Audit at the Speed of War: Why the DoD Must Automate Audit and Business Operations
Greg Little is joined by guest authors Kim Lynch (EVP Oracle Public Sector), Gregory Pejic (VP and Space Account Manager at Leidos), and Jonathan Moak (VP, Federal UiPath).
For eight years, the Department of Defense (DoD) has attempted to pass a financial audit—and each year, it has failed. The cost? Nearly $10 billion on audit efforts (that is almost all human labor!), with $1.4 billion in 2024 alone. That’s enough to employ 6,000 people for a year—or, more meaningfully, to fully man one aircraft carrier, an entire Army brigade combat team, or 80 Air Force fighter squadrons.
And yet, despite the scale of the investment, the audit never seems to get any closer to completion. The same issues persist year after year. Over two-thousand audit findings were reissued from previous audits in 2024 alone—that’s thousands of transactions that can’t be reconciled, items that can’t be found, and systems that can’t talk to each other. To put this in perspective, over 80% of the 2024 financial audit findings were audit issues found in previous years’ audits. The DoD isn’t just failing a financial audit. It’s failing to see the financial audit for what it should be: a tool for warfighting readiness, not just a compliance exercise.
The reality is that financial compliance alone is not enough—true success is measured by how well financial, logistics, and other business systems support warfighters in real time. Yet DoD’s approach to audit remediation is designed to sustain inefficiency rather than solve it. Consider the following:
The DoD operates on 1,700+ fragmented and outdated business systems—many redundant, few ever retired.
MOCAS, the world’s oldest operational IT system, has been tracking DoD contract payments since 1958, back when the U.S. had just launched its first satellite. In addition, critical DoD financial management systems like SPS, GAFS, OnePay, CAPS, STANFINS, SOMARDS, and IAPS are over 40 years old, on average!
Audit support is structured as a labor-based industry, driven by cost-plus and time-and-materials contracts that pay for effort, not results. The longer audit remediation takes, the more money firms make. This labor-based model causes problems even when a DoD organization passes a financial audit. For example, the United States Marine Corps (USMC) did pass an audit, a major milestone for the DoD! But this success was achieved on the backs of heroes—thousands of Marines and civilians putting in enormous amounts of manual labor and finding creative workarounds to piece together financial data that should have been automated from the start.
Audit is one of the most transformative initiatives to disrupt the Pentagon in decades, yet it remains outsourced and sidelined in favor of outdated business practices. The reluctance to change the process reflects a broader resistance to modernizing the enterprise, leaving business systems stagnant.
A financial audit isn’t just about balancing the books. When executed effectively, it becomes a force multiplier—driving warfighting advantage, financial transparency, and cost efficiency:
For warfighters: Property accountability must be directly tied to operational effectiveness and readiness. Knowing where equipment is from factory to foxhole, what condition it is in, and how quickly it can be deployed is critical to warfighting success. The inability to accurately track assets doesn’t just impact audit opinions—it affects combat effectiveness and sustainment in real-world operations.
For financial transparency: A modernized audit process should close the cash chain, ensuring that funds flow efficiently from appropriation to execution. Right now, financial opacity in the DoD and Congress leads to delays, lost purchasing power, and funds trapped in inefficient bureaucratic cycles. With a software and data-driven financial system, the DoD and Congress can track dollars—ensuring resources are allocated to the mission at speed.
For reducing audit costs: The Independent Public Accountants (IPAs) responsible for auditing the DoD are forced to manually recreate financial records, performing exhaustive reconciliations to prove existence and completeness. By automating these processes—including reconciliations, inventory validation, and internal controls—the DoD can reduce the need for thousands of auditors and shorten the time required to validate financial statements. Systems that automatically demonstrate compliance will drastically reduce external audit costs and improve confidence in financial reporting.
Instead, the DoD has built an audit industry that feeds itself, with billions spent on manual processes, contractors reviewing transactions line-by-line, audit coaches, and stale dashboards that inform but don’t act. Technology exists to fix this, but it is not being used at scale.
Fixing this problem does not require more people (it requires fewer!). It requires software, ontologies, analytics, intelligent document processing, AI, and agentic automation that can be integrated to extract meaningful outcomes across the Department’s many data silos. Software-as-a-Service (SaaS) is already transforming all business functions in the private sector, using AI, machine learning, and ontologies to automate routine tasks—allowing business professionals to focus on strategic decision-making rather than manually counting things. The DoD must move away from labor-driven compliance work and toward a software-driven business system that ensures accountability and efficiency in real time.
