Bookkeeping Errors Contribute to $17.3 Billion Federal Loss

Making Enron's $600 million restated financial statements look like a mistake in a child's allowance, the U.S. Treasury has admitted an accounting error and a resulting loss of $17.3 billion.

The admission appeared in the 2001 Financial Report of the United States Government issued earlier this spring and accompanied by the statement by the General Accounting Office (GAO) that once again, for the fifth consecutive year, the GAO is "unable to express an opinion on the consolidated financial statements because of certain material weaknesses in internal control and accounting and reporting issues."

Treasury Secretary Paul O'Neill stated in the report, "I believe that the American people deserve the highest standards of accountability and professionalism from their Government and I will not rest until we achieve them."

The report indicates that three factors contributed to the error: inaccurate bookkeeping by government agencies, errors in reporting contracts among government agencies, and timing problems associated with reporting costs and revenues.

You may like these other stories...

The Public Company Accounting Oversight Board (PCAOB) on Tuesday adopted a new auditing standard and amendments in three areas of the audit that could pose an increased risk of material misstatement in company financial...
Read more from Larry Perry here and in the Today’s World of Audits archive.In my last article, I presented an overview of one of the first steps in the preplanning phase of an audit engagement: reviewing prior year...
Read more from Larry Perry here and in the Today’s World of Audits archive.AU-C Section 800, Special Considerations—Audits of Financial Statements Prepared in Accordance with Special Purpose Frameworks (SPFs),...

Upcoming CPE Webinars

Jul 24
In this presentation Excel expert David Ringstrom, CPA revisits the Excel feature you should be using, but probably aren't. The Table feature offers the ability to both boost the integrity of your spreadsheets, but reduce maintenance as well.
Jul 31
In this session Excel expert David Ringstrom helps beginners get up to speed in Microsoft Excel. However, even experienced Excel users will learn some new tricks, particularly when David discusses under-utilized aspects of Excel.
Aug 5
This webcast will focus on accounting and disclosure policies for various types of consolidations and business combinations.