I 
115TH CONGRESS 
1ST SESSION H. R. 2040 
To impose consequences on the Department of Defense for any failure to 
meet statutory deadlines for validation of financial statements of the 
Department of Defense as ready for audit and for completion of a 
full audit on financial statements of the Department of Defense for 
fiscal year 2018. 
IN THE HOUSE OF REPRESENTATIVES 
APRIL 6, 2017 
Mr. LEWIS of Minnesota introduced the following bill; which was referred to 
the Committee on Armed Services 
A BILL 
To impose consequences on the Department of Defense for 
any failure to meet statutory deadlines for validation 
of financial statements of the Department of Defense 
as ready for audit and for completion of a full audit 
on financial statements of the Department of Defense 
for fiscal year 2018. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Defense Spending Ac-
countability Act’’. 
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SEC. 2. EFFECT OF FAILURE TO MEET DEADLINES FOR 
VALIDATION OF FINANCIAL STATEMENTS OF 
THE DEPARTMENT OF DEFENSE AS READY 
FOR AUDIT AND FOR SUBMISSION OF FULL 
AUDIT ON FINANCIAL STATEMENTS OF THE 
DEPARTMENT OF DEFENSE FOR FISCAL YEAR 
2018. 
(a) PAY REDUCTION FOR FAILURE TO MEET DEAD-
LINES.—Subject to subsection (b), but notwithstanding 
any other provision of law, the annual rate of pay for each 
Department of Defense position listed in subsection (c)— 
(1) beginning with the first pay period com-
mencing on or after the deadline specified in section 
1003(a)(2)(A)(ii) of the National Defense Authoriza-
tion Act for Fiscal Year 2010 (Public Law 111–84; 
10 U.S.C. 2222 note), and for each pay period 
thereafter, shall be reduced by 5 percent if the fi-
nancial statements of the Department of Defense 
are not validated as ready for audit by that deadline; 
and 
(2) beginning with the first pay period com-
mencing on or after the deadline specified in section 
1003(a)(2)(A)(iii) of the National Defense Author-
ization Act for Fiscal Year 2010 (Public Law 111– 
84; 10 U.S.C. 2222 note), as added by section 
1003(b) of the National Defense Authorization Act 
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for Fiscal Year 2014 (Public Law 113–66; 127 Stat. 
842), and for each pay period thereafter, shall be re-
duced by 10 percent if a full audit of the financial 
statements of the Department of Defense for fiscal 
year 2018 is not completed by that deadline. 
(b) DUE PROCESS PROTECTIONS.— 
(1) NOTICE AND OPPORTUNITY TO RESPOND.— 
At least 30 days before a reduction in pay takes ef-
fect under paragraph (1) or (2) of subsection (a) for 
a Department of Defense position listed in sub-
section (c), the Secretary of Defense shall— 
(A) notify the individual occupying the po-
sition of the imminent pay reduction; and 
(B) afford the individual an opportunity to 
prove that the requirement referred to in such 
paragraph has been satisfied. 
(2) APPEAL
RIGHTS.—The Secretary of De-
fense also shall afford an individual occupying a po-
sition listed in subsection (c) an opportunity to ap-
peal an adverse decision under paragraph (1)(B) 
against the individual to another department or 
agency of the Federal Government. If a final deci-
sion on the appeal is not made by the applicable de-
partment or agency of the Federal Government with-
in 30 days after receiving the appeal, the order of 
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the Secretary imposing the pay reduction shall be 
final and not subject to further appeal. 
(c) COVERED DEPARTMENT
OF DEFENSE POSI-
TIONS.—The Department of Defense positions subject to 
this section are the following: 
(1) The position of Deputy Secretary of De-
fense, who serves as the Chief Management Officer 
of the Department of Defense. 
(2) The position of Under Secretary of Defense 
(Comptroller). 
(3) The position of Chief Management Officer 
of each of the military departments. 
(d) LIFTING OF PAY REDUCTIONS.—A reduction in 
pay imposed under paragraph (1) or (2) of subsection (a) 
shall have no force or effect after the date on which the 
requirement referred to in such paragraph is satisfied. 
Æ 
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