbursing Officer and the DLA were accountable for DFI cash assets on hand and complied with the DoD requirements for safeguarding cash. We found that the processes employed by the JASG-C Comptroller’s Office for completing, controlling, and maintaining accurate records for the issuance of cash to DLAs and for clearing the Falluja DLA’s cash account and payment packets balances were acceptable. The procedures the Falluja DLA employed to maintain control of and to turn in the DFI cash and payment packets were acceptable.

Recommendations

We made no recommendations in this report.

5

Appendix A. Scope and Methodology

To determine if the DFI cash held by the Falluja DLA agreed with government records, we conducted an unannounced cash count of the DFI funds at approximately 0800 hours on March 30, 2006 (Project No. 6015). We were given access to the funds immediately and we were observed by the Disbursing Officer and the Falluja DLA during the entire cash count. We verified, by actual count, the cash in the amount of $7,222,330.09, which matches the accountability records maintained on the JASG-C Comptroller.

We reviewed the spreadsheets of reconciliation between the Division Level Agents and the JASG-C Comptroller. We reviewed receipts payment packets to determine if the amounts equaled the amounts on the Excel spreadsheet totals. We verified, by reviewing supporting documentation, the amount of the four payment packets was $697,418.31.

We reviewed the DoD Federal Management Regulation Volume 5 as the criteria to determine if the JASG-C Comptroller’s Office complied with applicable regulations.

We reviewed the Statement of Agent Officer’s Account, DD Form 1081 to determine the adequacy of the JASG-C Comptroller and the DLA funds accountability.

We performed the audit work at the JASG-C Comptroller’s Office and the Vault, located in the U.S. Embassy Annex, Baghdad, Iraq.

We conducted this audit from March 2006 through April 2006, with the actual cash count performed on March 30, 2006, in accordance with generally accepted government auditing standards.

Use of Computer-Processed Data. We did not use computer-processed data to perform this audit.

Prior Coverage. We reviewed the following reports:

The Special Inspector General for Iraq Reconstruction report, “Control of Cash Provided to South-Central Iraq,” (SIGIR 05-006, April 30, 2005). Reports issued by the Office of the Special Inspector General for Iraq Reconstruction can be accessed on its website http://www.sigir.mil.

Air Force Audit Agency report, “Nonappropriated Fund Cash Controls,” (F2003-0003- FB4000, dated 30 December 2002). AFAA Reports can be accessed on its website https://www.afaa.hq.af.mil

6

Appendix B. Acronyms

CPA DFI DLA JASG-C

Coalition Provisional Authority Development Fund for Iraq Division Level Agent Joint Area support Group – Central (Provisional)

7

Appendix C. Report Distribution

Department of State

Secretary of State Senior Advisor to the Secretary and Coordinator for Iraq

U.S. Ambassador to Iraq Director, Iraq Reconstruction Management Office Mission Director-Iraq, U.S. Agency for International Development

Inspector General, Department of State

Department of Defense

Secretary of Defense Deputy Secretary of Defense

Director, Defense Reconstruction support Office Under Secretary of Defense (Comptroller)/Chief Financial Officer

Deputy Chief Financial Officer

Deputy Comptroller (Program/Budget) Inspector General, Department of Defense Director, Defense Contract Audit Agency Director, Defense Finance and Accounting Service Director, Defense Contract Management Agency

Department of the Army

Assistant Secretary of the Army for Acquisition, Logistics, and Technology Principal Deputy to the Assistant Secretary of the Army for Acquisition,

Logistics, and Technology Deputy Assistant Secretary of the Army (Policy and Procurement) Director, Project and Contracting Office Commanding General, Joint Contracting Command-Iraq/Afghanistan

Assistant Secretary of the Army for Financial Management and Comptroller Chief of Engineers and Commander, U.S. Army Corps of Engineers

Commanding General, Gulf Region Division Auditor General of the Army

U.S. Central Command

Commanding General, Multi-National Force-Iraq Commanding General, Multi-National Security Transition Command-Iraq Commander, Joint Area support Group-Central

Other Federal Government Organizations

Director, Office of Management and Budget Comptroller General of the United States Inspector General, Department of the Treasury Inspector General, Department of Commerce Inspector General, Department of Health and Human Services Inspector General, U.S. Agency for International Development President, Overseas Private Investment Corporation

President, U.S. Institute for Peace

8

Congressional Committees and Subcommittees, Chairman and Ranking Minority Member

U.S. Senate

Senate Committee on Appropriations Subcommittee on Defense Subcommittee on State, Foreign Operations and Related Programs

Senate Committee on Armed Services Senate Committee on Foreign Relations

Subcommittee on International Operations and Terrorism

Subcommittee on Near Eastern and South Asian Affairs Senate Committee on Homeland Security and Governmental Affairs

Subcommittee on Federal Financial Management, Government Information and International Security

Subcommittee on Oversight of Government Management, the Federal Workforce, and the District of Columbia

U.S. House of Representatives

House Committee on Appropriations Subcommittee on Defense Subcommittee on Foreign Operations, Export Financing and Related Programs Subcommittee on Science, State, Justice and Commerce and Related Agencies

House Committee on Armed Services House Committee on Government Reform

Subcommittee on Management, Finance and Accountability Subcommittee on National Security, Emerging Threats and International

Relations House Committee on International Relations

Subcommittee on Middle East and Central Asia

9

Appendix D. Audit Team Members

This report was prepared and the audit was conducted under the direction of Joseph T. McDermott, Assistant Inspector General for Audit, Office of the Special Inspector General for Iraq Reconstruction. The staff members who contributed to the report include:

W. Dan Haigler, Jr. Ronald Rembold

10

[DAME1]

Wouldn't you love to know what the real numbers are including pay offs????kI :o

I guess that 14 trillion has to be somewhere........