DoD Financial Management: Important Steps Underway But Reform Will Require a Long-term Commitment

Thank you for the opportunity to discuss financial management at the Department of Defense (DOD). Today, DOD faces financial and related management problems that are pervasive, complex, long-standing, and deeply rooted in virtually all business operations throughout the department. DODs 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 has passed the test of an independent financial audit because of weaknesses in financial management systems, operations, and controls.