Pentagon Agency Tries to Hoodwink IRS

The Pentagon's inspector general's office, the office charged with exposing fraud in the federal government, provided the IRS with fake documents in order to avoid embarrassment in an audit.

The audit was part of a routine program where one U.S. inspector general checks the work of another. The inspector general's office apparently spent nearly 1,000 hours creating fake documents to cover up a 1988 audit report that they feared would not pass audit muster. It is estimated that the cost to taxpayers of preparing the false documents is approximately $63,000.

The IRS reviewers gave the Pentagon’s audit work a clean bill of health after examining the fake documents. A report was filed by an employee of the Pentagon's inspector general bringing the falsification to the attention of the Senate Finance Committee. "It's a very sad day indeed when the watchdog gets caught cheating," said Senator Charles Grassley, R-IA, in a letter to Defense Secretary Donald Rumsfeld. Senator Grassley is chairman of the Senate Finance Committee.

You may like these other stories...

Could the IRS disallow Ice Bucket Challenge charitable contributions?Unless you’ve been living under a rock, you’ve probably heard of – or participated in – the ALS Ice Bucket Challenge.I was...
As a general rule, a taxpayer can deduct the full amount of monetary contributions made to a qualified charitable organization, as long as certain substantiation requirements are met. These donations are typically made...
Hertz withdraws full-year forecast, cites accounting review, challengesRental car company Hertz Global Holdings Inc. said on Tuesday it is withdrawing its full-year financial forecast and expects 2014 results to be “...

Already a member? log in here.

Upcoming CPE Webinars

Aug 26
This webcast will include discussions of recently issued, commonly-applicable Accounting Standards Updates for non-public, non-governmental entities.
Aug 28
Excel spreadsheets are often akin to the American Wild West, where users can input anything they want into any worksheet cell. Excel's Data Validation feature allows you to restrict user inputs to selected choices, but there are many nuances to the feature that often trip users up.
Sep 9
In this session we'll discuss the types of technologies and their uses in a small accounting firm office.
Sep 11
This webcast will include discussions of commonly-applicable Clarified Auditing Standards for audits of non-public, non-governmental entities.