The Government Faces Serious Internal Control and Accounting Systems Problems

GAO discussed the government's efforts to improve its internal control and accounting systems under the Federal Managers' Financial Integrity Act. GAO found that, after 3 years of effort under the act: (1) agencies have progressed in identifying and reporting internal control and accounting system weaknesses and their plans for corrective actions; and (2) initial agency reports, inspectors general audits, and GAO reviews showed that weaknesses and breakdowns in agency systems of internal control frequently resulted in wasteful spending, poor management, and losses totalling billions of dollars. To correct those problems, GAO believes that: (1) managers must use the act to improve control over government operations; (2) strong central leadership and coordination of the financial management responsibilities presently split among the Office of Management and Budget, the Office of Personnel Management, and the Department of the Treasury are needed to effectively resolve many of the government's cross-cutting financial management problems; (3) there is a need for a sustained resource commitment to correct these problems; and (4) Congress must ensure that the executive branch effectively implements long-needed systems improvements.