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entitled 'Performance & Accountability Report: Fiscal Year 2009' which 
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Serving The Congress And The Nation: 

U.S. Government Accountability Office: 

Performance & Accountability Report: 

Fiscal Year 2009: 

Accountability: 
Integrity: 
Reliability: 

Figure: Serving The Congress: 

[Refer to PDF for image] 

Mission: 

GAO exists to support the Congress in meeting its constitutional 
responsibilities and to help improve the performance and ensure the 
accountability of the federal government for the benefit of the 
American people. 

Accountability: 

We help the Congress oversee federal programs and operations to ensure 
accountability to the American people. GAO’s analysts, auditors, 
lawyers, economists, information technology specialists, investigators, 
and other multidisciplinary professionals seek to enhance the economy, 
efficiency, effectiveness, and credibility of the federal government 
both in fact and in the eyes of the American people. 

Integrity: 

We set high standards for ourselves in the conduct of GAO’s work. Our 
agency takes a professional, objective, fact-based, nonpartisan, 
nonideological, fair, and balanced approach to all activities. 
Integrity is the foundation of our reputation, and the GAO approach to 
work ensures it. 

Reliability: 

We at GAO want our work to be viewed by the Congress and the American 
public as reliable. We produce high-quality reports, testimonies, 
briefings, legal opinions, and other products and services that are 
timely, accurate, useful, clear, and candid. 

Scope of work: 

GAO performs a range of oversight-, insight-, and foresight-related 
engagements, a vast majority of which are conducted in response to 
congressional mandates or requests. GAO’s engagements include 
evaluations of federal programs and performance, financial and 
management audits, policy analyses, legal opinions, bid protest 
adjudications, and investigations. 

Source: See Image Sources. 

[End of figure: Serving The Congress] 

GAO Performance and Accountability Report 2009: 

Contents: 

Abbreviations: 

How to Use This Report: 

Introduction: 

From the Acting Comptroller General: 

Financial Reporting Assurance Statements: 

About GAO: 

Mission: 

Strategic Planning and Management Process: 

Organizational Structure: 

Strategies for Achieving Our Goals: 

How We Measure Our Performance: 

Part I: Management’s Discussion and Analysis: 

Assisting the Congress and the Nation During Changing and Challenging 
Times: 

Focusing on Results: 

Focusing on Our Client: 

Focusing on Our People: 

Focusing on Our Internal Operations: 

GAO’s High-Risk Program: 

Assisted with the Transition: 

The Troubled Asset Relief Program: 

The American Recovery and Reinvestment Act: 

Managing Our Resources: 

Strategic and Annual Work Planning: 

Internal Management Challenges and Mitigating External Factors That 
Could Affect Our Performance: 

Part II: Performance Information: 

Performance Information by Strategic Goal: 

Goal 1 Overview: Provide timely, quality service to the Congress and 
the federal government to address current and emerging challenges to 
the well-being and financial security of the American people: 

Financial Benefits: 

Nonfinancial Benefits: 

Testimonies: 

Goal 2 Overview: Provide timely, quality service to the Congress and 
the federal government to respond to changing security threats and the 
challenges of global interdependence: 

Financial Benefits: 

Nonfinancial Benefits: 

Testimonies: 

Goal 3 Overview: Help transform the federal government’s role and how 
it does business to meet 21st century challenges: 

Financial Benefits: 

Nonfinancial Benefits: 

Testimonies: 

Goal 4 Overview: Maximize the value of GAO by being a model federal 
agency and a world-class professional services organization: 

Data Quality and Program Evaluation: 

Verifying and Validating Performance Data: 

Program Evaluation: 

Part III: Financial Information: 

From the Chief Financial Officer: 

Audit Advisory Committee’s Report: 

Independent Auditor’s Report: 

Purpose of Each Financial Statement: 

Financial Statements: 

Notes to Financial Statements: 

Part IV: From the Inspector General: 

From the Inspector General: 

Part V: Appendixes: 

1. Accomplishments and Other Contributions: 

2. GAO’s Report on Personnel Flexibilities: 

3. GAO’s FISMA Efforts: 

Image Sources: 

Providing Comments on This Report: 

Obtaining Copies of GAO Documents: 

Abbreviations 

AGA: Association of Government Accountants:
APSS: Administrative Professional and Support Staff:
ATF: Bureau of Alcohol, Tobacco, Firearms and Explosives:
BRAC: Base Realignment and Closure:
CGAB: Comptroller General Advisory Board:
CMS: Centers for Medicare & Medicaid Services:
CSRS: Civil Service Retirement System:
CVRA: Crime Victims’ Rights Act of 2004:
DEA: Drug Enforcement Administration:
DHS: Department of Homeland Security:
DOD: Department of Defense:
DOE: Department of Energy:
DOJ: Department of Justice:
DOT: Department of Transportation:
EAC: Employee Advisory Council:
EPA: Environmental Protection Agency:
ESC: Enterprise Service Center:
FAA: Federal Aviation Administration:
FCC: Federal Communications Commission:
FDA: Food and Drug Administration:
FECA: Federal Employees’ Compensation Act:
FEGLI: Federal Employees’ Group Life Insurance:
FEHBP: Federal Employees’ Health Benefits Program:
FEMA: Federal Emergency Management Agency:
FERS: Federal Employees Retirement System:
FHA: Federal Housing Administration:
FICA: Federal Insurance Contributions Act:
FISMA: Federal Information Security Management Act:
FMFIA: Federal Managers’ Financial Integrity Act of 1982:
FSI: Forensic Audits and Special Investigations unit
FTE: full-time equivalent:
FWS: Federal Wage System:
GPS: Global Positioning System:
GS: General Schedule:
GSA: General Services Administration:
HCTC: Health Care Tax Credit:
HHC: handheld computer:
HHS: Department of Health and Human Services:
HIT: Health Information Technology:
HSPD: Homeland Security Presidential Directive:
HUD: Department of Housing and Urban Development:
IAF: Intergovernmental Audit Forum:
ICE: Immigration and Customs Enforcement:
ICWG: Internal Control Working Group:
IFPTE: International Federation of Professional and Technical Engineers:
IG: inspector general:
IIA: Institute of Internal Auditors:
INTOSAI: International Organization of Supreme Audit Institutions:
IRB: Institutional Review Board:
IRIS: Integrated Risk Information System:
IRS: Internal Revenue Service:
IT: information technology:
ITIL: Information Technology Infrastructure Library framework:
LRP: local and regional procurement:
MAS: Multiple Award Schedules:
NASA: National Aeronautics and Space Administration:
NFC: National Finance Center:
NIAF: National Intergovernmental Audit Forum:
NIST: National Institute of Standards and Technology:
OIG: Office of the Inspector General:
OMB: Office of Management and Budget:
OPM: Office of Personnel Management:
OSHA: Occupational Safety and Health Administration:
PAR: performance and accountability report: 
PBC: performance-based compensation:
PBGC: Pension Benefit Guaranty Corporation:
QCI: Quality and Continuous Improvement office:
SAI: supreme audit institution:
SAT: Senior Assessment Team:
SEC: Securities and Exchange Commission:
SES: Senior Executive Service:
SBA: Small Business Administration:
SL: Senior Level:
SOC: Senior Oversight Committee:
SRS: standardized rating score:
SSA: Social Security Administration:
TAA: Trade Adjustment Assistance:
TARP: Troubled Asset Relief Program:
TSA: Transportation Security Administration:
USACE: U.S. Army Corps of Engineers:
USAID: U.S. Agency for International Development:
USDA: Department of Agriculture:
USPS: U.S. Postal Service:
VA: Department of Veterans Affairs:
VPP: voluntary protection program:
WHD: Wage and Hour Division: 

[End of Abbreviations] 

How to Use This Report 

This report describes the U.S. Government Accountability Office’s (GAO) 
performance measures, results, and accountability processes for fiscal 
year 2009. In assessing our performance, we compared actual results 
against targets and goals that were set in our annual performance plan 
and performance budget and were developed to help carry out our 
strategic plan. Our complete set of strategic planning and performance 
and accountability reports is available on our Web site at [hyperlink, 
http://www.gao.gov/sp.html. 

This report has an introduction, four major parts, and supplementary 
appendixes as follows: 

Introduction: 

This section includes the letter from the Acting Comptroller General 
and a statement attesting to the reliability of our performance and 
financial data in this report and the effectiveness of our internal 
control over our financial reporting. This section also includes a 
summary discussion of our mission, strategic planning process, 
organizational structure, strategies we use to achieve our goals, and 
process for assessing our performance. 

Management’s Discussion and Analysis: 

This section discusses our agencywide performance results and use of 
resources in fiscal year 2009. It also includes information on our 
internal controls and the management challenges and external factors 
that affect our performance. 

Performance Information: 

This section includes details on our performance results by strategic 
goal in fiscal year 2009 and the targets we are aiming for in fiscal 
year 2010. It also includes an explanation of how we ensure the 
completeness and reliability of the performance data used in this 
report. 

Financial Information: 

This section includes details on our finances in fiscal year 2009, 
including a letter from our Chief Financial Officer, audited financial 
statements and notes, and the reports from our external auditor and 
Audit Advisory Committee. This section also includes an explanation of 
the kind of information each of our financial statements conveys. 

From the Inspector General: 

This section includes our Inspector General’s assessment of our 
agency’s management challenges. 

Appendixes: 

These sections include detailed summaries of our most significant 
accomplishments and contributions recorded in fiscal year 2009 and 
information on certain human capital management flexibilities and on 
our information security management efforts. 

[End of How to Use This Report] 

Introduction: From the Acting Comptroller General: 

November 13, 2009: 

Reflecting on the past fiscal year, I am especially proud of our work 
in support of the Congress and the American people which we convey in 
this fiscal year 2009 performance and accountability report. Our 
mission is to help improve the way the federal government works, and 
based on the information in this report, I believe you will agree that 
we succeeded in this regard last fiscal year. I am confident that the 
performance and financial information in this report is complete and 
reliable and meets our high standards for accuracy and transparency. 

Fiscal year 2009 ushered in a period of change and challenge for the 
nation and GAO, and our people worked together creatively and 
tirelessly to support the Congress and the nation throughout the year. 
The election of a new U.S. President in November marked the first 
wartime presidential transition in 40 years and the first 
administration change since 9/11. To ensure that the government carried 
out its essential missions as efficiently and effectively as possible 
during this time of change, we did our part to help affect a seamless 
transition by outreaching to key members of the new administration and 
the Congress in person and through our transition Web site made 
available November 6, 2008—2 days after the national election. We 
highlighted for these policymakers and their staffs a number of 
pressing issues that demand urgent attention and continuing oversight 
to ensure the nation’s security and well-being. We also identified 
management challenges facing the government as well as several cost-
saving opportunities. Many of the urgent issues discussed on the site—
such as financial markets regulation; Iraq, Afghanistan, and Pakistan; 
and the 2010 Census—received attention in the early months of the new 
administration and the Congress and will continue to do so during the 
current fiscal year. 

Also during fiscal year 2009 the Congress, through mandates in the 
Emergency Economic Stabilization Act of 2008 (Stabilization Act) and 
the American Recovery and Reinvestment Act (Recovery Act), solicited 
our assistance with its efforts to address the nation’s financial and 
economic crisis. We assembled an interdisciplinary team of financial 
market experts, accountants, lawyers, and economists to produce 
bimonthly reports on the accountability, transparency, and integrity of 
efforts carried out under the $700 billion Troubled Asset Relief 
Program (TARP) created by the Stabilization Act. We also leveraged our 
internal resources, hired new staff, and coordinated with the 
accountability community to fulfill our Recovery Act mandates which 
include reporting every 2 months on how selected states and localities 
are using Recovery Act funding over the next several years. Federal 
programs administered by 16 selected states and the District of 
Columbia that we examine in these bimonthly reports account for 90 
percent of the Recovery Act outlays administered by states and 
localities for fiscal year 2009. 

In concert with these additional expectations, we successfully carried 
out our fiduciary functions—which included two new funding streams 
provided by TARP and the Recovery Act—our new mandates, and our basic 
legislative responsibilities. For example, we again received from 
independent auditors an unqualified or “clean” opinion on our financial 
statements for fiscal year 2009 and met or exceeded all 15 of our 
annual performance measures. We were also good stewards of the nation’s 
purse, documenting in fiscal year 2009 $43 billion in financial 
benefits—a return of $80 for every dollar invested in us. In addition, 
we recorded over 1,300 nonfinancial benefits that helped to change 
laws, such as the Weapon Systems Acquisition Reform Act of 2009 (Pub. 
L. No. 111-23); improve services to the public; and promote sound 
management governmentwide. Our testimonies measure indicates that the 
111th Congress continued to rely on us for information as it debated 
important national and international issues, with our senior officials 
testifying at 203 hearings during fiscal year 2009. Over two-thirds of 
our reports contained recommendations, and the rate at which federal 
agencies and the Congress implemented recommendations we made in past 
years met the 80 percent target we set for this measure. 

This level of performance could not have been achieved without the 
extraordinary efforts and support of our highly professional, diverse, 
and multidisciplinary staff. The hard work and dedication they 
displayed throughout the past fiscal year made it possible for us to 
meet our legislative deadlines, both anticipated and unforeseen. Our 
people measures for fiscal year 2009 indicate that we are doing many of 
the right things to ensure that our staff have the training, work 
experiences, tools, and services they need to be productive in this 
very demanding environment. Specifically, we exceeded the targets we 
set for all seven of our people measures—new hire rate, retention rate 
with and without retirements, staff development, staff utilization, 
effective leadership by supervisors, and organizational climate—from 2 
to 4 percentage points. Also, we rated second on the 2009 list of best 
places to work in the federal government among large federal agencies, 
according to rankings released in fiscal year 2009 by the Partnership 
for Public Service and the Institute for the Study of Public Policy 
Implementation at American University. 

