THE DEFENSE LOGISTICS AGENCY HAS NO AUDIT CAPABILITY OF ITS OWN AND RECEIVES LIMITED AUDIT COVERAGE FROM THE DEFENSE AUDIT SERVICE. THIS LACK OF AUDIT COVERAGE INCREASES THE NEED FOR A STRONG INSPECTION SYSTEM. INSPECTION REPORTS PROVIDE VALUABLE INFORMATION, BUT INSPECTIONS CAN BE IMPROVED BY DIRECTING THEM TOWARD IDENTIFYING SIGNIFICANT SYSTEM PROBLEMS, DEVELOPING CAUSES OF PROBLEMS, AND ELIMINATING THE REPORTING OF MINOR NONMISSION-RELATED DEFICIENCIES. ALSO, THE INSPECTOR GENERAL DOES NOT HAVE AN ADEQUATE FEEDBACK SYSTEM FOR DETERMINING THE DEFENSE AUDIT SERVICE'S REPONSIVENESS TO AUDIT REQUESTS SUBMITTED BY THE INSPECTOR GENERAL. THE USE OF MORE TEMPORARIES IN THE DEFENSE LOGISTICS AGENCY INSPECTION SYSTEM COULD ALLOW FOR MORE FREQUENT COVERAGE AND PROVIDE OTHER ADVANTAGES. TABLES, FOOTNOTES, AND A PRIOR LIST OF ABBREVIATIONS ARE PROVIDED. APPENDIXES CONTAIN RELATED LETTERS, A CHART OF ORGANIZATIONAL RELATIONSHIPS, AND INFORMATION ON THE INSPECTOR GENERAL'S NONINSPECTION FUNCTIONS, AS WELL AS THE REPORT'S OBSERVATIONS OF INSPECTIONS. (AUTHOR ABSTRACT MODIFIED--PRG)