Does the U.S. Government Know Where Its Money Is Going?

DOD Audit Deficiencies

In two separate WebCPA reports, the contract records section of the Securities and Exchange Commission and the Audit Division of the Department of Defense have been tested and found wanting. An outside auditor found that the SEC found "significant risk areas" with vendor contracts and procurements with one notorious example where the record system totally failed regarding contracts signed in regional offices. In the Defense Department, the GAO found that the Audit Agency fell short on planning, supervision and audit independence. GAO characterized problems as disturbing and widespread and issued numerous recommendations for improvement. Examples included over 500 hours of charged time for a cash management system which did not exist; skipping of audit steps on combat systems audit and elimination or mitigation of audit findings on a Iraq reconstruction contract solely based on the contractor's objections.

Do we really want the U. S. Government to add to their activities when they are having this many problems getting right work already performed by the Federal Government? (are you SURE?). I have no doubt that PCAOB would react harshly (and appropriately so) if a CPA firm were to act similarly on an audit of a publicly-traded private enterprise.