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Marine Corps is first service to pass audit

Dec. 23, 2013 - 07:14PM   |  
The US Marine Corps is the first military service to pass a financial audit by the DoD Office of Inspector General, the Pentagon announced Monday.
The US Marine Corps is the first military service to pass a financial audit by the DoD Office of Inspector General, the Pentagon announced Monday. (Getty Images)
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The Marine Corps is the first military service to pass a financial audit, a small but potentially important budgetary milestone.

The Pentagon was informed of the audit’s successful completion Dec. 20 by the DoD Office of Inspector General (DoDIG), who conducted the audit on the Marine’s 2012 financials. The IG’s office gave an “unqualified, favorable audit opinion” of the service’s FY2012 Schedule of Budgetary Activity.

“This year’s financial report demonstrates our dedication to assure the public that we are efficient and prudent stewards of the nation’s resources entrusted to us,” Ann-Cecile McDermott, fiscal director for the Marine Corps, said in a press release.

In Oct. 2011, then-Secretary of Defense Leon Panetta set a 2014 timetable to have an audited Statement of Budgetary Resources for the department. That was scaled back in September. The Pentagon has a 2017 deadline to have all its books ready for an audit.

“We had volunteered to be the first to go through the chute” with an audit, Marine Capt. Tyler Balzer told Defense News. “We’re fortunate in being the smallest service, in that it’s maybe a little easier to keep track of our records.”

The audit applies to the FY12 Schedule of Budgetary Activity (SBA) and not the larger Statement of Budgetary Resources (SBR). The SBA covers appropriations and transactions, which Balzer said is the majority of finances in the SBR prior-year appropriations that are a smaller portion of the SBR.

Balzer said the service expects to repeat the audit in 2013 with an eye on correcting “material issues” identified by the IG. Moving forward, he added, the audit is something that will be repeated frequently.

A Dec. 23 statement by Secretary of Defense Chuck Hagel called the audit a significant achievement.

“This was the first audit of its kind for any of our armed services,” Hagel said. “Along with the progress some DoD agencies have made in generating auditable financial statements, this development marks an important milestone on the path to achieving greater accountability in our financial operations and more effective management of the defense enterprise writ large. There is more work to do in preparing our other military services to pass an audit, but I remain fully committed to making the Pentagon fully audit-ready by 2017.

Danielle Brian, executive director for the Project on Government Oversight, called the successful audit good news, and called for the other services to follow the Marines’ lead.

“Credit due to the Marines,” Brian said. “The fact that they can do it shows that the other parts of the department should be able to as well.”

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