But our work is not done. Like the nation, we must continue to address 
our internal management challenges—physical security, information 
security, and human capital—as they evolve. For example, in fiscal year 
2009, we continued to focus on developing a more inclusive and diverse 
workplace by implementing and updating our 2008 Workforce Diversity 
Plan. We also reassessed our recruiting and hiring practices and began 
briefing managers on the Americans with Disabilities Act provisions and 
GAO’s new reasonable accommodation process to ensure that our practices 
align with the vision set forth in the Workforce Diversity Plan. In 
addition, we examined our performance appraisal process, surveyed all 
agency staff concerning their views of and experiences with the 
process, and implemented a standardized appraisal review process to 
ensure that all staff receive a fair and equitable assessment of their 
performance during annual performance reviews. These human capital 
issues and others constitute the primary focus of our agencywide 
management improvement efforts that we began in fiscal year 2009. 
Streamlining our processes and products is also another important part 
of our management improvement effort and should result in shorter 
testimony statements and reports in the coming months. 

We continued to maintain a good working relationship with the 
employees’ union, GAO Employees Organization, International Federation 
of Professional and Technical Engineers, Local 1921. GAO management has 
established an important line of communications with the union via 
weekly meetings with GAO Workforce Relations staff and union officers 
to discuss ongoing and emerging issues. We are also working with the 
Employee Advisory Council and the Diversity Advisory Council on a range 
of issues. 

In summary, fiscal year 2009 was a very fast-paced and demanding time 
for us, yet we succeeded at performing our mission and mandates and 
accomplishing the goals we set. We are committed to continuing our 
efforts to support the Congress and the taxpayers as the nation 
confronts the challenges ahead. 

Signed by: 

Gene L. Dodaro: 
Acting Comptroller General of the United States: 

[End of From the Acting Comptroller General] 

Financial Reporting Assurance Statements: 

November 13, 2009: 

We, as GAO’s executive committee, are responsible for preparing and 
presenting the financial statements and other information included in 
this performance and accountability report. The financial statements 
included herein are presented in conformity with U.S. generally 
accepted accounting principles; incorporate management’s reasonable 
estimates and judgments, where applicable; and contain appropriate and 
adequate disclosures. Based on our knowledge, the financial statements 
are presented fairly in all material respects, and other financial 
information included in this report is consistent with the financial 
statements. 

We are also responsible for establishing and maintaining adequate 
internal control over financial reporting. We conducted an assessment 
of the effectiveness of our internal control over financial reporting 
consistent with the criteria in 31 U.S.C. 3512 (c), (d) (commonly 
referred to as the Federal Managers’ Financial Integrity Act (FMFIA)) 
and in Appendix A of Office of Management and Budget (OMB) Circular A-
123, Management’s Responsibility for Internal Control. Based on the 
results of this assessment, we have reasonable assurance that internal 
control over financial reporting as of September 30, 2009, was 
operating effectively and that no material weaknesses exist in the 
design or operation of the internal control over financial reporting. 

On the basis of our comprehensive management control program, we are 
pleased to certify, with reasonable assurance, the following: 

* Our financial reporting is reliable—transactions are properly 
recorded, processed, and summarized to permit the preparation of 
financial statements in conformity with U.S. generally accepted 
accounting principles, and assets are safeguarded against loss from 
unauthorized acquisition, use, or disposition. 

* We are in compliance with all applicable laws and regulations—
transactions are executed in accordance with laws governing the use of 
budget authority and other laws and regulations that could have a 
direct and material effect on the financial statements. 

* Our performance reporting is reliable—transactions and other data 
that support reported performance measures are properly recorded, 
processed, and summarized to permit the preparation of performance 
information consistent with the criteria set forth in the Government 
Performance and Results Act of 1993 and related OMB guidance. 

We also believe that (1) these same systems of accounting and internal 
controls provide reasonable assurance that we are in compliance with 
the spirit of FMFIA and (2) we have implemented and maintained 
financial systems that comply substantially with federal financial 
management systems requirements, applicable federal accounting 
standards, and the U.S. Government Standard General Ledger at the 
transaction level consistent with the requirements in the Federal 
Financial Management Improvement Act and OMB guidance. These are 
objectives that we set for ourselves even though, as part of the 
legislative branch of the federal government, we are not legally 
required to do so. 

Signed by: 

Gene L. Dodaro: 
Acting Comptroller General of the United States: 

Signed by: 

Sallyanne Harper: 	
Chief Financial Officer: 

Signed by: 

Lynn H. Gibson: 
Acting General Counsel: 

[End of Financial Reporting Assurance Statements] 

About GAO: 

GAO is an independent, nonpartisan professional services agency in the 
legislative branch of the federal government. Commonly known as the 
audit and investigative arm of the Congress or the “congressional 
watchdog,” we examine how taxpayer dollars are spent and advise 
lawmakers and agency heads on ways to make government work better. As a 
legislative branch agency, we are exempt from many laws that apply to 
the executive branch agencies. However, we generally hold ourselves to 
the spirit of many of the laws, including 31 U.S.C. 3512 (c), (d) 
(FMFIA), the Government Performance and Results Act of 1993 (GPRA), and 
the Federal Financial Management Improvement Act of 1996 (FFMIA). 
[Footnote 1] Accordingly, this performance and accountability 
report for fiscal year 2009 provides what we consider to be information 
that is at least equivalent to that supplied by executive branch 
agencies in their annual performance and accountability reports. 

Mission: 

Our mission is to support the Congress in meeting its constitutional 
responsibilities and to help improve the performance and ensure the 
accountability of the federal government for the benefit of the 
American people. The strategies and means that we use to accomplish 
this mission are described in the following pages. In short, we 
accomplish our mission by providing objective and reliable information 
and informed analysis to the Congress, to federal agencies, and to the 
public, and we recommend improvements, when appropriate, on a wide 
variety of issues. Three core values—accountability, integrity, and 
reliability—form the basis for all of our work, regardless of its 
origin. These are described on the inside front cover of this report. 

[Text box: GAO’s History: 

The Budget and Accounting Act of 1921 required the President to issue 
an annual federal budget and established GAO as an independent agency 
to investigate how federal dollars are spent. In the early years, we 
mainly audited vouchers, but after World War II we started to perform 
more comprehensive financial audits that examined the economy and 
efficiency of government operations. By the 1960s, GAO had begun to 
perform the type of work we are noted for today—program evaluation—
which examines whether government programs are meeting their 
objectives. End of GAO's History]

Strategic Planning and Management Process: 

To accomplish our mission, we use a strategic planning and management 
process that is based on a hierarchy of four elements (see figure 1), 
beginning at the highest level with the following four strategic goals: 

* Strategic Goal 1: Provide Timely, Quality Service to the Congress and 
the Federal Government to Address Current and Emerging Challenges to 
the Well-Being and Financial Security of the American People. 

* Strategic Goal 2: Provide Timely, Quality Service to the Congress and 
the Federal Government to Respond to Changing Security Threats and the 
Challenges of Global Interdependence. 

* Strategic Goal 3: Help Transform the Federal Government’s Role and 
How It Does Business to Meet 21st Century Challenges. 

* Strategic Goal 4: Maximize the Value of GAO by Being a Model Federal 
Agency and a World-Class Professional Services Organization. 

Our audit, evaluation, and investigative work is primarily aligned 
under the first three strategic goals, which span issues that are both 
domestic and international, affect the lives of all Americans, and 
influence the extent to which the federal government serves the 
nation’s current and future interests (see figure 2). 

The fourth goal is our only internal one and is aimed at maximizing our 
productivity through such efforts as investing steadily in information 
technology to support our work; ensuring the safety and security of our 
people, information, and assets; pursuing human capital transformation; 
and leveraging our knowledge and experience. 

Figure 1: GAO’s Strategic Planning Hierarchy: 

[Refer to PDF for image] 

A four level stair-step pyramid that shows GAO's strategic planning 
hierarchy. 

Level 1: Strategic Goals (4); 
Level 2: Strategic Objectives (21); 
Level 3: Performance goals (93); 
Level 4: Key Efforts (300+). 

Source: GAO. 

[End of Figure 1] 

Text box: An Example of Our Strategic Planning Elements: 

Strategic Goal 1: Provide Timely, Quality Service to the Congress and 
the Federal Government to Address Current and Emerging Challenges to 
the Well-Being and Financial Security of the American People: 

Strategic Objective: The Health Needs of an Aging and Diverse 
Population. 

Performance Goal: Evaluate the Effectiveness of Federal Programs to 
Promote and Protect the Public Health. 

Key Efforts: 

* Evaluate impediments and barriers to the development of new 
prescription drugs and vaccines; 

* Assess the regulatory structure for ensuring the safety and efficacy 
of medical devices, drugs, and other medical products and therapies. 

* Evaluate programs targeted at improving the health status of the 
population; 

* Evaluate the effectiveness of programs to provide prevention, 
treatment, and other services related to mental health conditions, 
including substance abuse. End of text box] 

Figure 2: How GAO Assisted the Nation: Fiscal Year 2009: 

Strategic Goal 1: Provide timely, quality service to the Congress and 
the federal government to address current and emerging challenges to 
the well-being and financial security of the American people: 

* Highlighted weaknesses in the Food and Drug Administration’s 
oversight of medical devices; 

* Helped to improve the health care provided wounded soldiers returning 
home; 

* Investigated the death and abuse of children at public and private 
schools; 

* Recommended additional oversight and controls of voluntary workplace 
safety and health programs administered by some companies; 

* Enhanced management at the Pension Benefit Guaranty Corporation; 

* Enhanced federal efforts to combat drug trafficking; 

* Identified ways the Department of Housing and Urban Development could 
promote energy efficiency and green building in federal public housing 
programs; 

* Informed the debate on hardrock mining reform; 

* Reported on the Environmental Protection Agency’s reforms of its 
toxic chemical assessment process; 

* Informed the Congress about the U.S. Postal Service’s deteriorating 
financial situation. 

Strategic Goal 2: Provide timely, quality service to the Congress and 
the federal government to respond to changing security threats and the 
challenges of global interdependence: 

* Recommended actions to improve the Department of Defense’s (DOD) 
management of contractors in Iraq and Afghanistan; 

* Helped the Congress assess DOD’s ability to provide trained and ready 
forces for military operations; 

* Recommended that the State Department develop outcome measures for 
its capacity-building program in Iraq; 

* Helped to improve DOD’s accounting of weapons provided to Afghan 
security forces; 

* Helped to strengthen aviation security through improved passenger 
watch-list matching; 

* Developed a framework to help the Congress evaluate proposals for 
revamping the U.S. financial regulatory system; 

* Helped to assess the implementation of TARP; 

* Informed the Congress about weaknesses in lender data that limit 
regulators’ability to identify financial institutions at higher risk of 
discriminatory lending practices. 

Strategic Goal 3: Help transform the federal government’s role and how 
it does business to meet 21st century challenges: 

* Helped to track how states and localities are using Recovery Act 
funds; 

* Strengthened federal planning and preparedness efforts for the 
influenza pandemic; 

* Helped DOD and the Department of Veterans Affairs better share 
electronic health records; 

* Identified shortcomings in the Department of Homeland Security’s 
management of major acquisitions; 

* Tested the adequacy of the complaint intake process at the Department 
of Labor’s Wage and Hour Division; 

* Helped to reduce governmentwide improper payments; 

* Recommended ways to reduce tax noncompliance. 

Strategic Goal 4: Maximize the value of GAO by being a model federal 
agency and a world-class professional services organization: 

* Mobilized staff quickly to conduct mandated oversight work and ensure 
accountability of the federal assistance available through the Recovery 
Act; 

* Contributed to enhancing the ability of the domestic accountability 
community to prevent fraud, waste, and abuse of federal funds; 

* Helped enhance international accountability organizations’ capacity 
to implement strong professional standards by sponsoring training and 
participating in international forums. 

[End of Figure 2] 

We revisit the focus and appropriateness of these four strategic goals 
each time that we update our strategic plan. We last updated our 
strategic plan in March 2007. These four broad outcome goals are an 
outgrowth of our mission statement and explain our major focus areas 
and the long-term results they are intended to achieve. Each of our 
strategic goals is supported by four to eight strategic objectives that 
elaborate on each strategic goal. We list the strategic goals and 
strategic objectives under each one in figure 3, our strategic planning 
framework for serving the Congress. Several multiyear performance goals 
define a specific level of achievement for each strategic objective, 
and at the base of our strategic planning hierarchy, key efforts 
describe a body of work that operationalizes each performance goal. 
Complete descriptions of the steps in our strategic planning and 
management process are included in our strategic plan for fiscal years 
2007 through 2012, which is available on our Web site at [hyperlink, 
http://www.gao.gov]. This site also provides access to our annual 
performance plans since fiscal year 1999 and our performance and 
accountability reports since fiscal year 2001. To ensure that we are 
well positioned to meet the Congress’s current and future needs, we 
update our 6-year strategic plan every 3 years, consulting extensively 
during the update with our clients on Capitol Hill and with other 
experts (see our complete strategic plan on 
[http://www.gao.gov/about/strategic.html). Using the plan as a blueprint, 
we lay out the areas in which we expect to conduct research, audits, 
analyses, and evaluations to meet our clients’ needs, and we allocate 
the resources we receive from the Congress accordingly. Given the 
increasingly fast pace with which crucial issues emerge and evolve, we 
design a certain amount of flexibility into our plan and staffing 
structure so that we can respond readily to the Congress’s changing 
priorities. When we revise our plan or our allocation of resources, we 
disclose those changes in annual performance plans, which are posted—
like our strategic plan—on the Web for public inspection [hyperlink, 
http://www.gao.gov/sp.html]. 

