PRIA, Government Policy, Made Personal

Summary

Require the Department of Defense Inspector General to get yearly audits from outside, independent auditors of the financial statements for each DoD component that the OMB Director names under 31 U.S.C. 3515(c). These audits are done to meet the audit requirement in 31 U.S.C. 3521(e). Auditors must be chosen for their skills, independence, and ability to follow government auditing rules, and the Inspector General must take part in picking them and must watch over the audits. Each year the outside auditors must send their report to the Under Secretary of Defense (Comptroller) as the DoD Chief Financial Officer for chapter 9 of title 31, to the Controller of the Office of Federal Financial Management at OMB, to the head of the audited component, and to these congressional committees: Senate Armed Services; Senate Homeland Security and Governmental Affairs; Senate Appropriations; House Armed Services; House Oversight and Government Reform; and House Appropriations. These rules do not change the requirement in 31 U.S.C. 3521(e) about auditing the DoD-wide financial statements, and they do not limit the Comptroller General’s powers under 31 U.S.C. 3521(g).

Title 10, §240d

Armed Forces, Source: USLM XML via OLRC

(a)Audits Required.—

For purposes of satisfying the requirement under section 3521(e) of title 31 for audits of financial statements of Department of Defense components identified by the Director of the Office of Management and Budget under section 3515(c) of such title, the Inspector General of the Department of Defense shall obtain each year audits of the financial statements of each such component by an independent external auditor.

(b)Selection of Auditors.—

The selection of independent external auditors for purposes of subsection (a) shall be based, among other appropriate criteria, on their qualifications, independence, and capacity to conduct audits described in subsection (a) in accordance with applicable generally accepted government auditing standards. The Inspector General shall participate in the selection of the independent external auditors.

(c)Monitoring Audits.—

The Inspector General shall monitor the conduct of all audits by independent external auditors under subsection (a).

(d)Reports on Audits.—

(1)In general.—

The Inspector General shall require the independent external auditors conducting audits under subsection (a) to submit a report on their audits each year to—

(A)the Under Secretary of Defense (Comptroller) as the Chief Financial Officer of the Department of Defense for the purposes of chapter 9 of title 31;

(B)the Controller of the Office of Federal Financial Management in the Office of Management and Budget;

(C)the head of each component audited; and

(D)the appropriate committees of Congress.

(2)Appropriate committees of congress defined.—

In this subsection, the term “appropriate committees of Congress” means—

(A)the Committee on Armed Services, the Committee on Homeland Security and Governmental Affairs, and the Committee on Appropriations of the Senate; and

(B)the Committee on Armed Services, the Committee on Oversight and Government Reform, and the Committee on Appropriations of the House of Representatives.

(e)Relationship to Existing Law.—

The requirements of this section

(1)

(2)shall not be construed to limit or alter the authorities of the Comptroller General of the United States under section 3521(g) of title 31.

Notes & Related Subsidiaries

Editorial Notes

Codification Text of section, as added by Pub. L. 115–91, is based on text of section 1005 of Pub. L. 114–92, div. A, title X, Nov. 25, 2015, 129 Stat. 961, which was formerly set out as a note under section 2222 of this title, prior to repeal by Pub. L. 115–91, div. A, title X, § 1002(e)(4), Dec. 12, 2017, 131 Stat. 1541.

