Financial Management: Problems in Accounting for Navy Transactions Impair
Funds Control and Financial Reporting (Letter Report, 01/19/99,
GAO/AIMD-99-19).
Pursuant to a legislative requirement, GAO reviewed the effects of
in-transit disbursements on the Navy's funds control and financial
reporting.
GAO noted that: (1) the Navy and the Department of Defense (DOD) have
not established adequate funds control as required by the Antideficiency
Act; (2) current policies and procedures permit the Navy to delay for
about 5 years: (a) the recording of obligations in excess of available
budget authority; (b) the initiation of required Antideficiency Act
investigations; and (c) any resulting reports of violations to Congress
and the President; (3) during this time, the Navy's appropriation
balances are unreliable, leaving DOD and Congress without assurance that
budget authority has not been exceeded; (4) according to Navy records,
as of September 30, 1997, obligations for 9 cancelled and 20 expired
appropriations may have exceeded available budget authority by a total
of $290 million; (5) in accordance with DOD policy, obligations have
been recorded in the nine appropriations that have cancelled; (6) at the
time of GAO's review, the Navy's records indicated that these
obligations may have exceeded budget authority; (7) although the Navy
maintained cuff records (separately prepared spreadsheets used to track
obligations) that it also would need to record to resolve problem
in-transit disbursements in the 20 expired appropriations, these
obligations were not recorded in the Navy's accounting system; (8) if
these obligations had been recorded, the obligation records for the 20
expired appropriations would have shown that these appropriations also
may have obligations that exceed available budget authority; (9) Navy
officials stated that an investigation of these appropriations would
show that they are not overobligated; (10) at the time of GAO's review,
the Navy had not initiated an Antideficiency Act investigation of any of
the 29 appropriations, although DOD policy requires investigations of
the 9 cancelled appropriations with recorded obligations in excess of
available budget authority; (11) in addition to the lack of control over
funds, these problems have a major effect on the accuracy and
reliability of the Navy's financial reporting, including its annual
financial statements required under the Chief Financial Officers Act;
and (12) until transactions are recorded accurately and in a timely
manner, and reflected in these financial statements, the Navy and DOD
will remain unable to achieve the goal of producing reliable financial
statements.
--------------------------- Indexing Terms -----------------------------
REPORTNUM: AIMD-99-19
TITLE: Financial Management: Problems in Accounting for Navy
Transactions Impair Funds Control and Financial
Reporting
DATE: 01/19/99
SUBJECT: Expired appropriations
Federal agency accounting systems
Military appropriations
Funds management
Budget obligations
Internal controls
Financial records
Financial statements
Reporting requirements
Accounting procedures
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Cover
================================================================ COVER
Report to Agency Officials
January 1999
FINANCIAL MANAGEMENT - PROBLEMS IN
ACCOUNTING FOR NAVY TRANSACTIONS
IMPAIR FUNDS CONTROL AND FINANCIAL
REPORTING
GAO/AIMD-99-19
Navy Problem Disbursements
(919052)
Abbreviations
=============================================================== ABBREV
CFO - chief financial officer
DFAS - Defense Finance and Accounting Service
DOD - Department of Defense
OMB - Office of Management and Budget
Letter
=============================================================== LETTER
B-276772
January 19, 1999
The Honorable William J. Lynn
Under Secretary of Defense (Comptroller)
Mr. Charles P. Nemfakos
Senior Civilian Official for the Office of the Assistant Secretary of
the Navy
(Financial Management and Comptroller)
Mr. Gary Amlin
Director, Defense Finance and Accounting Service
The Department of the Navy's inability to accurately account for its
disbursements and collections is a serious, long-standing financial
management problem. As we have previously reported, the Department
of Defense's (DOD) continuing problems with its complex and
inefficient payment processes generally do not permit a transaction
to be properly recorded when it occurs, including the matching of a
transaction with the related obligation--a critical funds control
measure. Problem disbursements result from the difficulties in
properly recording transactions, including matching disbursements
with related obligations, well after the transactions have occurred.
Our previous reports on DOD's problem disbursements, listed at the
end of this report, detailed long-standing concerns in this area,
such as the failure to identify the root causes of DOD's disbursing
problems and therefore determine which of its numerous initiatives
will improve the problem areas. Our reports also provided
recommendations for needed actions to begin to address these
problems.
Corrective actions are important because problem disbursements can
increase the risks of (1) fraudulent or erroneous payments being made
without detection, (2) cumulative amounts of disbursements exceeding
appropriated amounts and other legal spending limits, and (3)
inaccurate and unreliable financial reporting. For example, we
previously reported\1 that the Army's budget execution information
could not be relied on to ensure that the Army complied with
disbursement limits established by the Antideficiency Act. In
addition, our March 1996 report\2 on the Navy's fiscal year 1994
financial reports stated that errors in recording billions of dollars
of Navy disbursements resulted in the Department of the Treasury
understating by at least $4 billion the federal government's overall
budget deficit reported as of June 30, 1995.
This report focuses on the effects of one type of problem
disbursement--in-transits--on the Navy's funds control and financial
reporting. The Navy defines problem in-transits as disbursement
transactions that accounting stations have matched to a Navy
appropriation, reducing the unexpended balance of that appropriation,
but have not been able to match to an obligation recorded against
that appropriation within 120 days from the date of the transaction.
The ability to match disbursements with corresponding obligations is
a basic funds control requirement. The Defense Finance and
Accounting Service (DFAS)\3 reported that the Navy's problem
in-transit transactions totaled $3.6 billion as of October 1997,
accounting for 25 percent of the Navy's problem disbursements as of
that date.
We performed this work under the Chief Financial Officers (CFO) Act\4
as part of our broad-based review of issues affecting the accuracy
and completeness of DOD's financial information. As stated in our
report and testimony on the fiscal year 1997 governmentwide financial
statements,\5 the errors and omissions in DOD's consolidated
statements were a major factor in our inability to form an opinion on
the financial statements of the U.S. Government.
--------------------
\1 Financial Management: Strong Leadership Needed to Improve Army's
Financial Accountability (GAO/AIMD-94-12, December 22, 1993).
\2 CFO Act Financial Audits: Increased Attention Must Be Given to
Preparing Navy's Financial Reports (GAO/AIMD-96-7, March 27, 1996).
\3 DFAS, which provides accounting services for DOD, was established
on January 15, 1991, to improve, standardize, and consolidate DOD's
finance and accounting policy, systems, and operations.
\4 The Chief Financial Officers Act, as expanded by the Government
Management and Reform Act, requires executive branch agencies and
certain components to prepare annual financial statements and have
them audited.
