Audit the Pentagon Act of 2023

I 118TH CONGRESS 1ST SESSION H. R. 2961 To ensure that the Department of Defense achieves a clean audit opinion on its financial statements, and for other purposes. IN THE HOUSE OF REPRESENTATIVES APRIL 27, 2023 Ms. LEE of California (for herself, Mr. BURGESS, Mr. POCAN, Mr. BIGGS, Mr. HUFFMAN, Ms. HAGEMAN, Ms. TLAIB, Ms. SCHAKOWSKY, Mr. GARCI´A of Illinois, Mr. MCGOVERN, Mr. DESAULNIER, Ms. JAYAPAL, Mr. AUCHINCLOSS, Mr. GOSAR, Mr. GRIJALVA, and Mr. BOWMAN) introduced the following bill; which was referred to the Committee on Armed Serv- ices A BILL To ensure that the Department of Defense achieves a clean audit opinion on its financial statements, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Audit the Pentagon 4 Act of 2023’’. 5 SEC. 2. FINDINGS. 6 (1) The Pentagon failed it’s 5th consecutive 7 Audit in November 2022. 8 VerDate Sep 11 2014 02:58 May 09, 2023 Jkt 039200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H2961.IH H2961 kjohnson on DSK79L0C42PROD with BILLS 2 •HR 2961 IH (2) Upon failure of this audit, the DoD was un- 1 able to account for hundreds of billions of dollars, 2 accounting for 61 percent of it’s $3.5 trillion in as- 3 sets. 4 SEC. 3. SENSE OF CONGRESS. 5 It is the sense of Congress that— 6 (1) as the overall defense budget is cut, the 7 congressional defense committees and the Depart- 8 ment of Defense should not endanger the Armed 9 Forces by reducing wounded warrior accounts or 10 vital protection (such as body armor) for members 11 of the Armed Forces serving in harm’s way; 12 (2) the valuation of legacy assets by the De- 13 partment of Defense should be simplified without 14 compromising essential controls or generally accept- 15 ed government auditing standards; and 16 (3) nothing in this Act should be construed to 17 require or permit the declassification of accounting 18 details about classified defense programs, and, as re- 19 quired by law, the Department of Defense should en- 20 sure financial accountability in such programs using 21 proven practices, including using auditors with secu- 22 rity clearances. 23 VerDate Sep 11 2014 02:58 May 09, 2023 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H2961.IH H2961 kjohnson on DSK79L0C42PROD with BILLS 3 •HR 2961 IH SEC. 4. DEPARTMENT OF DEFENSE SPENDING REDUC- 1 TIONS IN THE ABSENCE OF AN UNQUALIFIED 2 AUDIT OPINION. 3 (a) IN GENERAL.— 4 (1) REDUCTIONS.—If, during any fiscal year 5 after fiscal year 2022, the Comptroller of the De- 6 partment of Defense fails to certify to Congress that 7 a department, agency, or other element of the De- 8 partment of Defense has achieved an unqualified 9 opinion on its full financial statements, the amount 10 available for such department, agency, or element 11 shall be reduced— 12 (A) for the fiscal year during which such 13 determination is made, by an amount equal to 14 0.5 percent; and 15 (B) for any subsequent fiscal year during 16 which such determination is made, by an 17 amount equal to 1.0 percent. 18 (2) APPLICATION OF REDUCTIONS.—For any 19 fiscal year for which a reduction is made pursuant 20 to paragraph (1) for a department, agency, or ele- 21 ment, the amount of the reduction shall be applied 22 on a pro rata basis against each program, project, 23 and activity of such department, agency, or element 24 for that fiscal year. 25 VerDate Sep 11 2014 02:58 May 09, 2023 Jkt 039200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H2961.IH H2961 kjohnson on DSK79L0C42PROD with BILLS 4 •HR 2961 IH (3) USE OF REDUCED AMOUNTS.—The amount 1 of any reduction made under paragraph (1) shall be 2 deposited in the General Fund of the Treasury and 3 shall be available for purposes of deficit reduction. 4 (b) ACCOUNTS EXCLUDED.—The following accounts 5 are excluded from any reductions under subsection (a): 6 (1) Military personnel, reserve personnel, and 7 National Guard personnel accounts of the Depart- 8 ment of Defense. 9 (2) The Defense Health Program account of 10 the Department of Defense. 11 (c) WAIVER.—The President may waive subsection 12 (a) with respect to an account if the President— 13 (1) certifies that the application of such sub- 14 section to that account would— 15 (A) negatively affect the national security 16 of the United States or members of the Armed 17 Forces who are deployed in combat zones; or 18 (B) affect the Defense Health Program ac- 19 count; and 20 (2) submits to the Committee on Appropria- 21 tions and the Committee on the Budget of the 22 House of Representatives and the Committee on Ap- 23 propriations and the Committee on the Budget of 24 the Senate a report on such waiver that includes a 25 VerDate Sep 11 2014 02:58 May 09, 2023 Jkt 039200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H2961.IH H2961 kjohnson on DSK79L0C42PROD with BILLS 5 •HR 2961 IH description of the specific activities that would be af- 1 fected and why such activities are essential to the 2 national security of the United States. 3 (d) REPORT.—Not later than 60 days after a reduc- 4 tion takes effect under subsection (a), the Director of the 5 Office of Management and Budget shall submit to Con- 6 gress a report specifying each department, agency, or 7 other element of the Department of Defense subject to re- 8 duction and the amount of the reduction. 9 (e) DEFINITIONS.—In this section: 10 (1) The terms ‘‘financial statement’’ and ‘‘ex- 11 ternal independent auditor’’ have the meanings given 12 those terms in section 3521(e) of title 31, United 13 States Code. 14 (2) The term ‘‘unqualified’’, with respect to the 15 audit status of a financial statement, includes the 16 characterizations clean and unmodified. 17 Æ VerDate Sep 11 2014 02:58 May 09, 2023 Jkt 039200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6301 E:\BILLS\H2961.IH H2961 kjohnson on DSK79L0C42PROD with BILLS