Pentagon Fails Its First-Ever Audit

Pentagon Fails Its First-Ever Audit

Reuters/iStockphoto/The Fiscal Times

The Defense Department has failed its first-ever comprehensive audit, Deputy Secretary of Defense Patrick Shanahan said Thursday, according to multiple reports.

“We failed the audit, but we never expected to pass it,” Shanahan told reporters, according to Reuters.

The audit, announced in December 2017, was conducted by some 1,200 auditors, took nearly a year to complete and cost hundreds of millions of dollars. It found accounting problems that could take years to resolve. Pentagon Comptroller David L. Norquist told Congress earlier this year that he expected the Defense Department would have to spend more than $550 million in 2018 fixing problems identified during the process.

The Pentagon, with an estimated $2.4 trillion in assets, had never before been subjected to a comprehensive audit. It will now undergo an audit every year in an effort to reduce waste.

Shanahan said taxpayers should be encouraged by the process. “If I’m a taxpayer, what I want to see is: ‘You did the audit, you have all these findings. How long is it going to take for you to fix those?’" he said, according to Defense News. "Then show me next year it takes less to audit and you have fewer findings.”

Shanahan also told reporters that the services are working on the new $700 billion Defense budget for 2020 that President Donald Trump recently proposed, which represents a $33 billion cut compared to earlier plans. Shanahan noted that the Pentagon spent 10 months preparing its budget and now has to come up with a trimmed version, Breaking Defense says.

This article has been updated to correct the number of auditors who worked on the Pentagon's financial review. It was 1,200, not 2,400.