United States Government Accountability Office

Washington, DC 20548 

September 15, 2008 

Congressional Committees 

Subject: Global War on Terrorism: Reported Obligations for the Department of Defense

Since 2001, Congress has provided the Department of Defense (DOD) with about $807 

billion in supplemental and annual appropriations, as of September 2008, primarily for 

military operations in support of the Global War on Terrorism (GWOT).1

 DOD’s reported 

annual obligations2

 for GWOT have shown a steady increase from about $0.2 billion in fiscal 

year 2001 to about $139.8 billion in fiscal year 2007. The United States’ commitments to 

GWOT will likely involve the continued investment of significant resources, requiring 

decision makers to consider difficult trade-offs as the nation faces an increasing long-range 

fiscal challenge. The magnitude of future costs will depend on several direct and indirect 

cost variables and, in some cases, decisions that have not yet been made. DOD’s future costs 

will likely be affected by the pace and duration of operations, the types of facilities needed 

to support troops overseas, redeployment plans, and the amount of equipment to be 

repaired or replaced.3

 

DOD compiles and reports monthly and cumulative incremental obligations incurred to 

support GWOT in a monthly Supplemental and Cost of War Execution Report. DOD 

leadership uses this report, along with other information, to advise Congress on the costs of 

the war and to formulate future GWOT budget requests. DOD reports these obligations by 

appropriation, contingency operation,4

 and military service or defense agency. The monthly 

cost reports are typically compiled within the 45 days after the end of the reporting month in 

 1

After the terrorist attacks of September 11, 2001, the President announced a Global War on Terrorism, 

requiring the collective instruments of the entire federal government to counter the threat of terrorism. 

Ongoing military and diplomatic operations overseas, especially in Iraq and Afghanistan, constitute a key part 

of GWOT. These operations involve a wide variety of activities, such as combating insurgents, training the

military forces of other nations, and conducting small-scale reconstruction and humanitarian relief projects. 2

According to Department of Defense, Financial Management Regulation, 7000.14-R, vol. 1, ”Definitions” 

(Dec. 2001), xvii, obligations are incurred through actions such as orders placed, contracts awarded, services 

received, or similar transactions made by federal agencies during a given period that will require payments 

during the same or a future period. 3

For more information see GAO, Securing, Stabilizing, and Rebuilding Iraq: Key Issues for Congressional 

Oversight, GAO-07-308SP (Washington, D.C.: Jan. 9, 2007); and Global War on Terrorism: Observations on

Funding, Costs, and Future Commitments, GAO-06-885T (Washington, D.C.: July 18, 2006). 4

DOD defines contingency operations to include small, medium, and large-scale campaign-level military 

operations, including support for peace-keeping operations, major humanitarian assistance efforts,

noncombatant evacuation operations, and international disaster relief efforts. 

GAO-08-1128R Global War on Terrorism
 GAO-08-1128R Global War on Terrorism Page 2 

 

which the obligations are incurred.5 DOD has prepared monthly reports on the obligations 

incurred for its involvement in GWOT since fiscal year 2001. 

Section 1221 of the National Defense Authorization Act for Fiscal Year 20066

 requires us to 

submit quarterly updates to Congress on the costs of Operation Iraqi Freedom and 

Operation Enduring Freedom based on DOD’s monthly Supplemental and Cost of War 

Execution Reports. This report, which responds to this requirement, contains our analysis of 

DOD’s reported obligations for military operations in support of GWOT through June 2008. 

Specifically, we assessed (1) DOD’s cumulative appropriations and reported obligations for 

military operations in support of GWOT and (2) DOD’s fiscal year 2008 reported obligations 

from October 2007 through June 2008, the latest data available for GWOT by military service 

and appropriation account. 

