Budget constraints and fiscal challenges make sound financial management critical, GAO says.
The government has once again failed its overall audit, the Government Accountability Office reported Thursday.
The poor performance comes at a time when strong financial management is especially important, the watchdog agency noted. “Reliable financial and performance information is even more critical as (1) federal managers likely face increasingly tight budget constraints and need to operate their respective entities as efficiently and effectively as possible, and (2) decision makers carry out the important task of deciding how to use multiple tools ... to address the federal government’s fiscal challenges,” Comptroller General Gene Dodaro wrote in an introduction to the report.
As in past years, the Defense Department’s financial management flaws were one obstacle to GAO issuing an opinion on the government’s consolidated financial statement for fiscal 2012. The Pentagon is aiming to achieve auditability by fiscal 2014, and has a congressional mandate to do so by fiscal 2017.
The other major roadblocks to a clean governmentwide audit were ineffective procedures for preparing the financial statements and issues with tracking intragovernmental activity, GAO said. The report also noted some material weaknesses, including agencies’ failure to get a grasp on the extent of improper payments to program beneficiaries and other recipients of taxpayer money.
Despite these concerns, the watchdog said financial management has improved in the 16 years since the government started preparing consolidated statements. And it stressed that almost all of the 24 Chief Financial Officers Act agencies – with the exception of Defense and the Homeland Security departments – earned unqualified opinions on their statements. Homeland Security did achieve a qualified opinion for the first time, but problems with internal controls and property management prevented a clean audit.
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