\5 Financial Audit: 1997 Consolidated Financial Statements of the
United States Government (GAO/AIMD-98-127, March 31, 1998) and
Department of Defense: Financial Audits Highlight Continuing
Challenges to Correct Serious Financial Management Problems
(GAO/T-AIMD/NSIAD-98-158, April 16, 1998).
BACKGROUND
------------------------------------------------------------ Letter :1
The issues raised in this report relate directly to weaknesses in the
Navy's funds control system that result in its inability to ensure
that it has not incurred obligations in excess of available budget
authority. As the Supreme Court has made clear over the years, the
Appropriations Clause of the U.S. Constitution, often referred to as
the congressional "power of the purse," reflects a fundamental
proposition that a federal agency is dependent upon the Congress for
its funding. "The established rule is that the expenditure of public
funds is proper only when authorized by Congress, not that public
funds may be expended unless prohibited by Congress."\6 By
appropriating budget authority to an agency, the Congress makes
public funds available to the agency for obligation and expenditure.
--------------------
\6 United States v. MacCollom, 426 U.S. 317, 321 (1976).
FUNDS CONTROL REQUIREMENTS
---------------------------------------------------------- Letter :1.1
The Antideficiency Act is one of a number of statutes enacted by the
Congress to protect its prerogative over the public purse. It
provides that an officer or employee of the United States government
may not "make or authorize an expenditure or obligation exceeding an
amount available in an appropriation or fund for the expenditure or
obligation," or enter into a contract or other obligation for the
payment of money "before an appropriation is made."\7 It further
requires that the head of each executive agency prescribe a system of
administrative control to restrict obligations and expenditures to
amounts available.
In addition, the Federal Managers' Financial Integrity Act requires
that agencies' controls reasonably ensure that
-- obligations and costs comply with applicable law and
-- revenues and expenditures applicable to agency operations are
recorded and accounted for properly so that accounts and
reliable financial and statistical reports may be prepared and
accountability of assets may be maintained.\8
Proper obligation and expenditure recording practices are essential
to sound funds control and compliance with the Antideficiency Act.
Obligations include amounts of legal liability incurred, for example,
when contracts are awarded or orders placed, even though the agency
may not receive goods or make payment until some future period of
time. Expenditures include such transactions as the issuance of a
check, either in paper or electronic form, or the disbursement of
cash to pay an obligation incurred. To ensure sound funds control
and compliance with the act, an agency's funds control system must
record obligation and expenditure transactions as they occur. An
agency may not avoid the requirements of the act, including the
reporting requirements discussed below, by failing to record
obligations or expenditures.
Whenever an agency discovers evidence of a possible overobligation or
overexpenditure, it must investigate that evidence. If the
investigation shows that the appropriation, in fact, is overobligated
or overexpended, the Antideficiency Act requires reporting the
overobligation or overexpenditure to the President and the Congress.
Office of Management and Budget (OMB) Circular A-34, Instructions on
Budget Execution, which provides funds control implementation
guidance, requires agencies to include in such reports the primary
reason for the violation, a statement of any circumstances the agency
believes to be extenuating, a statement of the adequacy of the
agency's funds control system and whether the head of the agency
determines a need for changes in the system, and a statement of any
action taken by the head of the agency to prevent recurrence of the
same type of violation.\9
The act applies to expired and canceled appropriations, the types of
appropriations at issue in this report, as well as current
appropriations. At the end of the period of availability of a
fixed-year appropriation,\10 the appropriation expires and for the
next 5 fiscal years is available only for recording, adjusting, and
liquidating obligations properly chargeable to that appropriation.\11
However, an agency may not charge new obligations to an expired
appropriation. For example, an agency using a fiscal year
appropriation entered into a contract in fiscal year 1998. In fiscal
year 1999, it incurs increased costs due to changes in specifications
that fall within the contract's scope of work. The agency must
obligate the increased costs of this contract modification against
the fiscal year 1998 expired appropriation. If an adjustment to an
obligation properly chargeable to an expired appropriation exceeds
the remaining unobligated balance of the expired appropriation, the
agency has violated the Antideficiency Act.\12 The agency could also
violate the act if, in liquidating an obligation, the agency were to
exceed the remaining unexpended balance of the expired appropriation.
At the end of this 5-year period, the appropriation is closed and any
remaining balance, whether obligated or unobligated, is canceled.
What this means is that the appropriation is no longer available for
any obligation, obligation adjustment, or expenditure at all.
Obligation adjustments and liquidations (expenditures) that an agency
would otherwise have charged against the expired appropriation are,
at this point in time, chargeable against a current appropriation
available for the same purpose, but only to the extent of the lesser
of 1 percent of the current appropriation or unexpended balance of
the expired appropriation.\13 Any overobligation or overexpenditure
of this amount constitutes a violation of the Antideficiency Act.
--------------------
\7 31 U.S.C. 1341(a)(1).
\8 31 U.S.C. 3512(b)(1).
\9 OMB Circular A-34, sec. 22.6.
\10 A fixed-year appropriation is one that is available for a fixed
period of time, either 1 or more fiscal years.
\11 Under 31 U.S.C. 1553(a), obligations are "properly chargeable"
to an expired appropriation when they reflect "bona fide needs" of
the appropriation's period of availability and meet the other
requirements imposed by law, such as purpose and amount limitations.
See 71 Comp. Gen. 502 (1972).
\12 31 U.S.C. 1553(a).
\13 31 U.S.C. 1553(b).
THE NAVY'S PAYMENT AND
ACCOUNTING PROCESSES
---------------------------------------------------------- Letter :1.2
The Navy's payment and accounting processes are generally separate
functions carried out by separate offices in different locations.
Under the Navy's processes, the accounting for a payment occurs after
the payment has been made. The Navy's payments are made either by
DFAS disbursing stations aligned with the Navy or other disbursing
stations on behalf of the Navy, such as those aligned with the Army
or the Air Force. The disbursing stations then transmit
documentation supporting the payment transactions to the DFAS
accounting stations\14 to match and record Navy payments to the
corresponding obligations. Problem disbursements arise when the
accounting stations are not provided the documentation that permits
this matching in a timely manner.
To resolve problem in-transit disbursements, DFAS and the Navy must
locate accurate, detailed accounting data for each in-transit
disbursement (including, for example, a contract, travel order, or
other authorizing document number, and information on the cognizant
organization and program) necessary to match these transactions to
the corresponding obligation recorded in the accounting system and
verify that the correct appropriation was charged. According to
DOD's problem disbursement policy, when DFAS or the Navy determine
that a corresponding obligation was not recorded or it cannot be
identified, the Navy must adjust its accounting records by directing
DFAS to record an obligation to support the disbursement.
