Financial Management

Beginning in fiscal year 1996, the Navy and other federal agencies must produce auditable financial statements. In addition, accurate financial data are needed for measuring performance under the Government Performance and Results Act. In the Navy, comptrollers are critical to ensuring that the Department achieves its financial management objectives and meets the requirements of recent financial reform legislation. Yet GAO found that the Navy's personnel practices do not provide a career path for Navy officers to develop and maintain the core competencies needed by a comptroller. By contrast, the Air Force and the Army offer a career path in comptrollership. Because of the Navy's approach, many officers in key comptroller jobs lack adequate financial management experience and accounting education. Slightly more than half of the Navy's key comptroller positions are filled by line officers whose primary experience has been in surface warfare, submarines, aviation, or operational staff jobs. About 26 percent of the line officers serving as comptrollers lacked a college degree in a business-related field. Supply corps officers, while more qualified from the standpoint of formal education, generally lacked the depth of experience needed by a comptroller in the 1990s.

GAO noted that: (1) the Navy's personnel practices do not provide a career path for Navy officers to develop and maintain the core competencies needed by a comptroller; (2) by contrast, the Air Force and the Army offer a career path in comptrollership; (3) because of the Navy's approach, many officers in key comptroller positions lack the financial management experience and the accounting education needed to meet the demands of today's financial management environment; (4) slightly more than half of the Navy's key comptroller positions are filled by line officers whose primary occupation in the Navy is in surface warfare, submarines, aviation, or operational staff positions; (5) these officers averaged 17.8 years of commissioned service in the Navy, but only 3.4 of those years had been spent in any financial management position, including their current comptroller job; (6) about 60 percent of the line officers had obtained masters degrees in business-related majors, but due to Navy personnel practices, many did not utilize their financial management education until several years after graduation and generally served in a comptroller position for only one tour in their career; (7) about 26 percent of the line officers serving as comptrollers had no college degree in any business-related field; (8) supply corps officers, while more qualified from a formal education perspective than line officers for comptroller positions, generally lacked the depth of experience needed by a comptroller for the 1990s and beyond; (9) most of the supply officers held a college degree at the bachelors or masters level in accounting or business, but few had substantial experience in Navy fiscal administration assignments involving such roles as budget officer, accountant, or comptroller; (10) they averaged 16.1 years of commissioned service in the Navy of which 3.4 years were in fiscal administration and 5.7 years were in logistics positions that involved some financial management experience; and (11) in a few cases, senior supply corps officers had as much as 10 years experience in fiscal administration.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

Director: Team: Phone: