GAO: Pentagon failing to track improper contractor payments

In fiscal 2011, the Pentagon reported over $1.1 billion in improper payments, which refers to either an under- or overpayment of a contractor.

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Senate Homeland Security and Government Affairs Chairman Tom Carper (D-Del.), who authored the 2010 law along with Sen. Susan Collins (R-Maine), said in a statement that the report was a “troubling” reminder of the problems with the Pentagon’s accounting failures.

“The Department spends about a trillion dollars annually, but officials have no idea how much of that money it loses to waste and fraud. This is simply unacceptable,” said Carper, who had requested the report with his ranking member Tom Coburn (R-Okla.) and Sen. Claire McCaskill (D-Mo.).

Coburn said the report was more proof that the Pentagon must be audited, something that the department is currently not capable of. The Pentagon has vowed to get ready for an audit by 2017.

The GAO report faulted the Pentagon for failing to adapt key quality assurance procedures for tracking improper payments. It said the department did not develop sampling measures for estimating improper payments, maintain key documentation to support its estimates or conduct recovery audits or a required risk assessment.