Over the years, we have conducted a series of reviews examining funding and reported 

obligations for military operations in support of GWOT. Our prior work7

 has found the data 

in DOD’s monthly Supplemental and Cost of War Execution Report to be of questionable 

reliability. Consequently, we are unable to ensure that DOD’s reported obligations for GWOT 

are complete, reliable, and accurate, and they therefore should be considered 

approximations. Based on this work, we have made a number of recommendations to the 

Secretary of Defense intended to improve the transparency and reliability of DOD’s GWOT 

obligations. For example we have recommended that DOD (1) revise the cost reporting 

guidance so that large amounts of reported obligations are not shown in “other” 

miscellaneous categories and (2) take steps to ensure that reported GWOT obligations are 

reliable. In response, DOD is taking steps to improve GWOT cost reporting. For example, 

DOD has modified its guidance to more clearly define some of the cost categories and is 

taking additional steps to strengthen the oversight and program management of the cost 

reporting. Specifically, DOD has taken steps to improve transparency by requiring 

components to analyze variances in reported obligations and to disclose reasons for 

significant changes, and to affirm that monthly reported GWOT obligations provide a fair 

representation of ongoing activities. Furthermore, in February 2007, DOD established a 

Senior Steering Group including representatives from DOD, the Defense Finance and 

Accounting Service (DFAS), and the military services in an effort to standardize and 

improve the GWOT cost-reporting process and to increase management attention to the 

process. DOD established a GWOT Cost-of-War Project Management Office to monitor work 

performed by auditing agencies and to report possible solutions and improvements to the 

Senior Steering Group. DOD has started several initiatives to improve credibility, 

transparency, and timeliness. One of the initiatives is a quarterly validation of GWOT 

obligation transactions at each of the DOD components with the goal of having a sampling 

of all types of costs validated by the end of the fiscal year. Until all DOD efforts are more 

fully implemented, it is too soon to know the extent to which these changes will improve the 

reliability of DOD’s cost reporting. 

5

Department of Defense, Financial Management Regulation, 7000.14-R, vol. 12, ch. 23. This regulation 

generally establishes financial policy and procedures related to DOD contingency operations. Volume 6A, 

chapter 2, and volume 3, chapter 8, of the DOD Financial Management Regulation also include provisions to 

ensure the accuracy of cost reporting. 

6

Pub. L. No. 109-163, § 1221(c) (2006). 

7

For more information see GAO, Global War on Terrorism: DOD Needs to Improve the Reliability of Cost 

Data and Provide Additional Guidance to Control Costs, GAO-05-882 (Washington, D.C.: Sept. 21, 2005); and 

Global War on Terrorism: DOD Needs to Take Action to Encourage Fiscal Discipline and Optimize the Use 

of Tools Intended to Improve GWOT Cost Reporting, GAO-08-68 (Washington, D.C.: Nov. 6, 2007). 
 GAO-08-1128R Global War on Terrorism Page 3 

 

While establishing sound cost reporting procedures and oversight is clearly important, the 

reliability of the cost-of-war reports also depends on the quality of DOD’s accounting data. 

Factors contributing to DOD’s challenges in reporting reliable cost data include longstanding deficiencies in DOD’s financial management systems. We are aware that DOD has 

efforts under way to improve these systems as well. 

We have also made recommendations to improve transparency and fiscal responsibility 

related to funding the war on terrorism and to permit the Congress and the administration to 

establish priorities and make trade-offs among those priorities in defense funding. 

Specifically, we recommended that DOD (1) issue guidance defining what constitutes the 

“longer war against terror,” identify what costs are related to that longer war, and build 

these costs into the base defense budget; (2) identify incremental costs of the ongoing 

GWOT operations that can be moved into the base budget; and (3) in consultation with the 

Office of Management and Budget, consider limiting emergency funding requests to truly 

unforeseen or sudden events.8

 We will continue to review DOD’s efforts to implement these 

recommendations as part of our follow-up work on GWOT. 

Scope and Methodology 

To conduct our work, we analyzed applicable annual and supplemental appropriations from 

fiscal year 2001 through fiscal year 2007 and for fiscal year 2008 through June 2008, the 

latest GWOT appropriations provided, as well as DOD’s appropriation allocation documents. 

We also analyzed DOD’s monthly Supplemental and Cost of War Execution Reports from 

September 2001 through June 2008, the latest data available. Specifically, we identified 

appropriated amounts primarily intended for GWOT and reported GWOT obligations for 

each operation, military service, and appropriation account. 

