Original broadcast 4/13/25
Presented by KPMG
A Clean Audit Streak Signals Progress Toward DoD-Wide Reform
For the second year in a row, the United States Marine Corps has achieved a clean audit opinion—an achievement seen as a milestone on the Department of Defense’s (DoD) path toward full financial accountability. With Congress mandating a clean audit for the entire DoD by 2028, the Marine Corps’ example may be the blueprint others follow.
Joseph Nave, Principal at KPMG and a leader in federal financial management, joined Francis Rose on Fed Gov Today to discuss what makes the Marine Corps a standout and what other DoD components must do to replicate that success.
Tone at the Top: The Foundation for Audit Success
“The tone from the top is critical,” Nave said. “It has to be more than just the comptroller driving the effort. All functional areas need to buy in.” According to Nave, the Marine Corps has built a culture where audit readiness is not just a one-time milestone but an ongoing operational priority.
That level of organizational alignment, he noted, must come from leadership and be sustained through policy, training, and accountability. Without it, efforts to secure clean audits will either falter or fail to endure.
Sustainability: More Than a One-Time Win
Achieving a clean opinion is one thing—sustaining it is another. Nave pointed out that Marine Corps officials were arguably more nervous about sustaining their clean audit than they were about getting the first one. “Sustainability comes from addressing material weaknesses and investing in modernization,” he said.
That includes robust workforce training, revised internal policies, and smarter use of emerging technologies like automation and data analytics. “We need to move beyond outdated rules that no longer apply to today's operational realities,” Nave said.
Acceleration Under the Current Administration
Nave pointed to an encouraging trend: several DoD components are accelerating their timelines, aiming for clean opinions before the 2028 deadline. “The administration has clearly made this a priority,” he said, noting that clean audits aren’t just about compliance—they represent real improvements in efficiency, oversight, and taxpayer accountability.
That momentum could snowball as more entities achieve success and share lessons learned. “Once you have a framework and some wins on the board, others can follow more confidently,” Nave added.
Audit Culture as Operational Ethos
Perhaps most critically, Nave said the goal is for audit readiness to become “part of the organization’s ethos,” ingrained in how every office, team, and leader approaches their work. “We don’t want this to be seen as a once-a-year effort,” he said. “It should be embedded in day-to-day operations.”
That mindset shift—from audit as a compliance exercise to audit as a cultural norm—is key to sustaining long-term success.
From Compliance to Capability
Nave believes the audit journey can and should go hand-in-hand with IT modernization, cybersecurity, and data-driven decision-making. “Audits help expose where systems need upgrading and where policies are outdated,” he said.
By taking a holistic view—one that integrates people, processes, and technology—the DoD can build financial systems that are resilient, agile, and aligned with mission goals.
Conclusion: Leading the Way to 2028
With the Marine Corps as a model and a growing commitment from top leadership, the Pentagon is positioned to meet its 2028 clean audit mandate. But as Nave emphasized, the real goal isn’t just reaching that milestone—it’s making audit excellence a permanent feature of defense operations.