This is the accessible text file for GAO report number GAO-03-538 
entitled 'Forest Service: Year-end Financial Reporting Significantly 
Improved, but Certain Underlying Problems Remain' which was released on 
June 02, 2003.

This text file was formatted by the U.S. General Accounting Office 
(GAO) to be accessible to users with visual impairments, as part of a 
longer term project to improve GAO products' accessibility. Every 
attempt has been made to maintain the structural and data integrity of 
the original printed product. Accessibility features, such as text 
descriptions of tables, consecutively numbered footnotes placed at the 
end of the file, and the text of agency comment letters, are provided 
but may not exactly duplicate the presentation or format of the printed 
version. The portable document format (PDF) file is an exact electronic 
replica of the printed version. We welcome your feedback. Please E-mail 
your comments regarding the contents or accessibility features of this 
document to Webmaster@gao.gov.

This is a work of the U.S. government and is not subject to copyright 
protection in the United States. It may be reproduced and distributed 
in its entirety without further permission from GAO. Because this work 
may contain copyrighted images or other material, permission from the 
copyright holder may be necessary if you wish to reproduce this 
material separately.

Report to the Chairman and Ranking Minority Member, Subcommittee on 
Forests and Forest Health, Committee on Resources, House of 
Representatives:

May 2003:

FOREST SERVICE:

Year-end Financial Reporting Significantly Improved, but Certain 
Underlying Problems Remain:

GAO-03-538:

GAO Highlights:

Highlights of GAO-03-538, a report to the Chairman and Ranking 
Minority Member, Subcommittee on Forests and Forest Health, Committee 
on Resources, House of Representatives. 

Why GAO Did This Study:

Since 1996, we have periodically reported on Forest Service financial 
management problems that we, the U.S. Department of Agriculture’s 
Office of the Inspector General, and other independent auditors have 
identified. We have designated the Forest Service financial management 
as a high-risk area since 1999. Because of these longstanding 
financial management deficiencies, the Subcommittee asked GAO to 
report on the Forest Service’s progress in correcting its financial 
management problems and on remaining challenges and actions underway 
to address those challenges.

What GAO Found:

The Forest Service has made significant progress toward achieving 
financial accountability, receiving its first “clean” or unqualified 
audit opinion on its financial statements for fiscal year 2002. This 
was attained because top management dedicated considerable resources 
to address accounting and reporting deficiencies. We consider this a 
positive step; however, sustaining this outcome and achieving 
financial accountability will require more than obtaining year-end 
numbers for financial statement purposes. 

The Forest Service continues to face several major challenges, many of 
which resulted in unfavorable audit opinions in the past. Specifically, 
the Forest Service’s fiscal year 2002 financial statement audit report 
disclosed material internal control weaknesses related to its two 
major asset accounts—fund balance with the U.S. Department of the 
Treasury, and property, plant, and equipment—as well as for certain 
estimated liabilities, payroll processes, computer security controls, 
and software application controls related to its procurement and 
property systems. Further, the Forest Service has not addressed the 
challenges of replacing or enhancing legacy feeder systems and 
implementing a financial management field operation that supports 
efficient and effective day-to-day financial operations and routinely 
produces reliable and timely financial information. 

The Forest Service has corrective actions underway or planned that are 
intended to resolve these problems, including a financial management 
strategic plan. If this plan is to serve as a “road map” toward 
financial accountability, the Forest Service needs to ensure that its 
plan is comprehensive, integrating and prioritizing the various 
corrective action initiatives underway and planned. 

What GAO Recommends:

We recommend that the Forest Service develop a comprehensive financial 
management strategy that 

* defines financial management goals and objectives,
* specifies corrective actions, 
* identifies target dates and resources needed, 
* identifies responsible parties, and
* prioritizes and links improvement initiatives, including USDA 
financial management systems enhancements.

The Forest Service concurred with our recommendations and indicated 
that it is developing a strategic plan. 

www.gao.gov/cgi-bin/getrpt?GAO-03-538.

To view the full report, including the scope
and methodology, click on the link above.
For more information, contact McCoy Williams at (202) 512-6906 or 
williamsm1@gao.gov.

[End of section]

Letter:

Results in Brief:

Background:

Scope and Methodology:

The Forest Service Has Made Significant Progress toward Achieving 
Financial Accountability:

Despite Progress Made, Accountability Challenges Remain:

An Efficient and Effective Financial Management Organization Is Key to 
Achieving Financial Accountability:

Corrective Actions Are Underway or Planned to Resolve Remaining 
Problems:

Conclusion:

Recommendations for Executive Action:

Agency Comments and Our Evaluation:

Appendix:

Appendix I: Comments from the Forest Service:

Tables:

Table 1: Forest Service History of Audit Opinions:

Table 2: Forest Service Material Internal Control Weaknesses:

Letter May 1, 2003:

The Honorable Scott McInnis
Chairman
The Honorable Jay Inslee
Ranking Minority Member
Subcommittee on Forests
 and Forest Health
Committee on Resources 
House of Representatives:

Since December 1996, we have periodically reported[Footnote 1] on 
financial management problems identified by the U. S. Department of 
Agriculture's (USDA) Office of the Inspector General (IG) in its annual 
audits of the Forest Service's financial statements. In prior reports 
and testimonies, we discussed (1) how the lack of accountability raises 
concerns about the Forest Service's stewardship over billions of 
dollars of taxpayer money appropriated to it, (2) how its autonomous 
field structure hampers efforts to achieve financial accountability, 
and (3) its progress in correcting its financial accounting and 
reporting deficiencies. This report responds to your request that we 
continue to monitor the Forest Service's efforts to improve its 
financial management and determine:

* whether the Forest Service has made progress in resolving previously 
reported financial management problems,

* challenges that the Forest Service faces in achieving financial 
accountability, and:

* actions underway or planned by the Forest Service for resolving 
remaining problems.

Results in Brief:

In fiscal year 2002, the Forest Service made significant progress 
toward achieving financial accountability, receiving its first 
unqualified or "clean" audit opinion on its financial statements. To 
achieve this milestone, the Forest Service's top management dedicated 
considerable resources and focused staff efforts to address accounting 
and reporting deficiencies that had prevented a favorable opinion in 
the past. We consider this a positive step toward achieving financial 
accountability. However, sustaining this outcome and achieving 
financial accountability requires more than obtaining reliable onetime 
year-end numbers for financial statement purposes.

The Forest Service still must overcome several major challenges before 
it can routinely produce reliable and timely financial information to 
effectively manage operations, monitor revenue and spending levels, and 
make informed decisions about future funding needs for its programs. 
The fiscal year 2002 financial statement audit report disclosed 
material internal control weaknesses[Footnote 2] in several areas, 
including its two major asset accounts--fund balance with the U.S. 
Department of the Treasury (Treasury) and property, plant, and 
equipment--certain estimated liabilities, payroll processes, computer 
security controls, and application software controls related to its 
procurement and personal property systems. The audit report also 
discussed areas in which the Forest Service's financial management 
systems are not in substantial compliance with Federal Financial 
Management Improvement Act of 1996 (FFMIA)[Footnote 3] requirements. 
These relate primarily to the above internal control weaknesses.

As discussed in our prior reports and testimonies, the agency faces the 
challenge of replacing or enhancing certain antiquated financial 
subsidiary systems-called feeder systems-that transfer data to the 
Foundation Financial Information System (FFIS), its standard accounting 
system, and implementing a financial management field organization that 
supports efficient and effective day-to-day financial operations. In 
1999, we designated Forest Service financial management as high risk on 
the basis of serious financial and accounting weaknesses.[Footnote 4] 
Again in our January 2003 report,[Footnote 5] we reiterated our 
concerns due to the serious deficiencies that remain.

The Forest Service has corrective actions underway or planned that are 
intended to resolve these problems, including a financial management 
strategic plan. If this plan is to serve as a "road map" toward 
financial accountability, the Forest Service needs to make sure its 
strategic plan is comprehensive--integrating and prioritizing the 
various corrective actions--and includes detailed steps for 
implementing these actions.

The independent auditor hired by the Forest Service made numerous 
recommendations to improve the internal control weaknesses identified 
during its audit of the fiscal year 2002 financial statements. We 
support these recommendations. In addition, we are recommending to the 
Chief of the Forest Service that the Budget and Finance Deputy Chief/
Chief Financial Officer (CFO) develop a comprehensive financial 
management strategic plan to effectively manage the improvement efforts 
underway and planned. The Forest Service concurred with our 
recommendations and it is developing a strategic plan.

Background:

The Forest Service, a component of the USDA is responsible for 
maintaining the health, diversity, and productivity of the nation's 
forests and grasslands to meet the needs of present and future 
generations. This mission is carried out through the use of several 
programs, the largest being the National Forest System. Through the 
National Forest System, the Forest Service manages about 192 million 
acres, comprising about 8.5 percent of the total surface area of the 
United States. On these lands, the Forest Service, among other things, 
supports recreation, sells timber, provides rangeland for grazing, and 
maintains and protects watersheds, wilderness, fish, and wildlife. In 
addition, the Forest Service provides financial and program support for 
state and private forests and undertakes research activities. The 
Forest Service, headed by a chief, conducts its activities through 9 
regional offices, 6 research offices, 1 state and private forestry area 
office, the Forest Products Laboratory, and the International Institute 
of Tropical Forestry. In addition, the National Forest System has 155 
national forest offices and more than 600 ranger district offices.

The Chief of the Forest Service manages from the national office, 
headquartered in Washington, D.C., and provides national-level policy 
and direction to the field offices. The Forest Service has 
approximately 30,000 employees and a budget of over $5 billion to carry 
out its mission. The Forest Service Budget and Finance Deputy Chief/CFO 
is responsible for the financial accountability of funds appropriated 
by the Congress for Forest Service programs and reports to the Forest 
Service Chief.

The Chief Financial Officers Act of 1990 calls for CFO Act agencies, 
such as USDA, to have financial management systems, including internal 
control, that provide complete, reliable, consistent and timely 
information. The Government Management Reform Act of 1994 (GMRA) 
requires the CFO Act agencies to prepare and have audits of annual 
financial statements. FFMIA builds on the foundation laid by these acts 
by emphasizing the need for agencies to have systems that routinely 
generate timely, accurate, and useful information. Specifically, FFMIA 
requires that the auditor report on whether the agencies' financial 
management systems substantially comply with (1) federal financial 
management systems requirements, 
(2) applicable federal accounting standards, and (3) the U. S. 
Government Standard General Ledger (SGL) at the transaction 
level[Footnote 6] requirements. As authorized by GMRA, the Office of 
Management and Budget is responsible for identifying components of the 
designated CFO Act agencies that are required to have audited financial 
statements. OMB requires that the Forest Service, a major component of 
USDA, have audited financial statements.

Since its first financial statement audit for the fiscal year ended 
September 30, 1991, the Forest Service has faced numerous serious 
accounting and financial reporting weaknesses that have prevented it 
from receiving a positive audit opinion. These are shown in table 1.

Table 1: Forest Service History of Audit Opinions:

Fiscal year: 1991; Opinion: Adverse; Explanation: Major inaccuracies in 
the financial statements.

Fiscal year: 1992; Opinion: Adverse; Explanation: Major inaccuracies in 
the financial statements.

Fiscal year: 1993; Opinion: Qualified; Explanation: Pervasive errors in 
the field-level data supporting the land, buildings, equipment, 
accounts receivable, and accounts payable.

Fiscal year: 1994; Opinion: Qualified.

Fiscal year: 1995; Opinion: Adverse; Explanation: Continuing pattern of 
unfavorable conclusions about the Forest Service's financial 
statements. Several shortcomings in accounting and financial data and 
information systems were identified.

Fiscal year: 1996; Opinion: No Audit; Explanation: Due to the severity 
of the accounting and reporting deficiencies, the Forest Service did 
not prepare financial statements for fiscal year 1996, but chose; 
instead to focus on resolving these problems.

Fiscal year: 1997; Opinion: Disclaimer; Explanation: Unable to reliably 
track and report on major assets worth billions of dollars, including 
accounts receivable, real property, and accounts payable. Also errors 
in records of fund balances with Treasury.

Fiscal year: 1998; Opinion: Disclaimer; Explanation: Lack of basic 
accountability for major assets and liabilities; the inability to 
accurately track the cost of programs and activities, and significant 
reporting; errors in the Forest Service financial statements and 
supporting records.

Fiscal year: 1999; Opinion: Disclaimer; Explanation: Unable to 
determine accuracy of property, plant, and equipment and unable to 
verify fiscal year fund balance with Treasury because of lack of 
reconciliations and unsupported balances; remaining from its old 
accounting system.

Fiscal year: 2000, 2001; Opinion: Disclaimer; Explanation: Material 
internal control weaknesses existed in the financial statement 
compilation process and in; procedures for compiling the balances for 
fund balances with Treasury and general property, plant, and equipment. 
Because of these weaknesses, the agency was not able to provide timely, 
sufficient, and competent evidential matter to support amounts in the 
financial statements.

Source: GAO Analysis.

[End of table]

In the past, we have reported and testified that the Forest Service's 
(1) unreliable financial data hampers the agency's and the Congress' 
decision-making ability, (2) lack of accountability exposes the agency 
to mismanagement and misuse of its assets, and (3) autonomous field 
structure hampers efforts to achieve financial accountability. In 
January 1999, due to the longstanding serious accounting and financial 
reporting problems, we designated Forest Service financial management 
as a high-risk area. We continued to designate financial management at 
Forest Service as high-risk in our 2003 report. Since 1997, the IG and 
independent auditors have continued to report instances of 
noncompliance with certain federal financial accounting and information 
system requirements and internal control weaknesses related to Forest 
Service financial computer systems.

The Forest Service, a component of USDA, uses and depends on many 
financial management systems and services provided by USDA, including 
the USDA National Finance Center (NFC). Therefore, efforts to improve 
controls over certain financial management computer systems and 
internal controls over accounting processes must be made in cooperation 
with USDA and NFC. For example, the Forest Service uses the USDA 
Foundation Financial Information System as its standard accounting 
system. In addition, NFC maintains and controls entry of many Forest 
Service transactions into FFIS. NFC also reports expenditures and 
collections it processes on the Forest Service's behalf to Treasury. 
FFIS also depends on and receives data from feeder systems used by the 
Forest Service to record its transactions. Many of the Forest Service's 
longstanding problems with regard to its accounting and information 
systems are a result of outdated technology of the financial feeder 
systems that transfer accounting data to FFIS.

Scope and Methodology:

To address each of our objectives, we analyzed prior IG, consultant, 
and independent auditor reports including the audit report on the 
Forest Service's fiscal year 2002 financial statements that described 
several financial management weaknesses and their effect on the Forest 
Service's ability to properly account for assets worth billions of 
dollars entrusted to its care. Further, we examined the Forest 
Service's financial management policies, procedures, and processes, 
including completed, ongoing and planned activities and related 
implementation schedules to determine the Forest Service's progress, 
plans, and milestones for addressing financial management problems. We 
attended a Forest Service Budget and Finance planning conference and a 
financial statement training session conducted by the USDA CFO to gain 
a further understanding of Forest Service efforts to improve its 
financial statement compilation processes and overcome other financial 
management challenges. We analyzed reported financial management 
problems against the corrective actions taken to determine the 
remaining challenges. Further, we discussed the remaining challenges 
and the status of improvement efforts with officials from USDA and the 
Forest Service Office of the Chief Financial Officer, the USDA IG, and 
independent contractors working for the Forest Service.

We also visited and interviewed financial management staff at five 
Forest Service field locations. We visited the Intermountain Regional 
Office, the largest of the National Forest regions, because it 
processes a wide variety of financial accounting transactions. We also 
visited the Southern Regional Office, National Forest of North Carolina 
Supervisor's Office, Mt. Pisgah District Ranger Office, and North 
Carolina Research Station, each representing a different level of the 
financial management field organization. At each location, we 
interviewed staff and performed walk-throughs to obtain an 
understanding of accounting processes and procedures for certain 
accounts material to the financial statements, such as accounts 
receivable; property, plant, and equipment; other liabilities; and 
certain collections/revenues, such as timber sales.

We performed our fieldwork from July 2002 through March 2003 in 
accordance with generally accepted government auditing standards. We 
requested written comments on a draft of this report from the Chief of 
the Forest Service or his designee. The Chief of the Forest Service 
provided us with written comments, which are discussed in the "Agency 
Comments and Our Evaluation" section and reprinted in appendix I.

The Forest Service Has Made Significant Progress toward Achieving 
Financial Accountability:

The Forest Service has made significant progress toward achieving 
financial accountability. For the first time since its initial 
financial statement audit that covered fiscal year 1991, the Forest 
Service received an unqualified or "clean" opinion on its fiscal year 
2002 financial statements. To achieve this milestone, the Forest 
Service's top management dedicated considerable resources and focused 
staff efforts to address accounting and reporting deficiencies that had 
prevented a favorable opinion in the past.

Historically the Forest Service's financial management systems have not 
generated timely and accurate financial statements for its annual 
audit. In addition, the Forest Service has had long-standing material 
weaknesses with regard to its two major assets--fund balance with 
Treasury and property, plant, and equipment. In the past, such 
weaknesses prevented the IG from validating these two line items on 
both the Forest Service and the USDA departmentwide financial 
statements. In fiscal year 2002, the Forest Service reorganized the 
Budget and Finance Deputy Chief/CFO area and focused staff efforts to 
address reporting and accounting deficiencies identified in the fiscal 
year 2001 financial statement audit with the goal that the fiscal year 
2002 financial statements would pass audit tests. To assist in these 
efforts, the Forest Service hired senior financial management 
officials, consultants and contractors and formed a financial reports 
team and several reconciliation "strike" teams to improve (1) the 
financial statement compilation process and (2) reconciliations of its 
major accounts, including fund balance with Treasury and property, 
plant, and equipment.

During fiscal year 2002, the financial reports team completed a number 
of efforts to improve the compilation process. For example, the team 
held a series of financial statement workshops for national office and 
field staff, updated the methodology for preparing the fiscal year 2002 
financial statements, and provided the necessary information to 
complete the audit, such as account analyses and supporting 
documentation for sample transactions selected for testing.

Six reconciliation strike teams, consisting of contractors with 
expertise in reconciliation procedures and experienced Forest Service 
staff, performed financial statement account reconciliations and 
reviews to help ensure the accuracy and timeliness of recorded 
accounting data and that subsidiary ledgers were reconciled to general 
ledger accounts. The strike teams analyzed account data, identifying 
accounting errors and documenting adjustments to key asset, liability, 
and budgetary accounts in order to achieve accurate account balances. 
The fund balance with Treasury team focused on reconciling material 
fiscal year 2002 and prior-year cash transactions. The property, plant, 
and equipment reconciliation team analyzed transaction data to identify 
inaccurate records and reconciled the general ledger to its supporting 
detailed records. In addition, the property, plant, and equipment 
strike team, in cooperation with the USDA Office of the Chief Financial 
Officer, the USDA IG, and consultants, worked to ensure that property 
documentation supported property records, inventories were complete, 
and property was valued correctly.

