By Andrew Gray

WASHINGTON (Reuters) - The U.S. military command that trains Afghan forces, a key part of Washington's war strategy, lacks the capacity to oversee multimillion-dollar contracts it has awarded, a watchdog reported on Tuesday.

The Combined Security Transition Command Afghanistan is responsible for programs worth some $15 billion (10 billion pounds) to develop Afghan security forces so they can take over from U.S. and NATO troops in leading the fight against Taliban militants.

Yet the U.S. government watchdog found that the command had only one person in Afghanistan dedicated to overseeing a contract worth $404 million to provide training to Afghan police and soldiers.

"It does not have mechanisms necessary to ensure that U.S. funds are managed effectively and spent wisely," the office of the Special Inspector General for Afghanistan Reconstruction said in its report.

"We found that assigning one contracting officer's representative in the field did not provide the degree of oversight that is needed to ensure that funds are used as intended," the report said.

The watchdog did not name the company fulfilling the contract but the command, in a response to the report, said it was MPRI, an Alexandria, Virginia-based firm founded by retired military leaders and owned by L-3 Communications.

Although the United States has spent some $32 billion in aid to Afghanistan since the 2001 ouster of the Taliban, the watchdog was established only in 2008 after a similar agency found huge amounts of waste in efforts to rebuild Iraq.

"We probably should have done this several years before now," said Arnold Fields, the special inspector general for Afghanistan reconstruction.