Amendments

2023—Subsec. (d)(1)(A). Pub. L. 118–31 struck out “and the Chief Management Officer of the Department of Defense” after “chapter 9 of title 31”. 2018—Pub. L. 115–232 renumbered section 254 of this title as this section. 2017—Subsec. (a). Pub. L. 115–91, § 1002(e)(2)(B), struck out “, United States Code,” after “title 31”. Subsec. (d)(1)(A). Pub. L. 115–91, § 1002(e)(3)(A)(i), inserted “and the Chief Management Officer of the Department of Defense” before semicolon. Pub. L. 115–91, § 1002(e)(2)(A), struck out “, United States Code” after “title 31”. Subsec. (d)(1)(C), (D). Pub. L. 115–91, § 1002(e)(3)(A)(ii)–(iv), added subpar. (C) and redesignated former subpar. (C) as (D). Subsec. (e)(1). Pub. L. 115–91, § 1002(e)(3)(B), redesignated par. (2) as (1) and struck out former par. (1) which read as follows: “shall be implemented in a manner that is consistent with the requirements of section 1008 of the National Defense Authorization Act for Fiscal Year 2002 (Public Law 107–107; 10 U.S.C. 113 note);”. Subsec. (e)(2). Pub. L. 115–91, § 1002(e)(3)(B)(ii), redesignated par. (3) as (2). Former par. (2) redesignated (1). Pub. L. 115–91, § 1002(e)(2)(B), struck out “, United States Code,” after “title 31”. Subsec. (e)(3). Pub. L. 115–91, § 1002(e)(3)(B)(ii), redesignated par. (3) as (2). Pub. L. 115–91, § 1002(e)(2)(A), struck out “, United States Code” after “title 31”.

Statutory Notes and Related Subsidiaries

Change of Name

Committee on Oversight and Government Reform of House of Representatives changed to Committee on Oversight and Reform of House of Representatives by House Resolution No. 6, One Hundred Sixteenth Congress, Jan. 9, 2019. Committee on Oversight and Reform of House of Representatives changed to Committee on Oversight and Accountability of House of Representatives by House Resolution No. 5, One Hundred Eighteenth Congress, Jan. 9, 2023. Audit Requirement for Department of Defense Components Pub. L. 118–31, div. A, title X, § 1004, Dec. 22, 2023, 137 Stat. 379, as amended by Pub. L. 118–159, div. A, title X, § 1004, Dec. 23, 2024, 138 Stat. 2047; Pub. L. 119–60, div. A, title X, § 1005, Dec. 18, 2025, 139 Stat. 1029, provided that: “(a) In General.—During each of fiscal years 2024 through 2035, each component of the Department of Defense shall be subject to an independent audit. Any such component that fails to be subject to such an audit during any fiscal year shall have 1.5 percent of unobligated amounts available for the component be cancelled and returned to the general fund of the Treasury for deficit reduction, except as provided in subsection (b). “(b) Exceptions.—The following accounts are excluded from any reductions:“(1) Military personnel, reserve personnel, and National Guard personnel accounts of the Department of Defense. “(2) The Defense Health Program account of the Department of Defense.” Transparency of Accounting Firms Used To Support Department of Defense Audit Pub. L. 115–232, div. A, title X, § 1006, Aug. 13, 2018, 132 Stat. 1947, as amended by Pub. L. 116–92, div. A, title X, § 1011, Dec. 20, 2019, 133 Stat. 1577, provided that: “(a) In General.—For all contract actions (including awards, renewals, and

Amendments

) occurring more than 180 days after the date of the enactment of this Act [Aug. 13, 2018], the Secretary of Defense shall require any accounting firm providing financial statement auditing or audit remediation services to the Department of Defense in support of the audit required under section 3521 of title 31, United States Code, to provide the Department with a statement setting forth the details of any disciplinary proceedings with respect to the accounting firm or its associated persons before any entity with the authority to enforce compliance with rules or laws applying to audit services offered by accounting firms. “(b) Treatment of Statement.—A statement setting forth the details of a disciplinary proceeding submitted pursuant to subsection (a), and the information contained in such a statement, shall be—“(1) treated as confidential to the extent required by the court or agency in which the proceeding has occurred; and “(2) treated in a manner consistent with any protections or privileges established by any other provision of Federal law.”

§240d Audits: Audit of Financial Statements of Department of Defense Components by Independent External Auditors

Summary

Title 10, §240d

Notes & Related Subsidiaries

Editorial Notes

Amendments

Statutory Notes and Related Subsidiaries

Change of Name

Amendments

Citations & Metadata