Ongoing Weaknesses Prevent GAO from Providing Opinion on U.S. Government’s Financial Statements
WASHINGTON (January 16, 2025) – The Government Accountability Office (GAO) was unable to provide an opinion on the reliability of the federal government's consolidated financial statements for fiscal year 2024 and 2023. This year's audit report stresses the need to address serious deficiencies in federal financial management and address the federal government’s unsustainable long-term fiscal path.
"The federal government has again come up short in managing its finances and achieving a clean audit due to challenges in adequately supporting its costs, revenues, assets, and liabilities,” said Gene L. Dodaro, Comptroller General of the United States and head of the GAO. “These serious financial management weaknesses and unsustainable long term fiscal path further underscore the need for urgent attention, accountability, and transparency. To ensure our readiness as a nation to confront both domestic and international challenges, it’s imperative for Congress and the executive branch to come together and craft a plan for long-term fiscal sustainability.”
Several issues prevented GAO from providing an opinion on the federal government’s financial statements. Serious financial management problems persist at the Department of Defense, accounting for intragovernmental transactions and balances between federal entities remains inadequate, and weaknesses in the federal government’s process for preparing the consolidated financial statements continue. In addition, the Small Business Administration and the Department of Education are unable to support the cost of their loan programs. Additionally, improper payments totaling $162 billion were reported by several agencies in fiscal year 2024 and the annual gap between taxes owed and collected is several hundreds of billions of dollars.
Dodaro emphasized that it is important that Congress immediately replace the debt limit with an approach that links debt decisions to spending and revenue decisions at the time they are made. In 2015, GAO first recommended Congress consider alternative approaches to the current debt limit process. Last-minute negotiations on the debt limit can increase the risk of a default on government debt and other obligations. A default would disrupt financial markets, with immediate, potentially severe consequences for businesses and households. A default could also inflict long-lasting damage to the economy and could worsen the fiscal outlook.
Dodaro thanked the Inspector General community for their contributions to auditing the annual financial statements of their respective departments and agencies. The report also recognized that progress has been made over the years to improve financial management, but much more needs to be done.
GAO's audit report on the U.S. government's consolidated financial statements is included in the 2024 Financial Report of the United States Government, which is prepared by Treasury in coordination with the Office of Management and Budget.
For more information, contact Sarah Kaczmarek, Managing Director of Public Affairs, at (202) 512-4800 or media@gao.gov.
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