Pentagon pilots financial database after audit failure

The failure of its first audit has led the US Department of Defense (DOD) to begin the development of a central database that will record all financial transactions across its operations and aid it in managing a $692bn (£541bn) budget

The new database is intended to track the transactions of the world’s largest military and flag up potential anomalies. Introducing the plan during an event in Washington, D.C, acting deputy defence secretary David Norquist said that being able to track and analyse spending patterns would improve combat readiness and that ‘our ability to support the rest of the reform efforts across the department the way other commercial firms [do] gets dramatically improved’.

He also said that automated processes to replace many of the DOD’s legacy systems to drive down costs would be a significant aspect of the new system, noting that ‘everything that requires manual intervention costs more’.

The first audit, which was published in November 2018, showed that the Pentagon could not properly account for its $2.7 trillion (£2.1 trillion) in assets, with auditors finding that the department could not provide assurance on $282bn of inventory, nor on $759m of property, plant and equipment. Instead of a centralised system for the purposes of recording all financial transactions, auditors found that they were spread across 19 different databases.

The audit was conducted by more than 1,200 auditors carrying out around 900 site visits at over 600 locations and examining hundreds of thousands of inventoried items, ranging from bullets to ballistic missiles.

The DOD is currently engaged in a second audit to shed further lights on the extent of its spending. This coincides with its request to the US government for budgetary approval for full year 2020. Although the exact figure has yet to be disclosed, a 2020 budget proposed in late 2018 suggested that the department could receive as much as $750bn. This represents an 8% increase on the $692bn signed into law by President Trump in December 2017.

Report by James Bunney

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