--------------------
\14 To record a disbursement in the accounting records, disbursement
data must be sent from the disbursing station to the accounting
station. The accounting station records the transaction in the
accounting records and matches the payment to the corresponding
obligation.
RESULTS IN BRIEF
------------------------------------------------------------ Letter :2
The Navy and DOD have not established adequate funds control as
required by the Antideficiency Act. Current policies and procedures
permit the Navy to delay for about 5 years (1) the recording of
obligations in excess of available budget authority, (2) the
initiation of required Antideficiency Act investigations, and (3) any
resulting reports of violations to the Congress and the President.
During this time, the Navy's appropriation balances are unreliable,
leaving DOD and the Congress without assurance that budget authority
has not been exceeded.
According to Navy records, as of September 30, 1997, obligations for
9 canceled and 20 expired appropriations may have exceeded available
budget authority by a total of $290 million. Because the Navy was
unable to match problem in-transit disbursements in these 29
appropriations to already recorded obligations, Navy officials
concluded that to resolve these problem in-transits the Navy would
need to record obligations. In accordance with DOD policy,
obligations have been recorded in the nine appropriations that have
canceled. At the time of our review, the Navy's records indicated
that these obligations may have exceeded budget authority.
Although the Navy maintained obligations in "cuff" records
(separately prepared spreadsheets used to track obligations) that it
also would need to record to resolve problem in-transit disbursements
in the 20 expired appropriations, these obligations were not recorded
in the Navy's accounting system, in accordance with DOD policy. If
these obligations had been recorded, the obligation records for the
20 expired appropriations would have shown that these appropriations
also may have obligations that exceed available budget authority.
An agency may not avoid the requirements of the Antideficiency Act,
including its reporting requirements, by failing to record
obligations or to investigate potential violations. Navy officials
stated that an investigation of these appropriations would show that
they, in fact, are not overobligated. At the time of our review, the
Navy had not initiated an Antideficiency Act investigation of any of
the 29 appropriations, although DOD policy requires investigations of
the 9 canceled appropriations with recorded obligations in excess of
available budget authority. The Navy cannot rely on the possibility
that over the course of time, as a result of ordinary business
activity, these potential overobligations will be resolved.
In addition to the lack of control over funds, these problems have a
major effect on the accuracy and reliability of the Navy's financial
reporting, including its annual financial statements required under
the CFO Act. For example, these unrecorded transactions particularly
affect the Statement of Net Cost and the Statement of Budgetary
Resources. Until transactions are recorded accurately and in a
timely manner, and reflected in these financial statements, the Navy
and DOD will remain unable to achieve the goal of producing reliable
financial statements.
In written comments on a draft of this report, DOD indicated that it
recognized and concurred with the intent of our recommendations.
However, DOD also stated that the Navy's cuff records are unreliable
and should not be used to identify potential overobligations. DOD
stated further that the Navy has advised the Under Secretary of
Defense (Comptroller) that even if these amounts were recorded, a
number of the accounts addressed in our report still would show a
positive balance when other transactions are considered. DOD
suggests, therefore, that the Navy first perform a further review of
its cuff records, as well as transactions recorded in its official
records.
We disagree with DOD's assertion that the cuff records cannot be used
to identify possible overobligations, which may indicate
Antideficiency Act violations. During our audit, DFAS and Navy
officials acknowledged that after an extensive, multiyear effort,
they had completed all research of the in-transit disbursement
transactions represented by the obligations in the Navy's cuff
records. However, they were unable to match these transactions to an
existing obligation. The only reason that the Navy recorded these
amounts in cuff records rather than in its official accounting
records is that DOD policy permits delayed recording of the amounts
in the official accounting records where such recording would show
the related appropriations to be overobligated. The Navy's cuff
records, therefore, provide affirmative evidence of the obligations
that must be recorded in the Navy's accounting system to properly
match in-transit disbursements that have already occurred.
Finally, we agree, and recommended in our report, that the Navy
should investigate the account balance of any potentially
overobligated appropriations. As we also recommended in our report,
the Navy should report any overobligations found in such a review to
the Congress and the President consistent with the Antideficiency Act
and guidance in OMB Circular A-34.
OBJECTIVE, SCOPE, AND
METHODOLOGY
------------------------------------------------------------ Letter :3
The objective of this review was to assess the funds control and
financial reporting implications of the Navy's long-standing
inability to record obligations and expenditures to properly resolve
in-transit transactions. To complete this work, we
-- reviewed DOD funds control regulations\15 and Navy funds control
policies and procedures,\16
-- reviewed DOD Comptroller policy for researching and correcting
problem disbursements, including in-transit transactions, issued
between June 1995 and December 1996.\17 To obtain an
understanding of the December 1996 policy revision, which
extended the time frame for recording overobligations, we
reviewed Navy's December 4, 1996, briefing document to the DOD
Comptroller, which identified potential overobligations under
the then existing problem disbursement policy. We discussed
with DOD, DFAS, and Navy officials limitations on the Navy's
ability to research and correct problem in-transits, which
resulted in the request for the policy change, and
-- reviewed Navy and DFAS records on disbursements and collections
not yet recorded in the Navy's accounting system, including
in-transit transactions recorded in DFAS' problem disbursement
database, and the Navy's cuff records--separately prepared
spreadsheets that are not reflected in the Navy's accounting
system. Navy's cuff records identify the amount of obligations
that the Navy would need to record to resolve problem
disbursements and provide evidence of potential overobligations.
We also reviewed the Navy's SF-133, Reports on Budget Execution,
and its FMS-2108, Year End Closing Statement, on appropriation
balances. We discussed this information with Navy and DFAS
officials, respectively.
The data in this report are based on Navy and DFAS records. We did
not independently verify or audit the accuracy of these data. We
performed our work from March 1997 to June 1998 in accordance with
generally accepted government auditing standards at DFAS Cleveland
and operating locations\18 in Charleston, South Carolina; Norfolk,
Virginia; San Diego, California; and the Navy's Financial Management
Office in Washington, D.C.
We requested written comments on a draft of this report from the
Under Secretary of Defense (Comptroller). These comments are
presented and evaluated in the "Agency Comments and Our Evaluation"
section and are reprinted in appendix III.
--------------------
\15 DOD Financial Management Regulation, Volume 14.
\16 Navy Comptroller Manual, Volume 3, Chapter 2.
\17 This policy guidance has been incorporated in DOD Financial
Management Regulation, Volume 3, Chapter 11.
\18 Operating locations, also known as OpLocs, refers to DFAS
accounting and disbursing stations.
