Coburn, Manchin Drop Bipartisan Legislation to Hold Pentagon Accountable For Financial Audit

(WASHINGTON, D.C.) – Today, U.S. Senators Tom Coburn, M.D. (R-OK) and Joe Manchin (D-WV) introduced the Audit the Pentagon Act of 2013, a bill that provides incentives for the Department of Defense, which is the only Federal agency that has never fully complied with financial management laws, to meet its audit schedule while also instituting consequences for further failure to follow the law.

“You can’t manage what you can’t measure.  Every year the Pentagon fails to produce a viable financial audit they not only violate the Constitution, but put our nation’s security at risk because of a failure to effectively prioritize spending,” Dr. Coburn said.  “This summer the Pentagon cancelled important training and furloughed thousands of civilian personnel while it continued to waste billions on non-defense spending that had nothing to do with its core mission. A full and complete audit is the only way the department will be able to make better decisions about how it uses valuable taxpayer dollars.  This bill helps the Pentagon help itself by simply requiring the Pentagon to meet its own deadlines.  The Senate should pass this bill without delay.”

“The United States of America has – and will continue to have – the greatest military in the world. In order to maintain our great military strength, we need to make sure that we are cutting the fat and not the muscle from our Defense Department,” Sen. Manchin said. “We must ensure that we’re using our limited resources most efficiently to support the men and women in uniform. One of best ways to get the most accurate information about our spending and our military’s priorities is to shed light on the Department of Defense budget, without jeopardizing our national security secrets. It is simply unacceptable that the Department of Defense is the only major federal agency that has not completed a financial audit. Our bill will help to solve that problem.”

Key Findings and Provisions of the Audit the Pentagon Act:

  • The Department of Defense has never fully complied with these laws and has been on the Government Accountability Office’s “High Risk” list for waste, fraud, abuse, and mismanagement every year since 1995.
  • Secretary Hagel has affirmed his commitment to achieving audit-ready budget statements by the end of 2014, stating that he ‘will do everything he can to fulfill this commitment’ and confirming that auditable financial statements are essential to the Department of Defense not only improving the quality of its financial information, but also to reassuring the public and the Congress that it is a good steward of public funds.”  
  • Mandates that failure to obtain a clean audit opinion in 2018 will result in the military services not being allowed to fund new major defense acquisition programs past Milestone B, meaning that the Pentagon would not be able to enter into engineering and manufacturing development on a new weapon system until it passed a clean audit.
  • Requires the Department of Defense to amend its policies to prohibit the purchase of any “off-the-shelf” IT system that will take longer than three years to install and include provisions in the contracts for termination if the IT system is not delivered on schedule.