Key Issues > Federal Financial Accountability
auditing icon, source: PhotoDisc

Federal Financial Accountability

GAO is required to report on the U.S. government’s consolidated financial statements, but three major impediments continue to prevent an audit opinion.

  1. Share with Facebook 
  2. Share with Twitter 
  3. Share with LinkedIn 
  4. Share with mail 

The Secretary of the Treasury, in coordination with the Director of the Office of Management and Budget, annually prepares consolidated financial statements for the U.S. government for Congress and the administration to use in fiscal decision making. GAO has been required to audit the consolidated financial statements since 1997, but is also mandated to audit various other federal financial statements

U.S. Government’s Consolidated Financial Statements

Federal Entity Financial Statements

While federal financial management has improved since the federal government began preparing these statements, GAO has been unable to render an audit opinion on the government’s consolidated financial statement because of the following impediments:

  1. 1.  serious financial management problems leading to financial statements from the Department of Defense that cannot be audited;
  2. 2.  the federal government's inability to adequately account for and reconcile intragovernmental activity and balances between federal agencies; and
  3. 3.  the federal government's ineffective process for preparing the consolidated financial statements.

It is important to note that fiscal year 2013 was the first year that 23 of the 24 largest federal agencies received unmodified opinions on their financial statements—a first for the Department of Homeland Security. The Department of Defense was the one that did not receive an opinion.

Looking for our recommendations? Click on any report to find each associated recommendation and its current implementation status.

Financial Audit:

U.S. Government's Fiscal Years 2013 and 2012 Consolidated Financial Statements
Published: Feb 27, 2014. Publicly Released: Feb 27, 2014.

Financial and Performance Management:

More Reliable and Complete Information Needed to Address Federal Management and Fiscal Challenges
Published: Jul 10, 2013. Publicly Released: Jul 10, 2013.

Management Report:

Improvements Needed in Controls over the Preparation of the U.S. Consolidated Financial Statements
Published: Jun 28, 2013. Publicly Released: Jun 28, 2013.

Financial Audit:

U.S. Government's Fiscal Years 2012 and 2011 Consolidated Financial Statements
Published: Jan 17, 2013. Publicly Released: Jan 17, 2013.

Auditing and Financial Management:

Understanding the Primary Components of the Annual Financial Report of the United States Government
Published: Sep 25, 2009. Publicly Released: Sep 25, 2009.
  • portrait of Steve Sebastian
    • Steve Sebastian
    • Managing Director, Financial Management and Assurance
    • (202) 512-9521
  • portrait of Gary Engel
    • Gary Engel
    • Director, Financial Management and Assurance
    • (202) 512-8815
  • portrait of Cheryl Clark
    • Cheryl Clark
    • Director, Financial Management and Assurance
    • (202) 512-9377
  • portrait of Larry Malenich
    • Larry Malenich
    • Director, Financial Management and Assurance
    • (202) 512-9399
    • (202) 512-9399
  • portrait of Jim Dalkin
    • Jim Dalkin
    • Director, Financial Management and Assurance
    • (202) 512-3133