Bipartisan group of lawmakers demands better Pentagon auditing

Introduction

A bill proposed by a bipartisan group of senators Thursday would punish Pentagon agencies for failing to meet a series of deadlines for conducting proper internal audits, marking a major ratcheting up of congressional pressure about a good-government goal first set in legislation enacted 18 years ago.

Sen. Tom Coburn, R-Okla., a member of a subcommittee on federal financial management, is leading the effort to provide new incentives to the military services, which have moved slowly to comply with a target of completing successful audits of their expenditures by 2017. He was joined this week by five other Republicans and two Democrats.

Under their bill, military branches that don’t meet the 2017 deadline would see the development of weapons systems blocked before reaching the production and deployment stage.The bill would also reward agencies for meeting deadlines by conferring more control over their own budgets, including the ability to shift between $30 million and $60 million annually between accounts to pay for more weapons procurement, operations and maintenance, research or personnel, all without congressional approval.

The bill would also insist that the military services appoint some top officials who have previously worked as a chief financial officer of a government agency or a public company that has received an audit during their tenure there.

Each branch of the U.S. military has had difficulty meeting a set of interim auditing deadlines. A report from the Center for Public Integrity last week noted that problems with new accounting software systems have led to $8 billion in cost overruns. The Pentagon’s inspector general said recently that deadlines for completing the work have repeatedly slipped, with, for example, the Army’s launch date for its new auditing system pushed back 12 years, from 2004 to 2016.

Coburn has urged the Pentagon to get its financial house in order before, arguing that doing so will cut waste in military spending and increase efficiency. In January 2011, he wrote Admiral Gary Roughead, chief of naval operations, to say, “the Pentagon is one of the few agencies in the federal government that cannot produce auditable financial statements in accordance with the law … I will continue to push for a budget-freeze of all base budget non-military personnel accounts at the Defense Department until it complies with the law regarding auditable financial statements.”

Cosponsoring the bill with Sen. Coburn are Sens. Kelly Ayotte, R-N.H., John Cornyn, R-Texas, Chuck Grassley, R-Iowa, Ron Johnson, R-Wis., Joe Manchin, D-W.Va., Claire McCaskill, D-Mo., and Rand Paul, R-Ky.