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Friday, January 27, 2023
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Pentagon Can’t Account for at Least $220 Billion of Equipment: GAO

'Contractors can possess assets such as ammunition, missiles, torpedoes and equipment for specific uses associated with these items...'

(Ken Silva, Headline USAThe Pentagon can’t account for at least $220 billion of equipment provided to military contractors, according to a report released this week by the Government Accountability Office.

The GAO’s report studied “government-furnished property,” which auditors defined as property the government provides to contractors to carry out their responsibilities. Contractors can possess assets such as ammunition, missiles, torpedoes and equipment for specific uses associated with these items, the GAO said.

The GAO, a federal agency designed to provide Congress with non-partisan research, noted that the Department of Defense’s inability to properly track its military equipment stretches back to at least 2001.

In 2003, the DOD began working on a database that would track government-furnished property.

The completion date for that database was initially 2011. Then, the Pentagon pushed back the completion date to 2016 before postponing it again to 2017, and then to 2019. Now, the remediation date is 2026.

The GAO also noted that the $220 billion value estimate for the unaccounted property is based off of a 2014 report, and in fact “is likely significantly understated,” the GAO added.

“For example, in fiscal year 2016, we reported that the Army indicated the actual number of these GFP assets is unknown and that actual quantities may be greatly different than the Army’s documented property records reflect,” the GAO said.

The GAO noted that the Pentagon’s inability to track the equipment it provides to contractors is a major reason the DOD is the only federal agency to have never passed an audit with a clean bill of health.

The DOD, which holds some $3.2 trillion in assets—amounting to about two-thirds of the federal government’s total assets—has undertaken and failed five audits since Congress mandated such procedures in 1990. Its most recent audit failure was in December.

The GAO recommended that the DOD undergo a number of bureaucratic overhauls to address its shoddy record-keeping, including the development of a “comprehensive strategy” to “clearly articulate the detailed DOD-wide efforts to address the government-furnished property material weakness.”

“Without such a strategy, DOD is at an increased risk that its efforts to remediate the GFP material weakness will continue to be insufficient and that it will continue to miss or push back target remediation dates,” the GAO warned.

The DOD agreed with the recommendations, and the GAO said it will provide updates when its recommendations are implemented.

Ken Silva is a staff writer at Headline USA. Follow him at twitter.com/jd_cashless.

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