STATEMENT OF THE COMPTROLLER GENERAL OF THE UNITED STATES 36

February 27, 2020

The President

The President of the Senate

The Speaker of the House of Representatives

To operate as effectively and efficiently as possible, Congress, the administration, and federal 

managers must have ready access to reliable and complete financial and performance information—

both for individual federal entities and for the federal government as a whole. Our report on the U.S. 

government’s consolidated financial statements for fiscal years 2019 and 2018 discusses progress that

has been made but also underscores that much work remains to improve federal financial management 

and that the federal government continues to face an unsustainable long-term fiscal path.

Our audit report on the U.S. government’s consolidated financial statements is enclosed. In summary, 

we found the following: 

x Certain material weaknesses1 in internal control over financial reporting and other limitations 

resulted in conditions that prevented us from expressing an opinion on the accrual-based 

consolidated financial statements as of and for the fiscal years ended September 30, 2019, and 

2018.2 About 29 percent of the federal government’s reported total assets as of September 30, 

2019, and approximately 19 percent of the federal government’s reported net cost for fiscal year 

2019 relate to significant federal entities that received a disclaimer of opinion3 or qualified opinion4

on their fiscal year 2019 financial statements or whose fiscal year 2019 financial information was 

unaudited.5

1A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there 

is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected 

and corrected, on a timely basis. A deficiency in internal control exists when the design or operation of a control does not allow 

management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, 

misstatements on a timely basis.

2The accrual-based consolidated financial statements as of and for the fiscal years ended September 30, 2019, and 

2018, consist of the (1) Statements of Net Cost, (2) Statements of Operations and Changes in Net Position, (3) Reconciliations 

of Net Operating Cost and Budget Deficit, (4) Statements of Changes in Cash Balance from Budget and Other Activities, and 

(5) Balance Sheets, including the related notes to these financial statements. Most revenues are recorded on a modified cash 

basis. 

3

A disclaimer of opinion arises when the auditor is unable to obtain sufficient appropriate audit evidence to provide a basis for

an audit opinion and accordingly does not express an opinion on the financial statements.

4A qualified opinion arises when the auditor is able to express an opinion on the financial statements except for specific areas

where the auditor was unable to obtain sufficient and appropriate evidence.

5The Department of Defense and the Railroad Retirement Board both received disclaimers of opinion on their respective fiscal 

year 2019 financial statements. The Department of Housing and Urban Development received a qualified opinion on its fiscal 

year 2019 financial statements. For fiscal year 2019, the financial information for the General Fund of the U.S. Government 

was not audited to allow Treasury sufficient time to develop and begin to implement a remediation plan to address the issues 

we identified as part of our audit of the fiscal year 2018 Schedules of the General Fund. Also, for fiscal year 2019, the financial 

information for Security Assistance Accounts was unaudited.
 37 STATEMENT OF THE COMPTROLLER GENERAL OF THE UNITED STATES

x Significant uncertainties (discussed in Note 22 to the consolidated financial statements), primarily 

related to the achievement of projected reductions in Medicare cost growth, prevented us from 

expressing an opinion on the sustainability financial statements,6 which consist of the 2019 and 

2018 Statements of Long-Term Fiscal Projections;7 the 2019, 2018, 2017, 2016, and 2015 

Statements of Social Insurance;8 and the 2019 and 2018 Statements of Changes in Social 

Insurance Amounts. About $42.2 trillion, or 71 percent, of the reported total present value of future 

expenditures in excess of future revenue presented in the 2019 Statement of Social Insurance 

relates to Medicare programs reported in the Department of Health and Human Services’ 2019 

Statement of Social Insurance, which received a disclaimer of opinion. A material weakness in 

internal control also prevented us from expressing an opinion on the 2019 and 2018 Statements of 

Long-Term Fiscal Projections. 

x Material weaknesses resulted in ineffective internal control over financial reporting for fiscal year 

2019.

x Material weaknesses and other scope limitations, discussed above, limited tests of compliance with 

selected provisions of applicable laws, regulations, contracts, and grant agreements for fiscal year 

2019.

Overall, the federal government has made significant strides in improving financial management since 

key federal financial management reforms were enacted in the 1990s. Twenty-two of the 24 Chief 

Financial Officers Act of 1990 (CFO Act) agencies received unmodified (“clean”) opinions on their 

respective entities’ fiscal year 2019 financial statements, up from six CFO Act agencies that received 

clean audit opinions for fiscal year 1996.9 In addition, accounting and financial reporting standards have 

continued to evolve to provide greater transparency and accountability over the federal government’s 

operations, financial condition, and fiscal outlook. In a recent testimony, we highlighted the substantial 

progress made in federal financial management since the enactment of the CFO Act and identified 

several opportunities for how federal financial management can be enhanced.10 These opportunities 

include modernizing the role of Chief Financial Officers, preparing government-wide and agency-level 

financial management plans, and better linking performance and cost information for decision-making.

While the U.S. government's consolidated financial statements provide a high-level summary of the 

financial position, financial condition, and operating results for the federal government as a whole, the 

6The sustainability financial statements are based on projections of future receipts and spending, while the accrualbased consolidated financial statements are based on historical information, including the federal government’s 

assets, liabilities, revenue, and net cost.

7The 2019 and 2018 Statements of Long-Term Fiscal Projections present, for all the activities of the federal 

government, the present value of projected receipts and non-interest spending under current policy without change, 

the relationship of these amounts to projected gross domestic product (GDP), and changes in the present value of 

projected receipts and non-interest spending from the prior year. These statements also present the fiscal gap, which

is the combination of non-interest spending reductions and receipts increases necessary to hold debt held by the public as a 

share of GDP at the end of the projection period to its value at the beginning of the period. The valuation date for the 

Statements of Long-Term Fiscal Projections is September 30. 

8Statements of Social Insurance are presented for the current year and each of the 4 preceding years as required by 

U.S. generally accepted accounting principles. For the Statements of Social Insurance, the valuation date is 

January 1 for the Social Security and Medicare programs, October 1 for the Railroad Retirement program (January 1 

for 2015), and September 30 for the Black Lung program.

9The 22 agencies include the Department of Health and Human Services, which received an unmodified (“clean”) opinion on 

all statements except the Statements of Social Insurance and the Statements of Changes in Social Insurance Amounts.

10GAO, Federal Financial Management: Substantial Progress Made since the CFO Act of 1990 and Preliminary Observations 

on Opportunities for Enhancement, GAO-20-203T (Washington, D.C.: Oct. 30, 2019).
STATEMENT OF THE COMPTROLLER GENERAL OF THE UNITED STATES 38

annual preparation and audit of individual federal entity financial statements continue to be critical, 

among other things, to

x provide individual federal entity accountability to Congress and citizens, including 

(1) independent assurance, shortly after the end of the fiscal year, of the reliability of reported 

financial information and (2) association of program costs with related program performance and 

results;

x facilitate reliable, useful, and timely financial management information at the individual federal entity 

and program levels for effective management decision-making;

x assess the reliability and effectiveness of systems and related internal controls, including identifying 

control deficiencies that could lead to fraud, waste, and abuse; and

x deliver early warnings of emerging financial management issues.

Further, annual audits along with congressional and executive oversight provide significant incentives 

for individual federal entities to maintain reliable financial management information and effective 

systems and controls.

The preparation and audit of individual federal entities’ financial statements have also identified 

numerous deficiencies, leading to corrective actions to strengthen federal entities’ internal controls, 

processes, and systems. For instance, the Department of Housing and Urban Development took 

corrective actions to address deficiencies identified during its audits that enabled it to obtain a qualified 

audit opinion on its fiscal year 2019 financial statements after several years of receiving disclaimers of 

opinion on its financial statements.

However, since the federal government began preparing consolidated financial statements over 20 

years ago, three major impediments have continued to prevent us from rendering an opinion on the 

federal government’s accrual-based consolidated financial statements over this period: (1) serious 

financial management problems at the Department of Defense (DOD), (2) the federal government’s 

inability to adequately account for intragovernmental activity and balances between federal entities, and

(3) weaknesses in the federal government’s process for preparing the consolidated financial 

statements. 

DOD’s financial management continues to face long-standing issues. After many years of working 

toward financial statement audit readiness, DOD underwent full financial statement audits in fiscal 

years 2018 and 2019. These audits resulted in disclaimers of opinion, material weaknesses in internal 

control over financial reporting (20 in fiscal year 2018 and 25 in fiscal year 2019), and thousands of 

audit findings. Some of the material weaknesses—such as an inability to account for its property and 

equipment and ineffective information technology controls—are examples of long-standing weaknesses 

that DOD has been unable to address. 

DOD leadership identified a number of benefits from these department-wide audits, including 

that the audit process saves money by improving inventory management, identifying 

vulnerabilities, and providing better data for decision-making. Specifically, DOD stated that 

some of the benefits of the audit process included the following:

x The Navy fleet logistic center in Jacksonville, Florida identified $81 million of active material not 

tracked in the inventory system that was available for immediate use. It also eliminated unneeded 

equipment, freeing up approximately 200,000 square feet, or the equivalent of 2.6 acres.
 39 STATEMENT OF THE COMPTROLLER GENERAL OF THE UNITED STATES

x DOD automated the quarterly review process of its obligations, eliminating inefficiencies and

providing analysts the time and insights needed to identify $316 million that could be put to better 

use before these funds expired or were canceled.

x Navy personnel at multiple bases found $167 million of usable supplies that addressed unmet 

demands for things that were on back order.

DOD has acknowledged that achieving a clean audit opinion will take time. DOD reported that the 

number of auditor findings closed and material weaknesses downgraded from year to year is the 

objective measure of progress toward that goal. The department will also track progress by the number 

of components moving from disclaimers of opinion to clean opinions. The department reported closing 

550 or 23 percent of the 2,377 findings resulting from its fiscal year 2018 audit. In fiscal year 2019 

the auditors issued an additional 1,300 findings. 

Various efforts are also under way to address the other two major impediments to an audit of the 

consolidated financial statements. For example, during fiscal year 2019, the Department of the

Treasury (Treasury) continued to actively work with significant federal entities11 to resolve differences in 

intragovernmental activity and balances between federal entities through its quarterly scorecard 

process.12 This process highlights differences needing the entities’ attention, identifies differences that 

need to be resolved through a formal dispute resolution process,13 and reinforces the entities’ 

responsibilities to resolve intragovernmental differences. Treasury also made significant progress by

improving the accounting for and reporting of General Fund of the U.S. Government (General Fund) 

transactions and balances,14 and working to resolve significant differences between the General Fund 

and its federal entity trading partners. 

In recent years, Treasury’s corrective actions have included improving systems and implementing new 

processes for preparing the consolidated financial statements, enhancing guidance for collecting data 

from component entities, and implementing procedures to address certain internal control deficiencies 

detailed in our previously issued management report.15 Treasury also continued to develop its process 

for preparing the Reconciliation Statements16 by developing new transaction codes to support certain 

information reported in them. In addition to continued leadership by Treasury and the Office of 

Management and Budget (OMB), federal entities’ strong and sustained commitment is critical to fully 

address these issues. 

11The Office of Management and Budget and Treasury have identified 40 federal entities that are significant to the U.S. 

government’s fiscal year 2019 consolidated financial statements, including the 24 CFO Act agencies. See app. A of the Fiscal 

Year 2019 Financial Report of the United States Government for a list of the 40 entities.

12For each quarter, Treasury produces a scorecard for each significant entity, as well as any other component entity reporting 

significant intragovernmental balances or differences, that reports various aspects of the entity’s intragovernmental differences 

with its trading partners, including the composition of the differences by trading partner and category. Pursuant to Treasury 

guidance, entities are expected to resolve, with their respective trading partners, the differences identified in their scorecards.

13When an entity and its respective trading partner cannot resolve an intragovernmental difference, Treasury guidance directs 

the entity to request that Treasury resolve the dispute. Treasury will review the dispute and issue a decision on how to resolve 

the difference, which the entities must follow.

14The General Fund is a component of Treasury’s central accounting function. It is a stand-alone reporting entity that 

comprises the activities fundamental to funding the federal government (e.g., issued budget authority, cash activity, and debt

financing activities). 

15GAO, Management Report: Improvements Needed in Controls over the Processes Used to Prepare the U.S. Consolidated 

Financial Statements, GAO-19-624 (Washington, D.C.: Sept. 4, 2019). 

16The Reconciliations of Net Operating Cost and Budget Deficit and Statements of Changes in Cash Balance from Budget and 

Other Activities (Reconciliation Statements) reconcile (1) the accrual-based net operating cost to the primarily cash-based 

budget deficit and (2) the budget deficit to changes in cash balances.
STATEMENT OF THE COMPTROLLER GENERAL OF THE UNITED STATES 40

The material weaknesses underlying these three major impediments have continued to 

(1) hamper the federal government’s ability to reliably report a significant portion of its assets, liabilities, 

costs, and other related information; (2) affect the federal government’s ability to reliably measure the 

full cost, as well as the financial and nonfinancial performance, of certain programs and activities; (3) 

impair the federal government’s ability to adequately safeguard significant assets and properly record 

various transactions; and (4) hinder the federal government from having reliable, useful, and timely 

financial information to operate effectively and efficiently. Over the years, we have made a number of 

recommendations to OMB, Treasury, and DOD to address these issues.17 These entities have taken or 

plan to take actions to address these recommendations.

In addition to the material weaknesses referred to above, we identified three other material 

weaknesses. These are the federal government’s inability to (1) determine the full extent to which 

improper payments occur and reasonably assure that appropriate actions are taken to reduce them, (2) 

identify and resolve information security control deficiencies and manage information security risks on 

an ongoing basis, and (3) effectively implement internal controls over estimating the cost of credit 

programs and determining the value of loans receivable and loan guarantee liabilities. Our audit report 

presents additional details concerning these material weaknesses and their effect on the accrual-based 

consolidated financial statements and managing federal government operations. Until the problems 

outlined in our audit report are adequately addressed, they will continue to have adverse implications 

for the federal government and the American people.

Resolving the problems outlined in our audit report is of utmost importance given the federal 

government’s reported fiscal path. The 2019 Statement of Long-Term Fiscal Projections and related 

information in Note 23 and in the unaudited Required Supplementary Information section of the Fiscal 

Year 2019 Financial Report of the United States Government (2019 Financial Report) show that absent 

policy changes, the federal government continues to face an unsustainable long-term fiscal path. GAO 

and the Congressional Budget Office (CBO) also prepare long-term federal fiscal simulations, which 

continue to show federal debt held by the public rising as a share of gross domestic product (GDP) in 

the long term.18 This situation—in which debt grows faster than GDP—means the current federal fiscal 

path is unsustainable. 

GAO, CBO, and the 2019 Financial Report, although using somewhat different assumptions, all project 

that debt held by the public as a share of GDP will surpass its historical high (106 percent in 1946) 

within the next 11 to 14 years. Health care spending is a key driver of spending in the long-term 

projections. Eventually, however, based on both the 2019 Financial Report projections and GAO’s 

simulation, spending on net interest (primarily interest on debt held by the public) will surpass Social 

Security spending and become the largest category of spending in 2035 and 2044, respectively.19

Reliable and complete financial information for federal entities will be needed for making policy changes 

17See GAO-19-624. In addition, see GAO, DOD Financial Management, accessed February 19, 2020, 

https://www.gao.gov/highrisk/dod_financial_management. Further, other auditors have made recommendations to DOD for 

improving its financial management.

18For more information on GAO’s simulations, see GAO, America’s Fiscal Future, accessed on February 19, 2020, 

https://www.gao.gov/americas_fiscal_future. For more information on CBO’s simulations, see Congressional Budget Office, 

The 2019 Long-Term Budget Outlook (Washington, D.C.: June 25, 2019). 

19CBO’s projections in its 2019 long-term budget outlook report also show net interest growing as a percentage of total 

spending. However, since CBO’s 2019 extended baseline projections only go out to 2049, the cost of net interest does not 

quite overtake other categories in the projection period. 
 41 STATEMENT OF THE COMPTROLLER GENERAL OF THE UNITED STATES

that effectively address the unsustainable long-term fiscal path. GAO plans to issue its annual report on 

the fiscal health of the federal government in the coming weeks.20

In taking action to change the federal government’s long-term fiscal path, Congress will need to 

consider policy changes across the entire range of federal activities that affect both revenue and 

spending. Congress will also need to consider alternative approaches for managing the level of debt. 

We have recommended that Congress consider alternative approaches to the current debt limit to avoid 

seriously disrupting the Treasury market and increasing borrowing costs and to allow the federal 

government to better manage its level of debt.21 Delays in raising the debt limit have occurred in each of 

the last 9 fiscal years, resulting in Treasury deviating from its normal cash and debt management 

operations and taking extraordinary actions to avoid exceeding the debt limit, such as suspending 

investments to some federal employees’ retirement funds.22 As currently structured, the debt limit—a

legal limit on the total amount of federal debt that can be outstanding at one time23—does not restrict

Congress’s ability to enact spending and revenue legislation that affects the level of federal debt, nor 

does it otherwise constrain fiscal policy. The debt limit only restricts Treasury’s authority to borrow to 

finance the decisions already enacted by Congress and the President.

One cannot overstate the importance of preserving the confidence that investors have that debt backed 

by the full faith and credit of the United States will be honored. Failure to increase (or suspend) the debt 

limit in a timely manner could have serious negative consequences for the Treasury market and 

increase borrowing costs. If the level of publicly held debt or its share of GDP is to be used as a fiscal 

management tool to change the long-term fiscal path, it needs to be considered as part of overall 

budget decisions at the time those decisions are being made. A long-term plan is needed to put the 

government on a sustainable fiscal path. Such a step would provide a focus on the fiscal impacts of 

budget decisions, and would ensure that U.S. Treasury securities continue to be one of the safest 

assets in the world.

Further, there are other risks, such as health pandemics, cyberattacks, military engagements, and 

economic crises, that could affect the federal government’s financial position and condition and its 

financial management in the future. These risks are not fully accounted for in the government’s longterm fiscal projections. Specific risk factors that could affect the federal government’s financial condition 

in the future include the following:

20GAO, The Nation’s Fiscal Health: Action Is Needed to Address the Federal Government’s Fiscal Future, GAO-19-314SP

(Washington, D.C.: Apr. 10, 2019).

21See most recently GAO, Federal Debt Management: Treasury Should Strengthen Policies for Market Outreach and Analysis 

to Maintain Broad-Based Demand for Securities, GAO-20-131 (Washington, D.C.: Dec. 5, 2019), and The Nation’s Fiscal 

Health: Actions Needed to Achieve Long-Term Fiscal Sustainability, GAO-19-611T (Washington, D.C.: June 26, 2019).

22Extraordinary actions are actions that Treasury takes as it nears the debt limit to avoid exceeding the limit. These actions are 

not part of Treasury’s normal cash and debt management operations. For more information, see GAO, Debt Limit: Market 

Response to Recent Impasses Underscores Need to Consider Alternative Approaches, GAO-15-476 (Washington, D.C.: July 

9, 2015).

23The debt limit is codified at 31 U.S.C. § 3101(b), as amended, and applies to federal debt issued pursuant to the authority of 

31 U.S.C. chapter 31. A very small amount of total federal debt is not subject to the debt limit. This amount primarily comprises 

unamortized discounts on Treasury bills and Zero Coupon Treasury bonds; debt securities issued by agencies other than 

Treasury, such as the Tennessee Valley Authority; and debt securities issued by the Federal Financing Bank. The Bipartisan 

Budget Act of 2019 has suspended the debt limit through July 31, 2021. Pub. L. No. 116-37, § 301, 133 Stat. 1049, 1057 

(Aug. 2, 2019).
STATEMENT OF THE COMPTROLLER GENERAL OF THE UNITED STATES 42

x The Pension Benefit Guaranty Corporation’s (PBGC) financial future is uncertain because of shortterm and long-term challenges related to its pension guarantee liabilities and exposure. PBGC’s 

liabilities exceeded its assets by about $57 billion as of the end of fiscal year 2019. PBGC

estimated that its exposure to potential further losses for underfunded plans in both the single and 

multiemployer programs was nearly $166 billion.24

PBGC has projected that without legislative reforms, there is a high likelihood the multiemployer 

program will become insolvent during fiscal year 2025 and that insolvency is a near certainty by the

end of fiscal year 2026. When the program becomes insolvent, PBGC financial assistance to

multiemployer plans will be limited to the premiums collected by the program and insufficient to pay 

the current level of guaranteed benefits.25

x Federal support of the housing finance market remains significant even though the market has 

largely recovered since the 2007 to 2009 financial crisis. In 2008, the federal government placed 

the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage

Corporation (Freddie Mac) under conservatorship and entered into preferred stock purchase 

agreements with these government-sponsored enterprises (GSE) to help ensure their financial 

stability. These agreements could affect the federal government’s financial condition. At the end of 

fiscal year 2019, the federal government reported about $112 billion of investments in the GSEs, 

which is net of about $98 billion in valuation losses. The GSEs paid Treasury cash dividends of $15 

billion and $10 billion during fiscal years 2019 and 2018, respectively. The reported maximum 

remaining contractual commitment to the GSEs, if needed, is $254.1 billion. 

The ultimate role of the GSEs could affect the federal government’s financial position and the 

financial condition of federal entities, including the Federal Housing Administration (FHA), which in 

the past expanded its lending role in distressed housing and mortgage markets. The Government 

National Mortgage Association (Ginnie Mae) guarantees the performance of about $2 trillion in 

securities backed by federally insured mortgages—$1.2 trillion of which were insured by FHA and 

$0.8 trillion by other federal entities, such as the Department of Veterans Affairs. 

We have reported on the need for Congress to consider legislation making changes to the future 

federal role in housing finance that address the structure of the GSEs; establish clear, specific, and 

prioritized goals; and consider all relevant federal entities, such as FHA and Ginnie Mae.26

x Disaster costs are projected to increase as extreme weather events become more frequent and 

intense because of climate change as observed and projected by the U.S. Global Change 

Research Program and the National Academies of Sciences, Engineering, and Medicine. Federal 

insurance programs are also likely to be affected by the increasing costs of weather and climate 

disasters. For example, as currently structured, the National Flood Insurance Program’s premiums 

and dedicated resources are not, over the long-term, sufficient to cover expected costs without 

24For more information on Pension Benefit Guaranty Corporation insurance programs, see GAO, High-Risk Series: Substantial 

Efforts Needed to Achieve Greater Progress on High-Risk Areas, GAO-19-157SP (Washington, D.C.: Mar. 6, 2019), 267.

25In December 2019, the enactment of the Bipartisan American Miners Act of 2019 provided additional funding for future 

annual Treasury transfers to the 1974 United Mine Workers of America Pension Plan (included in PBGC’s multiemployer 

program). See Pub. L. No. 116-94, div. M, § 102, 133 Stat. 2534 (Dec. 20, 2019), classified at 30 U.S.C. § 1232. PBGC is 

currently assessing the effect of the legislation on its liabilities and contingency disclosures (including the estimated insolvency 

date for the multiemployer program).

26GAO, Housing Finance: Prolonged Conservatorships of Fannie Mae and Freddie Mac Prompt Need for Reform,

GAO-19-239 (Washington, D.C.: Jan. 18, 2019).
 43 STATEMENT OF THE COMPTROLLER GENERAL OF THE UNITED STATES

borrowing from Treasury.27 As of September 30, 2019, the Federal Emergency Management 

Agency (FEMA), which administers the National Flood Insurance Program, owed about $21 billion 

to Treasury for money borrowed to pay claims and other expenses. We have reported that FEMA is 

unlikely to collect enough in premiums in the future to repay this debt.28

As we reported in October 2019, the federal government could reduce future costs by investing in 

climate resilience projects to help communities prepare for hazards such as sea level rise.29 Our 

Disaster Resilience Framework provides information that can help federal agencies and 

policymakers consider opportunities across the government to promote and facilitate disaster risk 

reduction.30

x The U.S. Postal Service (USPS) continues to be in poor financial condition. USPS cannot fund its 

current level of services and meet its financial obligations from its current level of revenues. The 

fiscal year 2019 net loss of $8.8 billion marked its 12th consecutive year of net losses—totaling 

$77.8 billion. In addition, USPS has missed $55.4 billion in required payments for postal retiree 

health and pension benefits through fiscal year 2019, including $47.2 billion in missed payments for 

retiree health benefits and $8.2 billion in missed payments for pension benefits. USPS has stated 

that it missed these payments to minimize the risk of running out of cash, citing its precarious 

financial condition and the need to cover current and anticipated costs and any contingencies. 

_________________________

Our audit report on the U.S. government’s consolidated financial statements would not be possible 

without the commitment and professionalism of inspectors general throughout the federal government 

who are responsible for annually auditing the financial statements of individual federal entities. We also

appreciate the cooperation and assistance of Treasury and OMB officials as well as the federal entities’ 

chief financial officers. We look forward to continuing to work with these individuals, the administration, 

and Congress to achieve the goals and objectives of federal financial management reform.

27We have suggested an alternative way to record insurance commitments in the budget such that the federal government’s 

commitment would be more fully recognized. See GAO, Fiscal Exposures: Federal Insurance and Other Activities That 

Transfer Risk or Losses to the Government, GAO-19-353 (Washington, D.C.: Mar. 27, 2019).

28GAO, Flood Insurance: Comprehensive Reform Could Improve Solvency and Enhance Resilience, GAO-17-425

(Washington, D.C.: Apr. 27, 2017).

29GAO, Climate Resilience: A Strategic Investment Approach for High-Priority Projects Could Help Target Federal Resources, 

GAO-20-127 (Washington, D.C.: Oct. 23, 2019).

30GAO, Disaster Resilience Framework: Principles for Analyzing Federal Efforts to Facilitate and Promote Resilience to 

Natural Disasters, GAO-20-100SP (Washington, D.C.: October 2019).
STATEMENT OF THE COMPTROLLER GENERAL OF THE UNITED STATES 44

Our audit report begins on page 232. Our guide, Understanding the Financial Report of the United 

States Government, is intended to help those who seek to obtain a better understanding of the financial 

report and is available on GAO’s website at http://www.gao.gov.

31

Our audit report was prepared under the direction of Robert F. Dacey, Chief Accountant; and Dawn 

Simpson, Director, Financial Management and Assurance. If you have any questions, please contact 

me on (202) 512-5500 or them on (202) 512-3406.

Gene L. Dodaro

Comptroller General

of the United States

cc: The Majority Leader of the Senate

The Minority Leader of the Senate

The Majority Leader of the House of Representatives

The Minority Leader of the House of Representatives

31GAO, Understanding the Financial Report of the United States Government, GAO-18-239SP (Washington, D.C.:

February 2018).