Government fails 10th consecutive audit

[Herman Munster]

http://www.govexec.com/story_page.cfm?articleid=35710&dcn=todaysnews

As anticipated, the federal government flunked its audit for fiscal 2006, with $797 billion, or 53 percent, of its reported assets and an additional $790 billion, or 27 percent, of net costs, on the balance sheets of five agencies that could not be fully audited.

This marks the 10th year in a row in which the government's consolidated audit statement received a judgment of "no comment" from auditors. The Defense, State and Homeland Security departments, as well as NASA, received disclaimers on their 2006 audits. The Energy Department, which was only partially auditable due to a disclaimer in 2005, earned a qualified opinion -- a step up from no opinion but still short of a clean bill of health.

Contributing to the problems at those agencies is the difficulty of valuing some of the complex, one-of-a-kind systems they own. After new accounting rules for property went into effect in 2003, about $325.1 billion in military equipment appeared on the books for the first time, according to a Treasury Department analysis.

In fiscal 2006, the government's total reported assets increased $48.6 billion, to $1.5 trillion.