We are continuing to review DOD’s fiscal year 2008 funding and reported obligations, 

including the reliability of the reported obligations. We are also reviewing the processes, 

including models and other tools, used to estimate GWOT funding requirements. We plan to 

report on this work in September 2008. 

We conducted this performance audit from August 2008 to September 2008 in accordance 

with generally accepted government auditing standards. Those standards require that we 

plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable 

basis for our findings and conclusions based on our audit objectives. We believe that the 

evidence obtained provides a reasonable basis for our findings and conclusions based on 

our audit objectives. 

Summary 

As of September 2008, Congress has appropriated a total of about $807 billion primarily for 

GWOT operations since 2001. Of that amount, about $187 billion has been provided for fiscal 

year 2008 and about $65.9 billion has been appropriated for use in fiscal year 2009. DOD will 

likely request additional funds for fiscal year 2009. DOD has reported obligations of about 

$594.9 billion for military operations in support of the war from fiscal year 2001 through 

8

GAO-08-68. 
 GAO-08-1128R Global War on Terrorism Page 4 

 

fiscal year 2007 and fiscal year 2008 (October 2007 through June 2008). The $212.1 billion 

difference9

 between DOD’s appropriations and reported obligations can generally be 

attributed to certain fiscal year 2008 appropriations; multiyear funding for procurement, 

military construction, and research, development, test, and evaluation from previous GWOTrelated appropriations10 that have yet to be obligated; and obligations for classified and other 

items, which DOD considers to be non-GWOT related, that are not reported in DOD’s costof-war reports.11 This difference also includes the $65.9 billion appropriated for fiscal year 

2009. As part of our ongoing work, we are reviewing DOD’s rationale for reporting its GWOT 

related obligations. 

Figure 1 shows the increase in DOD’s cumulative reported GWOT obligations and 

cumulative GWOT appropriations from fiscal year 2001 through fiscal year 2007 and for 

fiscal year 2008 (October 2007 through June 2008). The appropriations amount does not 

include the fiscal year 2009 appropriation of $65.9 billion. 

9

We calculated this difference by comparing available data on appropriations and reported obligations. 10Appropriations for military personnel and operation and maintenance are usually available for 1 year, while 

appropriations for research, development, test and evaluation are usually available for 2 years; procurement 

funds (with the exception of ship-building funds, which are sometimes available longer) are usually available 

for 3 years; and military construction funds are usually available for 5 years. 11 We have not reviewed DOD’s determination of what appropriations should be considered non-GWOT. 
Figure 1: DOD’s Cumulative Reported GWOT Obligations and Cumulative GWOT

Appropriations for Fiscal Years 2001 through 2007 and for Fiscal Year 2008 through 

June 2008 

0

100

200

300

400

500

600

700

800

2008

Oct.-Dec.

2001 2002 2003 2004 2005 2006 2007

Dollars (in billions)

$594.9

$492.2

$352.5

$254

$169.2

$98 $29.4

$741

$554

$385

$269

$166

$100

$31

$0.2

$17

Cumulative GWOT appropriations

Cumulative reported GWOT obligations

Fiscal year

Source: GAO analysis of DOD and appropriations data.

Notes: Appropriations amounts reflect totals provided in supplemental and annual appropriations legislation. Reported GWOT obligations

include Operation Noble Eagle, Operation Enduring Freedom, and Operation Iraqi Freedom, and generally reflect costs reported in

DOD’s cost-of-war reports. However, the fiscal year 2002 and 2003 figures include about $20.1 billion that according to DOD officials was

war related but not reported in DOD’s cost-of-war reports. GAO has assessed the reliability of DOD’s obligation data and found significant 

problems, such that these data may not accurately reflect the true dollar value of GWOT obligations. 

Of DOD’s total cumulative reported obligations for GWOT through June 2008 (about $594.9

billion), about $462.1 billion is for operations in and around Iraq as part of Operation Iraqi 

Freedom, and about $104.8 billion is for operations in Afghanistan, the Horn of Africa, the 

Philippines, and elsewhere as part of Operation Enduring Freedom. The remaining about 

$28 billion is for operations in defense of the homeland as part of Operation Noble Eagle. 

