Tomorrow, the Department of Defense (DoD) will deliver its Agency Financial Report for fiscal year 2019. The report will include the results of the second “full” DoD department-wide audit. Last year, almost 30 years after the Chief Financial Officers Act first directed federal departments to deliver audited annual financial statements, the DoD finally certified it was ready to be audited.
The massive effort last year cost hundreds of millions of dollars, yielding (again) a “disclaimer of opinion” on the department-wide financial statements. However, the audit also identified specific sources of weakness in accounting systems and financial controls. Tomorrow’s report should include valuable insight into how well the DoD is addressing those weaknesses.
Truth in Accounting will prepare a report card on the audit results, like we did last year, as a way to gauge how much improvement is being made, and to gain insight into how cost-effective the audit process will be.
You can review our assessment last year here. For the current year, the DoD Office of Inspector General expects to produce a valuable review of the audit results in mid-to-late December, and we may have to wait for that report to prepare our own assessment.