DoD Financial Management: Integrated Approach, Accountability, Transparency, and Incentives Are Keys to Effective Reform

It is a pleasure to be here to discuss financial management at the Department of Defense (DOD). Today, DOD faces financial management problems that are pervasive, complex, long-standing, and deeply rooted in virtually all business operations throughout the department. DOD's financial management deficiencies, taken together, represent the single largest obstacle to achieving an unqualified opinion on the U.S. government's consolidated financial statements. To date, none of the military services or major DOD components have passed the test of an independent financial audit because of pervasive weaknesses in financial management systems, operations, and controls.