By Mike Stone
WASHINGTON (Reuters) – The Pentagon has found $2 billion worth of additional errors in its calculations for ammunition, missiles and other equipment sent to Ukraine, increasing the improperly valued material to a total of $8.2 billion, a U.S. government report revealed on Thursday.
The U.S. Department of Defense has faced challenges in accurately valuing defense articles sent to Ukraine due to unclear accounting definitions, a new Government Accountability Office report showed.
In 2023, the Pentagon said staff used “replacement value” instead of “depreciated value” to tabulate the billions in materials sent to Ukraine. The $6.2 billion error created a path for billions more to be sent to Kyiv.
The Pentagon told the GAO that since then, $2 billion more in overstatements have been found. As a result, an additional $2 billion worth of arms can be sent to Ukraine to cover the amount of aid approved by the Biden administration.
The GAO said a vague definition of value in the Foreign Assistance Act and the absence of specific valuation guidance for Presidential Drawdown Authority have led to inconsistencies in the reported value of military aid.
In one example cited in the GAO report, 10 vehicles were valued at $7,050,000 when the supporting documentation showed they should have been valued at zero, their net book value.
The GAO has recommended that Congress clarify the definition of value in the context of defense articles under Presidential Drawdown Authority.
Additionally, the GAO has issued seven recommendations to the Defense Department, urging it to update its guidance to include a PDA-specific valuation section and develop component-specific valuation procedures. The department said it has concurred with all recommendations and outlined actions to address these issues.
(Reporting by Mike Stone in Washington; Editing by Bill Berkrot)
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