**GAO-11-835T**                      Published: Jul 27, 2011. Publicly Released: Jul 27, 2011.                  

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## Highlights

As one of the largest and most complex organizations in the world, the Department of Defense (DOD) faces many challenges in resolving serious problems in its financial management and related business operations and systems. DOD is required by various statutes to (1) improve its financial management processes, controls, and systems to ensure that complete, reliable, consistent, and timely information is prepared and responsive to the financial information needs of agency management and oversight bodies, and (2) produce audited financial statements. Over the years, DOD has initiated numerous efforts to improve the department's financial management operations and achieve an unqualified (clean) opinion on the reliability of its reported financial information. These efforts have fallen short of sustained improvement in financial management or financial statement auditability. The Subcommittee has asked GAO to provide its perspective on the status of DOD's financial management weaknesses and its efforts to resolve them; the challenges DOD continues to face in improving its financial management and operations; and the status of its efforts to implement automated business systems as a critical element of DOD's Financial Improvement and Audit Readiness strategy.

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## Topics

Auditing and Financial Management

AccountabilityAudit oversightBudget functionsBudget obligationsData integrityDefense cost controlDefense economic analysisEnterprise architectureFinancial managementFinancial management systemsFinancial statement auditsFund auditsGeneral management reviewsInformation managementInternal controlsLossesPerformance measuresStrategic planningSystems evaluationSystems managementBusiness operationsFinancial reporting