GAO-05-1024R Federal Entities Financial Audits 

United States Government Accountability Office

Washington, DC 20548 

September 30, 2005 

Congressional Requesters 

Subject: Financial Audits: The Vast Majority of Executive Branch Entities 

Included in the Federal Budget Are Statutorily Required to Have Their Financial 

Statements Audited 

The Chief Financial Officers Act of 1990 (CFO Act),1 as expanded by the Government 

Management Reform Act of 1994,2

 requires 24 major executive branch departments 

and agencies to prepare annual financial statements and have them audited. The 

Accountability of Tax Dollars Act of 2002 (ATD Act) extended this requirement to 

most executive agencies not explicitly subject to the CFO Act, unless they received a 

waiver or exemption from the Director of the Office of Management and Budget (the 

Director).3

 Further, chapter 91 of title 31 of the United States Code, commonly 

referred to as the Government Corporation Control Act, and certain federal agencies’ 

enabling legislation also require annual financial statement audits. 

Given the importance of timely, reliable, and useful financial information in assessing 

the overall financial management of the government, you asked us to identify 

executive branch entities that are not subject to the requirements of preparing annual 

financial statements and having them audited.. In addition, you were interested in 

knowing certain budget information related to executive branch entities covered by 

the ATD Act that had received an exemption or waiver from the Director for fiscal 

years 2003 and 2004. This report summarizes the information provided during our 

June 27, 2005, briefing to your staff. The enclosed briefing slides and table highlight 

the results of our work and the information provided at the briefing. 

Based on your request letters and subsequent discussions with your staff, our 

objectives were to determine (1) which executive branch entities had received an 

exemption or waiver from the Director for preparing fiscal years 2003 and 2004 

financial statements and having them audited in accordance with the ATD Act, (2) the 

amount of net budget authority and net outlays for these entities, and (3) which 

executive branch entities other than those subject to the CFO Act, ATD Act, 

Government Corporation Control Act, and enabling legislation do not annually 

prepare financial statements and have them audited. Such other entities include 

 

1

Pub. L. No. 101-576, 104 Stat. 2838 (Nov. 15, 1990). 

2

Pub. L. No. 103-356, 108 Stat. 3410 (Oct. 13, 1994). 

3

Pub. L. No. 107-289, 116 Stat. 2049 (Nov. 7, 2002); see 31 U.S.C. § 3515. 
Page 2 GAO-05-1024R Federal Entities Financial Audits 

temporary commissions, task forces, advisory boards, and other special purpose 

entities. 

When performing our work, we (1) made inquiries to personnel from various federal 

agencies, including the Office of Management and Budget (OMB) and the General 

Services Administration (GSA),4

 as well as personnel from selected ATD Act agencies 

and federal commissions not currently required to prepare financial statements and 

have them audited; (2) reviewed the CFO Act, the ATD Act, the Government 

Corporation Control Act, and enabling legislation requiring certain federal entities to 

prepare financial statements annually and have them audited; (3) obtained and 

analyzed the OMB letters that notified the required congressional committees of the 

names of the executive branch agencies for which the Director granted waivers or 

exemptions from having to prepare financial statements and having them audited for 

fiscal years 2003 and 2004; and (4) obtained and summarized certain net budget 

authority and net outlays reported in the Budget of the United States Government, 

Fiscal Years 2006 and 2005 Appendices (federal budget). We requested comments 

on a draft of this report from the Chief of the Financial Standards and Grants Branch 

at OMB and a Committee Management Specialist at GSA. We performed our work 

from January 2005 through June 2005 in accordance with U.S. generally accepted 

government auditing standards. 

