GAO: Uncle Sam’s financial statements are a mess
The Government Accountability Office (GAO) recently released its annual audit of the federal government’s financial statements. The verdict? Pretty much as you would expect:
…much work remains to improve federal financial management and…the federal government continues to face an unsustainable long-term fiscal path.
More specifically, the GAO found:
Certain material weaknesses in internal control over financial reporting and other limitations resulted in conditions that prevented GAO from expressing an opinion on the accrual-based consolidated financial statements as of and for the fiscal years ended September 30, 2021, and 2020.
Significant uncertainties, primarily related to the achievement of projected reductions in Medicare cost growth, prevented GAO from expressing an opinion on the sustainability financial statements, which consist of the 2021 and 2020 Statements of Long-Term Fiscal Projections; the 2021, 2020, 2019, 2018, and 2017 Statements of Social Insurance; and the 2021 and 2020 Statements of Changes in Social Insurance Amounts. A material weakness in internal control also prevented GAO from expressing an opinion on the 2021 and 2020 Statements of Long-Term Fiscal Projections.
Material weaknesses resulted in ineffective internal control over financial reporting for fiscal year 2021.
Material weaknesses and other scope limitations, discussed above, limited tests of compliance with selected provisions of applicable laws, regulations, contracts, and grant agreements for fiscal year 2021.
In other words, Uncle Sam’s finances are a mess, and they are on track to get much, much worse.