Further, the property, plant, and equipment reconciliation team, worked 
with USDA on modifications and enhancements to certain property feeder 
systems. For example, in September 2002, USDA completed an automated 
interface with the Infrastructure Real Property Subsidiary System 
(INFRA) and FFIS. INFRA was revised to improve security by implementing 
controls such as user access restriction and password protection. Also, 
access to key data elements in the Personal Property System (PROP) and 
the Equipment Management Information System (EMIS) was restricted by 
September 2002 in order to address security weaknesses. At the same 
time, certain automated error checks were added to EMIS to help ensure 
data integrity.

While the primary focus of the reports and reconciliations teams was to 
help attain a clean fiscal year 2002 audit opinion, the teams have been 
institutionalized to work toward sustainable report compilation and 
reconciliation processes. Through these established account 
reconciliations and analyses, the teams are able to identify many of 
the underlying causes of inaccurate data and out of balance conditions. 
Specifically, according to the Forest Service CFO management, many of 
the problems are caused by improper recording of transactions, FFIS 
system problems, faulty interfaced and integrated feeder systems, lack 
of consistent formal policies and procedures, lack of staff training 
and manual accounting processes prone to human error. By understanding 
the root causes, the Forest Service has resolved some of the problems 
identified. For example, the strike teams coordinated with USDA to 
correct several programming errors[Footnote 7] in FFIS that were 
causing inappropriate accounting. For instance, the fund balance with 
Treasury team found that fund transfers between Forest Service units 
for equipment usage, which are noncash transactions, were incorrectly 
recorded and reported to Treasury as cash collections. As result, the 
Forest Service's fund balance account at Treasury was being overstated 
by these amounts.

During fiscal year 2002, the Forest Service CFO management also issued 
new policies and procedures or revised existing ones to help ensure the 
quality and integrity of the financial data in FFIS and the feeder 
systems. To communicate these changes, the Forest Service CFO issued 
over 25 CFO bulletins to accounting staff as the need for accounting 
and reporting controls were identified. For example, the CFO issued 
several bulletins that provided guidance on the proper recording of 
transactions, such as the types of transaction codes to use when 
entering data into FFIS. The CFO also issued bulletins (1) requiring 
analysis of delinquent bills to determine their collectability and (2) 
to clarify documentation requirements for personal and real property 
transactions.

Further, Forest Service management continued to emphasize the 
importance of financial accountability to its line managers in the 
field. In April 2002, the Forest Service CFO implemented a set of 
financial performance indicators to monitor progress of the field staff 
in maintaining its accounts, including progress in clearing suspense 
account[Footnote 8] items, monitoring collection of receivables, and 
compliance with CFO accounting guidance.

Despite Progress Made, Accountability Challenges Remain:

Achieving financial accountability involves more than obtaining a clean 
audit opinion by producing reliable onetime year-end numbers for 
financial statement purposes. The Forest Service still must overcome 
many challenges to sustain this outcome and to reach the end goal of 
routinely having timely, accurate, and useful financial information. In 
its December 2002 report on the Forest Service's fiscal year 2002 
financial statements, the auditor, KPMG Peat Marwick LLP (KPMG), 
continued to identify serious material internal control weaknesses and 
FFMIA noncompliance issues primarily related to weaknesses in controls 
over financial management computer systems that could adversely affect 
the Forest Service's ability to record, process, summarize, and report 
financial data in a timely manner.

The auditor attributed many of the deficiencies identified to lack of 
adequately trained staff; lack of manual internal control procedures, 
such as supervisory reviews; and poor automated controls, such as user 
access, system edits and system interfaces, within the FFIS and certain 
feeder systems that transfer the data to FFIS. As discussed in table 2, 
the auditor made several recommendations to address these conditions. 
We support these recommendations and are not making any new 
recommendations in these areas.

In addition, the IG, Forest Service contractors, and we have reported 
long-standing problems regarding the Forest Service's financial 
management systems and its financial management organization. Many of 
the legacy feeder systems that transfer data to FFIS are antiquated 
technology and must be enhanced or replaced. The agency also faces the 
challenge of implementing a financial management field organization 
that supports effective and efficient day-to-day financial operations. 
Unless the Forest Service addresses these issues and moves to 
sustainable financial management processes, it will have to continue to 
undertake extraordinary, costly efforts, outside of its normal business 
processes, to sustain clean audit opinions. Further, management's 
ability to routinely obtain reliable financial information to 
effectively manage operations, monitor revenue and spending levels, and 
make informed decisions about future funding needs will continue to be 
hampered.

Remaining Internal Control and FFMIA Compliance Deficiencies Need to Be 
Resolved:

Our Standards for Internal Control in the Federal Government[Footnote 
9] requires that agencies implement a strong internal control system 
that provides the framework for the accomplishment of management 
objectives, accurate financial reporting, and compliance with laws and 
regulations. It contains the specific internal control standards to be 
followed. These standards define internal controls as the policies, 
procedures, techniques, and mechanisms that enforce management's 
directives. They help ensure that actions are taken to address risks 
and are an integral part of an entity's accountability for stewardship 
of government resources. The lack of good internal controls puts an 
agency at risk of mismanagement, waste, fraud, and abuse. Further, 
without strong internal controls, an agency is unable to generate the 
consistent, reliable financial information needed to maintain ongoing 
accountability over its assets.

In its fiscal year 2002 audit report on the Forest Service's financial 
statements, the auditor continued to report serious internal control 
weaknesses with regard to the Forest Service's two major asset 
accounts--fund balance with Treasury and property, plant, and 
equipment. Also, KPMG reported material deficiencies related to certain 
estimated liabilities, payroll processes, general controls and certain 
application software computer controls. The following table provides a 
brief description of each of the reported deficiencies and 
recommendations for improvement.

Table 2: Forest Service Material Internal Control Weaknesses:

Financial management area: Fund balance with the Treasury; Conditions 
and recommendations reported by auditor: While the Forest Service has 
progressed in fiscal years 2001 and 2002 in reconciling its fund 
balance with Treasury accounts, control deficiencies still exist in its 
reconciliation processes. The Forest Service had a large backlog of 
unreconciled items that needed to be researched and resolved. In order 
to bring the Forest Service's fund balance with Treasury accounts into 
balance with Treasury records as of September 30, 2002, the Forest 
Service recorded an adjustment of $107 million. The auditor recommended 
that the Forest Service document its reconciliation processes, 
establish a point of contact at the National Finance Center to assist 
in the reconciliation process, analyze and determine the proper 
disposition of its budget and clearing accounts, and allocate the 
necessary resources to complete monthly reconciliations in a timely 
manner.

