The US Department of Defense failed to comply with the Chief Financial Officers Act of 1990 until December 2018, and failed its first audit. The audit did not result in a pass or fail, but highlighted accounting gaps and errors. It may take years for the Pentagon to close these gaps and pass an audit.
The Chief Financial Officers Act of 1990 heightened oversight of spending by all government agencies in an effort to curb the billions of dollars that are wasted each year through fraud, waste, abuse and mismanagement. The idea was that each agency would have a Chief Financial Officer, who would lead efforts to improve efficiency and effectiveness by conducting comprehensive audits. Until December 2018, however, the US Department of Defense had failed to comply with the requirement. What about the conclusion of 1,200 reviewers examining spending on a wide range of weapon systems, military personnel and properties? “We failed the audit, but we never expected to pass it,” Deputy Defense Secretary Patrick Shanahan said.
Just one battle in an ongoing war:
The US defense budget for fiscal 2018 was approximately $700 billion. In a press conference, Shanahan did not provide any details about how much money had not been accounted for.
Military officials have said it could be years before the Pentagon can close accounting gaps and errors and actually pass an audit.
In a follow-up email, Pentagon spokesman Joseph Buccino explained the finding: “To clarify, the audit is not a pass-fail process. We have not received a negative result (the lowest possible category) in any area.”
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