1

SPRING 2001

I am pleased to present the highlights of GAO’s

performance and accountability report, which

combines our assessment of what we were able to

accomplish in fiscal year 2000 with our plans for

continued progress through fiscal year 2002.

Looking back at last year, I am proud to say that

we served the Congress and the American people

well.

Our work resulted in a number of significant improvements to government that will benefit all Americans.

Among other things, by acting on our recommendations, the government improved public health and

safety, strengthened national security, better protected

consumers, and improved its financial management

and information systems. We also contributed critical

information to public debates on Social Security and

Medicare reform and called attention to looming

problems such as the security of government computer

systems and the knowledge and skills needed in the

federal workforce in coming years. Taxpayers benefited

from the near-
2

record $23 billion in savings identified through our work—a $61 retur

dollar invested in GAO.

I am particularly pleased that we were able to achieve these results in th

significant change within GAO. After completing our first strategic pla

realigned our organization to better meet our goals and objectives, and 

institute new ways of doing business. We also gained new legislative aut

will help us address our human capital requirements and help ensure th

remains prepared to meet the Congress’s needs in the future.

These needs are formidable. The nation’s leaders are faced with a range 

controversial, and multidimensional issues that require a more strategic

and integrated perspective than in the past. Looking toward fiscal year 2

the work we plan to undertake and our efforts to become a model agen

Congress address those challenges.

As we move ahead, we look forward to the continued support of the Co

working even more closely with Members and their staffs. Their suppor

dedication and commitment of our GAO team—are the driving forces 

continued success in serving the Congress and the American people.

DAVID M. WALKER

COMPTROLLER GENERAL

OF THE UNITED STATES

2
3

As the investigative arm of the Congress, GAO ev

the economy, efficiency, and effectiveness of a wide 

of federal policies and programs. Primarily in resp

congressional requests and mandates—but also th

our own targeted research and development effort

publish thousands of reports and other documents 

year and provide a number of related services to s

legislative oversight and improve government oper

By making recommendations to improve governm

programs and services, GAO contributes to more 

federal spending. Our work also helps to raise the 

trust and confidence in the federal government.

3
4

Consistent with the spirit of the Government Performance and 

Act (GPRA) of 1993, GAO operates under a broad strategic pla

that currently covers fiscal years 2000 through 2005. To drive o

toward the goals envisioned in the strategic plan, we developed 

strategic objective plans and report our results yearly to the Con

the public. In addition, we publish an annual performance plan 

our day-to-day efforts to meet our strategic goals and objectives

in response to the Congress’s desire to have financial and perfor

management information presented in a more cohesive format, 

merged three documents into one:

our performance report for fiscal year 2000,

our accountability report for fiscal year 2000, and

our performance plan for fiscal year 2002.

The combined, full-length report, available at www.gao.gov, rep

one more step in GAO’s efforts to lead by example. These highl

present (1) our performance in fiscal year 2000, (2) a brief look 

fiscal years 2001 and 2002, (3) the strategies we will employ an

challenges we face in meeting our strategic goals, and (4) conde

financial statements and the accompanying independent audito

for fiscal year 2000.

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5

In fiscal year 2000, GAO achieved more than 

billion in financial benefits for the American 

and recorded more than 700 actions taken in 

our recommendations to improve how the fede

ment operates. We also completed a number of 

initiatives to improve the way GAO itself oper

among them, our first strategic plan for the 21

Based on input from the Congress and supplem

our own expertise and other outreach efforts, t

established four strategic goals for our agency. 

four goals is supported by a set of strategic obje

guide GAO’s work, as the diagram on the nex

shows.

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TO RESPOND TO

CHANGING

SECURITY THREATS

AND THE

CHALLENGES

OF GLOBAL

INTERDEPENDENCE

TO A MORE

RESULTS-ORIENTED

AND ACCOUNTABLE

FEDERAL

GOVERNMENT

O

G

Diffuse security threats

Military capabilities and

readiness

Advancement of U.S.