We revised our strategic plan in fiscal year 2007 for the third time 
since we first issued a strategic plan in 2000. The broad goals and 
objectives of our strategic plan for 2007-2012 did not change 
significantly since our last update, but events such as the continuing 
war in Iraq and recent natural disasters account for some modification 
in emphasis. Seven broad issues or “themes” provide the context for our 
strategic plan (see figure 3), many of which were raised repeatedly by 
our client and other stakeholders during our outreach efforts and 
discussions we initiated while preparing the plan. For more information 
about the themes, see Forces That Will Shape America’s Future: The 
Themes from GAO’s Strategic Plan [hyperlink, 
http://www.gao.gov/products/GAO-07-467SP], March 2007. We are in 
the process of updating our current strategic plan and intend to 
release it in the spring of 2010. 

Figure 3: GAO's Strategic Plan Framework: 

[Refer to PDF for Image] 

Serving the Congress and the Nation: 

GAO's Strategic Plan Framework: 

Mission: 

GAO exists to support the Congress in meeting its constitutional 
responsibilities and to help improve the performance and ensure the 
accountability of the federal government for the benefit of the 
American people. 

Themes: 

* Changing Security Threats; 

* Sustainability Concerns; 

* Economic Growth and Competitiveness; 

* Global Interdependency; 

* Societal Change; 

* Quality of Life; 

* Science & Technology; 

Goals & Objectives: 

Provide Timely, Quality Service to the Congress and the Federal 
Government to: 

1) Address Current and Emerging Challenges to the Well-being and 
Financial Security of the American People related to: 

* Health care needs; 

* Lifelong learning; 

* Work benefits and protections; 

* Financial security; 

* Effective system of justice; 

* Viable communities; 

* Natural resources use and environmental protection; 

* Physical infrastructure; 

2) Respond to Changing Security Threats and the Challenges of Global 
Interdependence involving: 

* Homeland security; 

* Military capabilities and readiness; 

* Advancement of U.S. interests; 

* Global market forces. 

3) Help Transform the Federal Government’s Role and How It Does 
Business to Meet 21st Century Challenges by assessing: 

* Roles in achieving federal objectives; 

* Government transformation; 

* Key management challenges and program risks; 

* Fiscal position and financing of the government; 

4) Maximize the Value of GAO by Being a Model Federal Agency and a 
World-Class Professional Services Organization in the areas of: 

* Client and customer satisfaction; 

* Strategic leadership; 

* Institutional knowledge and experience; 

* Process improvement; 

* Employer of choice. 

Core Values: 

* Accountability; 

* Integrity; 

* Reliability. 

Source: GAO. 

[End of Figure 3] 

Each year, we hold ourselves accountable to the Congress and to the 
American people for our performance, primarily through our annual 
performance and accountability report. 

We have included some information about future plans in this report to 
provide as cohesive a view as possible of what we have done, what we 
are doing, and what we expect to do to support the Congress and to 
serve the nation. 

Last year, the Association of Government Accountants awarded us for the 
eighth consecutive year its Certificate of Excellence in Accountability 
Reporting for our fiscal year 2008 performance and accountability 
report. According to the association, this certificate means that we 
produced an interesting and informative report that achieved the goal 
of complete and fair reporting. We also received an award from Graphic 
Design USA for the full version of our fiscal year 2008 performance and 
accountability report, as well as for its summary version known as the 
Citizens’ Report. (See figure 4.) 

Figure 4: GAO’s Performance and Accountability Report Awards: 

[Refer to PDF for Image] 

Scanned copies of: 

1. Cover of the Government Accountability Office's Citizens' Report: Fiscal 
Year 2008 Summary of GAO's Performance and Financial Results. 

2. Cover of the Government Accountability Office's Performance and 
Accountability Report for Fiscal Year 2008. 

3. AGA Certificate of Excellence in Accountability Reporting, presented 
to the U.S. Government Accountability Office. 

In recognition of your outstanding efforts preparing GAO's Performance 
and Accountability Report for the fiscal year ended September 30, 2008. 

A Certificate of Excellence in Accountability is presented by AGA to 
federal government agencies whose annual Performance and Accountability 
Reports achieve the highest standards demonstrating accountability and 
communicating results. 

Signed by: 

John H Hammel, CGFM: 
Chair, Certificate of Excellence in Accountability Reporting Director: 

Signed by: 

Relmond P. Van Daniker, DBA, CPA: 
Executive Director, AGA: 

4. 2009 Graphic Design USA presents an: American Inhouse Design Award 
to Government Accountability Office for Performance and 
Accountability Full Report 2008. 

5. 2009 Graphic Desing USA presents an: American Inhouse Design Award to 
Government Accountability Office for Performance and Accoutability Citizens 
Report. 

Source: GAO. 

[End of Figure 4] 

Organizational Structure: 

As the Acting Comptroller General of the United States, Gene L. Dodaro 
is the head of GAO. On March 13, 2008, he succeeded David L. Walker who 
resigned before the end of his 15-year term that began in 1998. Mr. 
Dodaro previously served as GAO’s Chief Operating Officer for 9 years, 
and he retained this position after assuming the top post. Two other 
executives join Acting Comptroller General Dodaro to form our Executive 
Committee: Chief Administrative Officer/Chief Financial Officer 
Sallyanne Harper and Acting General Counsel Lynn Gibson. Mr. Dodaro 
will serve as Acting Comptroller General until the President nominates 
and the Senate confirms a successor from a list of candidates proposed 
by the Congress. 

To achieve our strategic goals, our staff are organized as shown in 
figure 5. For the most part, our 14 evaluation, audit, research, and 
investigative teams perform the work that supports strategic goals 1, 
2, and 3—our three external strategic goals—with several of the teams 
working in support of more than one strategic goal.[Footnote 2] In 
addition, FSI follows up on engagements and referrals from our other 
teams when its special services are required in areas such as specific 
fraud allegations or for assistance in evaluating security matters. In 
addition, FSI manages Fraudnet, which is our online system created for 
the public to report to GAO allegations of fraud, waste, abuse, or 
mismanagement of federal funds. FSI is an integrated unit composed of 
investigators, analysts, auditors who have experience with forensic 
auditing and data mining, and staff in General Counsel. 

Senior executives in charge of the teams manage a mix of engagements to 
ensure that we meet the Congress’s need for information on quickly 
emerging issues as we also continue longer-term work that flows from 
our strategic plan. To serve the Congress effectively with a finite set 
of resources, senior managers consult with our congressional clients 
and determine the timing and priority of engagements for which they are 
responsible. 

As described below, General Counsel supports the work of all of our 
teams. In addition, the Applied Research and Methods team assists the 
other teams on matters requiring expertise in areas such as economics, 
research design, and statistical analysis. Staff in many offices, such 
as Strategic Planning and External Liaison, Congressional Relations, 
Opportunity and Inclusiveness, Quality and Continuous Improvement, 
Public Affairs, and the Chief Administrative Office, support the 
efforts of the teams. This collaborative process, which we refer to as 
matrixing, increases our effectiveness, flexibility, and efficiency in 
using our expertise and resources to meet congressional needs on 
complex issues. 

Figure 5: Organizational Structure: 

[Refer to PDF for image] 

Level one: Comptroller General of the United States: 
* Public Affairs; 
* Strategic Planning and External Liaison; 
* Congressional Relations; 
* Opportunity and Inclusiveness. 

Level one (set apart from all GAO units to denote independence and 
statutory role): Inspector General. 

Level two: 
* General Counsel; 
* Chief Operating Officer; 
* Chief Administrative Officer/Chief Financial Officer. 

Level three: 

Under General Counsel: 
Goals 1, 2, 3, and 4: 
* Provide audit and other legal support services for all goals and 
staff offices; 
* Manage GAO’s bid protest and appropriations law work. 

Under Chief Operating Officer: 

Goal 1: 
Provide timely, quality service to the Congress and the federal 
government to address current and emerging challenges to the well-being 
and financial security of the American people: 
* Education, Workforce, and Income Security; 
* Financial Markets and Community Investment; 
* Health Care; 
* Homeland Security and Justice; 
* Natural Resources and Environment; 
* Physical Infrastructure. 

Goal 2: 
Provide timely, quality service to the Congress and the federal 
government to respond to changing security threats and the challenges 
of global interdependence: 
* Acquisition and Sourcing Management; 
* Defense Capabilities and Management; 
* International Affairs and Trade. 

Goal 3: 
Help transform the federal government’s role and how it does business 
to meet 21st century challenges: 
* Applied Research and Methods; 
* Financial Management and Assurance; 
* Forensic Audits and Special Investigations; 
* Information Technology; 
* Strategic Issues. 

Under Chief Administrative Officer/Chief Financial Officer: 

Goal 4: 
Maximize the value of GAO by being a model federal agency and a world-
class professional services organization: 
* Controller; 
* Human Capital Office; 
– Chief Human Capital Officer; 
* Information Systems and Technology Services; 
– Chief Information Officer; 
* Knowledge Services; 
– Chief Knowledge Services Officer; 
* Professional Development Program; 
* Field Operations. 

Source: GAO. 

Note: General Counsel’s structure largely mirrors the agency’s goal 
structure, and attorneys who are assigned to goals work with the teams 
on specific engagements. Thus, the dotted lines in this figure indicate 
General Counsel’s support of or advisory relationship with the goals 
and teams rather than a direct reporting relationship. 

[  figure: Organizational Structure] 

General Counsel is structured to facilitate the delivery of legal 
services to the teams and staff offices that support our four strategic 
goals. This structure allows General Counsel to (1) provide legal 
support to our staff offices and audit teams concerning all matters 
related to their work and (2) produce legal decisions and opinions for 
the Comptroller General. Specifically, the goal 1, goal 2, and goal 3 
groups in General Counsel are organized to provide each of the audit 
teams with a corresponding team of attorneys dedicated to supporting 
each team’s needs for legal services. In addition, these groups prepare 
advisory opinions to committees and members of the Congress on agency 
adherence to laws applicable to their programs and activities. General 
Counsel’s Legal Services group provides in-house support to our 
management on a wide array of human capital matters and initiatives and 
on information management and acquisition matters and defends the 
agency in administrative and judicial forums. Finally, attorneys in the 
Procurement Law and the Budget and Appropriations Law groups prepare 
administrative decisions and opinions adjudicating protests to the 
award of government contracts or opining on the availability and use of 
appropriated funds. 

For strategic goal 4—our only internal strategic goal—staff in our 
Chief Administrative Office take the lead. They are assisted on 
specific key efforts by the Applied Research and Methods team and by 
staff offices such as Strategic Planning and External Liaison, 
Congressional Relations, Opportunity and Inclusiveness, Quality and 
Continuous Improvement, and Public Affairs. In addition, attorneys in 
General Counsel, primarily in the Legal Services group, provide legal 
support for goal 4 efforts. 

We maintain a workforce of highly trained professionals with degrees in 
many academic disciplines, including accounting, law, engineering, 
public and business administration, economics, and the social and 
physical sciences. About three-quarters of our approximately 3,100 
employees are based at our headquarters in Washington, D.C.; the rest 
are deployed in 11 field offices across the country (see figure 6). 
Staff in these field offices are aligned with our research, audit, 
investigative, and evaluation teams and perform work in tandem with our 
headquarters staff in support of our external strategic goals. 

In September 2008, the Government Accountability Office Act of 2008 was 
enacted establishing the Office of the Inspector General (OIG) of the 
Government Accountability Office as an independent statutory office 
within the agency. Under the legislation, the OIG is responsible for 
conducting audits and investigations relating to the administration of 
the programs and operations of GAO and for making recommendations to 
promote its economy, efficiency, and effectiveness. The OIG also keeps 
the Comptroller General and the Congress fully informed through its 
semiannual reports that describe its findings. In addition, the OIG 
investigates allegations from GAO employees and other interested 
parties concerning activities within GAO that may constitute the 
violation of any law, rule, or regulation; mismanagement; or a gross 
waste of funds or other wrongdoing. 

Figure 6: GAO’s Office Locations: 

[Refer to PDF for image] 

This figure is a map of the United States depicting the following GAO 
Office Locations: 

Atlanta, Georgia: 
Boston, Massachusetts: 
Chicago, Illinois: 
Dallas, Texas: 
Dayton, Ohio: 
Denver, Colorado: 
Huntsville, Alabama: 
Los Angeles, California: 
Norfolk, Virginia: 
San Francisco, California: 
Seattle, Washington: 
Washington, D.C. 

Source: See Image Sources. 

