United States Government Publishing Office publisher pbl distributor dst United States Government Accountability Office National Security and International Affairs Division author aut Government Organization text government publication eng GAOREPORTS Legislative Agency Publications gao legislative 2010-08-12 U.S. Government Printing Office 1997-02-19 monographic deposited born digital 60 p. GA 1.13:NSIAD/AIMD-97-61 https://www.govinfo.gov/app/details/GAOREPORTS-NSIAD-AIMD-97-61 P0b002ee18037ea25 f:ns97061 DGPO 2010-08-12 2011-03-28 GAOREPORTS-NSIAD-AIMD-97-61 machine generated eng fdlp REPORT GAOREPORTS-NSIAD-AIMD-97-61 NSIAD/AIMD-97-61 Accounting procedures Defense cost control Federal agency accounting systems Financial management systems Industrial funds Federal agency reorganization Defense Business Operations Fund Army Working Capital Fund Navy Working Capital Fund Air Force Working Capital Fund Defense-wide Working Capital Fund Letter Report NSIAD AIMD Pursuant to a congressional request, GAO provided information on the Department of Defense's (DOD) management of its financial operations, focusing on: (1) DOD's rationale for creating the Defense Finance and Accounting Service (DFAS); (2) the current size of the DOD finance and accounting infrastructure; and (3) the various finance and accounting activities performed by DOD personnel.<p/>GAO found that: (1) as with any major corporation in the private sector, DOD must carry out financial management functions such as recording, tracking, and reporting the value of its assets, liabilities, changes in equity or capital, and expenses; (2) this type of accounting information not only helps disclose DOD's financial position and results of operations but also provides DOD and the Congress with information to effectively allocate resources and assess department performance; (3) in addition, DOD must monitor, control, and report on the obligation and expenditure of appropriations, to ensure that DOD does not violate spending limitations established in legislation; (4) before fiscal year 1991, the military services and defense agencies independently managed their finance and accounting operations; (5) according to DOD, these decentralized operations were highly inefficient and failed to produce reliable information for decisionmakers; (6) DOD created DFAS as its accounting agency to consolidate, standardize, and integrate finance and accounting requirements, functions, procedures, operations, and systems; (7) the military services and defense agencies also kept some people at most of the 332 installation-level offices and maintained responsibility for hundreds of feeder systems that are the source of most finance and accounting information; (8) DOD is working toward streamlining its finance and accounting infrastructure; (9) most of the reductions, however, are anticipated to occur in DFAS operations as it moves toward consolidating its activities; (10) the military services continue to perform certain finance and accounting activities at each military installation; (11) these activities vary by military service depending on what the services wanted to maintain in-house and the number of personnel they were willing to transfer to DFAS; (12) significantly improving financial management operations in DOD is an enormous task, involving the replacement of many antiquated systems and processes; (13) the enormity of this task is made even more difficult by the need to continue paying millions of military and civilian employees and thousands of defense contractors as improvements are being made; and (14) as DOD's accounting agency, DFAS records these transactions in the accounting records, prepares thousands of reports used by managers throughout DOD and by the Congress, and prepares the DOD-wide and servi* https://www.govinfo.gov/content/pkg/GAOREPORTS-NSIAD-AIMD-97-61/html/GAOREPORTS-NSIAD-AIMD-97-61.htm https://www.govinfo.gov/content/pkg/GAOREPORTS-NSIAD-AIMD-97-61/pdf/GAOREPORTS-NSIAD-AIMD-97-61.pdf GAO/NSIAD/AIMD-97-61 https://www.govinfo.gov/app/details/GAOREPORTS-NSIAD-AIMD-97-61 Letter Report GAO/NSIAD/AIMD-97-61; Financial Management: An Overview of Finance and Accounting Activities in DOD; Accounting procedures Defense cost control Federal agency accounting systems Financial management systems Industrial funds Federal agency reorganization Defense Business Operations Fund Army Working Capital Fund Navy Working Capital Fund Air Force Working Capital Fund Defense-wide Working Capital Fund