interests

Global market forces

Fiscal position of the

government

Government financing and

accountability

Governmentwide

management reforms

Economy, efficiency, and

effectiveness improvements

in federal agencies

Clien

Strate

plann

Huma

Core 

supp

Inform

servic

TO ADDRESS CURRENT AND EMERGING

CHALLENGES TO THE

WELL-BEING AND

FINANCIAL SECURITY

OF THE

AMERICAN PEOPLE

GAO exists to support the Congress in meeting its Constitutio

responsibilities and to help improve the performance and accounta

the federal government for the benefit of the American peopl

MISSION

THEMES

GOALS

Health care needs and

financing

Retirement income security

Social safety net

Education/workforce issues

Effective system of justice

Community investment

Natural resources use and

environmental protection

Physical infrastructure

OBJECTIVES

Government Performance and Accountability

SUPPORT THE

TRANSITION

M

V

PROVIDE TIMELY, QUALITY SERVICE TO THE

CONGRESS AND THE FEDERAL GOVERNMENT

Demographics Globalization Quality of Life Security 

CORE VALUES

Accountability Integrity 
qualitative performance 

expect to meet or exce

the end of fiscal year 20

The chart below shows 

our annual results since 

also provides 4-year ro

that serve to show tho

without the effects of o

unusual circumstances a

congressional priorities 

workloads.

P E R F O R M A 

Our performance for the year

exceeded all five of our annual

quantitative targets for financial

benefits, other benefits, recommendations implemented,

testimonies given, and new

recommendations made. Under a

separate management measure of

timeliness, we achieved a 96-

percent success rate for delivering our products on time but fell

short of our idealistic 100-

percent target. As for our 3-year

Charting Agencywide

7

 Annual Quantitative Performance Measures, Fiscal Years 1997-2000

1997 1998 1999 

 Type Measure Actual Actual Actual Ta

 Outcome Financial benefits (billions)

Annual $20.9 $19.7 $20.1 

4-year average $18.4 $18.4 $19.5 

Other benefits

Annual 391 537 607 

4-year average 266 354 451 

Recommendations implemented

4-year implementation rate 74% 69% 70% 

 Intermediate Testimonies

 outcome Annual 182 256 229 

4-year average 208 216 212 

Recommendations made

Annual 836 987 940 

4-year average 946 848 898 

 Annual Management Measure, Fiscal Years 1997-2000

 Management Timeliness

Annual 91% 93% 96% 

4-year average — — 88% 

 3-Year Qualitative Performance Goals, Fiscal Years 2000-2002

Qualitative measure Expect to meet Do not expect 

 or exceed to meet

 Performance goals: 94 100% 0% 

Note: The full report provides details about the data in this table.
8

$23.2 Billion in Direct Financial Benefits Were Realized. These res

exceeded our target of $22 billion and were up from the prev

results of $20.1 billion.

We achieve our financial benefits when our recommendations a

mented to make government services more efficient, to improv

budgeting and spending of tax dollars, and to strengthen the m

of federal resources. Estimated financial benefits include budge

tions, costs avoided, resources reallocated, and revenue enhance

Because it takes time for agencies to implement GAO’s recomm

and document savings, the financial benefits we report in a give

may be based on work we performed in the current or previous 
9

GAO had long advocated

increased funding specifically for

activities to prevent fraud and

abuse in the Medicare program.

In 1996, the Congress passed

the Health Insurance Portability

and Accountability 

provided the additi

As a result of these 

the Medicare prog

savings were about 

fiscal year 2000.

delays. Our analysis 

Congress reduce t

year 2000 appropr

for the F-22 by abo

million and to iden

tions that should b

the Department of 

could begin full pro

GAO identified fun

several sources in the Department of Housing and Urban

Development’s budget, including

unexpended balances no longer

needed, that could be recaptured in fiscal years 1998 and

1999. The Congress rescinded

$1.65 billion from the Section 8

housing program’s fiscal year

1998 budget authority and

rejected

$1.3 billion of HUD

1999 request for h

assistance for a tot

of $2.95 billion. Sub

GAO and HUD wo

together to revise 

analysis to show th

recaptured funds, H

sufficient funding to 

needs.

In a series of reports beginning

in the mid-1990s, GAO

questioned various aspects of

the Air Force’s F-22 aircraft

acquisition program. We

reported that the acquisition

strategy was risky and that the

program was experiencing cost

growth, manufacturing problems

with test aircraft, and testing
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788 Actions Were Taken to Improve Government Operations or Se

Our results exceeded our target of 620 actions taken and were u

the previous year’s total of 607 actions taken.

These benefits represent improved government operations and s

We measure these benefits by tabulating the number of cases in 

recommendations have prompted federal agencies or the Congr

action. The 788 actions reported for fiscal year 2000 include me

improve public safety and consumer protection, to establish mo

and efficient government operations, and to safeguard the natio

cal and information infrastructure.
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critical information systems at federal

agencies and recommended numerous

improvements, most recently at three

Treasury agencies, the Department of

Energy, the Department of Veterans

Affairs, and the Environmental Protection Agency. In September 2000, GAO

issued a governmentwide perspective

on federal information security that

The Health Care Financing Administration (HCFA) and several states—

including California, Maryland, and

Michigan—improved their oversight

and enforcement of nursing homes’

quality of care standards in response

to GAO’s recommendations highlighting weaknesses in existing processes.

Improvements included increased

funding for nursing home surveyors,

helped focus the attention of the

executive and legislative branches on

the importance of these issues,

particularly in managing for results. We

helped spur the administration to make

human capital a priority management

objective in the fiscal year 2001 budget

submission, and our framework for

human capital self-assessment is being

used at other agencies, including the

Social Security Administration, the Small

Business Administration, the National

Aeronautics and Spa

and the Environmen

Agency. The framew

throughout GAO to 

research and develo

congressionally drive

how well agencies a

human capital manag

GAO has evaluated 

more prompt invest

complaints alleging s

residents, more imm

ment actions for ho

serious problems, a 

HCFA’s regional staf

consistency in overs

funding for administ

reduce the backlog 

enforcement actions

Our work on huma

covered Inspector G

audit findings report

We concluded that 

continues to be a w

that places critical a

operations at risk of 

disruption, and inapp

sure.
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78 Percent of the Recommendations We Made 4 Years Ago Were

Implemented. Our results exceeded our target of 73 percent an

up from the previous year’s rate of 70 percent.

We measure our progress in improving the government’s accoun

operations, and services by tracking the percentage of recommen

we made 4 years ago that have since been implemented. For exa

percent of the recommendations we made in fiscal year 1996 ha

implemented by the end of fiscal year 2000. We use a 4-year int

because our historical data show that agencies often need this tim

action on our recommendations. Implemented recommendatio

the underlying causes of problems, weaknesses in internal contr

ures to comply with laws or regulations, or other matters imped

tive and efficient performance.
13

263 Testimonies Were Given Before the Congress. Our results exc

target of 230 and were up from the previous year’s total of 229 

nies.

Because one of GAO’s primary functions is to support the Cong

carrying out its decision-making and oversight responsibilities, t

ber of times our experts testify before congressional panels each y

indicator of our responsiveness and the impact, importance, and 

our work. In fiscal year 2000, GAO witnesses testified before 10

ent congressional committees and subcommittees on a broad ran

topics, including arms control, health care, Social Security, hum

nuclear waste cleanup, wildfires, aviation safety and security, inte

trade, computer security, financial management reform, and bud

issues.
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1,224 Recommendations Were Made During the Year. Our result

our target of 950 recommendations and were up from the pr

year’s total of 940.

Our investigations and analyses can lead to improved governm

mance when we make recommendations to federal agencies. W

recommend specific actions to improve the economy, efficiency

effectiveness of federal operations and aim to effect significant f

and other benefits to taxpayers. We therefore track the number 

mendations contained in the products we issue each year.

96 Percent of Our Products Were Delivered on Time. While our 

short of our idealistic target of 100-percent on-time delivery, 

ered the vast majority of our products on time.

In addition to the five performance measures already discussed

tor timeliness through a management measure. For our work to 

our congressional clients must have it on a timely basis. Therefo

compare actual product delivery dates with the dates we agreed 

our clients. We set an idealistic target of 100 percent to emphas

importance we place on being responsive to our clients. Althou

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not meet this target—and we believe it will remain a challenge b

our increasing workload and external factors beyond our control

continue to emphasize timeliness. Fully implementing our new 

and risk management strategies should help improve our on-tim

100 Percent of Our Qualitative Performance Goals Are on Track. A

end of fiscal year 2000, we expected to meet or exceed all 94 o

3-year performance goals, although progress toward some had 

slowed because we did not receive all the resources we requeste

will evaluate our success at the end of fiscal year 2002.

These 94 qualitative performance goals lay out the key efforts an

tial outcomes we hope to achieve for each of our strategic object

performance on these goals will meet expectations when we prov

information or make recommendations on the key efforts when 

collectively. Our performance will exceed expectations when we 

information or make recommendations that congressional decis

and others use toward achieving the potential outcomes. Our pe

mance goals are listed in the full-length version of this report.
16

To present a fuller picture of how we served the Congres

year 2000, the following pages provide details on each o

strategic goals. They present the goals’ strategic objective

tional examples of our fiscal year 2000 accomplishmen

some of the issues we testified on at the request of our co

sional clients.
17

American People

Strategic Objectives

The health care needs of an aging and diverse popul

A secure retirement for older Americans

The social safety net for Americans in need

An educated citizenry and a productive workforce

An effective system of justice

Investment in communities and economic developm

Responsible stewardship of natural resources and the 

A safe and efficient national physical infrastructure

Selected Accomplishments

Analyzing Social Security Reform

GAO produced a major body of work analyzing the c

the long-term financial solvency, stability, and sustaina

Social Security program, including developing and app

for evaluating reform proposals. Our criteria provide a 

consistent, and objective analytical framework that the 

program officials, and the public can use in evaluating 

reforms.

Improving Airline Competition

Our congressionally requested work on airline compet

with the Congress passing legislation that addressed cr

increased competition. Our work showed that limitati

numbers of arrivals and departures (called slot control

ability of some airlines to serve new markets. The new 

more vigorous competition by phasing out slot contro

airports, increases slots for new-entrant airlines, increa

airlines with limited access, and requires that DOT gr

slots to airlines that increase regional jet service to sma

Several of those smaller cities now receive improved se

airlines operating regional jets.

Maximizing the Uranium Enrichment Program

Acting on a GAO recommendation, the Congress req

Department of Energy to recover from commercial cu

appropriate share of the expected costs for work involv

decontamination and decommissioning of the Depart

enrichment plants. More than $731 million in additio

resulted.

Congressional

Testimonies

Issues we testified on

included:

Air traffic control

Airline competitiveness

Amtrak’s financial condition

Gun control

Health care

Homelessness

Housing programs

Intercity passenger rail

Long-term care insurance

Medicare

Nuclear waste cleanup

Nursing homes

Prescription drug benefits

Social Security

Truck safety

Welfare reform

Wildfire dangers

Worker protection
18

pgg 

Threats and the Challenges of Global Interdep

Strategic Objectives

Responding to diffuse threats to national and global se

Ensuring military capabilities and readiness

Advancing and protecting U.S. international interests

Responding to the impact of global market forces on U

and security interests

Congressonal

Testimonies

Issues we testified on

included:

AIDS crisis in Africa

Anthrax vaccine immunization

Arms control

Aviation security

Bosnia

Chemical and biological defense

Colombian drugs

Combating terrorism

Critical infrastructure

Defense acquisitions

Drug control

Export controls

I Love You virus

International child abductions

Micronesia

Military personnel

Peacekeeping operations

Trade with European Union

United Nations management

reforms

Weapons of mass destruction

World Trade Organization

Selected Accomplishments

Revamping Navy’s In-Transit Inventory

At the request of several Members of Congress, GAO e

the Navy reconciled its in-transit inventory records and 

Navy had lost accountability over $3 billion in inventor

the Navy established a task force that, for fiscal years 19

resolved errors valued at about $802 million. Had this r

not occurred, the Navy could have bought additional in

knowing that it already had the items in stock.

Stabilizing the Balkans

Despite the presence of two large NATO-led forces, the 

remain volatile. GAO’s work has shown that the interna

operations in Bosnia and Kosovo face severe obstacles to 

enduring peace and stability. Most local leaders and me

respective ethnic groups have not embraced the politica

reconciliation needed to build multiethnic, democratic 

work has also shown that the international community 

provided the resources that the United Nations mission 

says it needs. If progress is not made in these matters, vi

escalate or armed conflict may result.

Evaluating Trade Agreements

GAO identified procedural and structural problems in 

government’s monitoring and enforcement of its trade a

We found inconsistencies and weaknesses in trade archi

that prevented the government from determining the n

agreements it is party to. We also identified human capi

capacity weaknesses that limited key agencies’ trade mo

enforcement abilities. In response, the key agencies imp

accuracy and utility of their trade archives and are enha

to achieve compliance with trade agreement provisions, 

coordination and teamwork in monitoring and enforcem

across the government, and to update mechanisms for o

private sector input on trade policy.
19

Strategic Objectives

Analyzing the federal government’s long-term and ne

position, outlook, and options

Strengthening approaches for financing the governm

determining accountability for the use of taxpayer do

Facilitating governmentwide management and insti

needed to build and sustain high-performing organiz

more effective government

Recommending economy, efficiency, and effectiveness 

 in federal agency programs

Congressonal

Testimonies

Among the issues we

testified on:

