Auditing the Nation's Finances:
Fiscal Year 1999 Results Continue to Highlight Major Issues Needing Resolution
T-AIMD-00-137: Published: Mar 31, 2000. Publicly Released: Mar 31, 2000.
GAO discussed the results of its report on the U.S. government's financial statements for fiscal year (FY) 1999.
GAO noted that: (1) significant financial systems weaknesses, problems with fundamental recordkeeping and financial reporting, incomplete documentation, and weak internal controls continue to prevent the government from accurately reporting a significant portion of its assets, liabilities, and costs; (2) major challenges include the federal government's inability to: (a) properly account for and report material amounts of property, equipment, materials, and supplies and certain stewardship assets, primarily at the Department of Defense (DOD); (b) properly estimate the cost of certain major federal credit programs and the related loans receivable and loan guarantee liabilities, primarily at the Department of Agriculture; (c) estimate and reliably report material amounts of environmental and disposal liabilities and related costs, primarily at DOD; (d) determine the proper amount of various reported liabilities, including postretirement health benefits for military employees and accounts payable and other liabilities for certain agencies; (e) accurately report major portions of the net cost of government operations; (f) ensure that all disbursements are properly recorded; and (g) properly prepare the federal government's financial statements, including balancing the statements, accounting for substantial amounts of transactions between governmental entities, properly and consistently compiling the information in the financial statements, and reconciling the results of operations to budget results; (3) in addition, GAO found that: (a) the government is unable to determine the full extent of improper payments--estimated to total billions of dollars annually--and therefore cannot develop effective strategies to reduce them; (b) serious, long-standing computer security weaknesses expose the government's financial and other sensitive information to inappropriate disclosure, destruction, modification, and fraud, and critical operations to disruption; and (c) material control weaknesses affect the government's tax collection activities; and (4) the financial management systems of almost all agencies were again found not to be in substantial compliance with the requirements of the Federal Financial Management Improvement Act of 1996.