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Watchdog: Accountability

Chuck Grassley report questions accuracy of Pentagon financial statements

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Is the Pentagon's inspector general turning a "blind eye" to inaccuracies produced by the Department of Defense's chief accounting agency?

Iowa Republican Sen. Chuck Grassley, the ranking minority member of the Senate Committee on the Judiciary, believes DOD's Defense Finance and Accounting Service is producing error-ridden financial statements.

These statements, which were given "clean" opinion audits by an outside certified public accounting firm, were in turn ignored by DOD's IG, according to an oversight report prepared by the Iowa senator's staff.

The CPA firm "rubber-stamped" DFAS' flawed practices by using a defective audit method, the report said.

"Audits are a primary oversight tool for rooting out fraud and waste in the government. To protect taxpayers, these government audits must be as good as they can be," Grassley wrote in a letter to Secretary of Defense Chuck Hagel and DOD's IG, Jon T. Rymer.

The report also asked if DFAS is getting other things incorrect:

"If DFAS is unable to accurately report its own internal 'housekeeping' accounts of $1.5 billion, then there are grave concerns about DFAS’s ability to accurately report on the hundreds of billions DoD spends each year."

Recommendations in the Grassley staff report include the IG getting an independent audit of DFAS' financial statements to find errors.

The report also urges the IG to address allegations of misconduct involving DFAS officials.

View the full report below.

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