DawgTalkers.net Forums DawgTalk Everything Else... Pentagon can’t account for $6.5 trillion of taxpayer money

The United States Army’s finances are so jumbled it had to make trillions of dollars of improper accounting adjustments to create an illusion that its books are balanced.

The Defense Department’s Inspector General, in a June report, said the Army made $2.8 trillion in wrongful adjustments to accounting entries in one quarter alone in 2015, and $6.5 trillion for the year. Yet the Army lacked receipts and invoices to support those numbers or simply made them up.

As a result, the Army’s financial statements for 2015 were “materially misstated,” the report concluded. The “forced” adjustments rendered the statements useless because “DoD and Army managers could not rely on the data in their accounting systems when making management and resource decisions.”

Disclosure of the Army’s manipulation of numbers is the latest example of the severe accounting problems plaguing the Defense Department for decades.

The report affirms a 2013 Reuters series revealing how the Defense Department falsified accounting on a large scale as it scrambled to close its books. As a result, there has been no way to know how the Defense Department – far and away the biggest chunk of Congress’ annual budget – spends the public’s money.

The new report focused on the Army’s General Fund, the bigger of its two main accounts, with assets of $282.6 billion in 2015. The Army lost or didn’t keep required data, and much of the data it had was inaccurate, the IG said.

“Where is the money going? Nobody knows,” said Franklin Spinney, a retired military analyst for the Pentagon and critic of Defense Department planning.

The significance of the accounting problem goes beyond mere concern for balancing books, Spinney said. Both presidential candidates have called for increasing defense spending amid current global tension.

An accurate accounting could reveal deeper problems in how the Defense Department spends its money. Its 2016 budget is $573 billion, more than half of the annual budget appropriated by Congress.

The Army account’s errors will likely carry consequences for the entire Defense Department.

Congress set a September 30, 2017 deadline for the department to be prepared to undergo an audit. The Army accounting problems raise doubts about whether it can meet the deadline – a black mark for Defense, as every other federal agency undergoes an audit annually.

For years, the Inspector General – the Defense Department’s official auditor – has inserted a disclaimer on all military annual reports. The accounting is so unreliable that “the basic financial statements may have undetected misstatements that are both material and pervasive.”

In an e-mailed statement, a spokesman said the Army “remains committed to asserting audit readiness” by the deadline and is taking steps to root out the problems.

The spokesman downplayed the significance of the improper changes, which he said net out to $62.4 billion. “Though there is a high number of adjustments, we believe the financial statement information is more accurate than implied in this report,” he said.

"THE GRAND PLUG"

Jack Armstrong, a former Defense Inspector General official in charge of auditing the Army General Fund, said the same type of unjustified changes to Army financial statements already were being made when he retired in 2010.

“They don’t know what the heck the balances should be,” Armstrong said.

Some employees of the Defense Finance and Accounting Services (DFAS), which handles a wide range of Defense Department accounting services, referred sardonically to preparation of the Army’s year-end statements as “the grand plug,” Armstrong said. “Plug” is accounting jargon for inserting made-up numbers.

At first glance adjustments totaling trillions may seem impossible. The amounts dwarf the Defense Department’s entire budget. Making changes to one account also require making changes to multiple levels of sub-accounts, however. That created a domino effect where, essentially, falsifications kept falling down the line. In many instances this daisy-chain was repeated multiple times for the same accounting item.

The IG report also blamed DFAS, saying it too made unjustified changes to numbers. For example, two DFAS computer systems showed different values of supplies for missiles and ammunition, the report noted – but rather than solving the disparity, DFAS personnel inserted a false “correction” to make the numbers match.

DFAS also could not make accurate year-end Army financial statements because more than 16,000 financial data files had vanished from its computer system. Faulty computer programming and employees’ inability to detect the flaw were at fault, the IG said.

DFAS is studying the report “and has no comment at this time,” a spokesman said.

http://www.reuters.com/article/us-usa-audit-army-idUSKCN10U1IG

So when they say decades, are they saying that everybody has known about the problem and nobody decided to fix it?

Not sure, but I guarantee military contractors are responsible for this.

Somebody forgot to carry the 2. YOU HAVE TO CARRY THE 2!

I bet a lot of it went to secret aircraft development.

Is anyone surprised that the government has "misplaced" trillions of dollars?

