Defense Budget: Improved Reviews Needed to Ensure Better Management of Obligated Funds
Highlights
As of September 30, 2001, the Navy's operating appropriations had $2.1 billion in unliquidated--or unpaid--funds that were obligated during fiscal years 1997-99. Unliquidated obligations that are no longer needed to pay for goods and services tie up funds that could be used for other permissible purposes. In addition, inaccurate obligation data result in misstatement of budgetary information. Because of the large dollar value, we examined the Navy's management of unliquidated obligations. Specifically, we reviewed a statistically representative sample of the Navy's $1.4 billion in unliquidated operating obligations valued at $50,000 or more for fiscal years 1997-99 to determine whether these obligations were (1) properly accounted for and (2) reviewed in accordance with DOD regulations.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Defense | The Secretary of Defense should direct the Secretary of Navy to adhere to DOD unliquidated operating obligation review regulations. |
Navy has implemented improvements to its unliquidated operating obligation review procedures.
|
| Department of Defense | The Secretary of Defense should direct the Secretary of Navy to better apply existing internal control activities to ensure adherence to these regulations, and to hold fund managers accountable for the accuracy and completeness of their reviews. |
Navy has implemented improvements to its unliquidated operating obligation review procedures.
|