According to a June report published by US Department of Defense (DoD) Inspector General (IG), the US Army was forced to acknowledge discrepancies of… wait for it… $2.8 trillion.
And that's just for one quarter of 2015.
The "adjustments" required to balance the budget for the whole year, or, at least make it look balanced, come to some $6.5 trillion. There are no receipts or invoices to support these numbers, according to the report, they were simply pulled out of someone's… imagination.
The report of the Inspector General (IG), a Pentagon official, points out that any US Army 2015 financial statements are useless as a result of those adjustments, and no management or resource decisions relying on those figures will be possible.
The IG report focuses on the US Army's General Fund, the larger of its two primary accounts. The assets of the General Fund are thought to be in the neighborhood of $282.6 billion in 2015. But no one knows for certain, as much of the required financial data was either lost or was simply not recorded, the report says.
A. Franklin Spinney, a retired military analyst for the Pentagon and critic of DoD planning, asked reporters, "Where is the money going? Nobody knows."
An accurate accounting is likely to reveal much deeper problems within the culture of spending at the DoD. The DoD total annual budget is currently estimated to be some $573 billion, more than half of the entire United States budget. If DoD accounting errors are fully revealed and the whole scale of financial fraud is discovered, the consequences for the entire US military will be significant.
Spinney suggests that the lack of record keeping is not just improperly balanced books. He pointed out that both US presidential candidates have called for an increase in military spending, justifying it by intensifying conflicts and tensions around the globe.
Congress has now put the DoD on a September 30, 2017, audit deadline. Many doubt that the US military will meet that deadline.
The IG report also notes that the Defense Finance and Accounting Services (DFAS) have made unjustified changes to their budget figures.
According to the report, when DFAS computers show different numbers for ammunition or, say, missiles, they simply insert a false "correction" to make the numbers match. With over 16,000 financial data files vanished from the DFAS computer system, the patchwork budgeting is not only necessary, it's life-saving, especially for the expensive weapons programs that keep the military vital, the report says.
According to Jack Armstrong, a former Defense Inspector General, the accounting problem was a known issue as far back as 2010.
"They don't know what the heck the balances should be," Armstrong said.