Budget issues

Computer security

District of Columbia reforms

Electronic government

Federal management

challenges

Financial management reform

Government facility security

Government in the 21st

century

Government program

oversight

GPRA congressional oversight

Human capital

Managing in the new millennium

Money laundering

Security breaches at federal

agencies

U.S. government financial

statement audit

 Y2K leadership and

partnership

Selected Accomplishments

Improving SBA’s Disaster Loan Program Estimates

In reviewing information the Small Business Administ

and used to prepare its financial statements for fiscal y

1998, GAO identified errors in the method SBA used 

cost of the Disaster Loan Program. In response, SBA d

approach to estimate its program’s costs using actual hi

which decreased the estimated cost of the loan program

years 1999 and 2000, about $609 million in benefits r

Informing Congressional Deliberations on Tax Policy

The nation’s evolving economy and the size and comp

current IRS Code raise policy issues for the Congress. 

rapid development of electronic commerce has fueled 

whether online transactions should be taxed. During t

whether to modify states’ authority to require out-of-s

including Internet retailers, to collect taxes due on the

provided the Congress with a unique perspective on th

revenue losses to state and local governments. In addit

work on better targeting the Earned Income Credit co

generate substantial savings of over $600 million.

Implementing the Government Performance and R

GAO assisted the Congress and executive branch agen

difficult cultural changes needed to create high-perform

part of this work, we assessed agencies’ efforts under G

specific recommendations on how the Congress and th

branch could work together to ensure that results-orien

useful to and used by decisionmakers. We also worked 

Congress to ensure that agencies resolve management 

undercut or undermine programs. Our work for the S

attributes of high-performing organizations is being us

oversight and decision-making.
20

Strategic Objectives

Cultivate and foster effective congressional and agen

Implement a model strategic and annual planning a

process

Align human capital policies and practices to suppo

Develop efficient and responsive business processes

Build an integrated and reliable information techno

infrastructure

Selected Accomplishments

Managing Strategically With Accountability

GAO developed its first strategic plan for the 21st cen

input from the Congress and supplemented by GAO

other outreach efforts. We subsequently developed ou

plan for fiscal year 2001 to directly link our strategic 

managers and staff do day to day. Also in fiscal year 2

issued its first accountability report to the Congress, d

performance and accountability during fiscal year 199

Improving Service to the Congress

In fiscal year 2000, GAO piloted congressional proto

interactions with the Congress and to ensure our acco

final protocols have since been issued and reflect refin

response to feedback from Members of the Congress 

The protocols will allow us to better serve the Congre

satisfaction with our work, and ensure equitable treat

congressional requesters.

Managing Human Capital

Because of our work with key congressional committe

year 2000, the Congress passed the GAO Personnel F

which provides the Comptroller General with the aut

position our workforce for the future. Separately, we c

first human capital self-assessment and a computerize

and skills inventory, significantly increased our recruit

relations efforts, and enhanced training opportunities

established an employee advisory council and an emp

program.

Other actions in fiscal

year 2000 included:

realigning our operations to

better support the Congress,

eliminate a layer of management, reduce the number of

internal “silos” and field

offices, and better align

resources with our strategic

plan;

continuing to improve our

information technology and

knowledge-sharing

applications; and

organizing a global working

group of 14 nations’ chief

accountability officers who

met for the first time to

discuss emerging issues.
21

In fiscal year 2001, our work will continue t

on the major issues facing the Congress, inclu

Social Security solvency, education, economic 

ment, Medicare reform, national security, int

tional affairs, and government management 

and computer security. Our teams are in the f

gathering facts, providing analyses, and devel

recommendations to assist congressional

decisionmakers.

21
22

Note: We reset our originally published fiscal year 2001 targets for other benefits and t

The full-length report discusses these revisions.

