Money is double or triple-counted as it moves between accounts. Adjustments underscore weakness in Defense Department systems. The Pentagon made $35 trillion in accounting adjustments last year alone — a total that’s larger than the entire U.S. economy and underscores the Defense Department’s continuing difficulty in balancing its books.
The latest estimate is up from $30.7 trillion in 2018 and $29 trillion in 2017, the first-year adjustments were tracked in a concerted way, according to Pentagon figures and a lawmaker who’s pursued the accounting morass.
“Within that $30 trillion is a lot of double, triple, and quadruple counting of the same money as it got moved between accounts,” said Todd Harrison, a Pentagon budget expert with the Center for Strategic and International Studies.
The Defense Department acknowledged that it failed its first-ever audit in 2018 and then again last year when it reviewed $2.7 trillion in assets and $2.6 trillion in liabilities. While auditors found no evidence of fraud in the review of finances that Congress required, they flagged a laundry list of problems, including accounting adjustments.