MEETING WITH THE COMPTROLLER AND DEPUTY COMPTROLLER, CIA

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP80-01240A000100140061-0
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 3
• Document Creation Date: December 9, 2016
• Document Release Date: July 24, 2000
• Sequence Number: 61
• Publication Date: May 3, 1962
• Content Type: MEMO

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MEMORANDUM TO THE FILE:
that we believe the audit should,be continued..
May 3, 1962
SUBJECT: Meeting with the Comptroller and Deputy Comptroller, CIA
Messrs Pahl and Keithline, GAO, met on April 25, 1962, with the CIA
Deputy Comptroller, who serves also as GAO's liaison with
CIA, STATINTL
Mr. Pahl advised that the ;Director of CARD and Mr. Pahl
desired an appointment to meet in the near future the new Director of
Central Intelligence (DCI), Mr. McCone, and that the Comptroller General
would be pleased to attend such a meeting if it could be arranged. Mr.
stated that he would arre.nge such a meeting on the assumption that
the Comptroller General would attend, and inquired concerning the general
purpose of the intended meeting, Mr. Pahl stated the basic purpose of the
meeting was to discuss with Mr. McCone the status of and limitations on the
GAO comprehensive audit of CIA, and to advise him that under present lim-
itations we do not believe an exfective audit coulcL_be accomplished and
Mr. Pahl asked what recent major organizational changes had been
made in CIA. stated only a few changes had been made but that
they were significant changes, including: (1) separating to the extent
possible the functions of tihe DCI from those of the Director of the
Central Intelligence Agency; (2) creating two new committees, an Execu-
tive Committee and a Financial Policy and Budget Committee: (3) creating
a Research Component; (4) elevating in CIA's organizational pattern the
stature of the Offices of the Comptroller and General Counsel; and (5)
transferring the CIA Audit Staff from the Deputy Director for Support to
the Office of the Inspector general.
Under Mr. McCone's interpretation, the position of D01 will be used
primarily to coordinate the foreign intelligence activities of the entire
intelligence community of the United States in accordance with existing
law and applicable National Security Council directives. lie will use
his position as Chairman of the United States Intelligence Board (USI13)
to accomplish this. The USIB is composed of representatives from CIA; the
intelligence components of the Departments of State, Defent3e, Army, Navy
and Air -nonce, and the Joint Chiefs of Staff ; the Federal Bureau of
Investigation, the Atomic Energy Commission; and the National Security
Agency. We were advised that Mr. Dulles and others who had served as DCI
had functioned primarily as the .uirector of Central Intelligence Agency.
A newly created Research Component is oeing organized, but its pre-
cise mission in the CIA organization has not been fully defined. It will
be directed uy a Deputy Lirector for Research and will be at the same
organizational level as Flans, Intelligence;aadSuppo.rt. Current thinking
is that the Technical Services Division and Develdj nt_ fo'jeots Division
( covert operations) and part or all of the Office ofSc3entific Intelli-
gence and Office of Research and -deports in the Intel.Ligenc? uompo#ent
STATINTL (overt operations) will ue transferred to the Deputy Director.,.for "Research.
(and later the Comptroller's) state ent;a'could be construed to
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mean that the Research Component would be involved in the gathering of
intelligence on sit;`6&y `lardware" of foreign countries, and doing
research work leading to the development of such "hardware" for U.S. use,
The Deputy Director of Central Intelligence will airect CIA oper-
ations through a newly created position of Executive Officer which will
be filled by Mr, Kirkpatric, previously the CIA Inspector General; an'
D.ecutive Committee, which will be chaired by General Carter; and a
Financial Policy and Budget ~'ommittee, which will be chaired by the
Comptroller.