In summary, we determined that almost 94 percent of the executive branch entities 

included in the federal budget are statutorily required to have their financial 

statements audited. Looking at the federal government as a whole, we determined 

that about 83 percent of federal entities (including the legislative and judicial 

branches) included in the federal budget are statutorily required to have their 

financial statements audited.5

 To put this in perspective to federal spending, in fiscal 

year 2004, federal entities’ reported net outlays6 totaled about $2.797 trillion, of which 

approximately $2.784 trillion, or about 99.5 percent, was related to federal entities 

whose fiscal year 2004 financial statements were subjected to audit.7

The ATD Act provided the Director with the authority to waive entities from having 

to prepare financial statements and having them audited for fiscal years 2002 and 

2003, the initial phase in period of the act.8 In addition, beginning with fiscal year 

2002, the Director could exempt an ATD Act agency if the total budget authority of 

the agency for the fiscal year does not exceed $25 million and if the Director 

determines that requiring annual audited financial statements for the agency with 

respect to the fiscal year is not warranted due to the absence of risks associated with 

the agency’s operations, the agency’s demonstrated performance, or other factors 

 

4

GSA is responsible for developing regulations and guidance and maintaining data for advisory 

committees as defined by and subject to the Federal Advisory Committee Act, as amended. It also 

provides support services, including accounting services, to various commissions and boards. 

5

Federal entities include executive, legislative, and judicial branch entities. Seven governmentsponsored enterprises and an additional entity funded from Federal Home Loan banks’ contributions, 

although statutorily required to be audited, are not included in the federal budget and therefore are not 

included in this report. 

6

Net outlays represent gross outlays net of offsetting collections. 

7

Certain federal entities, although subject to audit, received disclaimers of opinion on their fiscal year 

2004 financial statements. 

8

Sections 2(a)(1)(c) and (b)(1) of the ATD Act. 
Page 3 GAO-05-1024R Federal Entities Financial Audits 

that the Director considers relevant.9 As a result, we found that primarily due to the 

expiration of the Director’s authority to waive the requirements of the ATD Act, for 

fiscal year 2004, the Director granted exemptions to 12 ATD Act agencies with net 

outlays totaling approximately $30 million. By comparison, 21 ATD Act agencies were 

granted exemptions or waivers for fiscal year 2003 with net outlays totaling about 

$1.669 billion. Enclosure II documents which federal executive branch entities were 

granted waivers or exemptions from the Director and the amount of net budget 

authority and net outlays for these entities. 

Aside from these 12, another 9 agencies with net outlays totaling about $521 million 

did not prepare and have audited financial statements for fiscal year 2004. Their 

reasons varied. However, officials for 5 of the 9 agencies stated that they will prepare 

and have audited financial statements for fiscal year 2005. Of the remaining 4, one 

official expressed the view that his agency is exempt from the ATD Act, one stated 

that it is not cost effective for it to prepare financial statements and have them 

audited, one has already requested an exemption from the Director for fiscal year 

2005, and one stated that it plans to request an exemption for fiscal year 2005. 

In addition, we found that the timing of when the Director notifies certain 

congressional committees of the ATD Act agencies exempted from preparing 

financial statements and having them audited may not be optimal for congressional 

consideration in its decision making and oversight. The ATD Act is silent on when, 

other than annually, OMB should provide Congress with a list of executive branch 

agencies exempted from preparing financial statements and having them audited. 

For fiscal years 2003 and 2004, OMB’s letters related to waivers or exemptions were 

provided to Congress after the end of each fiscal year subject to audit. 

Based on inquiries to OMB and others, we are not aware of any comprehensive list or 

database of other executive branch entities that receive federal funding. Such other 

entities include temporary commissions, task forces, and advisory boards. However, 

based on the limited information available, we were able to determine that the costs 

related to these types of entities are primarily administrative, such as travel, payroll, 

rent, and procurements, and may or may not be covered by separate appropriations. 

For example, we noted that entities subject to the Federal Advisory Committee Act 

included committees, boards, and councils that generally do not receive separately 

allocated budgets; therefore, the costs reported would likely be included in the costs 

of the departments, agencies, or bureaus involved.10 As a result, such costs 

could be subjected to audit as part of the annual audits of those entities’ financial 

statements. 