[  figure] 

Strategies for Achieving Our Goals: 

The Government Performance and Results Act directs agencies to 
articulate not just goals, but also strategies for achieving those 
goals. As detailed in part I of this report, we emphasize two 
overarching strategies for achieving our goals: (1) providing 
information from our work to the Congress and the public in a variety 
of forms and (2) continuing and strengthening our human capital and 
internal operations. Specifically, our strategies emphasize the 
importance of working with other organizations on crosscutting issues 
and effectively addressing the challenges to achieving our agency’s 
goals and recognizing the internal and external factors that could 
impair our performance. Through these strategies, which have proven 
successful for us for a number of years, we plan to achieve the level 
of performance that is needed to meet our performance measures and 
goals. This level of performance, in turn, will allow us to achieve our 
four, broad strategic goals. 

Attaining our three external strategic goals (goals 1, 2, and 3) and 
their related objectives rests, for the most part, on providing 
professional, objective, fact-based, nonpartisan, nonideological, fair, 
and balanced information to support the Congress in carrying out its 
constitutional responsibilities. To implement the performance goals and 
key efforts related to these three goals, we develop and present 
information in a number of ways, including: 

* evaluations of federal policies, programs, and the performance of 
agencies; 

* oversight of government operations through financial and other 
management audits to determine whether public funds are spent 
efficiently, effectively, and in accordance with applicable laws; 

* investigations to assess whether illegal or improper activities are 
occurring; 

* analyses of the financing for government activities; 

* constructive engagements in which we work proactively with agencies, 
when appropriate, to provide advice that may assist their efforts 
toward positive results; 

* legal opinions that determine whether agencies are in compliance with 
applicable laws and regulations; 

* policy analyses to assess needed actions and the implications of 
proposed actions; and; 

* additional assistance to the Congress in support of its oversight and 
decision-making responsibilities. 

We conduct specific engagements as a result of requests from 
congressional committees and mandates written into legislation, 
resolutions, and committee reports. In fiscal year 2009, we devoted 95 
percent of our engagement resources to work requested or mandated by 
the Congress. We devoted the remaining 5 percent of the engagement 
resources to work we initiated under the Comptroller General’s 
authority. Much of this work addressed various challenges that are of 
broad-based interest to the Congress, such as the cost and status of 
both security stabilization and reconstruction efforts in Iraq and the 
United States’ efforts to secure Afghanistan and combat terrorism in 
Pakistan.[Footnote 3] Also covered by this work were reviews of 
government programs and operations that we have identified as at high 
risk for fraud, waste, abuse, and mismanagement as well as reviews of 
agencies’ budget requests to help support congressional decision 
making. By making recommendations to improve the accountability, 
operations, and services of government agencies, we contribute to 
increasing the effectiveness of federal spending and enhancing the 
taxpayers’ trust and confidence in their government. 

Our staff are responsible for following high standards for gathering, 
documenting, and supporting the information we collect and analyze. 
More often than not, this information is documented in a product that 
is made available to the public. In some cases, we develop products 
that contain classified or sensitive information that cannot be made 
available publicly. We generally issue around 1,200 products each year, 
primarily in an electronic format. In addition, we publish about 250 to 
350 legal decisions and opinions each year. Our products include the 
following: 

* reports and written correspondence;; 

* testimonies and statements for the record, where the former are 
delivered orally by one or more of our senior executives at a 
congressional hearing and the latter are provided for inclusion in the 
congressional record; 

* briefings, which are usually given directly to congressional staff 
members; and; 

* legal decisions and opinions resolving bid protests and addressing 
issues of appropriations law, as well as opinions on the scope and 
exercise of authority of federal officers. 

We also produce special publications on specific issues of general 
interest to many Americans, such as our report on the fiscal future of 
the United States, GAO’s role in the federal bid protest process, and 
critical issues for congressional consideration related to improving 
the nation’s image abroad.[Footnote 4] Our publication, Principles of 
Federal Appropriations Law, is viewed both within and outside of the 
government as the primary resource on federal case law related to the 
availability, use, and control of federal funds. In addition, we 
maintain the government’s repository of reports on Antideficiency Act 
violations and make available on our Web site various information 
extracted from those reports. Collectively, our products always contain 
information and often conclusions and recommendations that allow us to 
achieve our external strategic goals. 

Another means of ensuring that we are achieving our goals is through 
examining the impact of our past work and using that information to 
shape our future work. Consequently, we evaluate actions taken by 
federal agencies and the Congress in response to our past 
recommendations. The results of these evaluations are reported in terms 
of the financial benefits and nonfinancial benefits that reflect the 
value of our work. We actively monitor the status of our open 
recommendations—those that remain valid but have not yet been 
implemented—and report our findings annually to the Congress and the 
public [hyperlink, http://www.gao.gov/openrecs.html]. 

Similarly, we use our biennial high-risk report, most recently issued 
in January 2009, to provide a status report on major government 
operations that we consider high risk because they are vulnerable to 
fraud, waste, abuse, and mismanagement or are in need of broad-based 
transformation. In fiscal year 2009 we also used our transition Web 
site to alert the nation’s leaders to current and emerging issues 
facing the nation—including food safety, defense spending, and the 
stability of U.S. financial markets and institutions—and the reports 
and testimonies we issued that address them. These products are 
valuable planning tools because they help us to identify those areas 
where our continued efforts are needed to maintain the focus on 
important policy and management issues that the nation faces. 

To attain our fourth strategic goal—an internal goal—and its five 
related objectives, we conduct surveys of our congressional clients and 
internal customers to obtain feedback on our products, processes, and 
services and perform studies and evaluations to identify ways in which 
to improve them. 

Because achieving our strategic goals and objectives also requires 
strategies for coordinating with other organizations with similar or 
complementary missions, we: 

* use advisory panels and other bodies to inform our strategic and 
annual work planning and; 

* maintain strategic working relationships with other national and 
international government accountability and professional organizations, 
including the federal inspectors general, state and local audit 
organizations, and other national audit offices. 

These two types of strategic working relationships allow us to extend 
our institutional knowledge and experience; leverage our resources; and 
in turn, improve our service to the Congress and the American people. 
Our Strategic Planning and External Liaison office takes the lead and 
provides strategic focus for the work with external partner 
organizations, while our research, audit, and evaluation teams lead the 
work with most of the issue-specific organizations. 

How We Measure Our Performance: 

To help us determine how well we are meeting the needs of the Congress 
and maximizing our value as a world-class organization, we assess our 
performance annually using a balanced set of quantitative performance 
measures that focus on four key areas—results, client, people, and 
internal operations. These categories of measures are briefly described 
below. 

* Results. Focusing on results and the effectiveness of the processes 
needed to achieve them is fundamental to accomplishing our mission. To 
assess our results, we measure financial benefits, other (nonfinancial) 
benefits, recommendations implemented, and percentage of new products 
with recommendations. 

Financial benefits and nonfinancial benefits provide quantitative and 
qualitative information, respectively, on the outcomes or results that 
have been achieved from our work. They often represent outcomes that 
occurred or are expected to occur over a period of several years. The 
remaining measures are intermediate outcomes in that they often lead to 
achieving outcomes that are ultimately captured in our financial and 
nonfinancial benefits. For financial benefits and nonfinancial 
benefits, we first set targets for the agency as a whole, and then we 
set targets for each of the external goals—that is, goals 1, 2, and 3—
so that the sum of the targets for the goals equals the agencywide 
targets. For past recommendations implemented and percentage of 
products with recommendations, we set targets and report performance 
for the agency as a whole because we want our performance on these 
measures to be consistent across goals. We track our performance by 
strategic goal in order to understand why we meet or do not meet the 
agencywide target. We also use this information to provide feedback to 
our teams on the extent to which they are contributing to the overall 
target and to help them identify areas for improvement. 

* Client. To judge how well we are serving our client, we measure the 
number of congressional hearings where we are asked to present expert 
testimony as well as our timeliness in delivering products to the 
Congress. Our strategy in this area draws upon a variety of data 
sources (e.g., our electronic client feedback form and in-person 
discussions with congressional staff) to obtain information on the 
services we are providing to our congressional clients. 

We set a target at the agencywide level for the number of hearings and 
then assign a portion of these hearings as a target for each of the 
external goals—that is, goals 1, 2, and 3—based on each goal’s expected 
contribution to the agencywide total. We base this target on our 
assessment of the congressional calendar and hearing trend data. As in 
measuring the results of our work, we track our progress on this 
measure at the goal level in order to understand why we met or did not 
meet the agencywide target. We set an agencywide target for timeliness 
because we want our performance on this measure to be consistent across 
goals. 

* People. As our most important asset, our people define our character 
and capacity to perform. A variety of data sources, including an 
internal survey, provide information to help us measure how well we are 
attracting and retaining high-quality staff and how well we are 
developing, supporting, using, and leading staff. We set targets for 
these measures at the agencywide level. 

* Internal operations. Our mission and people are supported by our 
internal administrative services, including information management, 
building management, knowledge services, human capital, and financial 
management services. Through an internal customer satisfaction survey, 
we gather information on how well our internal operations help 
employees get their jobs done and improve employees’ quality of work 
life. Examples of surveyed services include providing secure Internet 
access and voice communication systems, performance management, and 
benefits information and assistance. We set targets for these measures 
at the agencywide level. 

Setting Performance Targets: 

To establish targets for all of our measures, we examine what we have 
been able to achieve in the past (for example, by looking at our 4-year 
rolling averages) for most of our results measures (see p. 24) and the 
external factors that influence our work (see p. 60). The teams and 
offices that are directly engaged in the work discuss their views of 
what must be accomplished in the upcoming fiscal year with our top 
executives, who then establish targets for the performance measures. 

Once approved by the Comptroller General, the targets become final and 
are presented in our annual performance plan and budget.[Footnote 5] We 
may adjust these targets after they are initially published when our 
expected future work or level of funding provided warrants doing so. If 
we make changes, we include the changed targets in later documents, 
such as this performance and accountability report, and indicate that 
we have changed them. In part II, we include detailed information on 
data sources that we use to assess each of these measures, as well as 
the steps we take to verify and validate the data. 

On the pages that follow, we assess our performance for fiscal year 
2009 against our previously established performance targets. We also 
present our financial statements, the independent auditor’s report, and 
a statement from GAO’s Inspector General. 

[End of About GAO] 

[End of Introduction] 

Part I: Management’s Discussion and Analysis: 

Assisting the Congress and the Nation During Changing and Challenging 
Times: 

In fiscal year 2009, the challenges that most urgently engaged the 
attention of the Congress and the public helped to define our 
priorities. Our work on issues such as the home mortgage market and 
financial systems meltdown that led to one of the most significant 
downturns in the U.S. economy and a global economic crisis, the 
implementation of domestic economic recovery initiatives, military 
conflicts abroad, the health care provided to veterans returning from 
the battlefield, as well as concerns about food safety and worldwide 
public health emergencies all helped congressional members, the 
administration, and their staffs develop new federal policies and 
programs and oversee ongoing ones to address these and other issues. 

We monitored how well we performed our work and supported our staff 
using 15 annual performance measures. The results of our efforts are 
reflected in our solid performance in fiscal year 2009—we met or 
exceeded all of the performance targets we set for each of these 
measures (see table 1). We exceeded our financial benefits target of 
$43 billion for the fiscal year by $1 billion. This represents a $80 
return on every dollar the Congress invested in us.[Footnote 6] In 
addition, we exceeded our target of 1,200 nonfinancial benefits by more 
than 100 benefits. We also met our target for past recommendations 
implemented and exceeded the target for new products with 
recommendations by 8 percentage points. We slightly exceeded our target 
of 200 hearings at which we were asked to testify and met the target 
for delivering our products and testimonies to our clients in a timely 
manner. We also exceeded our annual targets for all seven of our people 
measures—our highest performance on these measures over the last 5 
fiscal years. 

Concerning our two internal operations measures, we will assess our 
performance related to how well our internal administrative services 
(e.g., computer support, mail service, and Internet service) help 
employees get their jobs done or improve employees’ quality of work 
life once data from our November 2009 annual customer satisfaction 
survey have been analyzed. These measures are directly related to our 
goal 4 strategic objectives of continuously enhancing our business and 
management processes and becoming a professional services employer of 
choice. There will always be a lag in reporting on this measure because 
our customer feedback survey is distributed after we issue the 
performance and accountability report. In fiscal year 2008, we met our 
target of 4.0 (a composite score based on employees’ responses from an 
internal survey) for our measure help get the job done and exceeded our 
target for our quality of work life measure. These scores indicate that 
our employees were satisfied with the internal administrative services 
they used during their workday. The survey asked staff to rank the 
importance of each service to them and indicate their satisfaction with 
it on a scale from 1 to 5. 

Table 1: Agencywide Summary of Annual Measures and Targets: 

Performance Measure: Results: Financial benefits (dollars in billions); 
2005 Actual: $39.6 billion; 
2006 Actual: $51.0 billion; 
2007 Actual: $45.9 billion; 
2008 Actual: $58.1 billion; 
2009 Target: $42.0 billion; 
2009 Actual: $43.0 billion; 
Met/Not Met: Met; 
2010 Target: $42.0 billion. 

Performance Measure: Results: Nonfinancial benefits; 
2005 Actual: 1,409; 
2006 Actual: 1,342; 
2007 Actual: 1,354; 
2008 Actual: 1,398; 
2009 Target: 1,200
2009 Actual: 1,315
Met/Not Met: Met; 
2010 Target: 1,200. 

Performance Measure: Results: Past recommendations implemented; 
2005 Actual: 85%; 
2006 Actual: 82%; 
2007 Actual: 82%; 
2008 Actual: 83%; 
2009 Target: 80%;
2009 Actual: 80%; 
Met/Not Met: Met; 
2010 Target: 80%. 

