GAO: Working for Good Government Since 1921

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Effective July 7, 2004, the GAO's legal name became the Government Accountability Office. The change, which better reflects the modern professional services organization GAO has become, is a provision of the GAO Human Capital Reform Act of 2004, Pub. L. 108-271, 118 Stat. 811 (2004). This article was published in 2001 to mark GAO's 80th anniversary. It refers to the agency by its original name, the U.S. General Accounting Office.

The GAO Headquarters Building

Chapter 1, Introduction

The U.S. General Accounting Office (GAO) is the government's accountability watchdog. It serves Congress and the public interest by keeping a close eye on virtually every federal program, activity, and function. Its highly trained evaluators examine everything from missiles to medicine, from aviation safety to food safety, from national security to social security. Their work results in the passage of legislation, improvements in government operations, and billions of dollars in financial benefits for American taxpayers.  Many of GAO's recent reports and testimonies are available on the Reports and Testimony section of the GAO web site.


Photo - GAO's clerks in the Pension Bldg, 1920s Photo - GAO's auditors at work, ca. 1993

GAO has focused on governmental accountability from the time it began operations on July 1, 1921. While the agency always has worked for good government, its mission and organization have changed a great deal since 1921 in order to keep up with Congressional and national needs.

The General Accounting Office was created by the Budget and Accounting Act (42 Stat. 20) in 1921. The law was aimed at improving federal financial management after World War I. Wartime spending had increased the national debt and legislators saw that they needed better information and control over expenditures. Congress passed the Budget and Accounting Act to require preparation by the President of an annual budget for the federal government and to improve accountability. The statute transferred to GAO auditing, accounting and claims functions previously carried out by the Department of the Treasury. The act made GAO independent of the executive branch and gave it a broad mandate to investigate how federal funds are spent. Later legislation clarified or expanded GAO's powers, but the Budget and Accounting Act continues to serve as the basis for its activities.

During the 1920s and 1930s,GAO took a control-oriented view of its charter. It focused on whether government spending had been handled legally and properly. Much of the agency's work centered on reviewing vouchers, which were forms used by executive branch administrative officials and disbursing officers to record information on spending. Government disbursing agents made payments based on the vouchers, then sent the forms to GAO for checking. This early period of GAO's history often is called the voucher checking era.

As government programs expanded during the 1930s and 1940s, GAO's audit clerks had to examine an increasing number of expenditure vouchers. An explosion in defense spending during World War II added to GAO's paperwork burden, creating a huge backlog of unaudited vouchers.

After World War II, the Office shifted from checking individual vouchers to doing more comprehensive audits of federal spending. This change to examining the economy and efficiency of government operations in the postwar era marked the first major evolutionary change for GAO.

In the late 1950s and early 1960s,  GAO focused on hiring accountants, professionalizing its staff, and expanding its offices during the Cold War.  The late 1960s and early 1970s  brought another major shift, as GAO broadened its work and moved into program evaluation.

During the 1980s and early 1990s, GAO examined high risk areas in government operations, paid close attention to budget issues and worked to improve federal financial management.  Today the modern GAO serves the nation by carrying out a broad range of financial and performance audits and program evaluations.

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