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...

IRS chief: New rule on the way for tax-exempt groupsIRS Commissioner John Koskinen told the USA Today on Monday that the agency will likely rewrite a proposed rule regulating the political activities of nonprofit groups to...
With tomorrow being Tax Day, you might see some procrastinators at your office filling out forms, printing out paperwork, or getting last-minute tax advice from their accountant so they can meet the IRS’s filing...
The IRS has launched 295 new identity theft and refund fraud investigations during this tax-filing season, bringing the number of active cases to nearly 1,900, the agency announced last week.The coast-to-coast enforcement...

Upcoming CPE Webinars

Apr 17
In this exciting presentation Excel expert David H. Ringstrom, CPA shares tricks that you can use with pivot tables every day. Remember, either you work Excel, or it works you!
Apr 22
Is everyone at your organization meeting your client service expectations? Let client service expert, Kristen Rampe, CPA help you establish a reputation of top-tier service in every facet of your firm during this one hour webinar.
Apr 24
In this session Excel expert David Ringstrom, CPA introduces you to a powerful but underutilized macro feature in Excel.
Apr 25
This material focuses on the principles of accounting for non-profit organizations' revenues. It will include discussions of revenue recognition for cash and non-cash contributions as well as other revenues commonly received by non-profit organizations.