Another top priority in fiscal year 2001 will be working with lea

the Hill to help the Congress strengthen its approach to oversig

emphasis on looking hard at what government does, how it doe

the long-term consequences of today’s policy choices. GAO’s 20

mance and Accountability Series and High-Risk Update will serve 

foundation for congressional oversight. We also have several key 

in progress to improve how we serve the Congress, among them

 Annual Quantitative PerformanceTargets, Fiscal Years 2001-2002

Type Measure 2

Outcome Financial benefits (billions)

Annual $

4-year average $

Other benefits

Annual 

4-year average 

Recommendations implemented

4-year implementation rate 

 Intermediate Testimonies

 outcome Annual 

4-year average 

Recommendations made

Annual 

4-year average 1

 Annual Management Target, Fiscal Years 2001-2002

 Management Timeliness

 Annual 1

 4-year average 
23

an expanded client feedback system;

protocols governing our dealings with federal agencies; and

new high-level advisory bodies to gain the expertise of busi

leaders, former Cabinet officials, and other experts and to o

avenues for sharing our own expertise with other accountab

organizations.

We are also preparing to carry out two new responsibilities assig

previous Congress. We will chair a panel to review the governm

process for obtaining services through competitive sourcing. If t

funding is provided, we will also review the costs and benefits of 

regulations under the Truth in Regulating Act (P.L. 106-312, O

2000).

To continue our efforts to support the Congress and maintain c

operations, we have requested a budget for fiscal year 2002 of ab

$430.3 million. This funding level will allow us to fully staff at o

rized total level of 3,275 full-time equivalent personnel. We wil
24

our emphasis on areas of congressional and public interest and, 

will continue initiatives addressing our two major management 

lenges: human capital and information technology. Our request 

$5.2 million to carry out responsibilities created by the Truth in 

ing Act.

Dollars in 

Strategic goal thousands eq

Goal 1 Provide timely, quality service to the Congress $100,737 

and the federal government to address current

and emerging challenges to the well-being and

financial security of the American people

Goal 2 Provide timely, quality service to the Congress 78,936 

and the federal government to respond to

changing security threats and the challenges of

global interdependence

Goal 3 Support the transition to a more results- 112,814 

oriented and accountable federal government

Goal 4 Maximize the value of GAO by being a model 137,808 

organization for the federal government

Total $430,295 
25

The Government Performance and Results Act 

agencies to articulate not just goals, but also str

achieving their goals. The strategies emphasize 

to work with other organizations on crosscuttin

and to mitigate internal and external factors th

impair performance. For GAO, achieving our 

goals and objectives rests, for the most part, on p

professional, objective, fact-based, nonpartisan,

nonideological, fair, and balanced information

support the Congress in a variety of ways:

25
26

evaluations of federal policies and the performance of agen

oversight of government operations through financial and 

management audits to determine whether public funds are 

efficiently, effectively, and in accordance with applicable la

investigations to assess whether illegal or improper activitie

occurring;

analyses of the financing for government activities;

various engagements in which we consult proactively with 

when appropriate, to help guide their efforts toward positi

legal opinions to determine whether agencies are in compl

applicable laws and regulations;

policy analyses to assess needed actions and the implicatio

proposed actions; and

additional assistance to the Congress in support of its over

decision-making responsibilities.

As part of these strategies, we are coordinating with the wider a

ity community, both domestically and internationally, and are c

ing challenges inside GAO and in the environment in which w

Congress operate.
27

Although GAO is unique in the scope of its activities to support 

Congress and to improve the performance and accountability of 

ment, it shares similar visions and values with other members of 

accountability community. To coordinate more effectively with t

organizations on crosscutting domestic and international issues, 

conduct four types of activities:

In consultation with other accountability organizations, we 

government auditing standards to address emerging issues; 

pate in the development of federal accounting and financia

ment systems standards; and, as required by the law, issue a

standards for internal controls in the federal government. F

ample, GAO and the President’s Council on Integrity and 

will soon issue a jointly developed manual on performing f

financial statement audits.

Coordination to Address Crosscutting I S S U E 
28

We develop and promote best

practices to build and sustain

high-performing organizations

throughout the government. For

example, federal agencies are

using an executive guide we

developed to maximize the

success of their chief information

officers, positions created by the

Congress to promote the efficient

design and operation of all major

information resources for executive branch agencies.

We leverage our resources

and services by working with

accountability organizations at

every level, local to international;

our sister congressional agencies;

and executive branch agencies.

