The Department of Defense (DOD), also referred to simply as “The Pentagon,” has failed its independent annual audit of $3.8 trillion in military assets due to the inability of defense officials to produce enough information for a full accounting evaluation. This is the sixth consecutive year it has failed, according to a Pentagon official.
“Auditing the department’s $3.8 trillion in assets and $4 trillion in liabilities is a massive undertaking,” Pentagon Comptroller Michael McCord said. “But the improvements and changes we are making every day as a result of these audits positively affect every soldier, sailor, airman, Marine, guardian and DOD civilian.”
However, he admits it is less than ideal: “Things are showing progress, but it’s not enough.” Secretary of Defense Lloyd Austin said, “We need to be doing better at this and moving faster.”
The US Defense Department failed its financial audit for the sixth consecutive year https://t.co/RRpbcQsPz2
— Bloomberg (@business) November 16, 2023
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Over 1,500 independent auditors evaluate the Pentagon’s records each year to discover if the Department can account for all of the money it is given and whether it has optimally spent it. The auditors gave a “disclaimer of opinion” regarding the consolidated 2023 audit, meaning they didn’t receive enough financial information to give an opinion.
According to the Pentagon, it breaks its books down into 29 standalone audits. Of those, seven received “unmodified opinions,” meaning clean, one received a “qualified opinion,” meaning acceptable, and 18 received incompletes or “disclaimers of opinion.” Three are currently still pending, including one for the Marine Corps.
The DoD has in fact never passed a yearly audit, as they were only imposed as a requirement in 2018 to enhance government oversight over its spending. Last year, McCord expressed his disappointment that the audit process has not improved much.
After this 2023 audit, McCord said the Pentagon is endeavoring for a fully clean audit but said that is still years away. He said it does not come as “a surprise,” since a single disclaimer of opinion causes the entire audit to be seen as unclean. But “It certainly is not something that we say, ‘it doesn’t matter,’” he added.
The Pentagon reportedly spent $187 million out of its $853 billion budget on the audit.
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