The DCAA is going to increase its spending on their audit staff by 14% in 2013. According to the Pentagon’s new request, the budget for auditors would increase from $1.7 billion to $1.9 billion dollars in 2013. This all comes at a time where the U.S. Military Budget is looking to decrease by 5%, so why increase the budget for auditors and not military personal?
As of today there is $400 billion in unaudited defense contracts. The increase in defense spending that occurred after 9/11 caused a huge pile-up of defense contracts that the DCAA hasn’t had the proper staffing to complete in a timely manner. What this means is that there is money out there waiting to be handed out to companies and recovered by our government. It is estimated that the U.S. Government could claim up $2.2 billion in overcharges, while companies could be seeing an even larger pay day which could potentially help give the lagging economy a boost.
The Pentagon is claiming that these contracts need to be audited and they need to be audited now. It is estimated that the U.S. Government has lost nearly $30 billion to fraud in contracts related to the wars in Iraq and Afghanistan. With fraud being as bad as it is, along with the 44% decrease of incurred cost audits performed by the DCAA in 2011, the Pentagon is making a great case for the budget increase.
Under the Pentagon’s new proposal the DCAA would get an 11% budget increase to $1.3 billion and the Defense Department budget would be $613.9 billion