... and I thought the fake plane crash into the pentagon's "accounting department" was supposed to cover all that missing money up. This is pretty much old news if you ask me. Guess some reporter was bored and decided to rehash old news.

$6.5 trillion is about 1/4 of our debt, yet so many right wing and some left wing nervous nancies don't want to reduce military spending... I just don't get it.

I'm Shocked

Great, and we want them to manage our healthcare too.

We are able to just print/borrow more from China. This enables our government to be clueless.

Guaranteed.

Also, neither the Army, nor DFAS, have a very good reputation when it comes to the acquisition community. No offense to anyone who works in DFAS or Army acquisition, but it's just commonly seen that way.

"misplaced" in offshore accounts of elected officials.

Anybody with half a brain knows the military could function and still be the greatest military in the world on a fraction of its current budget. Problem is that standing at a podium and proclaiming cuts to the military is a political death sentence in this country... You will immediately be labeled unpatriotic and not strong against terrorism, etc... There are a select few areas of the country where you can win with that message.

Fun fact: the richest neighborhood in the United States is not Beverly Hills, it's a suburb in Virginia where all the military contractors work.

Actually the top 3 richest counties are in Virginia.

http://www.cnsnews.com/news/article/tere...inia-suburbs-dc

If by "all" you mean General Dynamics and Northrop Grumman, then yes, they are all there. However, they are there 98 and 120 on the Fortune 500.. well behind Freddie Mac, which is in McLean, VA, and on par with Capital One, which is in McLean, VA, AES and CSC which are both in Arlington/Falls Church are also top 200 companies..... Most of the biggest law firms in the country also have a significant presence in the Northern Virginia area as well... Exxon Mobil has a very large office there...

Then you take into account the concentration of people.. Greenwich, CT has far more billionaires and millionaires than does Falls Chuch, VA.. but Greenwich, CT is a real county with 333 times the population size of Falls Church (which is about 15,000 people).....

Those counties always rank as very rich, military contractors is only a very small contributing factor to that.

Tell me more.

This is getting interesting.

About what? Military wasteful spending or why the counties in Northern Virginia are the richest in America?

So it's lobbyist heaven is what you're saying

That's a big part of it.. But mostly, the biggest part of it, is that the way Falls Church is counted as a county but is only 2 square miles with 15,000 residents. When you compare it on averages, it looks HUGE.. but it's more like a small town than a county.. Plenty of other counties have small areas that would compare with Falls Church, but Falls Church doesn't have rural areas and poor neighborhoods to offset it the way almost every other county does.

The average home price in Falls Church is $550,000... and it's only 1500 square feet.

This is why we need a whole new crew in town. A vote for criminal Hillary is a vote for the SOS.

Wake up America. Your country is being stolen from you.

And you think Trump is gonna fix this?

This has been a problem for decades. Apparently nobody is willing to fix the problem, maybe give lip service to it.

This has been going on for almost 4 decades Peen.

I know. That is why we need a non politician in there who isn't afraid to call out the BS be it in his party or the other.

When is the last time you saw a candidate running for President who isn't getting full support from their own party? You haven't is the answer.

Time to shake things up my friends. Falling back on the line "it has been that way for decades" sounds a lot like "it is always going to be that way".

Time to change.

Who's the Non politician running? There is none.

So now Trump is a career politician?

He's been donating and helping both sides consolidate power for how long?

He's been a honorary politician for decades. When you're helping put people into the political system, you're not an outsider.

With regards to this topic, that isn't a shot at trump or Clinton. It's just the hard truth that nobody running is an outsider. Trump isn't gonna fix this problem any more than Clinton or Johnson will.

I'm in the same position I was in a month ago.. Still think I'm voting for Johnson though Trump still will have a chance in the debates to win me over..

But even if I do end up voting for him, it won't be to fix this problem.

Oh and you are correct, I guess. You can't run for President (with any success) unless you are at least pretty wealthy with some name recognition.. which means you will have contributed and been involved with politicians.. but in my opinion, that's a whole different level than actually being a career politician.

maybe so bro.


but to me, there isn't much difference between letting the puppets run government compared to letting the puppet masters do it.

the goal is still the same. now the master just wants a hands on approach.

it would be like having the Rothchild's run the joint...hell, might as well. the billionaires just got tired of their toys.

Guys, I think I'm being surveilled by the pentagon!

Was just going through my couch cushions and found 6 trillion in loose change!

Give it back!