FUNDS CONTROL POLICIES AND
PROCEDURES DO NOT ENSURE
ACCURATE INFORMATION FOR
OVERSIGHT AND FINANCIAL
REPORTING
------------------------------------------------------------ Letter :4
The Navy's funds control policies and procedures do not ensure that
the Navy can match payments to corresponding obligations before or at
the time a payment is made. This has resulted in problem
disbursements and the need for the Navy, after a payment has been
made, to match the disbursement to an obligation or to record an
obligation to cover the disbursement.
In May 1997 testimony,\19 the Under Secretary of Defense
(Comptroller) stated that DOD "has confidence in its existing
budgetary accounting systems to control and account for funds
provided to DOD through the Congressional appropriation process.
Those systems successfully support the budgetary process, generally
have adequate funds control processes, and satisfy requirements for
appropriation balances and availability." However, our findings in
this report illustrate that significant breakdowns in funds control
have resulted in the Navy's problems in promptly resolving its
in-transit transactions and maintaining accurate and reliable
appropriation balances. In addition, these problems have a major
effect on the accuracy and reliability of the Navy's financial
reporting, including its annual financial statements required under
the CFO Act.
--------------------
\19 Statement of the Honorable John J. Hamre, Under Secretary of
Defense (Comptroller), Department of Defense, Before the Senate
Committee on Governmental Affairs, May 1, 1997.
FUNDS CONTROL IMPLICATIONS
---------------------------------------------------------- Letter :4.1
We found evidence that as of September 30, 1997, the Navy may have
overobligated 29 canceled and expired appropriations totaling $290
million. The Navy's obligation records for nine canceled
appropriations, as of September 30, 1997, show that these
appropriations may be overobligated. In addition, cuff records
(separately prepared spreadsheets that are not reflected in the
Navy's accounting system) evidence possible overobligations in 20
expired appropriations. The potential overobligations shown in the
records of the 9 canceled appropriations and the potential
overobligations identified in the cuff records for the 20 expired
appropriations reflect the results of the Navy's efforts to research
and resolve problem in-transit disbursements.
The DOD Comptroller has issued policy guidance on researching and
resolving problem disbursement transactions and investigating
potential overobligations that may result.\20 The Navy defines
problem in-transits as disbursements that DFAS accounting stations
have matched to a Navy appropriation, reducing the appropriation's
unexpended balance, but have not been able to match to a recorded
obligation of that appropriation within 120 days from the date of the
transaction. The DOD Comptroller's initial June 1995 policy required
DFAS to (1) research in-transit disbursements within 180 days of
their designation as a problem disbursement (allowing a total of 300
days to match disbursements to obligations) and (2) if unable to
match a problem disbursement to an obligation within 180 days, record
an obligation or an obligation adjustment (an increase or decrease to
an existing obligation). The policy also set minimum research
requirements and established criteria for discontinuing research when
there is no reasonable expectation that supporting documentation can
be located.
According to DOD's funds control regulations,\21 if evidence of a
potential Antideficiency Act violation is found, an investigation is
to be initiated. The regulations state that this investigation
consists of a preliminary review to gather basic facts about a
potential violation to determine whether a formal investigation is
warranted. The preliminary review would include, for example,
checking for duplicate transactions. If the preliminary review
determines that there is a potential violation of the act, a formal
investigation is to be initiated. The formal investigation is to
encompass a review of all activity within the appropriation to
determine if a violation of the act has, in fact, occurred.
DOD's problem disbursement policy was revised on at least two
occasions, permitting the Navy to delay recording and investigating
potential overobligations that may result in Antideficiency Act
violations. The October 1996 policy revision directed that (1)
obligations resulting from actions to resolve problem disbursements
be recorded in an appropriation only up to the amount of that
appropriation's unobligated balance, (2) if, during the 5-year
expired phase, obligational authority becomes available, record
obligations for problem disbursements before recording any program
obligational adjustments, and (3) record any remaining obligations
when the appropriation cancels--5 years after the appropriation
expires. Thus, this policy provided that recording obligations for
problem disbursements would take priority over recording program
obligational adjustments. This policy also suspended the requirement
to conduct investigations of potential Antideficiency Act violations
caused by recording problem disbursements until 6 months after the
appropriation canceled.
Under DOD's funds control regulations, obligations are to be recorded
at the time they occur and Antideficiency Act investigations are to
be initiated when there is evidence that a violation may have
occurred. However, under the October 1996 policy revision, the Navy
was not required to record obligations needed to cover problem
disbursements on an ongoing and current basis if recording the
obligation would cause the appropriation to be potentially
overobligated. This policy runs counter to the funds control
objectives of the Antideficiency Act.
In response to a briefing from Navy financial managers, the DOD
Comptroller revised the problem disbursement policy again on December
16, 1996, to avoid the negative impact on appropriations that affect
the Navy's readiness resulting from recording obligations to resolve
problem in-transit disbursements. For example, the December policy
change allowed program obligational adjustments to be recorded to
appropriations, eliminating the requirement to record, on a priority
basis, obligations to resolve problem in-transit disbursements.
Under this policy revision, the Navy is not required to establish
obligations to resolve problem in-transits that cannot be matched to
an existing obligation in a current or expired appropriation until
June 30 of the fiscal year in which the cited appropriation account
is scheduled to cancel--in other words, about 90 days short of 5
years after the appropriation has expired. This can amount to a
total of about 8 years after the original disbursement transaction
occurred in those cases where an appropriation covered
3 fiscal years. Of the 29 potentially overobligated appropriations,
8 appropriations covered at least 3 fiscal years.
In the December 1996 briefing, the Navy requested that the DOD
Comptroller revise the obligation requirement for in-transits because
the Navy's ability to resolve them was limited. The briefing
document noted the number of overobligated appropriations that the
Navy would have to investigate and report if it complied with the
180-day policy for recording obligations to resolve problem
in-transit disbursements.
We identified evidence of overobligations in the nine canceled
appropriations through discussions with Navy financial management
officials on the Navy's implementation of the DOD Comptroller's
problem disbursement policy. We reviewed Navy journal vouchers
(documentation of transactions) used to record these obligations.
The Navy's obligation records for these nine canceled appropriations,
as of September 30, 1997, show that the appropriations may have
obligations in excess of available budget authority. Appendix I
contains a list of the nine canceled appropriations and the amounts
by which the Navy may have obligations in excess of available budget
authority.
We also identified evidence of overobligations in the 20 expired
appropriations through discussions with Navy financial management
officials on the reasons why the DOD Comptroller policy was revised
to extend the period for recording obligations needed to resolve
problem in-transits. Navy officials showed us cuff records
identifying obligations that the Navy's research indicated are
necessary to resolve problem in-transit disbursements in these 20
appropriations. The Navy uses these cuff records to track
obligations that it concludes are necessary to resolve problem
disbursements. The data on these spreadsheets are not reflected in
the Navy's accounting system.
