Internal Audit Finds Pentagon Can’t Account for Hundreds of Millions of Dollars in Its Budget


Ernst & Young, in an audit, found that the Defense Logistics Agency, one of the Pentagon’s largest agencies, has failed to properly account for hundreds of millions of dollars in spending in its annual budget.  The accounting firm, conducting an internal audit, has found that the agency’s financial management team has no reliable way to track the billions of dollars it receives every year.

In one example, Ernst & Young found that discrepancies in the agency’s books totaled at least $465 million for construction projects it financed for the Army Corps of Engineers, among others.  For ongoing projects, discrepancies were found for another $384 million.  The agency also couldn’t produce proper records for $100 million worth of computer systems that help the agency conduct its day-to-day business.

The DLA has never been subjected to a full audit despite the fact that many lawmakers on Capitol Hill have been pushing for one for some time.  The Department of Defense as a whole has a $700 billion annual budget, and roughly $2.2 trillion in combined assets.


Join the discussion