An Inconvenient Audit
April 16, 2008 2:49 PM Subscribe
The Pentagon's $1 Trillion Problem.
posted by Kadin2048 (38 comments total)
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Even as the Defense Department prepares to send Congress its $481.4B FY2008 budget request
, it also prepares to admit -- for the 18th year in a row -- that its finances are in such poor shape that it is effectively impossible to audit or account for over a trillion dollars in past expenses.
"For the first three quarters of 2007, $1.1 trillion in Army accounting entries hadn't been properly reviewed and substantiated, according to the Department of Defense's inspector general. In 2006, $258.2 billion of recorded withdrawals and payments from the Army's main account were unsupported. It's as if the Army had submitted multibillion-dollar expense reports without any receipts."
Not that it's a new problem, however:
"In 1990, Congress enacted legislation requiring all federal agencies to pass independent audits. Every year, the Defense inspector general dispatched dozens of auditors to the military's financial and accounting centers. Every year, they reported back that the job couldn't be done. Defense Department records were in such disarray and were so lacking in documentation that any attempt would be futile. In 2000, the inspector general told Congress that his auditors stopped counting after finding $2.3 trillion in unsupported entries made to force financial data to agree." Annual audits were suspended indefinitely in 2002.
And in an interesting historical note: the 'Mechanization of Contract Administration Services
' (MOCAS) system, which "pays invoices and vouchers for hardware supplies and services"*
, was originally brought on-line in 1958
, making it half a century old this year.