Performance Measure: Results: New products with recommendations; 
2005 Actual: 63%; 
2006 Actual: 65%; 
2007 Actual: 66%; 
2008 Actual: 66%; 
2009 Target: 60%; 
2009 Actual: 68%; 
Met/Not Met: Met; 
2010 Target: 60%. 

Performance Measure: Client: Testimonies; 
2005 Actual: 179; 
2006 Actual: 240; 
2007 Actual: 276; 
2008 Actual: 298[A]; 
2009 Target: 200; 
2009 Actual: 203; 
Met/Not Met: Met; 
2010 Target: 220. 

Performance Measure: Client: Timeliness[B]; 
2005 Actual: 92%; 
2006 Actual: 93%; 
2007 Actual: 95%; 
2008 Actual: 95%; 
2009 Target: 95%; 
2009 Actual: 95%; 
Met/Not Met: Met; 
2010 Target: 95%. 

Performance Measure: People: New hire rate; 
2005 Actual: 94%; 
2006 Actual: 94%; 
2007 Actual: 96%; 
2008 Actual: 96%; 
2009 Target: 95%; 
2009 Actual: 99%; 
Met/Not Met: Met; 
2010 Target: 95%. 

Performance Measure: People: Retention rate: With retirements; 
2005 Actual: 90%; 
2006 Actual: 90%; 
2007 Actual: 90%; 
2008 Actual: 90%; 
2009 Target: 90%; 
2009 Actual: 94%; 
Met/Not Met: Met; 
2010 Target: 90%. 

Performance Measure: People: Retention rate: Without retirements; 
2005 Actual: 94%; 
2006 Actual: 94%; 
2007 Actual: 94%; 
2008 Actual: 93%; 
2009 Target: 94%; 
2009 Actual: 96%; 
Met/Not Met: Met; 
2010 Target: 94%. 

Performance Measure: People: Staff development[C,D]; 
2005 Actual: 72%; 
2006 Actual: 76%; 
2007 Actual: 76%; 
2008 Actual: 77%; 
2009 Target: 76%; 
2009 Actual: 79%
Met/Not Met: Met; 
2010 Target: 76%. 

Performance Measure: People: Staff utilization[C,D]; 
2005 Actual: 75%; 
2006 Actual: 75%; 
2007 Actual: 73%; 
2008 Actual: 75%; 
2009 Target: 75%; 
2009 Actual: 78%; 
Met/Not Met: Met; 
2010 Target: 75%. 

Performance Measure: People: Effective leadership by supervisors [C,F]; 
2005 Actual: 80%; 
2006 Actual: 79%; 
2007 Actual: 79%; 
2008 Actual: 81%; 
2009 Target: 80%; 
2009 Actual: 83%; 
Met/Not Met: Met; 
2010 Target: 80%. 

Performance Measure: People: Organizational climate[C]; 
2005 Actual: 76%; 
2006 Actual: 73%; 
2007 Actual: 74%; 
2008 Actual: 77%; 
2009 Target: 75%; 
2009 Actual: 79%; 
Met/Not Met: Met; 
2010 Target: 75%. 

Performance Measure: Internal operations[G]: Help get job done; 
2005 Actual: 4.1; 
2006 Actual: 4.1; 
2007 Actual: 4.05; 
2008 Actual: 4.0; 
2009 Target: 4.0; 
2009 Actual: N/A; 
Met/Not Met: N/A; 
2010 Target: 4.0. 

Performance Measure: Internal operations[G]: Quality of work life; 
2005 Actual: 3.98; 
2006 Actual: 4.00; 
2007 Actual: 3.98; 
2008 Actual: 4.01; 
2009 Target: 4.0; 
2009 Actual: N/A; 
Met/Not Met: N/A; 
2010 Target: 4.0. 

Source: GAO. 

Note: Information explaining all of the measures included in this table 
appears in the Data Quality and Program Evaluations section in part II 
of this report. 

[A] In fiscal year 2008, we inadvertently reported six additional 
hearings. This entry reflects the correct total. 

[B] The timeliness measure is based on one question on a form sent out 
to selected clients. The response rate for the form in fiscal year 2009 
is 28 percent, and 96 percent of the clients who responded answered 
this question. The percentage shown in the table represents the 
percentage of respondents who answered favorably to this question on 
the form. 

[C] This measure is derived from our annual agencywide employee 
feedback survey. From the staff who expressed an opinion, we calculated 
the percentage of those who selected favorable responses to the related 
survey questions. Responses of “no basis to judge/not applicable” or “
no answer” were excluded from the calculation. While including these 
responses in the calculation would result in a different percentage, 
our method of calculation is an acceptable survey practice, and we 
believe it produces a better and more valid measure because it 
represents only those employees who have an opinion on the questions. 

[D] Beginning in fiscal year 2006 we changed the way that the staff 
development people measure was calculated. Specifically, we dropped one 
question regarding computer-based training because we felt such 
training was a significant part of (and therefore included in) the 
other questions the survey asked regarding training. We also modified a 
question on internal training and changed the scale of possible 
responses to that question. We show the fiscal year 2005 data on a 
separate line to indicate that those data are not comparable to the 
data beginning in fiscal year 2006. 

[E] Our employee feedback survey asks staff how often the following 
occurred in the last 12 months: (1) my job made good use of my skills, 
(2) GAO provided me with opportunities to do challenging work, and (3) 
in general, I was utilized effectively. 

[F] In fiscal year 2009 we changed the name of this measure from 
“Leadership” to its current nomenclature to clarify that the measure 
reflects employee satisfaction with their immediate supervisor’s 
leadership. 

[G] For our internal operations measures, we will report actual data 
for fiscal year 2009 once data from our November 2009 internal customer 
satisfaction survey have been analyzed. N/A indicates that the data are 
not available yet. 

[End of Table 1] 

Our fiscal year 2010 targets for all 15 of our performance measures are 
the same as those targets we reported in our fiscal year 2009 
performance plan in January 2009. We believe that these targets are 
challenging yet realistic for our staff. For example, we did not 
increase our financial benefits target for 2010 above our fiscal year 
2009 actual because this target is more consistent with our actual 
performance in 3 of the last 5 fiscal years. Moreover, we cannot always 
anticipate whether agencies or the Congress will implement our 
recommendations or the benefits that may accrue from these actions in a 
given year. Thus, we believe our target of $42 billion for financial 
benefits for fiscal year 2010 (shown on p. 23) is reasonable and 
achievable. 

To help us examine trends over time, we also look at 4-year rolling 
averages for the following performance measures: financial benefits, 
nonfinancial benefits, new products with recommendations, and 
testimonies. We calculate 4-year rolling averages because historically 
our performance on these measures has fluctuated from year to year, and 
this calculation minimizes the effect of an atypical result in any 
given year. We consider this calculation, along with other factors, 
when we set our performance targets. Table 2 shows that from fiscal 
year 2005 through fiscal year 2009 our averages for financial benefits, 
new products with recommendations, and testimonies steadily increased 
during this period. However, the average number of nonfinancial 
benefits we recorded declined between fiscal years 2008 and 2009 after 
reaching a high of 1,376 in fiscal year 2008. 

Though we consider our 4-year rolling averages and our past performance 
when setting our target for the number of hearings at which our senior 
executives testify, we base our testimonies target largely on the 
cyclical nature of the congressional calendar. Our experience has shown 
that during the fiscal year in which an election occurs, generally the 
Congress holds fewer hearings because the congressional members are 
reorganizing during the months after the election. This situation 
provides fewer opportunities for us to be invited to testify. 

Table 2: Four-Year Rolling Averages for Selected GAO Measures: 

Performance measure: Results: Financial benefits (billions); 
2005: $39.2 billion; 
2006: $43.0 billion; 
2007: $45.1 billion; 
2008: $48.7 billion; 
2009: $49.5 billion. 

Performance measure: Results: Nonfinancial benefits; 
2005: 1,139; 
2006: 1,248; 
2007: 1,325; 
2008: 1,376; 
2009: 1,352. 

Performance measure: Results: New products with recommendations; 
2005: 58%; 
2006: 61%; 
2007: 64%; 
2008: 65%; 
2009: 66%. 

Performance measure: Client: Testimonies; 
2005: 200; 
2006: 206 
2007: 228; 
2008: 248[A]; 
2009: 254. 

Source: GAO. 

[A] In fiscal year 2008, we inadvertently reported six additional 
hearings. This entry reflects the correct total. 

[End of Table 2] 

Focusing on Results: 

Focusing on outcomes and the efficiency of the processes needed to 
achieve them is fundamental to accomplishing our mission. The following 
four annual measures—financial benefits, nonfinancial benefits, past 
recommendations implemented, and new products containing 
recommendations—indicate that we have fulfilled our mission and 
delivered results that benefit the nation. 

Financial Benefits and Nonfinancial Benefits: 

We describe many of the results produced by our work as either 
financial or nonfinancial benefits. Both types of benefits result from 
our efforts to provide information to the Congress that helped to (1) 
change laws and regulations, (2) improve services to the public, and 
(3) promote sound agency and governmentwide management. In many cases, 
the benefits we claimed in fiscal year 2009 are based on work we did in 
past years because it often takes the Congress and agencies time to 
implement our recommendations or to act on our findings. 

To claim either type of benefit, our staff must document the connection 
between the benefits reported and the work that we performed. We can 
claim benefits within 2 years of when the Congress or an agency takes 
action on our recommendations. 

Financial Benefits: 
Our findings and recommendations produce measurable financial benefits 
for the federal government after the Congress acts on or agencies 
implement them and the funds are made available to reduce government
expenditures or are reallocated to other areas. 

The monetary effect realized can be the result of: 

* changes in business operations and activities; 

* the restructuring of federal programs; or; 

* modifications to entitlements, taxes, or user fees. 

Financial benefits result if, for example, the Congress reduces the 
annual cost of operating a federal program, lessens the cost of a 
multiyear program or entitlement, or reallocates funds to other areas. 
Financial benefits could also result from increases in federal revenues—
because of changes in laws, user fees, or asset sales—that our work 
helped to produce. 

In fiscal year 2009, our work generated about $43 billion in financial 
benefits (see figure 7). We slightly exceeded our target by 2 percent 
due to several accomplishments with multiyear effects. Of the total 
amount documented in fiscal year 2009, about $18 billion (or 
approximately 42 percent) resulted from changes in laws or regulations
(see figure 8). The amount of financial benefits we were able to 
document in fiscal year 2009 was lower than in fiscal year 2008 because 
fiscal year 2008 was an exceptional year for us as figure 7 indicates. 
That year we recorded several unexpected and large financial benefits 
that significantly contributed to our performance. However, the amount
of financial benefits we documented in fiscal year 2009 is more 
consistent with our actual performance in several of the last 5 years. 

Figure 7: Financial Benefits GAO Recorded (dollars in billions): 

[Refer to PDF for image: vertical bar graph] 

2005 Actual: $39.6 billion; 
2006 Actual: $51.0 billion; 
2007 Actual: $45.9 billion; 
2008 Actual: $58.1 billion; 
2009 Target: $42.0 billion; 
2009 Actual: $43.0 billion. 

Source: GAO. 

[End of Figure 7] 

Figure 8: Types of Financial Benefits Recorded in Fiscal Year 2009 from 
Our Work: 

[Refer to PDF for image: pie-chart] 

Financial Benefits, Total: $43 billion; 
* Agencies acted on GAO information to improve services to the public: 
$8.2 billion (19%); 
* Information GAO provided to the Congress resulted in statutory or 
regulatory changes: $18.2 billion (42%); 
* Core business processes improved at agencies and governmentwide 
management reforms advanced by GAO’s work: $16.6 billion (39%). 

Source: GAO. 

[End of Figure 8] 

Financial benefits included in our performance measures are net 
benefits—that is, estimates of financial benefits that have been 
reduced by the estimated costs associated with taking the action that 
we recommended. We convert all estimates involving past and future 
years to their net present value and use actual dollars to represent 
estimates involving only the current year. Financial benefit amounts 
vary depending on the nature of the benefit, and we can claim financial 
benefits over multiple years based on a single agency or congressional 
action. We limit the period over which benefits from an accomplishment 
can accrue to no more than 5 years. Estimates used to calculate our 
financial benefits come from non-GAO sources. These non-GAO sources are 
typically the agency that acted on our work, a congressional committee, 
or the Congressional Budget Office. 

To document financial benefits, our staff complete reports documenting 
accomplishments that are linked to specific recommendations or actions. 
Each accomplishment report for financial benefits is documented and 
reviewed by (1) another GAO staff member not involved in the work and 
(2) a senior executive in charge of the work. Also, a separate unit, 
our Quality and Continuous Improvement (QCI) office, reviews all 
financial benefits and approves benefits of $100 million or more, which 
amounted to 95 percent of the total dollar value of benefits recorded 
in fiscal year 2009. During this past fiscal year, the GAO Inspector 
General (IG) performed an independent review of all financial 
accomplishments over $1 billion. (See the financial benefits section in 
table 16 in part II of this report for more details about our process 
for reviewing accomplishment reports claiming financial benefits.) 
Figure 9 lists several of our major financial benefits for fiscal year 
2009 and briefly describes some of our work contributing to each 
financial benefit. 

Figure 9: GAO’s Selected Major Financial Benefits Reported in Fiscal 
Year 2009: 

Description: Avoided costs associated with federal government 
contracting. In February 2005, we reported on the General Services 
Administration’s (GSA) Multiple Award Schedules (MAS) program designed 
to take advantage of the federal government’s significant aggregate 
buying power and to provide a simplified method for procuring commonly 
used goods and services, ranging from office supplies to technical 
support. The report highlight­ed the importance of pre-award audits of 
MAS contracts by contract negotiators to verify that vendor-supplied 
pricing information is accurate, complete, and current before a 
contract is awarded. We reported that the annual number of pre-award 
audits had decreased dramatically—from 130 in fiscal year 1992 to 14 in 
fiscal year 2003. As a result of our work, GSA and its Inspector 
General hired additional staff to improve and increase the use of pre-
award audits for both new contract offers and contract extensions. 
According to GSA’s data, over the 5-year period—from fiscal 2004 
through 2008—the increased use of pre-award audits resulted in a total 
of $3.66 billion in cost avoidances, or about $3.97 billion in net 
present value.
Amount (Dollars in billions): $3.97. 

Description: Prompted the elimination of seller-funded down payments 
assistance for Federal Housing Administration (FHA) mortgages. In a 
2006 report, we reported that the proportion of FHA-insured mortgages 
with seller-funded down payment assistance (i.e., assistance from 
nonprofit organizations funded by property sellers) had grown from 6 
percent in 2000 to 30 percent in 2004 and that such loans had 
substantially higher delinquency and insurance claim rates than similar 
loans without such assistance. We also reported that homes with seller-
funded down payment assistance sold for about 2 to 3 percent more than 
comparable homes with­out such assistance, resulting in homebuyers 
having less equity in the transaction than would otherwise be the case. 
We recommended that FHA take a number of steps to mitigate the risks 
associated with seller-funded down payment assistance, including 
treating such assistance as a seller inducement and therefore subject 
to FHA’s prohibition against using seller contributions to meet the 
borrower contribution requirement. At congressional hearings in 2007 we 
reiterated our concerns about loans with seller-funded down payment 
assistance and noted that such loans were contributing to FHA’s 
deteriorating financial performance. On October 1, 2008, the Housing 
and Economic Recovery Act of 2008 became effective and prohibited 
seller-funded down payment assistance. The estimated financial benefit 
associated with this provision is about $2.89 billion.
Amount (Dollars in billions): $2.89. 

Description: Focused federal oversight on Medicaid payment practices 
vulnerable to fraud. As part of our 2002 reporting on the Centers for 
Medicare & Medicaid Service’s (CMS) financial oversight activities, we 
identified several weaknesses in CMS’s oversight of Medicaid financial 
management. We recommended that CMS target its oversight resources to 
areas most vulnerable to improper payments and increase oversight of 
high-risk areas. Beginning in 2004 and 2005, CMS took action in 
response to our recommendations, including hiring about 90 funding 
specialists tasked with helping CMS better identify state payment and 
funding practices that could result in inappropriate claims for federal 
reimbursement or increased federal costs. For fiscal year 2008, CMS 
determined that almost $1.3 billion in inappropriate claims for federal 
Medicaid payments was avoided that year as a result of the funding 
specialists’ proactive work with states to identify and resolve 
potential issues before states filed potentially problematic claims. We 
recorded about $1.27 billion in benefits associated with fiscal year 
2008.
Amount (Dollars in billions): $1.27. 

Description: Reduced the number of unneeded federal properties 
overseas. In a 1996 report involving the Department of State’s (State) 
overseas real estate, we identified millions of dollars in unneeded 
overseas real estate that could potentially be sold by State. On the 
basis of our recommendation, an independent advisory panel was 
established to help State decide which properties should be sold. In 
2002, we assessed State’s performance in working with the new panel in 
identifying and disposing of excess property. This report noted that 
although progress had been made, State still had a large number of 
unneeded properties in its inventory, had inaccuracies in its inventory 
database causing some properties not to be properly identified, and had 
failed to sell several of the properties recommended by the advisory 
board. State agreed to improve the accuracy of its property inventory 
and make greater efforts to expedite the sale of unneeded property. 
State reported that it sold 34 properties from the second quarter of 
fiscal year 2006 through the third quarter of fiscal year 2007. The net 
present value of this financial benefit is about $562 million.
Amount (Dollars in billions): $0.562. 

Source: GAO. 

[End of Figure 9] 

Nonfinancial Benefits: 

Many of the benefits that result from our work cannot be measured in 
dollar terms. During fiscal year 2009, we recorded a total of 1,315 
nonfinancial benefits (see figure 10). We exceeded our target by almost 
10 percent due largely to a number of accomplishments we documented 
that related to the nation’s homeland security efforts, such as border 
security and immigration enforcement, and weapon systems acquisition 
programs. 

Figure 10: Nonfinancial Benefits GAO Recorded: 

[Refer to PDF for image: vertical bar graph] 

2005 Actual: 1,409; 
2006 Actual: 1,342; 
2007 Actual: 1,354; 
2008 Actual: 1,398; 
2009 Target: 1,200; 
2009 Actual: 1,315. 

Source: GAO. 

[End of Figure 10] 

In fiscal year 2009 we documented 626 instances where federal agencies 
used our information to improve services to the public, 69 instances 
where the information we provided to the Congress resulted in statutory 
or regulatory changes enacted in fiscal year 2009, and 620 instances 
where agencies improved core business processes or governmentwide 
reforms as a result of our work. (See figure 11.) These actions covered 
a variety of issues, such as strengthening the federal government’s 
planning and preparedness for an influenza pandemic, improving 
governmentwide sharing of information about the past performance of 
contractors that do business with the federal government, identifying 
federal employees who fraudulently sold their transit benefits on the 
Internet, and improving federal oversight of care in nursing homes. In 
figure 12, we provide examples of some of the nonfinancial benefits we 
claimed as accomplishments in fiscal year 2009. 

Figure 11: Types of Nonfinancial Benefits Documented in Fiscal Year 
2009 from Our Work: 

[Refer to PDF for image: pie-chart] 

Nonfinancial Benefits, Total: 1,315; 
* Agencies acted on GAO information to improve services to the public: 
626 (48%); 
* Information GAO provided to the Congress resulted in statutory or 
regulatory changes: 69 (5%); 
* Core business processes improved at agencies and governmentwide 
management reforms advanced by GAO’s work: 620 (47%). 

Source: GAO. 

[End of Figure 11] 

Figure 12: GAO’s Selected Nonfinancial Benefits Reported in Fiscal Year 
2009: 

Nonfinancial benefits that helped to change laws: 

Weapon Systems Acquisition Reform Act of 2009, Pub. L. No. 111-23: 
Enhanced oversight of major weapon systems development and cost 
estimates. The Congress included three provisions in this law citing 
some of our long-standing and recent work in the weapon systems 
acquisition area as partly the impetus. For example, we reported that 
many technologies critical to U.S. defense acquisition programs failed 
to meet minimum requirements for technological maturity. Section 104 of 
this law requires periodic review and assessment as well as annual 
reporting on the technological maturity and integration risk of 
critical technologies of the major defense acquisition programs. We 
also reported that the Department of Defense (DOD) often underestimates 
the development costs of major defense acquisition programs largely 
because the estimates are based on limited knowledge and optimistic 
assumptions about systems requirements and critical technologies. In 
addition, we testified on the need for DOD to use appropriate systems 
engineering practices to mitigate cost and scheduling risks during 
program development. Sections 101 and 102 of this law require that DOD 
create the positions of Director of Cost Assessment and Program 
Evaluation, Director of Developmental Test and Evaluation, and Director 
of Systems Engineering to address these issues. 

American Recovery and Reinvestment Act of 2009, Pub. L. No. 111-5: 
Improved access to benefits for workers who lose their jobs. The Trade 
Adjustment Assistance (TAA) program, administered by the Department of 
Labor, is the nation’s primary program providing income support, job 
training, and other benefits for manufacturing workers who lose their 
jobs as a result of international trade. We recommended, among other 
things, that the Congress consider (1) allowing a portion of TAA 
training funds to be used for case management services be­cause workers 
often require help determining whether they need additional training 
and what type to take and (2) simplifying the confusing training 
enrollment deadline used to determine whether a worker is eligible for 
extended income support while completing training. The Congress amended 
TAA in this law to require that states spend for case management no 
less than one-third of the funds set aside for administration, 
employment, and case management services and use a single time period 
for the training enrollment deadline. 

William Wilberforce Trafficking Victims Protection Reauthorization Act 
of 2008, Pub. L. No. 110-457: 
Strengthened process for investigating alleged household worker abuse 
by foreign diplomats. We recommended that the Departments of State, 
Justice, and Homeland Security establish an interagency process 
outlining agreed-upon policies and time frames for determining 
techniques used to investigate allegations by household workers of 
abuse by their employers who are foreign diplomats. These 
investigations are often hampered by the amount of time it takes State 
to provide an opinion. Consistent with our recommendation, Section 203 
of this law requires the Secretary of State to cooperate, to the 
fullest extent possible, with any U.S. law enforcement agencies 
regarding the exploitation of nonimmigrant domestic workers who come to 
the United States to work for foreign diplomats. 

Broadband Data Improvement Act, Pub. L. No. 110-385: 
Improved data about Internet services on tribal lands. We found that 
the rate of Internet subscribership for Native American households on 
tribal lands was unknown and recommended that the Congress consider 
directing the Federal Communications Commission (FCC) to determine what 
data were needed and how these data should be regularly collected. This 
law, passed early in fiscal year 2009, requires the FCC to compile a 
list of geographic areas that are not served by any Internet or 
broadband provider. The law also requires the Secretary of Commerce, in 
consultation with the FCC, to expand the American Community Survey 
conducted by the U.S. Census Bureau to gather information from 
residential households, including those on tribal lands, about their 
Internet or broadband services. 

Nonfinancial benefits that helped to improve services to the public: 

Strengthened the employment verification process: 
We found that the large number and variety of documents acceptable for 
proving employees’ work eligibility complicated the employment 
verification process used by millions of employers. The Department of 
Homeland Security (DHS) had not yet completed its review of the 
process, including revising the form used to certify employees’ work 
authorization. We recommended that DHS set a time frame for completing 
its review and issue regulations on changes to the process and form. In 
December 2008, DHS, among other things, amended its regulations on the 
type of accept­able work eligibility documents to strengthen the 
integrity of the employment verification process. 

Improved DOD's Sexual Assault Prevention and Response Program: 
In our report on DOD's program to prevent and respond to incidents of 
sexual assault, we made a number of recommendations to improve 
implementation of the program, such as by analyzing installation-level 
assault data to better target resources and evaluating factors that may 
discourage servicemembers from accessing mental health services 
following an assault. As a result of this work, DOD is currently 
developing a centralized database of assault incidents and has 
completed an assessment of the military health system’s support of the 
program, and Army Central Command and individual bases have taken 
actions in response to our site visits. 

Enhanced federal efforts to combat drug trafficking: 
Because most of the nation’s illegal drug supply is smuggled from 
abroad, the Drug Enforcement Administration’s (DEA) partnerships with 
agencies that have border-related missions—especially Immigration and 
Customs Enforcement (ICE), the largest investigative agency of the DHS—
are important. In response to our recommendations, DEA and ICE reached 
an agreement in June 2009 to collaboratively share intelligence and 
leverage investigative resources. The interagency agreement resolves a 
long-standing and counterproductive rivalry that for years has 
generated concerns about duplicative investigations and officer safety. 

Nonfinancial benefits that helped to promote sound agency and 
governmentwide management: 

Strengthened planning and preparedness for an influenza pandemic: 
In the aftermath of the H1N1 influenza outbreak, our work helped inform 
the Congress and the new administration about significant gaps in 
federal government pandemic influenza planning and preparedness 
efforts. In the summer of 2009, our testimony alerted the Congress to 
the need for the federal government to test shared federal pandemic 
leadership roles, update the National Pandemic Implementation Plan, 
improve coordination with state and local governments and the private 
sector, and monitor agencies readiness to protect federal workers in a 
pandemic. The House Home­land Security Committee directed DHS and the 
Department of Health and Human Services (HHS)to report on progress by 
fall 2009. 

Improved governmentwide sharing on contractor past performance 
information: 
In 2009, GAO identified shortfalls in the governmentwide system 
established to facilitate use of contractor past performance 
information. Given that in fiscal year 2007, federal agencies worked 
with over 160,000 contractors, obligating over $456 billion, this 
information is necessary to properly evaluate a contractor’s 
performance history and better inform agencies' contract award 
decisions. In response to our recommendations, the Office of Federal 
Procurement Policy revised the Federal Acquisition Regulation to 
improve past performance reporting across government, which will help 
agencies make better contract award decisions. 

Identified federal employees involved in transit benefit fraud: 
Our investigators identified dozens of federal employees who 
fraudulently sold their transit benefits over the Internet. Many of the 
employees admitted to intentionally falsifying their benefit 
applications to receive excess benefits. For seven agencies, we 
determined that the amount of potentially fraudulent transit benefits 
claimed during 2006 in the National Capital Region was at least $17 
million and likely more. Agencies took action to hold federal employees 
accountable based on our work. For example, one Department of 
Transportation (DOT) employee repaid $1,440 and resigned in lieu of 
removal while a Department of Commerce employee was fired and 
criminally prosecuted. 

Source: GAO. 

[End of Figure 12] 

Past Recommendations Implemented: 

One way we measure our effect on improving the government’s 
accountability, operations, and services is by tracking the percentage 
of recommendations that we made 4 years ago that have since been 
implemented. At the end of fiscal year 2009, 80 percent of the 
recommendations we made in fiscal year 2005 had been implemented (see 
figure 13), primarily by executive branch agencies. Putting these 
recommendations into practice generates tangible benefits for the 
nation. 

