The DoD Office of Inspector General (DoD OIG) released its Independent Auditor’s Reports as part of the DoD’s FY 2024 Agency Financial Report, which includes the Agency-Wide Financial Statements for FY 2024 and FY 2023. The Independent Auditor’s Reports comprise three separate reports—Report on the Financial Statements, Report on Internal Control over Financial Reporting, and Report on Compliance with Applicable Laws, Regulations, Contracts, and Grant Agreements. The DoD OIG issued a disclaimer of opinion, meaning that the auditors could not obtain sufficient, appropriate audit evidence to support an opinion. The DoD Agency-Wide opinion is the culmination of a larger effort to audit, oversee, or consider the results of the audits of nearly 30 DoD Components. The seventh annual full-scope DoD Agency-Wide Audit assessed approximately $4.1 trillion in assets this year.
The DoD OIG performed audit procedures at the Agency-Wide level and considered the results of the DoD Component audits performed by independent public accounting firms. During this year’s DoD Agency-Wide audit, DoD OIG auditors identified 28 material weaknesses, two significant deficiencies, and six instances of noncompliance with laws, regulations, contracts, and grant agreements. Material weaknesses are so significant that they could prevent management from promptly detecting and correcting a material misstatement in the financial statements. Significant deficiencies are less severe than material weaknesses but are important enough to formally communicate to management.
“Although the DoD made some progress in improving financial management during the FY 2024 financial statement audits, many of its identified weaknesses have not improved since 2005,” said IG Storch. “A continued commitment to addressing root causes and implementing corrective actions is necessary to move toward achieving an unmodified opinion. The DoD must continue to address the Secretary of Defense Audit Priorities. Aggressively retiring noncompliant systems and modernizing the DoD’s financial management systems would materially support those efforts. However, achieving a clean audit opinion does not rest solely in the hands of financial management professionals, but encompasses the entirety of processes and systems that track the accountability and use of DoD assets.”
The DoD OIG audited these Agency-wide Financial Statements in accordance with the Chief Financial Officers Act of 1990.
The Independent Auditor’s Reports are included in the DoD Agency Financial Report beginning at page 69: https://comptroller.defense.gov/odcfo/afr2024.aspx