For the sixth consecutive year, the Pentagon has fallen short in its annual audit, as disclosed by the Defense Department’s chief financial officer. Out of the 29 individual sub-audits conducted, only seven received passing grades, mirroring the previous year’s results. One sub-audit received a “qualified” rating, while 18 were deemed failures, with no evidence of fraud.
To gain overall approval, all sub-audits must pass, a requirement that remains unmet. Comptroller Mike McCord acknowledged some progress but emphasized that it’s insufficient. Secretary of Defense Lloyd Austin is reportedly pushing for better and quicker results, although a successful audit is anticipated to take several more years.
Mandatory audits for government agencies have been a federal law since the early 1990s. However, the Pentagon initiated self-auditing only in 2018, experiencing incremental improvements annually. This year, 1,600 auditors scrutinized the Department of Defense’s $3.8 trillion in assets and $4 trillion in liabilities, conducting 700 site visits. Notably, half of the department’s assets couldn’t be accounted for.
The complexity of auditing the Pentagon arises from its sheer size and diversity, encompassing over half of U.S. discretionary spending. The department’s assets span personnel, supplies, bases, and weapons. McCord acknowledged the increasing difficulty of each audit, noting that many easier issues have already been addressed.
Concerned about the recurring failed audits, lawmakers introduced bipartisan legislation this year to ensure a clean audit for the DOD in the following year. This legislative response reflects Congress’s ongoing worries about fraud, waste, and abuse in the Pentagon.
In response to queries about the audit’s potential impact on U.S. adversaries and allies, Pentagon deputy press secretary Sabrina Singh emphasized the continuous learning process. While acknowledging less-than-ideal results, she highlighted ongoing efforts to improve and learn from each audit iteration.