As figure 2 shows, DOD’s reported obligations for Operation Iraqi Freedom have 

consistently increased each fiscal year since operations began. The increases in reported 

obligations for Operation Iraqi Freedom are in part due to continued costs for military 

personnel, such as military pay and allowances for mobilized reservists, and for rising 

operation and maintenance expenses, such as higher contract costs for housing, food, and 

services and higher fuel costs. In addition, the need to repair and replace equipment because 

of the harsh combat and environmental conditions in theater and the ongoing costs 

associated with the surge strategy announced in January 2007, which provided for the 

deployment of additional troops, have further increased obligations for Operation Iraqi 

Freedom. In contrast, DOD’s reported obligations for Operation Noble Eagle have 

consistently decreased since fiscal year 2003, largely because of the completion of repairs to 

the Pentagon and upgrades in security at military installations that were onetime costs, as

well as a reduction in combat air patrols and in the number of reserve personnel guarding 

government installations. Reported obligations for Operation Enduring Freedom have 

ranged from $10.3 billion to $20.1 billion each fiscal year since 2003. Recent increases in

 Page 5 GAO-08-1128R Global War on Terrorism
reported obligations for Operation Enduring Freedom are in part caused by higher troop 

levels in Afghanistan, the costs associated with training Afghan security forces, and the need 

to repair and replace equipment after several years of ongoing operations. 

Figure 2: DOD’s Reported GWOT Obligations for Fiscal Years 2001 through 2007 by 

Operation 

0

20

40

60

80

100

120

140

Operation Iraqi Freedom

Operation Enduring Freedom

Operation Noble Eagle

2007

$139.8

2006

$98.4

2005

$84.8

2004

$71.3

2003

$68.6

2002

$29.1

2001

$0.2

Dollars (in billions)

Reported GWOT obligations per fiscal year

$27.9

$86.2

$378.1

Source: GAO analysis of DOD data.

Notes: Operation Iraqi Freedom began in fiscal year 2003; therefore no obligations were reported in fiscal years 2001 and 2002 for this

operation. Reported GWOT obligations generally reflect costs reported in DOD’s cost-of-war reports. However, the fiscal year 2002 and

2003 figures include about $20.1 billion that according to DOD officials was war-related but not reported in DOD’s cost-of-war reports. 

GAO has assessed the reliability of DOD’s obligation data and found significant problems, such that these data may not accurately reflect 

the true dollar value of GWOT obligations. 

In fiscal year 2008, through June 2008, DOD’s total reported obligations of about $102.7 

billion are about three-fourths of the total amount of obligations DOD reported for all of

fiscal year 2007. Reported obligations for Operation Iraqi Freedom continue to account for 

the largest portion of total reported GWOT obligations by operation—about $84 billion. In

contrast, reported obligations associated with Operation Enduring Freedom total about 

$18.6 billion, and reported obligations associated with Operation Noble Eagle total about 

$106.7 million. 

The Army accounts for the largest portion of reported obligations for fiscal year 2008 

through June 2008—about $74.7 billion, eight times higher than the almost $9.1 billion in 

obligations reported for the Air Force, the military service with the next greatest reported 

amount. Among appropriation accounts, operation and maintenance, which includes items 

such as support for housing, food, and services; the repair of equipment; and transportation 

to move people, supplies, and equipment, accounts for the largest reported obligations—

about $55.6 billion. Reported obligations for procurement account for about 22 percent of 

reported obligations or about $22.1 billion. Of the $43.6 billion provided to DOD for 

 Page 6 GAO-08-1128R Global War on Terrorism
procurement in fiscal year 2007, approximately 12 percent, or $5.4 billion, has yet to be 

obligated and remains available in fiscal year 2008. 

Figure 3 shows DOD’s reported obligations for fiscal year 2008 through June 2008 by DOD 

component and appropriation account. 

