Residual Audit and Accountability Risk in Navy Ordnance Reporting and Reconciliation Under Ordnance Information System 2.0

Abstract

Navy ordnance reporting and reconciliation continues to generate recurring audit and accountability deficiencies under Ordnance Information System (OIS) 2.0 despite documented processes, established internal controls, and ongoing remediation efforts. This study examines residual audit and accountability risk by analyzing 161 ordnance-related deficiencies documented in the Navy’s Deficiency Tracking Tool (DTT). Using a qualitative diagnostic research design, the study classified deficiencies through the Auditability Triangle and the Committee of Sponsoring Organizations of the Treadway Commission (COSO) Internal Control–Integrated Framework, then evaluated residual risk through an ISO 31000-informed qualitative risk assessment. Findings indicate that recurring deficiencies are not confined to OIS 2.0. Of the 161 reviewed deficiencies, 28 were directly associated with OIS, while 133 were associated with the broader enterprise environment. Across both environments, deficiencies were concentrated primarily in process and internal control conditions rather than personnel factors, with recurring weaknesses in control activities and information and communication. The study concludes that recurring ordnance-related deficiencies reflect structural process, control, information, and governance constraints within the current operating environment rather than isolated execution failures.