Navy officials told us that they had not recorded these obligations
against the appropriations because they were not required to do so by
the DOD Comptroller's December 16, 1996, policy for resolving problem
disbursements. However, if the obligations shown in the cuff records
were recorded in the Navy's accounting system, the obligation records
for these 20 expired appropriations, like the records for the 9
canceled appropriations, would show that these appropriations also
may have obligations in excess of available budget authority.
Appendix II contains a list of the 20 expired appropriations and the
amounts by which the cuff records show that these appropriation
accounts may have obligations in excess of available budget authority
as of September 30, 1997. As stated earlier, DOD's current policy,
as revised on December 16, 1996, does not require the Navy to record
these obligations in its accounting system until 3 months before the
appropriation is scheduled to cancel.
Navy officials also stated that while available evidence as of
September 30, 1997, may show that the 29 appropriations appear
overobligated, they do not believe them to actually be overobligated.
They indicated that an Antideficiency Act investigation of each
appropriation could result in identifying (1) other disbursements
recorded incorrectly against the appropriation, (2) obligations that
are no longer valid and can be deobligated,\22 or (3) other
accounting errors that would, when corrected, reduce recorded
obligations, leaving funds available to permit recording of these
disbursement transactions without incurring an overobligation. The
officials also stated that "historical trends" suggest that over a
period of time, as a result of ordinary business operations, the Navy
will be able to deobligate previously recorded obligations.
Navy officials told us that they had completed all research of the
problem in-transit disbursements that resulted in the obligations
recorded in the 9 canceled appropriations and identified in the cuff
records for the 20 expired appropriations. As of the completion of
our review, the Navy had not initiated an Antideficiency Act
investigation of any of these 29 appropriations. An agency may not
avoid the requirements of the act, including its reporting
requirements, by failing to record obligations or to investigate
potential violations. Also, the Navy cannot rely on the possibility
that over the course of time, as a result of ordinary business
activity, these potential overobligations will be resolved.
Moreover, the Navy has no assurance on an ongoing basis that it has
sufficient budget authority to cover adjustments to other obligations
incurred during the normal course of business and properly chargeable
to these appropriations, as discussed previously.
Further, an agency may not establish a policy to avoid proper funds
control and the consequences of the Antideficiency Act. The DOD
Comptroller's current policy, permitting the Navy to delay recording
obligations for problem in-transits for 5 years or more, runs counter
to the funds control objectives of the Antideficiency Act. It allows
the Navy to ignore evidence of potential overobligations, and delay
for over 5 years required Antideficiency Act investigations and any
resulting reports to the Congress and the President, limiting their
ability to maintain oversight. In addition, DOD's current problem
disbursement policy,\23 which states that an investigation be
initiated for potential Antideficiency Act violations that have not
been resolved within 6 months after the appropriation cancels, would
apply to the nine canceled accounts, although DOD did not ensure that
the policy was followed.
--------------------
\20 DOD Financial Management Regulation, Volume 3, Chapter 11.
\21 DOD Financial Management Regulation, Volume 14.
\22 Under 31 U.S.C. 1501 and OMB Circular A-34, agencies are
required to ensure that obligations are not over- or understated.
Agencies are required to make appropriate upward and downward
adjustments to obligations, deobligating, in whole or in part,
obligations that are not likely to require payment.
\23 DOD Financial Management Regulation, Volume 3, Chapter 11.
FINANCIAL REPORTING
IMPLICATIONS
---------------------------------------------------------- Letter :4.2
The Navy's ongoing problems in properly and promptly recording its
transactions also affect the reliability of its financial reporting,
including its annual financial statements. For example, these
unrecorded transactions particularly affect the Statement of Net Cost
and the Statement of Budgetary Resources. Until transactions are
recorded accurately and in a timely manner and reflected in these
financial statements, the Navy and DOD will remain unable to achieve
the goal of producing reliable financial statements.
The Statement of Net Cost is intended to provide information on an
agency's cost of operations and would generally be derived from cost
accounting information. However, because the Navy and DOD lack
appropriate cost accounting systems, they use obligation and
expenditure data to calculate costs. The reliability of this
information is impaired not only because obligation data do not
represent actual cost, but also because the Navy's obligation data
are unreliable, as evidenced by the delay in recording in-transit
transactions and the potential overobligations discussed in this
report. This factor further limits the reliability of the Statement
of Net Cost.
The Statement of Budgetary Resources is required for federal agencies
beginning with fiscal year 1998. The purpose of the Statement of
Budgetary Resources is to have audited budget information, which is
reconciled to the Statement of Net Cost. This statement is intended
to provide information on the type of resources used to fund the
operation of the agency, as well as the year-end status of those
funds. The required supplementary information to support this
statement includes information by appropriation on obligations and
expenditures for the period. Therefore, inaccurate and incomplete
information on expenditures and obligations directly affects the
reliability of this statement.
CONCLUSIONS
------------------------------------------------------------ Letter :5
Until the Navy corrects the fundamental deficiencies in its system of
funds control to allow for accurate recording of its transactions on
an ongoing and current basis, its ability to produce accurate
information on the status of its obligations and expenditures will
continue to be severely compromised. As evidenced by the 29
potentially overobligated expired and canceled appropriations
discussed in this report, the Navy's failure to adequately and timely
account for disbursements against recorded obligations impairs its
ability to ensure, in accordance with the Antideficiency Act's funds
control requirements, that on an ongoing basis, obligations and
disbursements do not exceed the budget authority made available by
the Congress.
The DOD Comptroller's current policy, permitting the Navy to delay
recording obligations for problem in-transits for 5 years or longer,
runs counter to the funds control objectives of the Antideficiency
Act. It allows the Navy to ignore evidence of potential
overobligations, and delay for almost 5 years required Antideficiency
Act investigations and any resulting reports to the Congress and the
President.
DOD may not avoid the requirements of the act by failing to record
obligations or expenditures and to investigate evidence of
overobligations or overexpenditures. To do so affects not only DOD's
ability to maintain funds control, but also limits the effectiveness
of congressional oversight. Incomplete and inaccurate information on
the Navy's transactions also affects the reliability of its financial
information used for financial reporting, including its annual
financial statements, a mechanism for oversight by the Congress and
the public.
RECOMMENDATIONS
------------------------------------------------------------ Letter :6
We recommend that the DOD Comptroller revise the problem disbursement
policies and procedures to ensure that the Navy's funds control
system maintains, on an ongoing and current basis, accurate and
reliable unobligated and unexpended balances for the Navy's expired
and canceled appropriations consistent with the Antideficiency Act
and requirements for accurate and timely financial reporting. The
DOD Comptroller should also monitor compliance with the revised
policies and procedures.
We also recommend that the Navy's Assistant Secretary (Financial
Management and Comptroller) in concert with DFAS
-- record obligations in the Navy's official accounting and funds
control records for the 20 expired appropriations identified in
the Navy's cuff records,
-- immediately investigate any of the 9 canceled appropriations and
the 20 expired appropriations that are potentially
overobligated, and
-- report any overobligations to the Congress and the President
pursuant to the Antideficiency Act and implementing guidance in
OMB Circular A-34.
AGENCY COMMENTS AND OUR
EVALUATION
------------------------------------------------------------ Letter :7
In written comments on a draft of this report, DOD indicated that it
recognized and concurred with the intent of our recommendations. DOD
stated that it has implemented various policies and procedures
intended to ensure that the funds control systems of each of the DOD
components maintain accurate unobligated and unexpended balances and
comply with the Antideficiency Act. DOD also stated that we did not
validate and should not have relied on the Navy's cuff records to
identify potential overobligations because (1) the Navy advised the
Under Secretary of Defense (Comptroller) that its cuff records may
not accurately reflect amounts that should be properly recorded in
the applicable Navy accounts and (2) even if the obligations were
recorded, a number of the accounts addressed in our report would show
a positive balance, and it would be premature to conduct
Antideficiency Act investigations based on these cuff records.
We disagree with DOD's and the Navy's assertions. DOD's problem
disbursement policy allows DOD agencies, including the Navy, to
undermine the funds control objectives of the Antideficiency Act and
OMB guidance. As stated in our report, DOD's policy inappropriately
allows the Navy to ignore evidence of potential overobligations for
almost 5 years, and to maintain inaccurate and unreliable
appropriation balances during that period of time.
Further, DOD's comments ignore the basis for our finding that
obligations recorded in the Navy's cuff records should be recorded in
the Navy's official accounting records. The level and quality of
research supporting amounts in the cuff records is no different from
the research supporting amounts that the Navy has already recorded in
the official obligation records to resolve other problem in-transit
disbursement transactions. The obligations recorded in the Navy's
cuff records are a direct result of extensive, multiyear DFAS and
Navy efforts to research and resolve the Navy's problem in-transit
disbursement transactions. When this research fails to identify a
corresponding obligation, the Navy will record an obligation in its
official records, but only up to the amount of the appropriations'
remaining unobligated budget authority. According to Navy officials,
an amount is recorded in cuff records when official accounting
records show insufficient unobligated budget authority to cover the
obligation. The only reason that the Navy records these amounts in
cuff records rather than in its official accounting records is that
DOD policy permits delayed recording of the amounts in the official
accounting records where such recording would show the related
appropriations to be overobligated. Because the same level and
quality of research supports obligations that the Navy records in
both its official records and the cuff records, the cuff records
represent affirmative evidence of possible overobligations. The
Navy, by its own admission, would have recorded these amounts in its
official records had there been sufficient unobligated budget
authority to cover these obligations. As recommended in our report,
the Navy should record these amounts and, without further delay,
begin investigations of this evidence.
Although DOD and the Navy now assert that the cuff records are
unreliable, both have used the cuff records as evidence of possible
overobligations. As discussed in our report, the Navy offered, and
the DOD Comptroller accepted, the Navy's cuff records as evidence of
overobligations in 29 Navy appropriations if the Navy were to record
such obligations as required by DOD's previous problem disbursement
policy. As a result, the DOD Comptroller revised this policy to
extend the time frame for recording such obligations for nearly 5
years. Moreover, pursuant to the revised policy, the Navy used these
same records as sufficient evidence of the amount of obligations they
needed to record in its official records for the nine canceled
appropriation accounts listed in appendix I to this report.
DOD also suggested that the Navy's cuff records should be reviewed
further. DOD stated that preliminary reviews conducted by the Navy
indicate that the cuff records may not accurately reflect the amount
of obligations that should be recorded in some of the appropriation
accounts in question. However, DOD did not provide documentation to
support this assertion. We are concerned that DOD's comments
represent a further attempt to avoid the requirements of the
Antideficiency Act and, at the very least, underscore DOD's serious
difficulties in resolving its problem disbursements and maintaining
accurate, reliable accounting records. Moreover, unless DOD
establishes accurate and current appropriation balances by recording
transactions when they occur, it will be difficult, if not
impossible, for DOD to effectively monitor and report on the use of
resources provided by the Congress.
DOD also stated, but offered no documentation, that even if the Navy
recorded cuff record amounts in its official records, a number of the
appropriations would show a positive balance. Although DOD stated
that it would be premature, for this reason, to conduct an
Antideficiency Act investigation, it suggested a review of the
transactions in the cuff records and those in the Navy's official
records. We agree that the Navy should investigate the account
balance of any potentially overobligated appropriations, as
recommended in our report. This sort of investigation could result
in identifying (1) other disbursements recorded incorrectly against
the appropriation, (2) obligations that are no longer valid and can
be deobligated, or (3) other accounting errors that would, when
corrected, reduce recorded obligations, leaving funds available to
permit recording of these disbursement transactions without incurring
an overobligation. As we recommended, the Navy should report any
overobligations found as a result of such an investigation to the
Congress and the President pursuant to the Antideficiency Act and
implementing guidance in OMB Circular A-34.
---------------------------------------------------------- Letter :7.1
This report contains recommendations to the Under Secretary of
Defense (Comptroller) and the Assistant Secretary of the Navy
(Financial Management and Comptroller). Within 60 days of the date
of this letter, we would appreciate receiving written statements on
actions taken to address these recommendations.
We are sending copies of this letter to the Chairmen and Ranking
Minority Members of the Senate Committee on Armed Services, the House
Committee on National Security, the Senate Committee on Governmental
Affairs, the House Committee on Government Reform and Oversight, the
House and Senate Committees on Appropriations and the Director of the
Office of Management of Budget. We are also sending copies to the
Secretary of Defense and the Secretary of the Navy. Copies will also
be made available to others upon request.
Please contact me at (202) 512-9095 if you or your staffs have any
questions on this report. Major contributors to this report are
listed in appendix IV.
