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Pentagon fails first-ever audit

Pentagon fails first-ever audit

The Defense Department failed its first full-scale audit, the results of which are expected to be released later today, according to a Pentagon spokesman.

Deputy Secretary of Defense Patrick Shanahan told reporters in a news briefing Thursday that the Pentagon had failed the audit. Some of the agency's accounting issues could take years to fix.

Shanahan cautioned, though, that the agency never expected to pass.

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"We failed the audit, but we never expected to pass it," Shanahan told reporters at a briefing.

"We never thought we were going to pass an audit, everyone was betting against us that we wouldn’t even do the audit," he added.

But Shanahan also made it clear the agency intended to take the audit seriously, saying he was concerned about the effect on future Pentagon funding if the agency was unable to resolve the issues identified.

"If I’m a taxpayer what I want to see is, 'that’s great, you did the audit and you have all these findings – how long is it going to take for you to fix those?' " Shanahan said.

"And then show me next year that it takes less to audit and you have fewer findings. That’s what I’d want to see."

The audit, which began in December of 2017, took nearly a year to complete and cost $367 million. It is said to be the first comprehensive audit of the agency in the history of the Defense Department.

At least 2,400 Pentagon auditors surveyed the department's estimated $2.4 trillion in resources.  The department says an audit will now be undertaken every year to cut down on department-wide waste.

"It is important that the Congress and the American people have confidence in DOD's management of every taxpayer dollar," Defense Department Comptroller David Norquist said in December.

"With consistent feedback from auditors, we can focus on improving the processes of our day-to-day work," he added. "Annual audits also ensure visibility over the quantity and quality of the equipment and supplies our troops use."

The U.S. defense budget hovered around $700 billion in 2018.

According to Norquist, future spending to fix problems identified in the 2018 audit is expected to be about $551 million.

Ellen Mitchell contributed.

--Updated at 3:43 p.m.