Figure 3: DOD’s Reported GWOT Obligations for Fiscal Year 2008 through June 

2008, by DOD Component and Appropriation Account 

72.7%

9.5%

13.4%

54.1%

8.9%

7.3%

4.3%

Army $74.7

Other DOD

components $4.4

Navy $7.4

Air Force $9.1

Marine Corps $7.0 6.9%

21.5%

Other $9.7

Procurement $22.1

Operation and maintenance

$55.6

Military personnel $13.7

0.3%

Working Capital Fund $0.3

0.7%

Military construction $0.7

0.6%

Research, development,

test, and evaluation $0.6

By DOD component (dollars in billions) By appropriation account (dollars in billions)

Source: GAO analysis of DOD data.

Total $102.7 billion

Notes: Obligation figures may not add to $102.7 billion because of rounding. The “Other” portion of the appropriation account pie chart 

includes programs designed to reimburse coalition countries for logistical and military support, to train and equip the Afghan National 

Army and Armed Forces of Iraq, and to execute the Commanders Emergency Response Program. GAO has assessed the reliability of 

DOD’s obligation data and found significant problems, such that these data may not accurately reflect the true dollar value of GWOT 

obligations. 

Agency Comments and Our Evaluation 

In written comments on a draft of this report, DOD agreed with our point that the difference 

between the GWOT appropriated and obligated amounts is partly due to certain GWOT 

appropriated amounts that will not result in obligations in a cost-of-war report. DOD further 

commented on our prior recommendation that the incremental costs of ongoing operations 

for the war on terrorism be built into the base defense budget. It stated that DOD cannot 

make this decision without the approval of the Office of Management and Budget and we 

should direct our recommendation to that Office. We continue to believe that DOD could 

identify additional incremental GWOT needs that could be moved into the base budget and 

that doing so would assist the Congress and the department in evaluating priorities and that 

doing so would assist the Congress and the department in evaluating priorities and making 

tradeoffs among all funding needs. Furthermore, our recommendation specifically stated 

 Page 7 GAO-08-1128R Global War on Terrorism
that DOD consult with the Office of Management and Budget on these matters. DOD’s 

comments are included in enclosure I in this report. 

- - - - - 

We are sending copies of this report to interested congressional committees; the Secretary 

of Defense; the Under Secretary of Defense (Comptroller); and the Director, Office of 

Management and Budget. We will also make copies available to others upon request. In 

addition, this report will be available at no charge on the GAO Web site at 

http://www.gao.gov. 

If you or your staff have any questions about this report, please contact me at (202) 512-9619 

or pickups@gao.gov. Contact points for our Offices of Congressional Relations and Public 

Affairs may be found on the last page of this report. Key contributors to this report are listed 

in enclosure II. 

Sharon L. Pickup 

Director, Defense Capabilities and Management 

Enclosures - 2 

 

 Page 8 GAO-08-1128R Global War on Terrorism
 GAO-08-1128R Global War on Terrorism Page 9 

List of Committees 

The Honorable Carl Levin 

Chairman 

The Honorable John McCain 

Ranking Member 

Committee on Armed Services 

United States Senate 

The Honorable Daniel K. Inouye 

Chairman 

The Honorable Thad Cochran 

Ranking Member 

Subcommittee on Defense 

Committee on Appropriations 

United States Senate 

The Honorable Ike Skelton 

Chairman 

The Honorable Duncan L. Hunter 

Ranking Member 

Committee on Armed Services 

House of Representatives 

The Honorable John P. Murtha 

Chairman 

The Honorable C. W. Bill Young 

Ranking Member 

Subcommittee on Defense 

Committee on Appropriations 

House of Representatives
 

 

Enclosure I 

Comments from the Department of Defense 

Page 10 GAO-08-1128R Global War on Terrorism
 

 

Enclosure II 

GAO Contact and Staff Acknowledgments 

GAO Contact Sharon Pickup, (202) 512-9619 or pickups@gao.gov 

Acknowledgments In addition to the contact named above, Ann Borseth, Assistant 

Director; Richard Geiger; Linda Keefer; Ron La Due Lake; Lonnie 

McAllister; Eric Petersen; and Angela Watson made key 

contributions to this report. 

(351259)

Page 11 GAO-08-1128R Global War on Terrorism
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