Financial management area: Property, plant, and equipment; Conditions 
and recommendations reported by auditor: Material deficiencies in the 
controls related to the accurate recording of property, plant, and 
equipment transactions remain. For example, there were instances in 
which recorded amounts did not agree with supporting documentation and 
inappropriate payroll expenses were included in property values instead 
of being recorded as expenses, resulting in an overstatement of 
property and an understatement of expenses. Further, the Forest Service 
did not have effective controls over the initial recording of 
acquisition costs, in-service date, and useful life of property items. 
Because the Forest Service did not require reviews of data input for 
property transactions by a supervisor, another independent person or by 
system checks within property systems, certain property items were not 
recorded properly. The auditors recommended that the Forest Service 
train personnel on accurate transaction recording, require supervisory 
review of data input of property transactions, and design and implement 
a control methodology that verifies recording of acquisition costs, in-
service date, and useful life and other critical elements, to ensure 
proper depreciation of capital assets.

Financial management area: Accrued liabilities; Conditions and 
recommendations reported by auditor: The Forest Service's proposed 
methodology for estimating certain liabilities, such as grants, was not 
accurate and did not substantially support the unpaid amount of 
services that had been delivered as of year-end. In addition, the 
proposed methodology did not consider payments to states, which are 
recorded as liabilities as of September 30. If the Forest Service had 
used its proposed methodology, both its accrued liabilities and 
associated expenses would have been understated for fiscal year 2002. 
As a result, sampling methodologies were used to project the year-end 
balance. The auditor recommended that the Forest Service develop a new 
methodology for estimating liabilities and maintain the supporting 
documentation used to determine the estimate.

Financial management area: Payroll process; Conditions and 
recommendations reported by auditor: Serious automated control 
deficiencies existed with the Forest Service's payroll time card entry 
system. For example, it allowed the Forest Service users to submit 
their time sheets for approval to an employee that was not the 
designated supervisor. In some locations, the employee could send the 
time sheet to him/herself for approval. In addition, deficiencies in 
manual controls over the payroll process existed, such as missing 
employee and/or supervisor signatures. The auditor recommended that the 
Forest Service implement controls to ensure that employees' supervisors 
appropriately review and approve their subordinates' time sheets, 
reinforce the requirement for time sheets to be signed by both the 
employee and supervisor, and reconcile and biweekly certify its payroll 
registers to its personnel listing.

Financial management area: General and software application controls; 
Conditions and recommendations reported by auditor: The Forest Service 
had material deficiencies in its general controls[A] environment. For 
example, controls for determining the trustworthiness of personnel, 
such as background checks, and limiting access to information systems 
needed improvement. Software application controlsb related to 
procurement, and real and personal property feeder systems also needed 
improvement. Without sufficient application controls, the Forest 
Service is exposed to the risk of its property records being corrupted, 
lost, or altered, and errors and omissions not being prevented, 
detected, and corrected. The auditor recommended several actions for 
improving controls over user access, system interfaces, system edits, 
separation of duties, and data accuracy and completeness.c.

Source: GAO analysis.

[A] General controls include the structure, policies, and procedures 
that apply to the agency's overall computer operations, for example: 
security management programs, access control, application software 
development and change, system software control, segregation of duties, 
and service continuity.

[B] Application controls covers the structure, policies, and procedures 
designed to help ensure the accuracy, completeness, authorization and 
validity of all transactions during the application process. 
Application controls play a crucial role in the auditability of these 
feeder systems.

[C] Due to the sensitive nature of the issues identified, the auditor 
provided the Forest Service with a separate limited-distribution report 
that contains the detailed findings and specific recommendations.

[End of table]

Further the auditor reported that the Forest Service's systems did not 
substantially comply with the three requirements of the FFMIA--federal 
financial management systems requirements, applicable federal 
accounting standards, and the U.S. Government Standard General Ledger 
at the transaction level. One example of noncompliance with federal 
financial management systems requirements was that the Forest Service 
did not have required certification and accreditations of security 
controls performed timely on its procurement and property systems. 
Further, the Forest Service did not record revenue for certain 
collections, such as map sales and camp site reservation fees, when 
they were collected, as required by federal accounting 
standards.[Footnote 10] Instead, collections and fees were recorded in 
a suspense account and revenue was recognized when the money was used 
for other operational needs instead of when the revenue was actually 
earned. This practice could result in revenues and related costs being 
misstated on the Forest Service's financial reports.

Financial Management Systems Remain an Obstacle to Achieving 
Sustainable Accountability:

Weaknesses in the Forest Service's financial management systems 
continue to hamper its ability to achieve sustainable financial 
transaction processing and reporting. In the past, the IG and we have 
reported long-standing problems with the feeder systems that process 
and transfer financial information into FFIS. Several of the feeder 
systems that generate data used to support the financial statements 
predate FFIS and have antiquated technology. Because significant 
differences existed between the data in the FFIS general ledger and its 
supporting detail in the feeder systems, financial statements produced 
by FFIS could not be relied upon. For example, the Forest Service uses 
several feeder systems to support its multibillion dollar property, 
plant, and equipment line item in its financial statements, including 
(1) Infrastructure Real Property Subsidiary System (INFRA), (2) 
Personal Property System (PROP), and (3) Equipment Management 
Information Systems (EMIS). These feeder systems also rely, in some 
cases, on data transferred from other lower level (subsidiary) feeder 
systems. In prior years, material internal control weaknesses in the 
compilation of the property, plant, and equipment balance contributed 
to a disclaimer of an opinion on the Forest Service's financial 
statements.

In preparation for the fiscal year 2002 audit, the Forest Service 
engaged a consultant to perform extensive procedures to arrive at an 
opening (October 1, 2001) property, plant, and equipment balance using 
statistical sampling of property records. The existing data was 
examined for erroneous and duplicate records through a variety of 
means, including checks for mathematical accuracy and comparisons with 
physical records and inventories. During this process, the consultant 
discovered that the lack of and/or faulty interfaces between these 
feeder systems and FFIS resulted in erroneous postings to the property, 
plant, and equipment account. Although the Forest Service has made 
certain improvements to its property feeder systems during fiscal year 
2002, more needs to be done to improve the quality and integrity of 
financial data in FFIS and the feeder systems.

In its fiscal year 2002 report on Forest Service's Information 
Technology,[Footnote 11] the auditor reported certain weaknesses in 
internal controls related to the feeder systems. For example, the 
auditor found duplicate and dropped records after data was transferred 
between PROP, the Purchase Order Normal Tracking and Inventory System, 
and the Purchase Order System. The auditor also reported that system 
data validation and error detection controls were ineffective in EMIS. 
Further, the auditor reported weaknesses related to the Automated 
Timber Sales Accounting System (ASTA). Specifically, there were no 
controls built into ASTA to prevent duplicate transactions from being 
recorded. As a result, field unit staff had to manually review the data 
to identify any transactions that were erroneously entered more than 
once.

We visited and interviewed financial management staff at five Forest 
Service field offices about the accounting processes and systems used 
to obtain a "field" perspective on financial management problems and 
the status of improvement efforts. At the field offices we visited, the 
financial management staff told us that system issues affect their 
operations. For example, one field office uses the Timber Information 
Management (TIM) system, an upfront system used to record the initial 
information and produce bills for timber sales and wood product 
permits. Since the system does not interface with FFIS, users have to 
manually enter the timber sale deposits and permit sales into FFIS. 
Lack of an automated interface between the systems increases workload 
as well as the risk of input errors.

Problems with the financial management systems continue to hamper the 
Forest Service's ability to move to sustainable processes. Until the 
Forest Service resolves its systems problems, the financial statements 
produced by FFIS cannot be relied upon without significant manual 
intervention to reconcile differences between FFIS and the feeder-
systems. Resolving these differences consumes personnel and other 
resources and limits the Forest Service's ability to have reliable 
financial information on an ongoing basis for day-to-day management.

An Efficient and Effective Financial Management Organization Is Key to 
Achieving Financial Accountability:

Among the other challenges that the Forest Service faces is 
establishing an efficient and effective organization to accomplish 
financial management activities. The highly decentralized 
organizational structure of the Forest Service's financial management 
presents significant challenges in achieving financial accountability. 
Under the current organization, financial activities are performed and 
recorded at the Forest Service national office, nine regional forest 
offices, six research stations and USDA NFC as well as at hundreds of 
forest and district ranger offices where many transactions originate. 
The decentralized financial management organization presents a 
significant challenge because the Forest Service's national office 
financial management team is tasked with ensuring that staff at 
hundreds of field locations are routinely processing accounting 
transactions accurately and consistently, in accordance with management 
directives.

Since February 1998, we have reported that the Forest Service's 
autonomous and decentralized organizational structure could hinder 
management's ability to achieve financial accountability. In March 
1998, an independent contractor, hired by the Forest Service to assess 
the agency's financial management and organization, also raised the 
issue of the agency's autonomous organizational structure. The 
contractor reported that the Forest Service lacked a consistent 
structure for financial management practices and that each field unit 
was operating independently. In response to these concerns, the Forest 
Service conducted a Financial Management Field Operation Assessment 
(FOA), which was completed in March 2001. As part of the assessment, 
the FOA project team evaluated the current level of accountability for 
financial management and made six recommendations to strengthen lines 
of responsibility and accountability. Specifically, the team 
recommended that the Forest Service (1) ensure that appropriate 
delegation of authority is in place, (2) finalize performance measures 
for financial management, 
(3) appoint field directors as responsible financial accountability 
officers for their respective units, (4) appoint deputy chiefs in the 
national office as responsible financial accountability officers for 
their units, (5) provide training and develop core competencies, and 
(6) establish policies and guidelines addressing the development, 
implementation, and financing arrangements for shared services 
agreements related to financial activities.

The Forest Service has taken several actions to address the FOA 
recommendations related to the autonomous field structure to improve 
accountability for financial management in the field and throughout the 
organization. For example, the agency restructured its national office 
financial management team to create functional lines of accountability 
for Budget and Finance management, under the leadership of the deputy 
CFO, who reports directly to the Chief of the Forest Service. The 
Forest Service also appointed field directors (regional foresters, 
research station directors, etc.) to serve as the responsible financial 
accountability officers for their units. Further, beginning in 2001, 
the Forest Service began to restructure its regional offices to mirror 
the national office's financial management structure. Currently, six of 
the nine regional offices have consolidated budget and finance 
functions, under the direction of a financial director who is 
responsible for financial management activities in the region. Another 
regional office is in the process of restructuring its financial 
management organization. The two remaining regional offices have no 
definite plans to change their financial management structure. While 
this is a good first step in resolving the autonomy of the Forest 
Service field offices, the Forest Service has not determined how best 
to structure the regions and related suboffices to create an efficient 
and effective organization to accomplish financial management 
activities.

At the five field offices we visited, the financial management field 
staff told us that, although progress is being made, more needs to be 
done to move to sustainable financial transaction processing and 
reporting in the field. For example, staff reported that they need more 
training on FFIS and updated policy and procedure manuals. They also 
stated that the national office needs to improve communication with the 
field to obtain better understanding of field business processes and to 
solicit more input from the field staff in developing accounting and 
reporting policies and procedures.

The Forest Service CFO management acknowledges that creating an 
effective and efficient organizational structure is critical to 
establishing sustainable processes and addressing many of the financial 
management issues and challenges that Forest Service faces, including:

* improving internal controls over its accounting functions, such as 
adequate supervisory review, and over other areas of weakness noted by 
the auditors;

* providing training programs and on the job training opportunities for 
accounting field staff; and:

* providing adequate oversight to ensure accurate and consistent 
processing of accounting transactions.

In 1999, we designated financial management at the Forest Service to be 
high risk because of serious financial and accounting weaknesses that 
had been identified and not corrected, in the agency's financial 
statements for a number of years. We continued to designate financial 
management at Forest Service as high risk in our 2003 report. In order 
to be removed from the high-risk list, the Forest Service, at a 
minimum, will need to demonstrate sustained accountability over its 
assets on an ongoing basis.

Corrective Actions Are Underway or Planned to Resolve Remaining 
Problems:

While the conditions discussed above present a major challenge to 
achieving financial accountability, the Forest Service has several 
efforts underway or planned, that if implemented, should help to 
resolve many of its financial management problems and to move toward 
sustainable financial management business processes. Such efforts are 
designed to address internal control and noncompliance issues 
identified in the fiscal year 2002 audit report as well as address 
feeder system and organizational issues. To assist in its efforts, the 
Forest Service CFO management is developing a financial management 
strategic plan intended to provide direction for continued improvement 
efforts and a mechanism to monitor and evaluate performance. To be 
effective, this plan should be comprehensive--providing a detailed road 
map of the steps, resources, and time frames for achieving the end goal 
of sustainable financial management.

