The Department of Defense inspector general found that the Pentagon cannot maintain proper bookkeeping on expenses, which means they have not audited $6.5 TRILLION they spent on wars, equipment, etc. Lorin Venable, the assistant inspector general wrote:

Army and Defense Finance and Accounting Service Indianapolis personnel did not adequately support $2.8 trillion in third quarter adjustments and $6.5 trillion in yearend adjustments made to the Army General Fund data during FY2015 financial statement compilation. We conducted this audit in accordance with generlly accepted government auditing standards.

$6.5 TRILLION in ONE year. Could you imagine what the IRS would do to a private company if they did this? How about an average American?

Congress told the department to become “audit readiness” by September 30, 2017, but the horrible bookkeeping may make that impossible, even though the deadline is a year away.

The department relies on the Defense Finance and Accounting Service [DFAS] to handle their expenses, but they “could not adequate documentation for $6.5 trillion” to the IG.

The DFAS “did not document or support why the Defense Departmental Reporting system-Budgetary (DDRS-B), a budgetary reporting system, removed at least 16,513 of 1.3 million records during third quarter FY 2015.” The IG continued:

As a result, the data used to prepare the FY 2015 AGF third quarter and yearend financial statements were unreliable and lacked an adequate audit trail. Furthermore, DoD and Army managers could not rely on the data in their accounting systems when making management and resource decisions. Until the Army and DFAS Indianapolis correct these control deficiencies, there is considerable risk that AGF financial statements will be materially misstated and the Army will not achieve audit readiness by the congressionally mandated deadline of September 30, 2017.

The IG did not find any wrong doing or people taking large sums of money, but instead they could not find out who authorized all these transactions called “journal vouchers,” which “provide serial numbers, transaction dates and the amount of the expenditure.”

The IG has now recommended the financial company “enforce ‘the applicable guidance’ periodically issued by the Under Secretary of Defense Comptroller ‘regarding journal voucher category identification codes and metric reporting.'”

Problem is the Pentagon has done this for YEARS. Scot Paltrow did three part series at Reuters in 2013 about the waste at the Pentagon. He interviewed Linda Woodford, who worked at the Pentagon for 15 years and inserted “phony numbers in the U.S. Department of Defense’s accounts.” Every single month the financial people found numbers missing, wrong, or showing up with absolutely no explanation.

Reuters found the same problems as the IG:

In its investigation, Reuters has found that the Pentagon is largely incapable of keeping track of its vast stores of weapons, ammunition and other supplies; thus it continues to spend money on new supplies it doesn’t need and on storing others long out of date. It has amassed a backlog of more than half a trillion dollars in unaudited contracts with outside vendors; how much of that money paid for actual goods and services delivered isn’t known. And it repeatedly falls prey to fraud and theft that can go undiscovered for years, often eventually detected by external law enforcement agencies.

The consequences aren’t only financial; bad bookkeeping can affect the nation’s defense. In one example of many, the Army lost track of $5.8 billion of supplies between 2003 and 2011 as it shuffled equipment between reserve and regular units. Affected units “may experience equipment shortages that could hinder their ability to train soldiers and respond to emergencies,” the Pentagon inspector general said in a September 2012 report.