For example, the Federal Aviation

Accountability C

Organizations w

include:

Association of Gove

Accountants

Chief Financial Offic

Chief Information O

Congressional Budg

Congressional Rese

Domestic Working 

Executive Council o

Efficiency

Federal Accounting 

Advisory Board

Financial Accounting 

Board

Global Working Gro

Government Accou

Board

Inspectors General

Intergovernmental A

International Audito

Program

International Organ

Supreme Audit Ins

Joint Financial Mana

Improvement Prog

Office of Manageme

President’s Council 

Efficiency

Private Sector Coun

State and Local Aud
29

Administration (FAA) is presenting the training we develop

request to prepare safety inspectors to conduct effective inte

audits. In return, FAA has loaned us one of its training plat

help our analysts gain a fuller understanding of the air traff

system, new navigational systems, and other topics.

We help convene and participate in forums, boards, and co

share knowledge with other government audit organization

ing international congresses and a new informal domestic w

group launched by the Comptroller General in March 200

includes federal inspectors general and state and local audit

also coordinate with the Chief Financial Officers Council t

crosscutting accounting, financial systems, internal control

financial reporting issues and with the Chief Information O

Council to address governmentwide information technolog
30

Like any organization, GAO faces major management challenge

accomplishing our strategic goals and objectives. With most of o

sources devoted to staff salary and benefits, the area of human c

presents a major challenge. A significant percentage of our work

nearing retirement age while marketplace, demographic, econom

technological changes indicate that competition for skilled work

greater in the future. With our agency realigned to facilitate our 

the Congress and new legislative authority in hand to manage o

workforce more effectively, we are pursuing several initiatives to

strengthen our human capital. For example, we are recruiting di

high-caliber staff with the skills and abilities we need to achieve 

strategic goals and objectives. We will be putting into place a co

based performance appraisal system and using the results of our 

knowledge and skills inventory to help us in workforce planning

also reestablished and are expanding training opportunities for o

from the senior executives to the new hires.

Major Management Challenges—Internal Factors

THAT COULD AFFECT OUR PERFORMANCE
31

Another major management challenge is building an integrated 

reliable information technology (IT) infrastructure that support

achievement of our goals. We are conducting a comprehensive r

identify opportunities to increase our efficiency, effectiveness, an

tivity. We are mapping our business processes to our IT architec

will link future IT investments to our business goals. We plan to 

initiatives to increase our employees’ productivity, maximize the 

technology, and enhance the Web-based knowledge-sharing app

on the desktop. We must also increase the security of our netwo

A number of external factors could affect our ability to meet our 

objectives. Among them are emerging national issues, internatio

developments, and the resources we receive. For instance, durin

year 2001, both a new Congress and a new administration are b

work. The many new committee chairs in the House, a 50/50 s

Senate, and the extended transition in progress may affect our p

work. The priorities set under the previous Congress may chang

External FactorsTHAT COULD AFFECT OUR PER
32

issues may emerge, and the number of requests we receive for te

and other work may be lower than expected.

At the international level, to protect the safety of GAO employ

may have to restrict the scope of work on certain issues. Moreov

cause we do not have audit authority with respect to foreign go

entities, our ability to conduct thorough analyses of some issues 

by the level of openness and voluntary cooperation we can obta

addition, while we continue to make progress toward our strate

achieving them will depend on having sufficient budgetary reso

available, particularly for technology and process improvements 

support our goal to serve as a model agency.

Although these external factors are beyond our control, we will 

to work closely with our congressional clients, to monitor dome

international events, and to maintain broad-based staff expertis

we can quickly adapt to meet emerging needs.
33

Condensed financial statements for GAO appea

end of these highlights. Our detailed statements 

their accompanying notes appear in the full-leng

version of this report. Our financial statements f

fiscal year that ended September 30, 2000, were 

by an independent auditor, Clifton Gunderson L

The independent auditor rendered an unqualifi

ion on GAO’s financial statements and an unqu

opinion on the effectiveness of GAO’s internal co

over financial reporting and compliance with la

regulations. In addition, the independent audito

no reportable instances of noncompliance with s

provisions of laws and regulations. In the opinio

independent auditor, the financial statements ar

sented fairly in all material respects and in confo

with generally accepted accounting principles.

33
34

Financial Systems and Internal

GAO recognizes the importance of strong financial systems and i

controls to ensure our accountability, integrity, and reliability. To 

high level of quality, management maintains a quality control pro

and seeks advice and evaluation from both internal and external s

Specifically, through internal and peer reviews, GAO obtains reas

assurances that our audit and evaluation work conforms to all app

professional requirements, including generally accepted governm

auditing standards. Additionally, GAO’s Inspector General condu

audits and investigations, and an Audit Advisory Committee assi

Comptroller General in overseeing the effectiveness of our financ

reporting and audit processes, internal controls, and processes to 

compliance with laws and regulations.

