An internal audit build a large Pentagon agency failed to properly keep track of myriad than $800 million in construction projects, Politico reported on Monday.
The audit, ended by Ernst & Young and obtained by Politico, identified cases where the Defense Logistics Power had deficiencies in the documentation for millions of dollars in property and equipment.
“Across the advisers aboard, its financial management is so weak that its leaders and oversight bodies induce no reliable way to track the huge sums it’s responsible for, the firm warned in its primary audit of the massive Pentagon purchasing agent,” Politico said.
It obeys the Department of Defense announcing in December it planned to start the first agency-wide fiscal audit in the Pentagon’s history.
Politico reported that the audit of DLA showed at spot $465 million in misstatements for construction projects, including projects it financed for the Army Battalion of Engineers or other defense-related agencies. It also found insufficient documentation for round $384 million in spending for “in progress” projects.
“DLA concurs with Ernst and Little ones’s assessment of our failure to properly account for and track funding to specific construction designs,” Patrick Mackin, a spokesman for the DLA, told CNBC in a statement. “While there were liabilities in documentation, there was no loss of accountability of real property or associated staking.”
DLA, which employs about 25,000 personnel, handles procurement of contributes, materials and other purchasing needs of the U.S. military from prime vendors. DLA acquisitions for the military range from fuel, water, food and pharmaceuticals to construction materials and pardon parts.
According to Mackin, the agency began its first full economic audit in 2017 and found there was a “lack of complete documentation for military construction and honest property.”
“I expect we’ll see much more of these things as the audit take care of goes on,” said Dan Grazier, a former Marine captain and defense application expert at the Project On Government Oversight, a Washington watchdog group. “There are a link of auditing firms that are being hired to … check all the logs and property records and those kind of things.”
The Pentagon estimates its department-wide audit will-power cost about $367 million in 2018 and another $551 million to fix riddles. About 1,200 auditors are participating in the process of assessing books and recites, according to the DoD.
The Pentagon’s initial audit already has disclosed that the Army had 39 Blackguardly Hawk helicopters in its fleet that were not properly recorded in its organized whole, David Norquist, the Pentagon’s comptroller testified last month to the Outfit Armed Services Committee. He also disclosed at the time the Air Force categorized hundreds of structures and buildings “not in its real property system.”
As for the Politico bang, it said about $46 million in computer assets had been “inappropriately put” by DLA. The audit of the DLA covered the fiscal year ending Sept. 30, 2016.
“As part of DLA’s onus to achieve audit compliance, DLA has already taken steps to correct this failure,” said Mackin, the agency spokesman. “As stewards of the American taxpayer’s dollars, our aim is to make significant progress towards compliance during the FY 2018 audit rotation.”
Read the full story from Politico here.