Elon Musk understands that inefficiency is a national security risk. President Trump’s Department of Government Efficiency (DOGE) aims to cut outdated processes that slow progress. If Musk had $1.4 billion, he wouldn’t waste it on manually reconciling spreadsheets, tracking paper trails, and hiring consultants. He’d automate, optimize, and deploy AI (including Agentic AI) to solve the problem at speed and scale.
This isn’t science fiction—it is how modern financial and logistics systems operate in the private sector today. The DoD just hasn’t embraced it. A commercial software-driven audit system wouldn’t just validate financial transactions—it would directly impact operational outcomes. A financially optimized force is a more lethal force!
To achieve compliance and unlock warfighting value, the DoD must take the following steps:
1. A New Approach to Business System Modernization
The DoD must move away from fragmented, legacy business systems that were never designed to operate at the speed and complexity of today’s defense environment. A different approach is needed—one that doesn’t just replace old systems with more custom-built or monolithic architectures, but instead integrates data across financial, logistics, and operational domains in real time.
Modern commercial data integration, analytics, transactional, and AI platforms provide an alternative to the traditional model of building separate systems for every function. Instead of a new wave of costly systems that will become obsolete in a few years, the DoD should adopt a scalable ontology-based open architecture that connects existing data sources, automates workflows, and eliminates redundant systems altogether.
By using a modern ontology-based operating system for defense business data, the DoD can:
Eliminate outdated and duplicative business systems instead of perpetually upgrading broken infrastructure.
Automate reconciliation, financial tracking, and asset visibility across business and warfighting domains.
Ensure auditability and financial transparency as a built-in function, not a separate compliance burden.
This is not just a shift in technology—it’s a shift in how the DoD thinks about business systems. Instead of continuing the cycle of replacing old software with new isolated solutions, a fully integrated, open, data-driven ontology-based approach will ensure real-time decision-making, automated cross-functional workflows, financial accountability, and warfighting readiness.
2. Expand and Evolve Advana Beyond Dashboards
Advana has been underutilized for the last 18 months, and its integration approach remains overly reliant on manual, labor-intensive integration processes (Greg L knows—he founded it!). To reach its full potential, it must evolve into the DoD’s central system for financial and business operational analytics, workflows, and automation.
This requires continued backing from senior DoD leadership and an aggressive push to expand the universe of auditable data, mapped to a common ontology that ensures financial and business operational transparency. More importantly, it demands a shift from passive dashboards to real-time financial tracking, automated workflows, and AI-driven reconciliation. By aggressively integrating commercial software and AI-powered automation, Advana can move beyond visualization and become a true engine for audit success and business decision-making at speed.
3. Adopt Firm Fixed-Price Contracts. Change Audit Remediation Incentives
The DoD must stop paying for inefficiency. Instead of rewarding labor via large consulting contracts, it should pay for audit success and business integration. Firm fixed-price contracts ensure contractors are incentivized to automate and solve problems, not prolong them. Outcomes and speed matter!
4. Deploy Commercial Software for Audit Integration and Remediation
The DoD has relied too long on custom-built government software and large consulting firms that lag behind industry standards.
Software firms already deliver AI-powered business solutions at scale in logistics and audit automation.
They move faster than traditional government consultants.
The DoD must shift from a workforce of neurons (human labor) to a system of electrons (software)—replacing manual audit efforts with software-driven, automated, and AI-enhanced financial oversight. There are a few enlightened system integrators that are starting to get this balance right.
By making these changes, the DoD can finally move beyond compliance and use the audit process as a tool for operational readiness, financial speed, and strategic advantage.
While the Pentagon struggles to audit itself, China is rapidly modernizing its systems with AI and automation. Their military-civil fusion strategy ensures financial and operational decisions are fully integrated—giving them an edge in speed, transparency, and adaptability. This is not just an inefficiency problem—it is a national security problem.
Yet, modernization is not just a technology challenge—it’s a cultural one. The DoD rewards the status quo and sidelines those who push for change. Every outdated business process and aging system has its protectors—people who resist transformation out of fear, optics, or the comfort of the old system. Until this mindset shifts, innovation will remain an uphill battle, and inefficiencies will continue to drain resources from warfighters. The Pentagon cannot afford to let bureaucracy stand in the way of operational superiority.
The good news? The Navy and Marine Corps are already moving in this direction by implementing the recommendations above. Both Services are actively working to integrate software-driven financial management solutions that align with operational needs, closing the cash chain while improving warfighting readiness.
The Navy and Marine Corps understand what Sun Tzu wrote centuries ago: “If you know the enemy and know yourself, you need not fear the result of a hundred battles.” Audit and financial transparency are not just compliance goals—they are the foundation of understanding our own capabilities, ensuring resources flow efficiently, and maintaining operational advantage in every fight.
The time for incremental progress is over. The future belongs to those who move fast, automate ruthlessly, and act boldly.