The federal government should consider further revisions to the current financial reporting model, GAO has said following a review of the government’s financial statements, on which it could not offer an opinion for the 10th year running because of weaknesses.
It called for a reconsideration of issues such as the kind of information that may be relevant in order to stimulate needed discussion and lead to reporting enhancements that might help Congress come up with ways to address the nation’s growing long-term fiscal imbalance, currently four times GDP after having increased 150 percent in six years.
It said that as of September 30, 2006, the federal government did not maintain effective internal controls over financial reporting and compliance with significant laws and regulations due to numerous material weaknesses.
The federal government’s financial condition and fiscal outlook are worse than many understand, according to GAO-07-607T.
It said structural deficits are nearly guaranteed given the design of current programs and policies, and that they will bring about unsustainable federal deficits and debt and eventually could damage living standards, domestic tranquility and national security.
Additional transparency in connection with federal budget reporting and legislative proposals is needed, GAO said.
