Would we give defense companies like Lockheed, General Dynamics, Halliburton and Blackwater contracts if their books were so messed up that they could not be audited?†
Hopefully, these are unlikely questions, because these corporations' executives know that they would be out of business and probably in jail, if they failed their financial statements' annual audits?†
Unfortunately, there are organizations in this country that affect the lives of every American, that do not receive clean opinions on their financial statements.†† There are organizations that are responsible for the safety and security of our citizens, yet they can not keep their books properly.† These organizations include the Departments of Defense, Homeland Security, State and NASA.†
According to Comptroller General David Walker, the federal government's head auditor, agencies responsible for approximately $740 billion of the government's net cost received disclaimer opinions or were not audited.† This amount represents the combined revenues of all the corporations mentioned above.† This means that†one out of every four dollars spent by the government could not be properly audited.†
The real question is:† Why isn't anybody up in arms about this? †The presidential candidates are promising to fix everything from the healthcare system to the economy.† Why aren't they acknowledging these problems and vowing to fix the government's books?†
In his audit report Walker stated the following:†
While significant progress has been made in improving financial management since the U.S. government began preparing consolidated financial statements 11 years ago, three major impediments continue to prevent us from rendering an opinion on the accrual basis consolidated financial statements: (1) serious financial management problems at the Department of Defense, (2) the federal government's inability to adequately account for and reconcile intragovernmental activity and balances between federal agencies, and (3) the federal government's ineffective process for preparing the consolidated financial statements. Until the problems outlined in our audit report are adequately addressed, they will continue to have adverse implications for the federal government and American taxpayers.