Lisa G. Jacobson
Director, Defense Audits
CANCELED APPROPRIATIONS FOR WHICH
THE NAVY'S ACCOUNTING SYSTEM
INDICATED POTENTIAL
OVEROBLIGATIONS AS OF
SEPTEMBER 30, 1997
=========================================================== Appendix I
(Dollars in thousands)
Potential\
a
Account Fiscal overobliga
Appropriation account number year tion
-------------------------------------- -------- -------- ----------
Appropriations affected by other
problem disbursements and in-
transits:
Aircraft Procurement, Navy 1506 1987- $10,500
1989
Weapons Procurement, Navy 1507 1987- 34,700
1989
Other Procurement, Navy 1810 1987- 57,800
1989
Other Procurement, Navy 1810 1989 100
Coastal Defense Augmentation 0380 1985- 5,600
1989
Research, Development, Test & 1319 M\b 32,700
Evaluation, Navy
======================================================================
Subtotal $141,400
Appropriations affected by in-
transits only:
Operation and Maintenance, Marine 1107 1991 $20
Corps Reserve
Operation and Maintenance, Marines 1106 1990 4,000
Military Personnel, Navy 1453 1991 20
======================================================================
Subtotal $4,040
======================================================================
Total $145,440
----------------------------------------------------------------------
Note: These appropriation accounts did not have sufficient
unobligated balances to obligate the full amount of in-transits after
recording obligations to resolve other problem disbursements.
\a These amounts relate to other problem disbursements as well as
in-transits.
\b An M account was a successor account into which unobligated
balances were transferred, or merged, from an expired account at the
end of the second full fiscal year following expiration. Under the
National Defense Authorization Act of 1991, existing M accounts were
phased out.
EXPIRED APPROPRIATIONS WHICH THE
NAVY'S CUFF RECORDS INDICATED MAY
BE OVEROBLIGATED AS OF SEPTEMBER
30, 1997
========================================================== Appendix II
(Dollars in thousands)
Potential\
a
Account Fiscal overobliga
Appropriation account number year tion
-------------------------------------- -------- -------- ----------
Appropriations affected by other
problem disbursements and in-
transits:
Reserve Personnel, Navy 1405 1997 $150
Operation and Maintenance, Marine 1107 1993 197
Corps Reserve
Operation and Maintenance, Marine 1107 1996 3
Corps Reserve
Procurement of Ammunition, Navy and 1508 1995- 4
Marine Corps 1997
Shipbuilding & Conversion, Navy 1611 X\b 176
Shipbuilding & Conversion, Navy 1611 1995- 5
1996
Other Procurement, Navy 1810 1994- 14,480
1996
Research, Development, Test, and 1319 1995- 258
Evaluation, Navy 1996
======================================================================
Subtotal $15,273
Appropriations affected by in-
transits only:
Reserve Personnel, Marine Corps 1108 1995 $3
Operation and Maintenance, Navy 1804 1994 38,161
Operation and Maintenance, Navy 1804 1995 17,064
Operation and Maintenance, Navy 1804 1996 50,729
Operation and Maintenance, Marine 1106 1997 55
Corps
Operation and Maintenance, Marine 1107 1994 70
Corps Reserve
Aircraft Procurement, Navy 1506 1995- 2,567
1997
Shipbuilding and Conversion, Navy 1611 1986- 1,495
1990
Other Procurement, Navy 1810 1993- 6,025
1995
Procurement, Marine Corps 1109 1992- 10,054
1994
Research, Development, Test, and 1319 1996- 2,564
Evaluation, Navy 1997
Military Construction, Naval Reserve 1235 1995- 144
1999
======================================================================
Subtotal $128,931
======================================================================
Total $144,204
----------------------------------------------------------------------
\a Includes amounts for in-transits only.
\b The "X" denotes a no-year appropriation, for which funds are
available until expended without regard to fiscal year. The Navy
included this appropriation in its cuff records of expired
appropriations.
(See figure in printed edition.)Appendix III
COMMENTS FROM THE DEPARTMENT OF
DEFENSE
========================================================== Appendix II
(See figure in printed edition.)
(See figure in printed edition.)
(See figure in printed edition.)
The following are GAO's comments on the Department of Defense's
letter dated November 24, 1998.
GAO COMMENTS
1. DOD's problems resulting from its outdated finance and accounting
systems are long-standing. However, DOD's inability to match
disbursement transactions to obligations at the time a payment is
made is not a temporary situation as DOD's comments have indicated.
As discussed in our report, some of the unmatched transactions
represented by the Navy's cuff records are at least 8 years old.
2. We recognize that DOD has made progress in addressing problem
disbursements. However, as stated in our May 1997 report,\1 DOD
cannot ensure accurate and consistent reporting. For example, our
testing of problem disbursement amounts reported by DOD as of May 31,
1996, showed that the $18 billion reported by DOD was understated by
at least $25 billion. We reported that DOD significantly understates
the magnitude of its problem disbursements by (1) netting positive
and negative amounts that result from disbursements, collections,
reimbursements, or adjustments and (2) excluding certain
transactions. DOD continues to understate the magnitude of its
problem disbursements by reporting net amounts. For example, DOD's
April 1998 testimony on financial management,\2 indicated that as of
January 31, 1998, DOD's problem disbursements totaled $14.3 billion,
including in-transits, when, in fact, the absolute value of DOD's
problem disbursements would have totaled $22.6 billion, if positive
and negative amounts had not been used to offset one another.
3. DOD stated that it requires its component agencies to research
and resolve problem disbursements and to record obligations for those
disbursements that are not matched to a corresponding obligation
within specified time frames. A fundamental premise of funds control
accounting is that an agency records its obligations at the time
incurred and disburses funds based on an obligation to pay. The
5-year time frame allowed by DOD's policy for recording obligations
to resolve problem in-transit disbursements undermines fund control
accounting.
DOD stated that its policy requires review and confirmation of the
accuracy, completeness, and timeliness of commitment and obligation
transactions at least three times a year. According to DOD
officials, DOD's requirement for a triannual review of obligations
was implemented about 3 years ago. These reviews do not
retroactively cover prior obligations, and they do not cover the
obligations recorded in the Navy's cuff records. Regardless, the
Navy's failure to record all known obligations impairs the
effectiveness of DOD's triannual review of obligations as a funds
control mechanism.
4. The statements and recommendations in our report are consistent
with our past position on potential Antideficiency Act violations.
When our audits have identified potential overobligations or
overexpenditures, we have recommended that DOD investigate the
transactions and report any resulting overobligations and/or
overexpenditures to the President and the Congress pursuant to the
act.\3
5. We appropriately consider the obligations in the Navy's cuff
records to be affirmative evidence of potential overobligations. The
particular Navy cuff records that we discuss in this report represent
the Department of the Navy's determination, after an extensive,
multiyear research effort, of the obligations that need to be
recorded in the Navy's accounting system to match in-transit
disbursement transactions that have already occurred. As discussed
in this report, DOD and Navy officials told us that all research to
identify existing obligations for the transactions represented by the
cuff records has been performed. The only reason that these
obligations have not been recorded in the Navy's accounting system is
that DOD policy permits the Navy to delay such recording for almost 5
years if recording the amounts in official records would indicate
potential overobligations that would need to be investigated pursuant
to OMB's funds control guidance and the Antideficiency Act.
