United States General Accounting Office
GAO
Report to the Secretary of Defense
June 1998
FINANCIAL
MANAGEMENT
Training of DOD
Financial Managers
Could Be Enhanced
GAO/AIMD-98-126
GAO
United States
General Accounting Office
Washington, D.C. 20548
Accounting and Information
Management Division
B-279753
June 24, 1998
The Honorable William S. Cohen
The Secretary of Defense
Dear Mr. Secretary:
With passage of the Chief Financial Officers (CFO) Act of 1990 and the
Government Management Reform Act of 1994, agencies are increasingly
expected to implement improved financial and accounting practices with
the goal of producing accurate and complete information on their
operations, including auditable financial statements. Such information is
critical for use by managers and policymakers in making difficult
decisions as well as measuring agency performance and the full cost of
government activities as envisioned by the Government Performance and
Results Act of 1993. Financial management personnel are now required to
use new federal accounting standards that are intended to provide greater
accountability and enhanced decision-making in a cost-effective manner
by enhancing existing accounting and reporting requirements. Integrating
these new accounting standards and legislative requirements with existing
financial management practices creates a challenge for financial managers
throughout government.
The Department of Defense’s (DOD) financial management systems,
policies, and procedures continue to be hampered by significant
weaknesses. We have issued several reports pointing out that DOD has not
established policies nor begun to implement many of the accounting
requirements that were being phased in and are now effective.1
Consequently, DOD personnel are now confronting an enormous financial
management improvement challenge, the most difficult in the federal
government. Training is key to bringing DOD financial managers up-to-date
and keeping them current on enhanced accounting standards and
legislative requirements. Technic