U.S. Consolidated Financial Statements: Key Issues for the Department of Transportation
Highlights
What GAO Found
The Department of Transportation's (DOT) strong and sustained commitment is critical to addressing (1) recommendations made by its financial statement auditor and (2) key issues that affect the U.S. government's consolidated financial statements. While DOT's auditor issued an unmodified audit opinion on DOT's fiscal years 2024 and 2023 financial statements, the auditor identified a significant deficiency in internal control over financial reporting and made recommendations to help address it.
In addition, key issues that affect the consolidated financial statements include providing reliable intragovernmental activity and balances data, accurately preparing budget and accrual reconciliation information, providing more detailed information for Fund Balance with Treasury activity, and effectively implementing new processes related to treaties and other international agreements.
For example, GAO continued to report on the Department of the Treasury's inability to effectively prepare the reconciliations of the budget deficit to net operating cost and changes in cash balance, which contributed to GAO being unable to express an opinion on the consolidated financial statements. Treasury is developing corrective actions to address these deficiencies, including enhancing the ability for federal entities, such as DOT, to record reclassifications of Fund Balance with Treasury activity at a sufficiently detailed level. DOT using the enhanced reclassification process is important to Treasury's efforts to effectively prepare the reconciliation statements.
Why GAO Did This Study
GAO is responsible for conducting the annual audit of the U.S. government's consolidated financial statements. On January 16, 2025, GAO issued a disclaimer of opinion on these statements for fiscal years 2024 and 2023. The consolidated financial statements are compiled from federal entity financial statements and other federal entity information. As such, federal entities, including DOT, have a key role in supporting financial reporting at the government-wide level.
For more information, contact Dawn B. Simpson at simpsondb@gao.gov.