Although DOD and the Navy now assert that the cuff records are
unreliable, both have used the cuff records as evidence of possible
overobligations. As discussed in our report, the Navy and the DOD
Comptroller accepted the Navy's cuff records as evidence of
overobligations in 29 Navy appropriations if the Navy were to record
such obligations as required by DOD's previous problem disbursement
policy. As a result, the DOD Comptroller revised this policy to
extend the time frame for recording such obligations for nearly 5
years. Moreover, pursuant to the revised policy, Navy officials used
these same records as sufficient evidence of the amount of
obligations they needed to record in the Navy's official records for
the nine canceled appropriation accounts listed in appendix I of this
report.
6. DOD stated, but offered no documentary support, that even if the
Navy recorded cuff record amounts in its official records, a number
of the appropriations would show a positive balance. Although DOD
asserted that it would be premature, for this reason, to conduct an
Antideficiency Act investigation, it suggested a review of the
transactions in the cuff records and those in the Navy's official
records. We agree, and recommended in our report, that the Navy
should undertake an investigation to accurately establish the
balances in the 29 appropriations discussed in our report. As
explained in our report, this sort of investigation could result in
identifying (1) other disbursements recorded incorrectly against the
appropriation, (2) obligations that are no longer valid and can be
deobligated, or (3) other accounting errors that would, when
corrected, reduce recorded obligations, leaving funds available to
permit recording of these disbursement transactions without incurring
an overobligation. As we recommended, the Navy should report any
overobligations found as a result of such an investigation to the
Congress and the President pursuant to the Antideficiency Act and
implementing guidance in OMB Circular A-34.
7. We disagree with DOD's position that it has implemented
procedures intended to ensure adequate funds controls and compliance
with the Antideficiency Act. Current policies and procedures permit
the Navy to delay for about 5 years (1) the recording of obligations
needed to support payments already made, (2) avoid the initiation of
Antideficiency Act investigations of any potential violations, and
(3) any resulting reports of violations to the Congress and the
President. During this time, the Navy's appropriation balances are
unreliable, leaving DOD and the Congress without assurance that the
Navy has not incurred obligations in excess of available budget
authority. Based on the findings in our report, we have recommended
that DOD revise its problem disbursement policies and procedures to
ensure that the Navy's funds control system maintains, on an ongoing
and current basis, accurate and reliable unobligated and unexpended
balances in expired and canceled accounts.
8. See comments 5 and 6.
--------------------
\1 Financial Management: Improved Reporting Needed for DOD Problem
Disbursements (GAO/AIMD-97-59, May 1, 1997).
\2 Statement of Nelson Toye, Deputy Chief Financial Officer, Before
the Committee on Government Reform and Oversight, Subcommittee on
Government Management, Information and Technology, April 16, 1998.
\3 TOPAZ II Space Nuclear Power Program: Management, Funding, and
Contracting Problems (GAO/OSI-98-3R, December 1, 1997), Air Force
Appropriations: Funding Practices at the Ballistic Missile
Organization (GAO/NSIAD-93-47, July 16, 1993), and Financial
Management: Agencies' Actions to Eliminate "M" Accounts and Merged
Surplus Authority (GAO/AFMD-93-7, April 2, 1993).
MAJOR CONTRIBUTORS TO THIS REPORT
========================================================== Appendix IV
ACCOUNTING AND INFORMATION
MANAGEMENT DIVISION, WASHINGTON,
D.C.
Gayle Fischer, Assistant Director
Miguel Castillo, Senior Accountant
Francine DelVecchio, Communications Analyst
CHICAGO FIELD OFFICE
Keith McDaniel, Project Manager
Jean Lee, Accountant
OFFICE OF THE GENERAL COUNSEL
Thomas Armstrong, Assistant General Counsel
Andrea Levine, Senior Attorney
RELATED GAO PRODUCTS
============================================================ Chapter 0
Department of Defense: Financial Audits Highlight Continuing
Challenges to Correct Serious Financial Management Problems
(GAO/T-AIMD/NSIAD-98-158, April 16, 1998).
Correspondence to the Honorable Charles E. Grassley, United States
Senate, on "Fast Pay" Provision of DOD Reform Act (B-279620, March
31, 1998).
CFO Act Financial Audits: Programmatic and Budgetary Implications of
Navy Financial Data Deficiencies (GAO/AIMD-98-56, March 16, 1998).
DOD Procurement: Funds Returned by Defense Contractors
(GAO/NSIAD-98-46R, October 28, 1997).
Financial Management: DOD Progress Payment Distribution Procedures
(GAO/AIMD-97-107R, July 21, 1997).
DOD High-Risk Areas: Eliminating Underlying Causes Will Avoid
Billions of Dollars in Waste (GAO/T-NSIAD/AIMD-97-143, May 1, 1997).
Financial Management: The Prompt Payment Act and DOD Problem
Disbursements (GAO/AIMD-97-71, May 23, 1997).
Financial Management: Improved Reporting Needed for DOD Problem
Disbursements (GAO/AIMD-97-59, May 1, 1997).
Contract Management: Fixing DOD's Payment Problems Is Imperative
(GAO/NSIAD-97-37, April 10, 1997).
DOD Problem Disbursements: Contract Modifications Not Properly
Recorded in Payment System (GAO/AIMD-97-69R, April 3, 1997).
Financial Management: Improved Management Needed for DOD
Disbursement Process Reforms (GAO/AIMD-97-45, March 31, 1997).
DOD Problem Disbursement Reporting Excludes In-Transits
(GAO/AIMD-97-36R, February 20, 1997.)
High-Risk Series: Defense Financial Management (GAO/HR-97-3,
February 1997).
CFO Act Financial Audits: Increased Attention Must Be Given to
Preparing Navy's Financial Reports (GAO/AIMD-96-7, March 27, 1996).
Financial Management: Challenges Facing DOD in Meeting the Goals of
the Chief Financial Officers Act (GAO/T-AIMD-96-1, November 14,
1995).
Financial Management: Status of Defense Efforts to Correct
Disbursement Problems (GAO/AIMD-95-7, October 5, 1994).
Financial Management: Financial Control and System Weaknesses
Continue to Waste DOD Resources and Undermine Operations
(GAO/T-AIMD/NSIAD-94-154, April 12, 1994).
DOD Procurement: Millions in Overpayments Returned by DOD
Contractors (GAO/NSIAD-94-106, March 14, 1994).
Financial Management: DOD Has Not Responded Effectively to Serious,
Long-standing Problems (GAO/T-AIMD-93-1, July 1, 1993).
Financial Management: Navy Records Contain Billions of Dollars in
Unmatched Disbursements (GAO/AFMD-93-21, June 9, 1993).
*** End of document. ***