Pentagon's accounting shambles may cost an additional $1 billion

DOD had pledged clean books by 2017, but Panetta wants deadline moved up three years

By R. Jeffrey Smith

UPDATED: 5:20 pm ET 10/13/2011

The Pentagon, which previously warned that reliable military spending figures could not be produced until 2017, has discovered that financial ledgers are in worse shape than expected and it may need to spend a billion dollars more to make DOD’s financial accounting credible, according to defense officials and congressional sources.

Experts say the Pentagon’s accounting has never been reliable. A lengthy effort by the military services to implement new financial systems at a cost so far of more than $6 billion has itself been plagued by overruns and delays, senior defense officials say. The Government Accountability Office said in a report last month that although the services can now fully track incoming appropriations, they still cannot demonstrate their funds are being spent as they should.