U.S. Defense Department can't account for billions for Iraq, audit finds

The U.S. Defense Department cannot account for about $2 billion it was given to cover Iraq-related expenses and is not providing Iraq with a complete list of U.S.-funded reconstruction projects, according to two new government audits.

The reports come from the office of the Special Inspector General for Iraq Reconstruction.

The Iraqi government in 2004 gave the Department of Defense access to about $3 billion to pay bills for certain contracts, and the department can only show what happened to about a third of that, the inspector general says in an audit published Friday.

Although the Department of Defense (DoD) had "internal processes and controls" to track payments, the "bulk of the records are missing," the report says, adding that the department is searching for them.

Other documents are missing as well, including monthly reports documenting expenses, the audit says.

"From July 2004 through December 2007, DoD should have provided 42 monthly reports. However, it can locate only the first four reports." Read More