Pentagon vows audit fixes by 2028

Defense Secretary Pete Hegseth has made a clean Pentagon audit by 2028 a top management goal, after the department failed its seventh straight department-wide audit in November 2024. (war.gov 1) (war.gov 2) At a June 18, 2025 Senate hearing, Pentagon comptroller Bryn Woollacott MacDonnell said the secretary had issued yearly milestones to reach a clean opinion by 2028 or sooner. (war.gov) The Pentagon’s problem is basic bookkeeping at enormous scale: in fiscal 2024, auditors reviewed financial statements covering about $4.1 trillion in assets and $4.3 trillion in liabilities. (congress.gov) (gao.gov) That 2024 audit ended in a disclaimer of opinion, meaning auditors could not get enough reliable evidence to say the Pentagon’s statements were fairly presented. The Government Accountability Office said the Defense Department still had 28 department-wide material weaknesses. (gao.gov) (media.defense.gov) The new strategy is not just “do better.” A March 24, 2026 memo changed how the Pentagon will present its books and said stand-alone audits for entities not on an approved list now need comptroller approval. (media.defense.gov) That same memo said the Defense Department inspector general plans to use an outside accounting firm for the Defense Working Capital Fund and consolidated agency-wide audits starting in fiscal 2027. (media.defense.gov) A separate January 9, 2026 memo reorganized Advana, the Pentagon’s enterprise data platform, into three programs, including one dedicated to financial management and audit remediation. (media.defense.gov) That financial-management unit was assigned to support a clean audit of the Defense Working Capital Fund in fiscal 2027 and the full department in fiscal 2028, while the Chief Digital and Artificial Intelligence Office gives status updates every 45 days. (media.defense.gov) The pressure is not limited to the Pentagon. The Government Accountability Office said on April 27, 2026 that 15 federal agencies reported about $186 billion in improper payments across 64 programs in fiscal 2025, up $24 billion from a year earlier. (gao.gov) About $153 billion, or 82%, of those improper payments were overpayments, and GAO said cumulative executive-branch estimates since fiscal 2003 have reached about $3 trillion. (gao.gov) The Centers for Medicare & Medicaid Services said Medicaid improper payments rose to $37.39 billion in fiscal 2025 from $31.10 billion in fiscal 2024, partly reflecting post-pandemic eligibility redeterminations and provider revalidation. (cms.gov) The Pentagon’s 2028 promise now sits inside a wider federal push to prove agencies can track money, document payments and defend their books under audit. (gao.gov) (media.defense.gov)