GAO is committed to fulfilling the internal control objectives of 

U.S.C. 3512, formerly the Federal Managers’ Financial Integrity 

the objectives of the Federal Financial Management Improvemen

(FFMIA) of 1996. We assessed our internal controls as of Septem

C O N T R O 
35

2000, and we believe we had effective controls in place as of tha

addition, on the basis of assessments of our financial systems, w

GAO has implemented and maintained financial systems that c

substantially with the objectives of FFMIA for the fiscal year tha

September 30, 2000.
36

Dollars in Thousands 2000 

Assets

Intragovernmental funds with the U.S. Treasury $55,115 

Property and equipment, net 74,863 

Other assets 856 

Total Assets $130,834 

Liabilities

Accounts payable and payroll $32,143 

Accrued annual leave 27,573 

Workers’ compensation and retirement 12,562 

Capital leases 7,730 

Deferred lease revenue 8,550

Total Liabilities 88,558 

Net Position

Unexpended appropriations $23,515 

Cumulative results of operations 18,761 

Total net position 42,276 

Total Liabilities and Net Position $130,834 

CONDENSED BALANCE SHEET

As of September 30, 2000 and 1999
37

CONDENSED STATEMENT OF NET COST

For Fiscal Years Ended September 30, 2000 and 1999

Dollars in Thousands 2000 

Net Costs by Program Area

National Defense, Security and International

Relations, and Other Related Issues $87,094 

Financial Audits, Systems, Information Management

and Technology Issues 83,159 

Energy, Agriculture, Environment, Housing,

Transportation, and Natural Resources Issues 75,927 

Justice, Tax Policy, Financial Institutions, and

General Management Issues 63,750 

Education and Employment, Health Care

and Income Security Issues 58,989 

Legal Services 26,017 

Special Investigations and Investigative Support 6,275 

Senior management and staff 3,627 

Less reimbursable services not attributable to programs (712) 

Net Cost of Operations $404,126 
38

Dollars in Thousands 2000 

Net Cost of Operations $404,126 

Financing Sources (other than reimbursable services)

Appropriations used 376,640 

Employees benefit costs imputed to GAO 19,009 

Other (53) 

Total Financing Sources 395,596 

Net Results of Operations (8,530) 

Net Increase (Decrease) in Unexpended Appropriations 738 

Change in Net Position (7,792) 

Net Position - Beginning of Fiscal Year 40,105 

Reinstatement of the GAO Building and Land as a Multi-Use

 Heritage Asset 9,963

Net Position - End of Fiscal Year $42,276 

CONDENSED STATEMENT OF CHANGES IN NET POSITIO

For Fiscal Years Ended September 30, 2000 and 1999
39

CONDENSED STATEMENT OF BUDGETARY RESOURCES

For Fiscal Years Ended September 30, 2000 and 1999

Dollars in Thousands 2000 

Budgetary Resources Made Available

Current year appropriations and transfers $377,686 

Unobligated appropriations, beginning of fiscal year 4,477 

Reimbursements 8,490 

Total Budgetary Resources Made Available $390,653 

Status of Budgetary Resources

Obligations incurred $386,081 

Unobligated appropriations, end of fiscal year 4,264 

Lapsed budget authority 308 

Total Status of Budgetary Resources $390,653 

Outlays

Obligations incurred $386,081 

Less: Reimbursements (8,490) 

Obligated balance, net - beginning of fiscal year 48,866 

Less: Obligated balance, net - end of fiscal year (50,851) 

Total Outlays $375,606 
40

CONDENSED STATEMENT OF FINANCING

For Fiscal Years Ended September 30, 2000 and 1999

Dollars in Thousands 2000 

Obligations and Nonbudgetary Resources

Obligations incurred $386,081 

Less: Reimbursements (8,490) 

Employee benefit costs imputed to GAO 19,009 

Other (53) 

Total obligations as adjusted, and

nonbudgetary resources 396,547 

Resources That Do Not Fund Net Cost of Operations

Net (increase) decrease in unliquidated obligations (951) 

Costs capitalized on the balance sheet (9,204) 

Expenses to be funded by future appropriations 1,159 

Total resources that do not fund net cost of operations (8,996) 

Costs That Do Not Require Resources

Depreciation 16,575 

Net Cost of Operations $404,126 
41