The Deputy Directors for Plana, Intelligence, Support, and Research;
the Comptroller; the General Counsel; and the Executive Officer will
serve on the Fixecutive Committee. This Committee will consider both
operational and administrative policy matters,
The Assistant Deputy Directors for Plans, Intelligence, Support, and
Researbh, and the Assistant General Counsel will serve on the Financial
tlolicy and Budget Committee. This Committee will replace the Project
view Co' .mi ' tt_ ift+ will carry on its review and approval' processes with
respect to pro ects Froposea to be undertaken by the various CIA components
at costs estimated to exceed certain (redetermined amounts, The Committee
will play an active part in the budget preparation process in CIA. It will
consider and take action. on matters arising in the initial budget prep-
aration that are not resolved between the Budget Division and the operating
units, and will recommend to the DCI the initial CIA budget for submission
to the Bureau of the Budget. It will also consider and take action on
changes made in the CIA budget by the Bureau of the Budget.
To complete this reorganization, the Office of the Comptroller, the
Office of the General Counsel, area the Audit Staff have been transferred
from the Support Component. The Comptroller and the General ''ounsel now
report to the Director, as do the Deputy Directors for Plans, Intelligence,
Support, and Research, The Audit Staff has been assigned to and will
report to the CIA Inspector General, The extent to which the availability
STATINTL of Audit Staff working papers and reports for review by GAO may be affected
by placing Audit Staff under the Inspector General is not ow known by rATINTL
eithe or the Chief of the Audit Staff, . In the
past, however, we have been denied access to all working papers and reports
prepared by the Inspector General. STATINTL
By way of background information, stated that Mr. Bross,
who was named to succeed Mr. Saunders as CIA Comptroller, is a lawyer
STATINTL with many years of operating experience in the Plans Component, both in
the United States and overseas, advised that it is the inten-
tion of the new DCI to hold the Comptroller's Office responsible for
performing substantive evaluations concerning the operating plans and
accomplishments of the four CIA operating components. He stated such
evaluations of Plans Component activities had. not always been possible
in the past, but had generally been limited to self-evaluations within
the Plans Component, The naming of Mr. Bross as Comptroller, therefore,
is intended to gain the services of an individual well qualified in
o
by the operatin eqj.1e, perations and the international political situation, any well respected
I zatio~l ~ c ~ a t 4 a x O ftc~~ "fi'd4 1969a ~: su tan iv
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STATI IML
evaluations, - advised that the Comptroller's staff will not
be substantially increased to perform these evaluations because it is
expected that only a few people - say two or three - will be engaged
in-evaluating Plans Component activities.
STATINTL Mr. Bross, the Comptroller, also participated in part of the dis-
cussion with- and stated that he would take up later in the
day with Mr. McCone our request for a meeting with the DCI. Mr. Bross
anticipated that Mr. MoCone may call the Comptroller General directly
to arrange such a meeting.
We advised Messrs Bross that we presently were engaged
in a limited review of the Intelligence komponent, and that this review
may lead to additional reporting by GAO, but that the review had not yet
been completed, and that our reporting to date has been limited to the
Comptroller General's letters of May 1961 to the DCI and. to the Kilday
group. We advised him also that a detailed report had been prepared
and reviewed by CIA officials, but that this report had not been released.
At request we made a copy of this detailed report available
to him for the purpose of briefing Mr. Bross more fully on the status of
our work.
At Mr. Bross' request we briefly summarized the comprehensive audit
work that we had done to date. We advised him that, as stated in our
May 1961 letters to the DCI and to the Tilday group, our Office did not
believe that we could make an ezfeutive audit contribution on a contin-
uing basis under the present limitations on our audit. We advised him,
however, that our Office had not made any suggestions on changing the
limitations on our audits of CIA. We advised Mr. Bross also, that over
a year ago Mr. Samuelson had advised Colonel White, DDfS, that we did
not plan to undertake voucher and payroll audits of "vouchered fund"
expenditures, Mr. Bross expresses the belief thtit such audits would
be beneficial to the Government. We advised him, however, that such
audits usually are not productive of findings of interest to the Congress,
and perhaps the agency haad, because usually they are limited to disclosing
isolated instances of errors in computing pay and of non-compliance with
law or regulation,
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