The Department of Defense recently released a report detailing an independent audit performed across the entire agency. This report admitted that they were only able to account for approximately 37% of all Department of Defense assets. Some quotes from the report are featured below.
The Department completed its fourth annual consolidated financial statement audit in FY 2021. It covered approximately $3.2 trillion of the Department’s total assets, involved more than 1,200 auditors, and included nearly 1,350 site visits (virtual and in-person). The audit comprised 26 standalone audits conducted by independent public accountants (IPAs) and a consolidated Agency-wide audit performed by the DoD OIG (see Figure 15). The DoD OIG issued a disclaimer of opinion on the Department’s FY 2021 financial statements, meaning it was unable to obtain sufficient appropriate audit evidence on which to base an opinion. The Department’s leadership fully expected these results, as receiving a disclaimer of opinion is consistent with the experiences of other large and complex federal agencies during their initial years under audit. See the DoD OIG’s independent audit report in the Financial Section.
Of the 26 standalone audits, 6 reporting entities received unmodified opinions (i.e., auditors determined the financial statements were presented fairly and in accordance with generally accepted accounting principles), 1 reporting entity received a qualified opinion (i.e., auditors concluded there were misstatements or potentially undetected misstatements that were material but not pervasive to the financial statements), and 17 reporting entities received disclaimers of opinion. The standalone audits for two reporting entities, the DoD OIG and the Defense Information Systems Agency (DISA) Working Capital Fund, are scheduled to conclude in December 2021. The independent auditor’s report for each standalone audit is available in the respective reporting entity’s financial report available on the Agency Financial Report website.
When describing the percentage of total DoD assets accounted for in the audits, the report said:
Together, reporting entities receiving unmodified opinions on their standalone audits accounted for about $3.2 trillion (36.9 percent) of total DoD assets and $0.2 trillion (11.2 percent) of total DoD budgetary resources.
The official Department of Defense report PDF is available at below: