Key Takeaways:
> Recommendation #1: The Department of Treasury’s Fiscal Service should ensure that agency policy regarding information system security documentation is thoroughly implemented for each system pertinent to the General Fund.
> Recommendation #2: Coordinate with the Federal Reserve Banks (FRB) to establish and apply procedures for the FRBs to maintain documentation supporting FRB-initiated transactions.
Overview
The General Fund of the U.S. Government (USG) serves as the central accounting entity managed by the Department of the Treasury’s Fiscal Service. This fund plays a critical role in the federal financial system by handling the accounting and reporting functions for cash activities that are fundamental to funding government operations.
The General Fund encompasses both assets and liabilities that are utilized to finance the USG’s daily operations as well as its long-term initiatives. As the primary financial management mechanism, it requires robust oversight to ensure proper stewardship of public resources.
Findings
The GAO report identifies concerns regarding the current management of the General Fund, highlighting weaknesses in accounting procedures and reporting mechanisms that could affect financial transparency and accuracy. For example, the Treasury’s Fiscal Service didn’t maintain documentation to support certain cash transactions, and the agency didn’t fully document all of its IT controls in its security plans.
Additionally, 82 percent of GAO’s previous recommendations have yet to be fully addressed.
Recommendations
The recommendations focus on strengthening these processes to improve overall fiscal management and accountability in government operations.
#1: The Department of Treasury’s Fiscal Service should strengthen accounting and reporting procedures for the General Fund to ensure accurate tracking of cash activities that fund federal government operations.
#2: The Fiscal Service should improve internal controls and oversight of the General Fund’s assets and liabilities to enhance financial management of resources used for both daily and long-term government operations.
Why It Matters
The General Fund consists of assets and liabilities used to finance the daily and long-term operations of the U.S. government. The preparation of and audit assurance over the Schedules of the General Fund is necessary to account for and eliminate General Fund intragovernmental activity and balances with other reporting entities in the USG consolidated financial statements.
For the full GAO report, click here.