Figure 13: Percentage of Past Recommendations Implemented: 

[Refer to PDF for image: vertical bar graph] 

Four-year implementation rate: 
2005 Actual: 85%; 
2006 Actual: 82%; 
2007 Actual: 82%; 
2008 Actual: 83%; 
2009 Target: 80%; 
2009 Actual: 80%. 

Source: GAO. 

[End of Figure 13] 

The 80 percent implementation rate for fiscal year 2009 met our target 
for the year. We have not been able to achieve the level of performance 
we did in past years because, in some cases, we were unable to obtain 
the agency data that would allow us to fully document that our 
recommendations had been implemented. As figure 14 indicates, agencies 
need time to act on recommendations. Therefore, we assess 
recommendations implemented after 4 years, the point at which 
experience has shown that if a recommendation has not been implemented, 
it is not likely to be. 

Figure 14: Cumulative Implementation Rate for Recommendations Made in 
Fiscal Year 2005: 

[Refer to PDF for image: vertical bar graph] 

After 1 year: 13%; 
After 2 years: 31%; 
After 3 years: 45%; 
After 4 years: 80%. 

Source: GAO. 

[End of Figure 14] 

New Products Containing Recommendations: 

In fiscal year 2009, about 68 percent of the 576 written products we 
issued (excluding testimonies) contained recommendations. (See figure 
15.) We track the percentage of new products with recommendations 
because we want to encourage staff to develop recommendations that when 
implemented by the Congress and agencies, produce financial and 
nonfinancial benefits for the nation. We exceeded our target of 60 
percent by 8 percentage points because our audit teams are better 
emphasizing the need to identify possible recommendations as they plan 
and carry out their work. However, we set our target again in fiscal 
year 2010 at 60 percent because we recognize that our products do not 
always include recommendations and that the Congress and agencies often 
find informational reports just as useful as those that contain 
recommendations. Our informational reports have the same analytical 
rigor and meet the same quality standards as those with recommendations 
and, similarly, can help to bring about significant financial and 
nonfinancial benefits. Hence, this measure allows us ample leeway to 
respond to requests that result in reports without recommendations. 

Figure 15: Percentage of New Products with Recommendations: 

[Refer to PDF for image: vertical bar graph] 

2005 Actual: 63%; 
2006 Actual: 65%; 
2007 Actual: 66%. 
2008 Actual: 66%; 
2009 Target: 60%; 
2009 Actual: 68%. 

Source: GAO. 

[End of Figure 15] 

Focusing on Our Client: 

To fulfill the Congress’s information needs, we strive to deliver the 
results of our work orally as well as in writing at a time agreed upon 
with our client. Our performance this year indicates that we assisted 
the Congress extremely well, by slightly exceeding our target on the 
number of hearings we participated in and delivering many of our 
products on time based on the feedback from our client. 

Testimonies: 

Our clients often invite us to testify on our current and past work 
when it addresses issues that congressional committees are examining 
through the hearing process. During fiscal year 2009, experts from our 
staff testified at 203 congressional hearings covering a wide range of 
complex issues, and we slightly exceeded our target of 200 hearings at 
which we testify (see figure 16) by 3 hearings. (See figure 17 for a 
summary of issues we testified on by strategic goal in fiscal year 
2009.) About 70 of the hearings at which our senior executives 
testified were related to high-risk areas and programs, which are 
listed on page 40. 

Figure 16: Testimonies: 

[Refer to PDF for image: vertical bar graph] 

Hearings at which GAO testified: 
2005 Actual: 179; 
2006 Actual: 240; 
2007 Actual: 276. 
2008 Actual: 298; 
2009 Target: 200; 
2009 Actual: 203. 

Source: GAO. 

Note: In fiscal year 2008, we inadvertently reported six additional 
hearings. This entry reflects the correct total. 

[End of Figure 16] 

The Congress asked our executives to testify in fiscal year 2009 more 
than 15 times on homeland security issues; more than 10 times each on 
climate change and Iraq, Afghanistan, and Pakistan; and 8 times on 
military and veterans’ health care and disability benefits. We believe 
that our fiscal year 2010 target of testimonies at 220 hearings is 
challenging and reflects the number of hearings we are likely to attend 
given the Congress’s continuing interest in our Troubled Asset Relief 
Program (TARP) and American Recovery and Reinvestment Act (Recovery 
Act) work along with our reviews of the U.S. financial markets and 
conflicts in Iraq and Afghanistan and terrorism in Pakistan. 

Figure 17: Selected Testimony Issues: Fiscal Year 2009: 

Goal 1: Address Challenges to the Well-Being and Financial Security of 
the American People: 

* Auto industry bailout; 

* Nonprime home loans and rising foreclosures; 

* Pension Benefit Guaranty Corporation financial challenges; 

* Social Security Administration challenges with disability claims 
processing; 

* Wildland fire management; 

* Mental health services for Hurricane Katrina’s youngest victims; 

* Clean water trust fund; 

* Department of Veterans Affairs (VA) health care for women veterans; 

* Corporate crime and deferred prosecutions; 

* D.C. public school reform efforts; 

* Limiting United States Postal Service losses; 

* Reverse mortgages; 

* Crime victims’ rights; 

* Federal Protective Service. 

Goal 2: Respond to Changing Security Threats and the Challenges of 
Globalization: 

* U.S. strategies and plans in Iraq, Afghanistan, and Pakistan; 

* Reforming U.S. defense acquisitions; 

* Planning future army combat systems; 

* DOD’s business transformation; 

* Financial regulators’ oversight of large financial institutions; 

* Security and Exchange Commission enforcement resources; 

* TARP; 

* U.S. cybersecurity strategy; 

* Screening air cargo on passenger aircraft; 

* Post-Katrina Emergency Management Reform Act; 

* Climate change trade measures; 

* Small Business Administration Disaster Loan Program reforms. 

Goal 3: Help Transform the Federal Government’s Role and How It Does 
Business: 

* Recovery Act; 

* Influenza pandemic; 

* Health IT; 

* Management of DOD contractors; 

* Key National Aeronautics and Space Administration challenges; 

* U.S. government financial statements; 

* 2010 Census preparations; 

* Improper federal payments to suspended businesses; 

* Offshore financial activity and tax enforcement; 

* VA and DOD electronic health records; 

* Illegal export of military technology. 

Source: GAO. 

[End of Figure 17] 

Timeliness: 

To be useful to the Congress, our products must be available when our 
clients need them. We outreach directly to our clients through several 
means, including an electronic feedback form. We use the results of our 
client feedback form as a primary source and barometer for whether we 
are getting our products to our congressional clients when they need 
the information. In fiscal year 2009 we met our timeliness target of 95 
percent. To calculate this result we tally responses from the form we 
send to key congressional staff working for the requesters of our 
testimony statements and more significant written products (e.g., 
engagements assigned an interest level of “high” by our senior 
management[Footnote 7] and those expected to reach 500 staff days or 
more), which represented about 65 percent of the congressionally 
requested written products we issued in fiscal year 2009. Because our 
products usually have multiple requesters, we often send forms to more 
than one congressional staff person per testimony or product. One of 
the questions on each form asks the client whether the product was 
provided or delivered on time. In fiscal year 2009, of the forms 
returned to us, 96 percent of the congressional staff responding 
answered the question on timeliness. Overall, the response rate to our 
entire form was 28 percent, though we received feedback on 53 percent 
of the products for which we sent forms. 

In fiscal year 2009, we met our timeliness target of 95 percent. We 
have always set our target for timeliness high because it is important 
for us to meet congressional needs when they occur, and we set our 
fiscal year 2010 target at the same 95 percent level. 

Figure 18: Timeliness: 

[Refer to PDF for image: vertical bar graph] 

Percentage of products on time: 
2005 Actual: 92%; 
2006 Actual: 93%; 
2007 Actual: 95%; 
2008 Actual: 95%; 
2009 Target: 95%; 
2009 Actual: 95%. 

Source: GAO. 

[End of Figure 18] 

Focusing on Our People: 

Our highly professional, multidisciplinary, and diverse staff were 
critical to the level of performance we demonstrated in fiscal year 
2009. Our ability to hire, develop, retain, and lead staff is a key 
factor to fulfilling our mission of serving the Congress and the 
American people. 

Over the last 5 fiscal years, we have refined our processes for 
measuring how well we manage our human capital. In fiscal year 2009, we 
exceeded all of our seven people measures. These measures are directly 
linked to our goal 4 strategic objective of becoming a professional 
services employer of choice. For more information about our people 
measures, see Verifying and Validating Performance Data on page 84 of 
this report. 

New Hire Rate: 

Our new hire rate is the ratio of the number of people hired to the 
number we planned to hire. Annually, we develop a workforce plan that 
takes into account strategic goals; projected workload changes; and 
other changes, such as retirements, other attrition, promotions, and 
skill gaps. The workforce plan for the upcoming year specifies the 
number of planned hires. The plan is conveyed to each of our units to 
guide hiring throughout the year. The Chief Operating Officer, the 
Chief Administrative Officer, the Deputy Chief Administrative Officer, 
the Chief Human Capital Officer, and the Controller meet monthly, or 
more frequently if needed, to monitor progress toward achieving the 
workforce plan. 

Adjustments to the workforce plan are made throughout the year, if 
necessary, to reflect changing needs and conditions. In fiscal year 
2009, our adjusted plan was to hire 345 staff. We were able to bring on 
board 340 staff by year-end. Table 3 shows that we exceeded by 4 
percentage points the target we set for our new hire rate. Our success 
in achieving a 99 percent new hire rate resulted from an aggressive and 
structured recruitment strategy focused on meeting our current workload 
demands, as well as the additional requirements in fiscal year 2009 as 
a result of TARP and the Recovery Act. 

Table 3: Actual Performance and Targets Related to Our New Hire Rate 
Measure: 

Performance measures: People: New hire rate; 
2005 Actual: 94%; 
2006 Actual: 94%; 
2007 Actual: 96%; 
2008 Actual: 96%; 
2009 Target: 95%; 
2009 Actual: 99%. 

Source: GAO. 

[End of Table 3] 

Retention Rate: 

We continuously strive to make GAO a place where people want to work. 
Once we have made an investment in hiring and training people, we would 
like them to stay with us. This measure is one indicator of whether we 
are attaining this objective. We calculate this measure by taking 100 
percent minus the attrition rate, where attrition rate is defined as 
the number of separations divided by the average onboard strength. We 
calculate this measure with and without retirements. Table 4 shows that 
prior to fiscal year 2009, we consistently met the 90 percent target 
rate for overall retention (with retirements), and that we exceed that 
rate considerably by 4 percentage points in fiscal year 2009, with 94 
percent retention. This increase was likely due to the influence of the 
overall economy, which caused some staff to delay retirements and 
reduced other attrition via resignations or transfers to other 
agencies. Similarly, for retention without retirements, we consistently 
met the target of 94 percent for the 3 of the 4 years prior to fiscal 
year 2009, but exceeded it in fiscal year 2009 by 2 percentage points. 
As with the overall retention rate, this increase was likely caused by 
the overall economy, which has slowed attrition via resignations and 
transfers. 

Table 4: Actual Performance and Targets Related to Our Retention Rate 
Including and Excluding Retirements: 

Performance measures: People: Retention rate: With retirements; 
2005 Actual: 90%; 
2006 Actual: 90%; 
2007 Actual: 90%; 
2008 Actual: 90%; 
2009 Target: 90%; 
2009 Actual: 94%. 

Performance measures: People: Retention rate: Without retirements; 
2005 Actual: 94%; 
2006 Actual: 94%; 
2007 Actual: 94%. 
2008 Actual: 93%; 
2009 Target: 94%; 
2009 Actual: 96%. 

Source: GAO. 

[End of Table 4] 

Staff Development and Utilization, Effective Leadership by Supervisors, 
and Organizational Climate: 

One way that we measure how well we are supporting our staff and 
providing an environment for professional growth and improvement is 
through our annual employee feedback survey. This Web-based survey, 
which is conducted by an outside contractor to ensure the 
confidentiality of every respondent, is administered to all of our 
employees once a year. Through the survey, we encourage our staff to 
indicate what they think about our overall operations, work 
environment, and organizational culture and how they rate their 
immediate supervisors on key aspects of their leadership styles. The 
survey consists of over 100 questions. In fiscal year 2009, to better 
ensure confidentiality of individual responses, we used the same 
outside contractor that administered the survey to also analyze the 
data. 

This fiscal year about 74 percent of our employees completed the 
survey, and we exceeded all four targets (see table 5). In fact, our 
fiscal year 2009 performance on all of these measures was the highest 
since fiscal year 2005. The organizational climate measure showed the 
greatest increase among these measures, exceeding our fiscal year 2009 
target by 4 percentage points and our actual performance last fiscal 
year by 2 percentage points. Our performance on the staff development 
and leadership measures also beat last fiscal year’s actual performance 
by 2 percentage points each, and staff utilization showed a 3 
percentage point gain over last fiscal year’s results. Given our uneven 
performance on these measures over the last 5 years, we decided to 
retain our fiscal year 2009 targets for fiscal year 2010. (See table 
1.) 

