The Pentagon's Defense Logistics Agency (DLA) is reportedly not able to document hundreds of millions of dollars of money it spent.
An internal audit by Ernst & Young finds the agency can't account for more than $800 million in construction projects, Politico reported.
According to Politico, the audit, covering the fiscal year that ended Sept. 30, 2016, raises concerns about how the Defense Department handles its $700 billion annual budget.
“If you can’t follow the money, you aren’t going to be able to do an audit,” Sen. Chuck GrassleyChuck GrassleyFormer Sen. Bob Dole dies at 98 Alarm grows over smash-and-grab robberies amid holiday season GOP blocks bill to expand gun background checks after Michigan school shooting MORE (R-Iowa) said.
The DLA has 25,000 employees and processes about 100,000 orders a day, according to Politico.
Army Lt. Gen. Darrell Williams, the agency's director, wrote in response to Ernst & Young's findings that the audit has "provided us with a valuable independent view of our current financial operations."
"We are committed to resolving the material weaknesses and strengthening internal controls around DLA's operations," he said, according to Politico.
In a statement, the agency also said it is the "first of its size and complexity in the Department of Defense to undergo an audit so we did not anticipate achieving a 'clean' audit opinion in the initial cycles."
"The key is to use auditor feedback to focus our remediation efforts and corrective action plans, and maximize the value from the audits. That’s what we’re doing now," the statement said.
The report comes as the Trump administration is poised to ask Congress for $716 billion for defense spending for fiscal 2019, a major hike that budget analysts say aligns with the administration's stated goals of bulking up the military and preparing it to potentially fight near-peer rivals after years of focusing on terrorism.
President TrumpDonald TrumpSenate rejects attempt to block Biden's Saudi arms sale Crenshaw slams House Freedom Caucus members as 'grifters,' 'performance artists' Senate confirms Biden's nominee to lead Customs and Border Protection MORE came into office pledging to rebuild what he described as a "depleted" military.
--This report was updated at 10:07 a.m.