Finally,.

 the Federal Accounting Standards Advisory Board (FASAB)11 is currently 

considering undertaking a project that would, among other things, reconsider the 

definition of a federal entity and address criteria and possible disclosures relative to 

 

9

Sections 2(a)(4) of the ATD Act. 

10GSA’s fiscal year 2004 Federal Advisory Committee Act database, as of May 2005, reported 944 

advisory committees with total costs of about $300 million. 

11The Federal Accounting Standards Advisory Board was established by the Secretary of the Treasury, 

the Director of OMB, and the Comptroller General in October 1990. It is responsible for promulgating 

accounting standards for the United States government. These standards are recognized as generally 

accepted accounting principles (GAAP) for the federal government. 
Page 4 GAO-05-1024R Federal Entities Financial Audits 

entities not considered federal entities under Statement of Federal Financial 

Accounting Concepts No. 2, Entity and Display,12 but which present significant 

financial or other accountability issues for the federal government. Such a project 

could identify special purpose and other entities funded by the federal government.13

 

OMB and GSA officials orally agreed with the matters discussed in this report. In 

response to an OMB suggestion, we modified the report to include the percentage of 

executive branch agencies statutorily required to have their financial statements 

audited. 

We are sending copies of this report to other congressional committees, the Director 

of OMB, the Administrator of GSA, and other interested parties. Copies will be made 

available to others upon request. This report is also available at no charge on 

GAO’s Web site at www.gao.gov. We look forward to continuing to work with your 

staff to help improve financial management in the federal government. If you have 

any questions about the contents of this report, please contact me at (202) 512-3406. 

Gary T. Engel 

Director 

Financial Management and Assurance 

Enclosure – 2 

 

12In FASAB’s current exposure draft, Technical Agenda Options, it is noted that in SFFAC 2, FASAB 

established concepts for identifying what components to include in reporting entities. 

13Such as federally funded research and development centers and public private partnerships. 
Page 5 GAO-05-1024R Federal Entities Financial Audits 

List of Congressional Requesters 

The Honorable Tom Coburn, Chairman 

The Honorable Thomas R. Carper, Ranking Minority Member 

Subcommittee on Federal Financial Management, Government Information, and 

International Security 

Committee on Homeland Security and Governmental Affairs 

United States Senate 

The Honorable Daniel K. Akaka, Ranking Minority Member 

Subcommittee on Oversight of Government Management, the Federal Workforce, and 

the District of Columbia 

Committee on Homeland Security and Governmental Affairs 

United States Senate 

The Honorable Tom Davis, Chairman 

The Honorable Henry A. Waxman, Ranking Minority Member 

Committee on Government Reform 

House of Representatives 

The Honorable Todd Platts, Chairman 

Subcommittee on Government Management, Finance and Accountability 

Committee on Government Reform 

House of Representatives 
Enclosure I 

Page 6 GAO-05-1024R Federal Entities Financial Audits 

1

Financial Audits: The Vast Majority of Executive Branch Entities Included 

in the Federal Budget Are Statutorily Required to 

Have Their Financial Statements Audited

Briefing to the Staff of the 

Subcommittee on Federal Financial Management, Government 

Information, and International Security, Senate Homeland Security 

and Governmental Affairs Committee

Subcommittee on Oversight of Government Management, the Federal 

Workforce, and the District of Columbia (Ranking Minority Member), 

Senate Homeland Security and Governmental Affairs Committee

House Government Reform Committee

Subcommittee on Government Management, Finance and Accountability,

House Government Reform Committee

June 27, 2005
Enclosure I 

Page 7 GAO-05-1024R Federal Entities Financial Audits 

2

Table of Contents

• Introduction

• Objectives

• Results in Brief

• Scope and Methodology

• Results of GAO’s Work 

• Related Initiative 
Enclosure I 

Page 8 GAO-05-1024R Federal Entities Financial Audits 

3

Introduction

• The Chief Financial Officers Act of 1990 (CFO Act), as expanded by the Government 

Management Reform Act of 1994, requires 24 major executive departments and 

agencies to prepare financial statements annually and have them audited.

• The Accountability of Tax Dollars Act of 2002 (ATD Act) extended the requirement to 

prepare financial statements annually and have them audited to most executive agencies 

not subject to the CFO Act, unless waived or exempted by the Director of the Office of 

Management and Budget (OMB).

• Chapter 91 of title 31 of the United States Code, commonly referred to as the Government Corporation Control Act, requires government corporations to prepare and 

submit audited financial statements in accordance with U.S. generally accepted 

government auditing standards.

• Some federal agencies’ enabling legislation requires annual audits (e.g., the American

Battle Monuments Commission).

• You requested that we perform a study of executive branch entities that currently are not 

required to prepare financial statements annually and have them audited. This study was 

also to provide certain budget information on federal entities covered by the ATD Act that 

had received an exemption or waiver from the Director of OMB for fiscal years 2003 and 

2004.
Enclosure I 

Page 9 GAO-05-1024R Federal Entities Financial Audits 

4

Objectives

• Based on the request letters received and subsequent discussions with the related committee 

and subcommittee staff, we made inquiries to personnel from various federal agencies, 

including OMB, the General Services Administration (GSA),1 and ATD Act agencies, as well as 

personnel from selected commissions not currently required to prepare financial statements 

and have them audited, to determine

• which executive branch entities had received an exemption or waiver from the Director of 

OMB for preparing fiscal years 2003 and 2004 financial statements and having them 

audited in accordance with the ATD Act,

• the amount of net budget authority and net outlays for these entities, and

• which executive branch entities other than those subject to the CFO Act, ATD Act, 

Government Corporation Control Act, and enabling legislation do not annually prepare 

financial statements and have them audited. (Such other entities include temporary 

commissions, task forces, advisory boards, and other special purpose entities.)

1 GSA is responsible for developing regulations and guidance and maintaining data for advisory committees as defined by and subject to the Federal Advisory Committee Act, as 

amended. It also provides support services, including accounting services, to various commissions and boards.
Enclosure I 

Page 10 GAO-05-1024R Federal Entities Financial Audits 

5

Results in Brief

• Almost 94 percent of executive branch entities included in the federal budget are 

statutorily required to have their financial statements audited.

• About 83 percent of federal entities (including legislative and judicial branches) included 

in the federal budget are statutorily required to have their financial statements audited.

• Reported net outlays for federal entities in fiscal year 2004 totaled about $2.797 trillion. Of this amount, approximately $2.784 trillion or about 99.5 percent was related to federal 

entities whose fiscal year 2004 financial statements were subjected to audit. 

• For fiscal year 2003, the Director of OMB granted waivers or exemptions to 21 ATD Act agencies, with net budget authority totaling about $1.916 billion and net outlays totaling 

approximately $1.669 billion. 

• For fiscal year 2004, the Director of OMB granted exemptions to 12 ATD Act agencies, with net budget authority totaling about $26 million and net outlays totaling approximately 

$30 million. In addition, for fiscal year 2004, 9 ATD Act agencies that did not receive an 

exemption from the Director of OMB did not prepare financial statements and have them 

audited for various reasons. Reasons provided by agency officials included the inability 

to prepare the fiscal year 2004 financial statements as well as the view of one agency 

official that it is not cost effective to prepare financial statements and have them audited. 
Enclosure I 

Page 11 GAO-05-1024R Federal Entities Financial Audits 

6

Results in Brief

(continued)

• Five of the nine agencies stated that for fiscal year 2005 they will prepare financial statements and have them audited. The remaining four agencies do not plan to prepare 

financial statements and have them audited for fiscal year 2005.

• Based on inquiries to OMB and others, we are not aware of a comprehensive list or database of other executive branch entities, including temporary commissions, task 

forces, advisory boards, and other special purpose entities, that receive federal funding. 

The limited information that was readily available shows that costs related to other 

entities such as commissions, task forces, and advisory boards, are primarily 

administrative, including travel, payroll, rent, and procurements and may or may not be 

covered by separate appropriations.

• The Federal Accounting Standards Advisory Board (FASAB) is currently considering undertaking a project which would, among other things, reconsider the definition of a 

federal entity and address criteria and possible disclosures relative to entities not 

considered federal entities under Statement of Federal Financial Accounting Concepts 

(SFFAC) No. 2, Entity and Display, but which present significant financial or other accountability issues for the federal government.
Enclosure I 

Page 12 GAO-05-1024R Federal Entities Financial Audits 

7

Scope and Methodology

• To accomplish our objectives, we

• reviewed the CFO Act, the ATD Act, the Government Corporation Control Act, and 

enabling legislation requiring certain federal entities to prepare financial statements 

annually and have them audited;

• obtained and analyzed the OMB letters which notified the required congressional 

committees of the names of the executive branch agencies for which the Director of 

OMB granted waivers or exemptions from having to prepare financial statements 

and having them audited in accordance with the ATD Act for fiscal years 2003 and 

2004;

• obtained and summarized certain net budget authority and net outlays reported in 

the Budget of the United States Government, Fiscal Years 2006 and 2005 

Appendices (federal budget);

• held discussions with various federal agency officials, including OMB, GSA, and 

ATD Act agencies, as well as personnel from selected commissions not currently 

required to prepare financial statements and have them audited; and 

• performed our work from January 2005 through June 2005 in accordance with U.S. 

generally accepted government auditing standards.
Enclosure I 

Page 13 GAO-05-1024R Federal Entities Financial Audits 

8

Results of GAO’s Work 

• Almost 94 percent of executive branch entities included in the federal budget are 

statutorily required to have their financial statements audited.

• About 83 percent of federal entities (including legislative and judicial branches) included 

in the federal budget are statutorily required to have their financial statements audited.

(See table on page 14.)
Enclosure I 

Page 14 GAO-05-1024R Federal Entities Financial Audits 

9

Results of GAO’s Work 

(continued)

Percentage of Federal Entities Included in the Federal Budget Whose Financial Statements 

Are Statutorily Required to Be Audited 

 Category of federal entities 

Number of 

federal 

entities 

Number of federal 

entities statutorily 

required to be audited 

Percentage of 

category statutorily 

required to be audited

Executive branch entities 

CFO Act entities 24 24 100.0

Accountability of Tax Dollars Act entities 76 76 100.0

Government Corporation Control Act entities 16a 16 100.0

Other independent entities and other defense - civil 

programs 24 15b

62.5

Subtotal: executive branch entities 140 131 93.6

Legislative branch entitiesc13 3 23.1

Judicial branch entities 8 0 0.0

 Total 161 134 83.2

Source: GAO. 

 

a

 This amount does not include eight of the 24 Government Corporation Control Act entities. Although statutorily required to be audited, these entities are not 

included in the federal budget. Seven of the 8 are government-sponsored enterprises that are private companies and their securities are not backed by the full 

faith and credit of the federal government and 1 entity is funded from Federal Home Loan banks' contributions.

b

 Of the remaining 9 federal entities or programs, there is no statutory requirement for 2. For the other 7 entities, our research could not confirm whether or not 

a statutory requirement exists because of the limited description of the entity or program. 

c

 Of the 10 legislative branch entities that are not statutorily required to have their financial statements audited, GAO, the Library of Congress, and the Architect 

of the Capitol (balance sheet only) voluntarily have their financial statements audited. In addition, the U.S. Senate voluntarily receives audits for parts of its 

operations such as the Senate restaurants. 
Enclosure I 

Page 15 GAO-05-1024R Federal Entities Financial Audits 

10

Results of GAO’s Work

(continued)

• Reported net outlays for federal entities in fiscal year 2004 totaled about $2.797 trillion. 

Of this amount, approximately $2.784 trillion or about 99.5 percent was related to federal 

entities included in the federal budget whose fiscal year 2004 financial statements were 

subjected to audit.

(See table on page 16.)
Enclosure I 

Page 16 GAO-05-1024R Federal Entities Financial Audits 

11

Results of GAO’s Work

(continued)

Percentage of Reported Net Outlays for Federal Entities Included in the Federal Budget 

Whose Fiscal Year 2004 Financial Statements Were Subjected to Audita (dollars in millions) 

 

 

 

Category of federal entities 

FY 2004 

net outlaysb

FY 2004 net outlays for 

federal entities included in 

the federal budget whose 

financial statements were 

subjected to audit 

Percentage of FY 2004 net outlays 

by category of federal entities 

included in the federal budget 

whose financial statements were 

subjected to audit 

Executive branch entities 

CFO Act entities $2,630,341 $2,630,341 100.0

Accountability of Tax Dollars Act entitiesc 58,741 58,190 99.1

Government Corporation Control Act entitiesd12,398 12,398 100.0

Other independent entities and other defense

civil programs 85,761 80,250 93.6

Subtotal: executive branch entities $2,787,241 $2,781,179 99.8

Legislative branch entitiese3,910 3,077 78.7

Judicial branch entities 5,694 0 0.0

 Total $2,796,845 $2,784,256 99.5

Source: Budget of the United States Government, Fiscal Year 2006, Appendix and GAO. 

 

a

 Certain federal entities, although subject to audit, received disclaimers of opinion on their fiscal year 2004 financial statements.

b

 Net outlays represent gross outlays net of offsetting collections. 

c

 The unaudited net outlays totaling about $551 million ($58,741 - $58,190) relate to the 12 federal entities exempted by OMB and 9 additional federal 

entities that did not prepare fiscal year 2004 financial statements and have them audited. 

d

 The Government Corporation Control act lists 24 government corporations. Seven of the listed entities under the act are not included in the federal 

budget. They are treated as government-sponsored enterprises that are private companies and their securities are not backed by the full faith and 

credit of the federal government. Another entity is not included in the federal budget because it is solely a financing vehicle and is funded from Federal 

Home Loan banks' contributions. The reported $12,398 million of net outlays relate to 16 government corporations that are included in the federal 

budget. 

e

 The $3,077 million of net outlays subjected to audit does not include net outlays of $686 million related to the U.S. Senate, parts of which were 

subjected to audit but are not separately identified in the federal budget. 
Enclosure I 

Page 17 GAO-05-1024R Federal Entities Financial Audits 

12

Results of GAO’s Work 

(continued)

• In accordance with the ATD Act, the Director of OMB may exempt a covered executive 

agency from the act’s requirements if both of the following criteria are met:

• The total amount of budget authority available to the agency for the fiscal year does not exceed $25 million. 

• The Director of OMB determines that requiring an annual audited financial statement for the agency with respect to the fiscal year is not warranted due to the 

absence of risks associated with the agency’s operations, the agency’s 

demonstrated performance, or other factors that the Director considers relevant.

• We developed a list of ATD Act agencies for which the Director of OMB granted waivers 

or exemptions for fiscal years 2003 and 2004 and the reported net budget authority and 

net outlays of those agencies.

• For fiscal year 2003, the Director of OMB granted waivers or exemptions to 21 ATD 

Act agencies, with net budget authority totaling about $1.916 billion and net outlays 

totaling approximately $1.669 billion. 

• For fiscal year 2004, the Director of OMB granted exemptions to 12 ATD Act 

agencies, with net budget authority totaling about $26 million and net outlays 

totaling approximately $30 million. Three of these 12 agencies were also granted 

waivers or exemptions in fiscal year 2003.
Enclosure I 

Page 18 GAO-05-1024R Federal Entities Financial Audits 

13

Results of GAO’s Work 

(continued)

• In addition, for fiscal year 2004, nine ATD Act agencies that did not receive an exemption 

from the Director of OMB did not prepare financial statements and have them audited.

• Five of these nine agencies stated that for fiscal year 2005 they will prepare 

financial statements and have them audited.

• The remaining four agencies do not plan to prepare financial statements and have 

them audited for fiscal year 2005.

• One entity has requested an exemption from OMB.

• One entity plans to request an exemption from OMB for fiscal year 2005 and 

prepare financial statements and have them audited for fiscal year 2006.

• One entity said it believes it is exempt from the ATD Act.

• One entity expressed the view that it is not cost effective to prepare financial 

statements and have them audited.
Enclosure I 

Page 19 GAO-05-1024R Federal Entities Financial Audits 

14

Results of GAO’s Work 

(continued)

• The ATD Act is silent on when, other than annually, OMB should provide the 

Congress with a list of executive branch agencies the Director of OMB has 

exempted from having to prepare financial statements and having them 

audited. Letters related to waivers or exemptions for fiscal years 2004 and 

2003 were provided to the Congress after the end of each fiscal year.

• On October 23, 2003, OMB notified the required committees of the

Congress of the names of the executive branch agencies for which OMB 

had provided waivers or exemptions for fiscal year 2003. 

• On November 15, 2004, OMB notified the required committees of the 

Congress of the names of the executive branch agencies that OMB had 

provided exemptions for fiscal year 2004.
Enclosure I 

Page 20 GAO-05-1024R Federal Entities Financial Audits 

15

Results of GAO’s Work 

(continued) 

• Based on inquiries to OMB and others, we are not aware of a comprehensive list or 

database of other executive branch entities, including temporary commissions, task forces, 

advisory boards, and other special purpose entities, that receive federal funding.

• The limited information that was readily available shows that costs related to entities such 

as commissions, task forces, and advisory boards are primarily administrative, including 

travel, payroll, rent, and procurements, and may or may not be covered by separate 

appropriations (e.g., earmark or line item).

• The types of entities subjected to the Federal Advisory Committee Act, as amended (FAC 

Act) included committees, boards, and councils. According to a GSA official responsible for 

obtaining FAC Act data, these committees generally do not receive separately allocated 

budgets and the costs reported would likely be included in other reporting done by the 

agencies involved. 

• Costs related to such entities generally would be rolled up into the costs of the related 

departments, agencies, or bureaus and would likely be subjected to audit as part of 

those entities’ financial statements. 

• The General Services Administration’s fiscal year 2004 FAC Act database as of May 

2005 reported that there were 944 advisory committees and that their costs totaled 

about $300 million.
Enclosure I 

Page 21 GAO-05-1024R Federal Entities Financial Audits 

16

Related Initiative

• FASAB is currently considering undertaking a project that would, among other things, 

reconsider the definition of a federal entity, and address criteria and possible disclosures 

relative to entities not considered federal entities under SFFAC No. 2, Entity and Display, 

but which present significant financial or other accountability issues for the federal 

government.
Federal Entities for Which the Director of OMB Granted Waivers or Exemptions from the Accountability of Tax Dollars

Act's Audit Requirements for FY 2003 or FY 2004 (dollars in millions)

Enclosure II Enclosure II

FY 2003 FY 2004 FY 2003 FY 2004 FY 2005 FY 2006 FY 2003 FY 2004 FY 2005 FY 2006

Broadcasting Board of Governors X $541 $581 $591 $652 $517 $653 $608 $643

Central Intelligence Agency X 223 226 239 245 222 226 239 245

Commodity Futures Trading Commission X 85 89 94 99 83 92 94 98

Court Services and Offender Supervision 

Agency for the District of Columbia X 154 167 179 203 140 167 192 198

Defense Nuclear Facilities Safety Board X 19 20 20 22 20 21 20 22

Federal Election Commission X 50 50 52 55 46 50 56 61

Federal Labor Relations Authority X 29 29 25 25 27 26 25 25

Federal Maritime Commission X 17 18 19 20 17 18 19 20

Japan-U.S. Friendship Commission X X 3 2 3 3 2 3 3 3

National Archives and Records Administration X 251 307 320 315 301 307 324 314

National Endowment for the Humanities X 126 135 138 138 119 127 133 142

National Labor Relations Board X 237 243 250 252 231 242 250 251

Peace Corps X 298 310 319 347 310 306 328 342

Securities and Exchange Commission d

X (283) (700) (950) (1,278) (532) (685) (942) (1,256)

Selective Service System X 26 26 26 26 26 23 26 27

U.S. Commission for the Preservation of 

America's Heritage Abroad X X L L L L L L L L

U.S. Commission of Fine Arts X X 8 8 9 9 8 8 9 9

U.S. Commission on Civil Rights X 9 9 9 9 9 9 9 9

U.S. Consumer Product Safety Commission X 57 60 62 62 59 60 62 62

U.S. International Trade Commission X 54 57 61 65 52 54 60 65

U.S. Office of Special Counsel X 12 14 15 15 12 13 15 15

Barry M. Goldwater Scholarship and Excellence 

in Education Foundation X 4 4 4 4 3 3 5 4

Christopher Columbus Fellowship Foundation X 0 0 1 1 1 1 1 1

Harry S. Truman Memorial Scholarship Trust 

Fund X 3 3 3 3 3 4 3 3

Marine Mammal Commission X 3 3 2 2 2 3 2 2

U.S. Commission on Ocean Policy e

X 2 0 0 0 3 3 1 0

U.S. Interagency Council on Homelessness X 2 2 2 2 1 1 2 2

U.S. National Commission on Libraries and 

Information Science X 1 1 1 1 1 1 1 1

U.S. Nuclear Waste Technical Review Board X 3 3 3 4 3 3 3 4

White House Commission on the National 

Moment of Remembrance X L L L L L L L L

Total of waived/exempted in FY 2003 21 $1,916 $1,481 $1,284 $1,669 $1,530 $1,295

Total of exempted in FY 2004 12 $26 $28 $29 $30 $30 $29

Year waived a or exempted b Net budget authority c Net outlays c

Page 22 GAO-05-1024R Federal Entities Financial Audits

Source: Office of Management and Budget and the Budget of the United States Government, Fiscal Year 2006, appendix and Fiscal Year 2005, appendix. As reported in the Budget of the United States

Government, fiscal years 2003 and 2004 amounts are actuals; fiscal year 2005 amounts are estimates; and fiscal year 2006 amounts are the President's request.

Legend: L = Amounts in individual accounts for these other independent agencies are below the million-dollar reporting threshold and they are consolidated into a single set of 

schedules under Other Commissions and Boards in the Budget of the United States Government. The Other Commissions and Boards account presents data on several small 

independent commissions and other entities on a consolidated basis.

a

 Waiver - Under sections 2 (a)(1)(c) and (b)(1) of the Accountability of Tax Dollars Act of 2002 (ATD Act), the Director of the Office of Management and Budget (OMB) could waive 

entities from having to prepare financial statements and having them audited for fiscal years 2002 and 2003. b

 Exemption - Under section 2(a)(4) of the ATD Act, the Director of OMB may exempt a covered executive agency from the requirements of the ATD Act in any fiscal year if (1) the 

total amount of budget authority available to the agency for the fiscal year does not exceed $25 million, and (2) the Director determines that requiring an annual audited financial 

statement for the agency with respect to the fiscal year is not warranted due to the absence of risks associated with the agency's operations, the agency's demonstrated 

performance, or other factors that the Director considers relevant. 

c

 Budgetary totals represent gross budget authority and gross outlays net of offsetting collections.

d

 Negative balances represent the amount of offsetting collections (cash) in excess of gross budget authority and gross outlays.

e

 On September 20, 2004, the U.S. Commission on Ocean Policy fulfilled its mandate to submit recommendations for a coordinated and comprehensive national ocean policy to the 

President and the Congress.

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