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Report | June 9, 2023

Audit of the DoD’s Financial Management of the Afghanistan Security Forces Fund (DODIG-2023-082)


Publicly Released: June 13, 2023



The objective of this audit was to determine whether the DoD managed the Afghanistan Security Forces Fund (ASFF) appropriated funds in the Foreign Military Sales (FMS) Trust Fund in accordance with applicable laws and regulations. This audit was performed due to previously identified risks related to the DoD’s transfer of ASFF appropriated funds to the FMS Trust Fund and the sudden collapse of the Afghan government. Data reliability and supporting documentation issues, described in the Scope and Methodology section, limited our ability to perform tests on the underlying transactions for the ASFF funds.



Since FY 2005, public laws appropriated a net amount of $80.7 billion to the ASFF account to provide the Afghanistan National Defense and Security Forces with assistance. Of the $80.7 billion, Defense Security Cooperation Agency (DSCA) personnel transferred $47.5 billion from the ASFF account to the FMS Trust Fund. Once DSCA personnel transferred the funds, they issued the funds’ obligation authority to various DoD Components to spend. DSCA personnel transferred those funds using the process for Building Partnership Capacity (BPC) programs. While the sources and purposes of BPC funds vary, the DoD’s underlying policies and procedures for executing the programs are similar. Therefore, this report makes recommendations related to the policies and procedures for BPC programs. In addition, while additional funding for the ASFF is unlikely, other BPC programs—such as the Ukraine Security Assistance Initiative and the Foreign Security Forces: Authority to Build Capacity—continued to receive funding.



The DoD did not manage ASFF appropriated funds in accordance with applicable laws and regulations. Specifically, the DoD did not comply with the requirements of:

  • the Arms Export Control Act, the Economy Act, or the National Defense Authorization Acts that established the ASFF by transferring $47.5 billion to the FMS Trust Fund;
  • appropriations laws by not returning $2.3 billion in canceled funds to the U.S. Treasury in a timely manner and $25.7 million in expired funds to the ASFF account and by inappropriately disbursing and depositing canceled funds in at least 15 cases; and
  • Office of Management and Budget Circular No. A‑123 by inaccurately recording $4.1 billion appropriated to the ASFF account as spent.


This mismanagement occurred because the DoD did not design and implement effective controls over BPC funds. As a result, the DoD increased the risk of violating the Antideficiency Act, designed a process that was inefficient, provided inaccurate appropriation status data for quarterly reports to Congress, and reported ASFF‑related financial activity inaccurately in the DoD, Army, and Security Assistance Accounts financial statements.



Among other recommendations, we recommend that the Under Secretary of Defense (Comptroller)/Chief Financial Officer, DoD (USD[C]/CFO) and the DSCA Director:

  • rescind policies that: (a) cite the Economy Act as the authority for transferring funds to the FMS Trust Fund, (b) cite the FMS Trust Fund as an appropriated destination for BPC funds, and (c) allow for the incorrect reporting of the status of funds;
  • issue policies that require the DoD to only use the FMS Trust Fund for its established purposes and remove any BPC funds remaining in the FMS Trust Fund; and
  • develop and implement policies that require the DoD to fully use U.S. Treasury funds controls.

We also recommend that the USD(C)/CFO, the DSCA Director, and the Assistant Secretary of the Army (Financial Management and Comptroller) review the DoD Agency‑Wide, Security Assistance Account, and Army General Fund financial statements, respectively, to determine the necessary corrections to prior period financial reports based on U.S. Treasury guidance and take action accordingly.


Management Comments and Our Response

The USD(C)/CFO agreed with the 17 recommendations we addressed to them. However, the comments for 10 of the recommendations lacked sufficient detail describing the actions their office plans to take to implement the recommendations. Therefore, those recommendations remain unresolved. The remaining seven recommendations are resolved but will remain open.

Of the 11 recommendations addressed to the DSCA Director, DSCA officials agreed with 6 recommendations, partially agreed with 2 recommendations, and did not agree with 3 recommendations. Of the 11 recommendations, DSCA responses to 8 recommendations either lacked sufficient detail describing the planned actions to implement the recommendations or stated that officials disagreed with the recommendations. Therefore, those 8 recommendations remain unresolved. The remaining three recommendations are resolved but will remain open.

We request that the USD(C)/CFO and DSCA Director provide additional comments on the unresolved recommendations within 30 days. The Army official, responding for the Assistant Secretary of the Army (Financial Management and Comptroller), agreed with the three recommendations addressed to the Assistant Secretary. Therefore, the recommendations are resolved but will remain open.


This report is the result of Project No. D2022-D000FV-0091.000.