To address the fiscal year 2002 internal control and FFMIA audit 
findings, the fund balance with Treasury reconciliation team has 
documented its reconciliation procedures and is working with NFC to 
develop a fund balance with Treasury reconciliation process to assist 
in timely research and resolution of reconciling items related to fund 
balance with Treasury activities that are processed by NFC on the 
Forest Service's behalf. According to Forest Service CFO management, 
the reconciliation process should be in place by August 2003. The 
property, plant, and equipment reconciliation team has started a 
project to update existing policies and procedures and plans to issue 
revised property, plant, and equipment manuals during fiscal year 2003. 
The property, plant, and equipment team is also continuing to analyze 
property data files and reconcile data in property feeder systems to 
data in FFIS monthly. In January 2003, CFO management developed and 
implemented an automated system to track and monitor the status of 
issues identified by the reconciliation teams to help ensure timely 
resolution. They also hired a training coordinator to develop 
standardized training programs and two additional staff to update all 
financial policy and procedure manuals.

The Forest Service is also continuing to work with USDA to enhance or 
replace the feeder systems in an effort to resolve data transfer 
problems between feeder systems and FFIS. For example, it is currently 
exploring an option for replacing the Forest Service's three property 
feeder systems with a single USDA-wide property system. A decision on 
the system will be made by December 2003. The Forest Service expects to 
begin implementing the system in fiscal year 2004. Also, the Forest 
Service is scheduled to pilot the Integrated Acquisition System (IAS) 
by fiscal year 2004. IAS is a procurement system that will replace the 
current purchase order system and will link to FFIS. IAS will support 
three major procurement processes: requisitioning, purchasing, and 
contracting.

In addition to the efforts mentioned above, the Forest Service is 
evaluating options for a more efficient financial management 
organization. In November 2002, it formed the Financial Management 
Efficiency Team to assess financial management roles and 
responsibilities and evaluate models for an efficient financial 
management organization. In January 2003, the team submitted a draft 
proposal for financial management roles and responsibilities throughout 
the organization and is scheduled to submit its recommendation for a 
financial management organization in June 2003. According to CFO 
management, the team is expected to make a detailed recommendation for 
a consolidated accounting and fund control organization either at each 
regional office or within multiregional shared services centers located 
at selected regional offices.

The Forest Service has several strategic plans that include many of the 
financial management improvement efforts. For example, the Forest 
Service prepares agencywide strategic plans and annual performance 
plans as required by the Government Performance and Results Act. Also, 
the Forest Service's Budget and Finance Deputy Chief units prepare 
annual project plans. However, the agencywide strategic and performance 
plans are broad in scope and focus on high-level goals and objectives. 
The annual project plans are narrowly focused on specific short-term 
projects. These plans are not an adequate substitute for a 
comprehensive financial management implementation strategy because 
they do not integrate all the improvement efforts and do not include 
the critical elements needed to effectively manage an overall strategy 
that will succeed in achieving and sustaining financial accountability.

Forest Service CFO management is developing a financial management 
strategic plan intended to provide direction for continued improvement 
efforts and a mechanism to monitor and evaluate performance. This plan 
is designed as a working tool, evolving over 3 to 5 years, which will 
be reviewed and updated annually. In January 2003, the plan was 
introduced at the Forest Service's Budget and Finance planning 
conference. According to Forest Service CFO management the initial plan 
will be completed by June 30, 2003.

To be effective, the Forest Service's plan should combine all the 
financial management improvement efforts into an overall comprehensive 
financial management implementation strategy. Such a strategy is a 
critical tool for the Forest Service, serving as a road map to help in 
resolving financial management problems. An effective plan includes 
long-term and short-term plans with clearly defined goals and 
objectives and specific corrective actions, target dates, and resources 
necessary to implement those actions. A comprehensive plan also 
prioritizes projects and assigns accountability by identifying 
responsible offices and staff responsible for carrying out the 
corrective actions. Without such a plan, it will be difficult to fix 
accountability for its many efforts and effectively monitor progress 
against its end goals.

Conclusion:

The Forest Service has demonstrated strong leadership and commitment to 
reach its goal of obtaining an unqualified opinion on its fiscal year 
2002 financial statements. At the same time, many of the financial 
management improvement efforts implemented to date are outside of 
normal business processes and focus mainly on obtaining reliable year-
end numbers for financial statement purposes. The Forest Service still 
must overcome several major challenges before it can move to 
sustainable processes that can routinely provide accurate, relevant, 
and timely information to support program management and 
accountability. The Forest Service is at a critical juncture. If the 
Forest Service is to achieve and sustain financial accountability, it 
must fundamentally improve its underlying internal controls, including 
financial management computer system controls, and financial management 
operations. The Forest Service has various efforts underway or planned, 
that if successfully carried through, will be important steps toward 
addressing the financial management challenges it faces. However, to 
date, several problems identified by the IG, KPMG, and us remain. Some 
of Forest Service problems are deep-seated and therefore will require 
sustained leadership and commitment of significant resources and time 
to resolve. The number and significance of the issues still facing the 
Forest Service emphasizes the need for a comprehensive strategy to 
manage the various initiatives underway or planned.

Recommendations for Executive Action:

To help ensure sustained commitment and timely implementation of 
financial management improvement efforts, we recommend that the Chief 
of the Forest Service direct the Chief Financial Officer to develop a 
comprehensive financial management strategic plan that:

* clearly defines long-term and short-term financial management goals 
and objectives;

* specifies corrective actions to address financial management 
challenges, including internal control weaknesses, FFMIA compliance 
deficiencies, system problems and organization issues;

* includes target dates and resources necessary to implement corrective 
actions;

* identifies the responsible parties for carrying out corrective 
actions; and:

* prioritizes and links the various improvement initiatives underway 
and planned, including USDA financial management systems enhancement 
efforts.

Agency Comments and Our Evaluation:

In written comments on a draft of this report, the Forest Service 
concurred with our recommendations to develop a comprehensive financial 
management strategic plan that defines financial management goals, 
specifies corrective actions, identifies target dates and resources 
needed, identifies responsible parties, prioritizes and links 
improvement initiatives, and provides details on financial management 
systems enhancements. Forest Service's response (see appendix I) stated 
that preparation of a financial management strategic plan is in 
process.

:

As agreed with your office, unless you publicly announce its contents 
earlier, we will not distribute this report for 30 days. At that time, 
copies of this report will be sent to the congressional committees with 
jurisdiction over the Forest Service and its activities; the Secretary 
of Agriculture; and the Director of the Office of Management and 
Budget. We will also make copies available to others upon request. In 
addition, the report will be available at no charge on the GAO web site 
at http://www.gao.gov.

