Financial Audit: Material Weaknesses in Internal Control Continue to Impact Preparation of the Consolidated Financial Statements of the U.S. Government
GAO-09-387
Published: Apr 21, 2009. Publicly Released: Apr 21, 2009.
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Highlights
Since GAO's first audit of the fiscal year 1997 consolidated financial statements of the U.S. government (CFS), material weaknesses in internal control and other limitations on the scope of our work have prevented GAO from expressing an opinion on the accrual basis CFS. Certain of those material weaknesses relate to inadequate systems, controls, and procedures to properly prepare the CFS. The purpose of this report is to (1) provide details of the continuing material weaknesses related to the preparation of the CFS, (2) recommend improvements, and (3) provide the status of corrective actions taken to address the 56 open recommendations GAO reported for this area in June 2008.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of the Treasury | The Secretary of the Treasury should direct the Fiscal Assistant Secretary to design, document, and implement policies and procedures to identify and eliminate intragovernmental payroll tax amounts at the governmentwide level when compiling the CFS. |
Closed – Implemented
We found that during fiscal year 2013 Treasury designed, documented and implemented policies and procedures to identify and eliminate intragovernmental payroll tax amounts at the governmentwide level when compiling the CFS.
|
| Department of the Treasury | The Secretary of the Treasury should direct the Fiscal Assistant Secretary, in coordination with the Controller of OMB, to develop, document, and implement processes and procedures for preparing and reviewing the Management and Discussion Analysis (MD&A) and Citizen's Guide sections of the Financial Report to help assure that information reported in these sections is complete, accurate, and consistent with related information reported elsewhere in the Financial Report. |
Closed – Implemented
We found that over the past few years, Treasury, in coordination with OMB, has taken several actions to address this recommendation. To provide recommendations that are better aligned with the current status of remaining deficiencies related to this area, we have (1) closed this recommendation based on Treasury's significant progress in developing and implementing procedures for preparing the U.S. government's management discussion and analysis and citizen's guide, and (2)included new recommendations for corrective actions for the remaining control deficiencies in the FY 2011 CFS management report [GAO-12-529] under section "Review and Approval of the Financial Report".
|
| Department of the Treasury | The Secretary of the Treasury should direct the Fiscal Assistant Secretary, in coordination with the Controller of OMB, to establish and document criteria to be used in identifying federal entities as significant to the CFS for purposes of obtaining assurance over the information being submitted by those entities for the CFS. |
Closed – Implemented
We found that during fiscal year 2011, Treasury and OMB appropriately established and documented the criteria to be used in identifying federal entities as significant to the CFS for purposes of obtaining assurance over the information being submitted by those entities for the CFS.
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| Department of the Treasury | The Secretary of the Treasury should direct the Fiscal Assistant Secretary, in coordination with the Controller of OMB, to develop and implement policies and procedures for assessing and documenting, on an annual basis, which entities meet the criteria established for identifying federal entities as significant to the CFS. |
Closed – Implemented
We found that during fiscal year 2009, Treasury developed new policies and procedures for assessing, on an annual basis, which entities meet the criteria established for identifying federal entities as significant to the CFS. For fiscal years 2010 and 2011, we found that Treasury did not effectively implement these policies and procedures. However, during fiscal year 2012, we found that Treasury effectively implemented the policies and procedures for assessing and documenting which entities meet the criteria established for identifying federal entities as significant to the CFS.
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Topics
AccountingAccounting proceduresAccounting standardsAuditing proceduresDocumentationFederal agenciesFinancial managementFinancial recordsFinancial statement auditsFinancial statementsGovernment informationInternal controlsIntragovernmental transactionsReporting requirementsStrategic planningUnified budgetsCorrective actionPolicies and procedures