The Pentagon has failed its annual financial audit for the seventh year in a row. This means the Department of Defense (DOD) has failed every single audit it has been subjected to, but officials hope to have things under control by the time audit No. 11 rolls around.
The DOD announced the results on Friday. "Each year teams of independent public accountants audit the department's $4.1 trillion in assets and $4.3 trillion in liabilities," which are then audited by the DOD Office of the Inspector General, Pentagon comptroller Michael McCord told reporters. "In total, the overall DOD audit is comprised of or supported by 28 separate audits of these different components."
Of those 28 components, only nine passed inspection with an "unmodified audit opinion," which the DOD says means "auditors determined the financial statements were presented fairly and in accordance with [generally accepted accounting principles]." One component received a "qualified" opinion, meaning "auditors concluded there were misstatements or potentially undetected misstatements that were material but not pervasive to the financial statements."
Fifteen others earned "disclaimers," meaning auditors "could not obtain sufficient, appropriate evidence to provide a basis for an audit opinion." Among those receiving disclaimers were such big-ticket items as the National Security Agency, the Defense Intelligence Agency, and the Defense Advanced Research Projects Agency.
"The DoD reporting entities that received disclaimers of opinion on their financial statements, when combined, account for at least 44 percent of the DoD's total assets and at least 68 percent of the DoD's total budgetary resources," the report noted.
Opinions on three components are still pending. But even if all three pass with flying colors, more than half of the DOD's elements will have failed to pass inspection.
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reason.com
