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Financial management : Navy records contain billions of dollars in unmatched disbursements : report to the Acting Secretary of the Navy

The proper matching of disbursements with recorded obligations is an important way of ensuring that agency funds are used properly. The Standard Accounting and Reporting System, which annually accounts for nearly $57 billion, or more than half, of the Navy's overall budget, contained $12.3 billion in unmatched disbursements as of February 1992. Almost $5 billion had been unmatched for more than two years. Of the total amount of unmatched disbursements, $3.9 billion of individual disbursements of $1 million or more had been unmatched with obligations for more than six months. The problem, however, may be much larger because GAO found instances in which Navy personnel arbitrarily matched obligations and disbursements. In addition, GAO found that unmatched disbursements were caused by lax compliance with internal controls or the lack of controls over (1) recording obligations in the accounting system before disbursing funds, (2) detecting and correcting errors in the disbursement process, and (3) posting accurate and complete accounting information in systems that support the disbursement process. Although Navy officials acknowledge that unmatched disbursements have been a long-standing problem, current initiatives are unlikely to resolve the problem because they fail to address the basic causes outlined above.

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