If you or your staff have any questions please contact me at (202) 512-
6906. Key contributors to this report were Alana Stanfield, Suzanne 
Murphy, Martin Eble, and Lisa Willett.

[See PDF for image]

[End of figure]

Signed by:

McCoy Williams
Director, Financial Management and Assurance:

[End of section]

Appendixes:

Appendix I: Comments from the Forest Service:

United States Department of Agriculture:
Forest Service:
Washington Office:
14th & Independence SW
P.O. Box 96090
Washington, DC 20090-6090

File Code:	1310/1930:

Dare:	APR 24 2003:

Mr. McCoy Williams:

Director, Financial Management and Assurance U.S. General Accounting 
Office:

441 G Street, N.W. Washington, DC 20548:

Dear Mr. McCoy:

Thank you for the opportunity to review and comment on the draft 
General Accounting Office (GAO) Report, GAO-03-538, "Forest Service: 
Year-end Financial Reporting Significantly Improved, But Certain 
Underlying Problems Remain." The report effectively recognizes the 
progress the Forest Service made toward achieving financial management 
accountability in FY 2002. The report also identifies the necessity for 
the Agency to develop a comprehensive financial management strategic 
plan that defines financial management goals; specifies corrective 
actions; identifies target dates and resources needed; identifies 
responsible parties; prioritizes and links improvement initiatives; and 
provides details on financial management systems enhancements. Thus, 
the Forest Service concurs with the audit findings and recommendations. 
Preparation of the financial management strategic plan is in process.

Sincerely,

DALE N. BOSWORTH: 

Chief:

Signed by DALE N. BOSWORTH:

cc: Mary S Matiella, Sandy T Coleman:

[End of section]

(190066):

FOOTNOTES

[1] U.S. General Accounting Office, Financial Management: Forest 
Service's Efforts to Achieve Accountability, GAO/AIMD-99-68R 
(Washington, D.C.: Feb. 8, 1999); Forest Service: Barriers to Financial 
Accountability Remain, GAO/AIMD-99-1 (Washington, D.C.: Oct. 2, 1998); 
Forest Service: Status of Progress Toward Financial Accountability, 
GAO/AIMD-98-84 (Washington, D.C.: Feb. 27, 1998); Financial Management: 
Forest Service's Progress Toward Financial Accountability, GAO/AIMD-
97-151R (Washington, D.C.: Aug. 29, 1997); and Letter to the Chairman, 
House Committee on the Budget, GAO/AIMD-97-11R (Washington, D.C.: Dec. 
20, 1996).

[2] A material weakness is a condition in which the design or operation 
of one or more of the internal control components does not reduce to a 
relatively low level the risk that errors, fraud, or noncompliance in 
amounts material to the financial statements may occur and not be 
detected promptly by employees in the normal course of performing their 
duties.

[3] P.L. 104-208, title VIII, 110 Stat. 3009-389 (1996). 

[4] U.S. General Accounting Office, High-Risk Series: An Update, GAO/
HR-99-1 (Washington, D.C.: January 1999).

[5] U.S. General Accounting Office, High-Risk Series: An Update, GAO-
03-119 (Washington, D.C.: January 2003).

[6] The SGL provides a standard chart of accounts and standardized 
transactions that agencies are to use in all their financial systems.

[7] FFIS is programmed to debit or credit certain general ledger 
accounts based on identifiers, such as job code and transaction 
identification number and type, used to record the accounting event. 

[8] Suspense accounts are used to temporarily hold collections and 
disbursements until disposition is determined and they can be properly 
classified in the applicable receipt or expenditure budget accounts. 

[9] See U.S. General Accounting Office, Standards for Internal Control 
in the Federal Government, GAO/AIMD-00-21.3.1 (Washington, D.C.: 
November 1999), which contains the internal control standards to be 
followed by executive agencies in establishing and maintaining systems 
of internal controls as required by 31 U.S.C. Section 3512(c), (d), 
commonly called the Federal Manager's Financial Integrity Act of 1982.

[10] Statement of Federal Financial Accounting Standard No. 7, 
Accounting for Revenue and Other Financing Sources, requires 
collections be recorded as revenue at the point of sale.

[11] As part of the fiscal year 2002 financial statement audit of 
Forest Service's financial statements, the auditor conducted a review 
of the Forest Service's information and technology general and 
application controls. Due to the sensitive nature of the findings, the 
auditors issued a separate restricted report to Forest Service 
Management. 

GAO's Mission:

The General Accounting Office, the investigative arm of Congress, 
exists to support Congress in meeting its constitutional 
responsibilities and to help improve the performance and accountability 
of the federal government for the American people. GAO examines the use 
of public funds; evaluates federal programs and policies; and provides 
analyses, recommendations, and other assistance to help Congress make 
informed oversight, policy, and funding decisions. GAO's commitment to 
good government is reflected in its core values of accountability, 
integrity, and reliability.

Obtaining Copies of GAO Reports and Testimony:

The fastest and easiest way to obtain copies of GAO documents at no 
cost is through the Internet. GAO's Web site ( www.gao.gov ) contains 
abstracts and full-text files of current reports and testimony and an 
expanding archive of older products. The Web site features a search 
engine to help you locate documents using key words and phrases. You 
can print these documents in their entirety, including charts and other 
graphics.

Each day, GAO issues a list of newly released reports, testimony, and 
correspondence. GAO posts this list, known as "Today's Reports," on its 
Web site daily. The list contains links to the full-text document 
files. To have GAO e-mail this list to you every afternoon, go to 
www.gao.gov and select "Subscribe to daily E-mail alert for newly 
released products" under the GAO Reports heading.

Order by Mail or Phone:

The first copy of each printed report is free. Additional copies are $2 
each. A check or money order should be made out to the Superintendent 
of Documents. GAO also accepts VISA and Mastercard. Orders for 100 or 
more copies mailed to a single address are discounted 25 percent. 
Orders should be sent to:

U.S. General Accounting Office

441 G Street NW,

Room LM Washington,

D.C. 20548:

To order by Phone:  

 Voice: (202) 512-6000:

 TDD: (202) 512-2537:

 Fax: (202) 512-6061:

To Report Fraud, Waste, and Abuse in Federal Programs:

Contact:

Web site: www.gao.gov/fraudnet/fraudnet.htm E-mail: fraudnet@gao.gov

Automated answering system: (800) 424-5454 or (202) 512-7470:

Public Affairs:

Jeff Nelligan, managing director, NelliganJ@gao.gov (202) 512-4800 U.S.

General Accounting Office, 441 G Street NW, Room 7149 Washington, D.C.

20548: