DOD Financial Management: Weaknesses in Controls over the Use of Public Funds and Related Improper Payments

摘要

The Budget and Accounting Procedures Act of 1950 and the law commonly known as the Federal Managers Financial Integrity Act of 1982 (FMFIA) placed primary responsibility for establishing and maintaining internal control on the head of the agency. Internal control is an integral component of an organization s management that when properly implemented and operating effectively provides reasonable assurance6 that the following objectives are being achieved: (1) effectiveness and efficiency of operations; (2) reliability of financial reporting; and (3) compliance with laws and regulations. Within this broad framework of internal control, DOD must design and implement effective funds control, payment controls, and internal control over financial reporting.7 Auditors of DOD s financial statements are to assess the effectiveness of these controls as part of the financial statement audit. However, DOD has acknowledged that long-standing weaknesses in its internal controls, its business systems, and its processes have prevented auditors from determining the reliability of DOD s financial statement information, including the budgetary information included in DOD s SBR. Moreover, we have previously reported that a weak overall control environment and poor internal controls limit DOD s ability to prevent and detect fraud, waste, abuse, and improper payments.