Bohemia, NY (PRWEB) November 29, 2013
Lawrence Teicher, founder of CFO Consulting Services and prominent Long Island CPA, responds to an article published by The Verge on November 18th regarding the alleged accounting fraud at the Pentagon.
According to [The Verge article titled “Pentagon guilty of billion-dollar accounting fraud, reveals Reuters investigation,” a new Reuters report uncovered possible instances of accounting fraud at the Pentagon. The report discovered that about $8 trillion has disappeared “into a mess of corrupted data, erroneous reports and unauditable ledgers.” While the report doesn’t point fingers, it does highlight the overall epic failure of accounting processes at the Pentagon.
The article says sources from the U.S. Dept. of Finance and Accounting have had problems in the past trying to balance the U.S. Navy’s books with the U.S. Treasury outlays. Often times, the books arrive late, leaving treasury employees to fill in the blanks and attempt to correct inaccurate numbers. “The data usually arrives just two days before deadline, and supervisors direct the office to enter false numbers—known as ‘plugs’—to square the accounts and conceal the agencies’ patchy bookkeeping,” the article explains. “The result is fraudulent figures that can reach as high as a trillion dollars in a single year, simply to make the Pentagon books match the Treasury’s budget.”
The article says that one of the most surprising examples of the government’s inaccurate accounting is that the Army allegedly “lost track of roughly $5.8 billion worth of supplies between 2003 and 2011.” During those years, many soldiers deployed in Iraq and Afghanistan reported equipment shortages.
Lawrence Teicher, founder of CFO Consulting Services and a leading Long Island CPA, says this is a mass failure of accounting in the federal government. “This is a serious waste of money and resources,” he says. “These are serious accounting offenses that need to be remedied for the future of the economy and the rest of the country. How does the federal government ‘lose track’ of trillions of dollars? It shows that there are many flaws within the Pentagon’s accounting system. Good accountants do not fudge reports and record illegitimate numbers simply because they cannot find the correct data. These issues need to be addressed and the government agencies must be more strictly audited in the future.” As a CFO that has handled many government audits of government contractors by the DCAA, Teicher states that “it would be a criminal offense for a business to handle government contracts with such an obviously deficient accounting system.”
“It is truly unfortunate that there is such incongruence between the government’s demands on business and their demands on their internal systems and procedures. As taxpayers we deserve better.”
CFO Consulting Services, LLC provides outsourced, part-time CFO services on an as-needed basis to both small and mid-sized businesses located in the NY metropolitan region. Founded by Long Island CPA and financial expert Lawrence Teicher, CFO Consulting Services follows four main principles: independence, objectivity, competence and confidentiality. These core values have led its clients to achieve lasting success in their businesses.