DoD Owes Taxpayers Full Accounting of Assets, Comptroller Tells House
For decades, IG auditors and the Office of Management has said that the Department of Defense needed a comprehensive audit. Resistance from inside the DoD, their insistence on autonomy, and the lack of will of congress members to demand have created a very poor understanding of the spending habits and use of taxpayer money within defense. Speculation has been riff of massive overspending, unnecessary spending, and redundant spending for an equally long time.
When President Trump came in, he campaigned on the promise of real “draining of the swamp.” He obviously heard complaints or had his own thoughts on DoD over the years . In fact even during his latest congressional meeting and over the last year, Trump has mentioned the massive cost overruns in DoD and the delays. It is no wonder that his cabinet members have decided that this is another project whose time had come.
Under Mattis’s leadership, this holding of DoD accountable is no longer just “talk” but is now a “work in progress.”
By Jim Garamone
January 10, 2018
A departmentwide audit is important for business reform, for Congress and for the taxpayer, the Defense Department’s comptroller told the House Armed Services Committee today.
The process has started for the first departmentwide audit in DoD history, David L. Norquist said. Defense is the largest department in the executive branch and has assets around the world.
While the department has auditors looking at various contracts or processes, “this is the first time the department will undergo a full financial statement audit,” he said. “A financial statement audit is comprehensive and occurs annually and it covers more than financial management.”
This audit will verify the count, location and condition of military equipment and real property. “It tests the vulnerability of our security systems and it validates the accuracy of personnel records and actions,” Norquist said.
The department will have 1,200 financial statement auditors assessing the books and records to develop a true account of the state of the department, the comptroller said. It will take time to pass all the process and system changes necessary to pass the audit and get a so-called “clean opinion,” he said. He noted that it took the Department of Homeland Security — a much smaller and newer agency — 10 years to get a clean audit.
“But we don’t have to wait to see the benefits of a clean opinion,” Norquist said. “The financial statement audit helps drive enterprise improvements to standardize our business practices and improve the quality of our data.”
The audit will provide information and accountability to the American people. “The taxpayers deserve the same level of confidence as a shareholder that DoD’s financial statement presents a true and accurate picture of its financial condition and operations,” he said. “Transparency, accountability and business process reform are some of the benefits of a financial statement audit.”
An audit will improve accountability, the comptroller said, noting that, for example, an initial Army audit found that 39 UH-60 Black Hawk helicopters were not properly recorded in the property system. “The Air Force identified 478 structures and buildings at 12 installations that were not in its real property system,” he added.
The audit should cost about $367 million in 2018, Norquist said, which is about the same percentage of the overall budget that large firms like Proctor and Gamble or IBM spend on their audits. “We also anticipate spending about $551 million in 2018 fixing problems identified by the auditors,” he said.
Finding better ways to do business will allow DoD to invest in greater lethality for the force, the comptroller said.
This is a long overdue audit. Pouring billions into a defense agency is fine IF taxpayers can feel that the money has been well spent. Also, while DoD has itself b een reluctant and at times downright belligerent about handling its own problems or audits internally, there is another aspect that may come out which could have taxpayers and congress up in arms.
Past presidents, in particular Obama, have had a great deal of latitude in “moving funds and equipment” around or using it for unacceptable reasons. Some of their actions have harmed the readiness capability of our forces and been politically or financially motivated to cause benefit or profit to foreign players or inside US as “pay-to-play” profit for special interests.
I have already reported on the extravagance of an unnecessary and field military unwanted base in Afghanistan as well as several other actions like mothballing planes that should have been repaired but were put in “dumps”; poorly built or grossly overpriced equipment that soldier have had to deal with; lack of up-to-date soldier needs; or, planes and equipment left behind seemingly randomly but not really in areas across the Middle East that have shown up in terrorist hands.
Finally, someone is taking the bull by the horns and getting answers. I seriously doubt the DoD or our country is going to like the results of the audit. Lancing a festering wound however is necessary if we hope to finally get spending under control.
Hopefully, we will now be able to feel reasonably sure that our demands for accountability and transparency are being heard and acted upon thanks to President Trump and his cabinet. It is one thing to “drain the swamp” but we must also be able to “control spending” and hold everyone accountable across all the three branches if we hope to get back on track.
Sorry — forgot to add this chart….notice the costs from 2009-2016 because while our forces suffered SOMEONE got benefits.