The failure of an aviation mechanic/inspector to adequately inspect the pilot/owner's work during the engine overhaul, which resulted in a loss of engine oil and engine power during cruise flight, and a subsequent ditching. Factors associated with the accident were the inadequate installation of the idler gear shaft setscrew, and the lack of a safety wire on the three-quarter inch hex head (oil) plug in front of the idler gear shaft. Additional factors associated with the accident were the lack of suitable terrain for a forced landing, and ocean water.