Table 5: Actual Performance and Targets Related to Our Measures of 
Employee Satisfaction with Staff Development, Staff Utilization, 
Effective Leadership by Supervisors, and Organizational Climate: 

Performance Measures[A]: People: Staff development[B]; 
2005 Actual: 72%; 
2006 Actual: 76%; 
2007 Actual: 76%. 
2008 Actual: 77%; 
2009 Target: 76%; 
2009 Actual: 79%. 

Performance Measures[A]: People: Staff utilization; 
2005 Actual: 75%; 
2006 Actual: 75%; 
2007 Actual: 73%. 
2008 Actual: 75%; 
2009 Target: 75%; 
2009 Actual: 78%. 

Performance Measures[A]: People: Effective leadership by supervisors[C]; 
2005 Actual: 80%; 
2006 Actual: 79%; 
2007 Actual: 79%. 
2008 Actual: 81%; 
2009 Target: 80%; 
2009 Actual: 83%. 

Performance Measures[A]: People: Organizational Climate; 
2005 Actual: 76%; 
2006 Actual: 73%; 
2007 Actual: 74%. 
2008 Actual: 77%; 
2009 Target: 75%; 
2009 Actual: 79%. 

Source: GAO. 

[A] Certain portions of our Web-based survey are used to develop these 
four measures. 

[B] Beginning in fiscal year 2006 we changed the way that the staff 
development people measure was calculated. Specifically, we dropped one 
question regarding computer-based training because we felt such 
training was a significant part of (and therefore included in) the 
other questions the survey asked regarding training. We also modified a 
question on internal training and changed the scale of possible 
responses to that question. We show the fiscal year 2005 data on a 
separate line to indicate that those data are not comparable to the 
data beginning in fiscal year 2006. 

[C] In fiscal year 2009 we changed the name of this measure from “
Leadership” to its current nomenclature to clarify that the measure 
reflects employees’ satisfaction with their immediate supervisors’ 
leadership. 

[End of Table 5] 

Focusing on Our Internal Operations: 

Our mission and people are supported by our internal administrative 
services, including information management, facility management, 
knowledge services, human capital, financial management, and other 
services. To assess our performance related to how well our internal 
administrative services help employees get their jobs done or improve 
employees’ quality of work life, we use information from our annual 
customer satisfaction survey to set targets and assess our performance 
for both of these measures, which are shown in table 6. We asked staff 
to rank 31 internal services available to them and to indicate on a 
scale from 1 to 5 their satisfaction with each service. Our internal 
operations measures are directly related to our goal 4 strategic 
objectives of continuously enhancing our business and management 
processes and becoming a professional services employer of choice. The 
first measure encompasses 19 services that help employees get their 
jobs done, such as Internet access, desktop computer equipment, voice 
and video communication systems, shared service centers for copying and 
courier assistance, travel services, and report production. The second 
measure encompasses another 12 services that affect quality of work 
life, such as assistance related to pay and benefits, building security 
and maintenance, and workplace safety and health. Using survey 
responses, we calculate a composite score for each service category 
that reflects employee ratings for (1) satisfaction with the service 
and (2) importance of the service. 

Table 6: Actual Performance and Targets Related to Our Internal 
Operations Measures: 

Performance measures: Internal operations: Help get job done; 
2005 Actual: 4.10; 
2006 Actual: 4.10; 
2007 Actual: 4.05; 
2008 Actual: 4.00; 
2009 Target: 4.00; 
2009 Actual: N/A. 

Performance measures: Internal operations: Quality of work life; 
2005 Actual: 3.98; 
2006 Actual: 4.00; 
2007 Actual: 3.98; 
2008 Actual: 4.01; 
2009 Target: 4.00; 
2009 Actual: N/A. 

Source: GAO. 

Note: We will report actual data for fiscal year 2009 once the data 
from our November 2009 internal operations survey have been analyzed. 
N/A indicates that the data are not available yet. 

[End of Table 6] 

GAO’s High-Risk Program: 

Since 1990, our high-risk program has highlighted long-standing 
challenges facing the federal government. Increasingly, the program has 
focused on those major programs and operations that are in urgent need 
of broad-based transformation and congressional as well as executive 
branch action to ensure that our national government functions in the 
most economical, efficient, and effective manner possible. Our latest 
regular update, released in January 2009, highlights 30 troubled areas 
across government. Many of these areas involve critical public service 
providers, such as the Department of Agriculture (USDA), the Internal 
Revenue Service (IRS), and the Centers for Medicare and Medicaid 
Services (CMS), which provides services to Medicare and Medicaid 
recipients. In July 2009 we added the U.S. Postal Service (USPS) 
financial condition to the list because the service urgently needs to 
restructure to address its current and long-term financial viability. 

Issued to coincide with the start of each new Congress, our high-risk 
updates have helped sustain attention from members of the Congress who 
are responsible for oversight and from executive branch officials who 
are accountable for performance. Our focus on high-risk problems 
contributed to the Congress enacting a series of governmentwide reforms 
to address critical human capital challenges, strengthen financial 
management, improve IT practices, and instill a more results-oriented 
government. Overall, our high-risk program has served to identify and 
help resolve serious weaknesses in areas that involve substantial 
resources and provide critical services to the public. 

In fiscal year 2009, we determined that sufficient progress was made to 
merit removing the high-risk designation from one area—the Federal 
Aviation Administration’s air traffic control modernization. We also 
designated three new areas as high risk: modernizing the outdated U.S. 
financial regulatory system, protecting public health through enhanced 
oversight of medical products, and transforming the Environmental 
Protection Agency’s (EPA) processes for assessing and controlling toxic 
chemicals. We added USPS financial condition to the high-risk list 
later in fiscal year 2009 because amid challenging economic conditions 
and an accelerated decline in mail volume, USPS is facing a 
deteriorating financial situation in which it does not expect to cover 
its expenses and financial obligations in fiscal years 2009 and 2010. 

Since our program began, the government has taken high-risk problems 
seriously and has made progress toward correcting them. The original 
high-risk list included 14 areas, but over the past 19 years, 38 areas 
were added, 19 areas were removed, and 2 were consolidated to reach the 
current 31 areas. The Department of Defense (DOD) continues to dominate 
the list with 8 high-risk areas of its own and shared responsibility 
for 7 more. Table 7 lists each current high-risk area and the year it 
was placed on the high-risk list. 

Our high-risk list work in fiscal year 2009: 

* 150 reports; 
* 71 testimonies; 
* $25.7 billion in financial benefits. 

In fiscal year 2009, we issued 150 reports, delivered 71 testimonies to 
the Congress, and documented financial benefits totaling approximately 
$25.7 billion related to our high-risk areas. Included in these results 
are reviews we completed that examined the administration of the 
Medicaid program by CMS. For example, our recommendations to help 
modernize and safeguard the Medicaid program resulted in $3.6 billion 
in financial benefits. Additionally, we evaluated DOD’s acquisition of 
weapons systems resulting in financial benefits of over $7 billion. 
Some of our significant work in this area included reviewing the cost 
and risks of the Joint Strike Fighter program, target attack radar 
systems, and satellite systems. We also documented about $5.7 billion 
in financial benefits from our work examining IRS’s enforcement of tax 
laws. The actions IRS took to improve tax collections in response to 
our recommendations resulted in over 90 percent of the financial 
benefits we documented for this high-risk list area in fiscal year 
2009. Our work analyzing DOD’s attainment of new weapon systems 
resulted in approximately $8 billion in financial benefits. To learn 
more about our work on the high-risk areas or to download our January 
2009 high-risk update in full, go to [hyperlink, 
http://www.gao.gov/docsearch/featured/highrisk.html]. 

General Counsel Decisions and Other Legal Work: 

In addition to benefiting from our audit and evaluation work, the 
Congress and the public also benefited from some of our other 
activities in fiscal year 2009 in the following ways: 

* We handled more than 1,600 protests filed by parties who challenged 
the way individual federal procurements and contracts were handled, and 
we issued decisions on more than 250 protests addressing a wide range 
of issues involving compliance with, and the interpretation of, 
procurement statutes and regulations. For example, we issued decisions 
concerning the Army’s award of contracts for joint light technology 
vehicles,[Footnote 8] the Coast Guard’s award of a $1.3 billion 
contract for the fast response cutter,[Footnote 9] the Department of 
Energy’s (DOE) award of a $3.3 billion contract for liquid waste 
remediation services at the agency’s Savannah River site,[Footnote 10] 
and the National Aeronautics and Space Administration’s (NASA) award of 
a contract for commercial resupply services for the International Space 
Station.[Footnote 11] In addition, we issued revised bid protest 
regulations and a new guide to GAO protective orders. 

Table 7: GAO’s High-Risk List as of July 2009: 

Addressing Challenges to Broad-Based Transformation: 

High-risk area: Restructuring the U.S. Postal Service to Achieve 
Sustainable Financial Viability; 
Year designated as high risk: 2009. 

High-risk area: Modernizing the Outdated U.S. Financial Regulatory 
System[A]; 
Year designated as high risk: 2009. 

High-risk area: Protecting Public Health through Enhanced Oversight of 
Medical Products; 
Year designated as high risk: 2009. 

High-risk area: Transforming EPA’s Processes for Assessing and 
Controlling Toxic Chemicals[A]; 
Year designated as high risk: 2009. 

High-risk area: 2010 Census; 
Year designated as high risk: 2008. 

High-risk area: Strategic Human Capital Management[A]; 
Year designated as high risk: 2001. 

High-risk area: Managing Federal Real Property[A]; 
Year designated as high risk: 2003. 

High-risk area: Protecting the Federal Government’s Information Systems 
and the Nation’s Critical Infrastructures; 
Year designated as high risk: 1997. 

High-risk area: Implementing and Transforming the Department of 
Homeland Security; 
Year designated as high risk: 2003. 

High-risk area: Establishing Effective Mechanisms for Sharing Terrorism-
Related Information to Protect the Homeland; 
Year designated as high risk: 2005. 

High-risk area: DOD Approach to Business Transformation[A}; 
Year designated as high risk: 2005. 

High-risk area: DOD Approach to Business Transformation[A]: Business 
Systems Modernization; 
Year designated as high risk: 1995. 

High-risk area: DOD Approach to Business Transformation[A]: Personnel 
Security Clearance Program; 
Year designated as high risk: 2005. 

High-risk area: DOD Approach to Business Transformation[A]: Support 
Infrastructure Management; 
Year designated as high risk: 1997. 

High-risk area: DOD Approach to Business Transformation[A]: Financial 
Management; 
Year designated as high risk: 1995. 

High-risk area: DOD Approach to Business Transformation[A]: Supply 
Chain Management; 
Year designated as high risk: 1990. 

High-risk area: DOD Approach to Business Transformation[A]: Weapon 
Systems Acquisition; 
Year designated as high risk: 1990. 

High-risk area: Funding the Nation’s Surface Transportation System[A]; 
Year designated as high risk: 2007. 

High-risk area: Ensuring the Effective Protection of Technologies 
Critical to U.S. National Security Interests[A]; 
Year designated as high risk: 2007. 

High-risk area: Revamping Federal Oversight of Food Safety[A]; 
Year designated as high risk: 2007. 

Managing Federal Contracting More Effectively: 

High-risk area: DOD Contract Management; 
Year designated as high risk: 1992. 

High-risk area: DOE’s Contract Management for the National Nuclear 
Security Administration and Office of Environmental Management; 
Year designated as high risk: 1990. 

High-risk area: NASA Acquisition Management; 
Year designated as high risk: 1990. 

High-risk area: Management of Interagency Contracting; 
Year designated as high risk: 2005. 

Assessing the Efficiency and Effectiveness of Tax Law Administration: 

High-risk area: Enforcement of Tax Laws[A]; 
Year designated as high risk: 1990. 

High-risk area: IRS Business Systems Modernization; 
Year designated as high risk: 1995. 

Modernizing and Safeguarding Insurance and Benefit Programs: 

High-risk area: Modernizing Federal Disability Programs[A]; 
Year designated as high risk: 2003. 

High-risk area: Pension Benefit Guaranty Corporation Single-Employer 
Insurance Program[A]; 
Year designated as high risk: 2003. 

High-risk area: Medicare Program[A]; 
Year designated as high risk: 1990. 

High-risk area: Medicaid Program[A]; 
Year designated as high risk: 2003. 

High-risk area: National Flood Insurance Program[A]; 
Year designated as high risk: 2006. 

Source: GAO. 

[A] Legislation is likely to be necessary, as a supplement to actions 
by the executive branch, to effectively address this high-risk area. 

[End of Table 7] 

* We issued appropriations law and other legal decisions on, among 
other things, the purposes for which appropriated funds may be used, 
potential Antideficiency Act violations, and the obligational 
consequences of various contracting actions. A few decisions and 
opinions stand out. One opinion, issued in response to a legislative 
mandate, concluded that DOD’s outreach to retired military officers 
serving as media analysts did not violate the prohibition on using 
appropriations for publicity or propaganda purposes.[Footnote 12] The 
opinion suggested that DOD, nevertheless, should consider policies and 
procedures for future outreach activities to protect the integrity of, 
and public confidence in, its public affairs efforts. Another opinion, 
in which we disagreed with the views of the Department of Justice (DOJ) 
Office of Legal Counsel, reminded agencies that it is a violation of 
the Antideficiency Act whenever an agency violates a statutory 
prohibition on the use of appropriated funds, regardless of whether the 
prohibition was enacted in the appropriations act from which the funds 
were obligated.[Footnote 13] A third decision advised agencies that 
notwithstanding the GSA instructions to the contrary, they may not 
obligate expiring fiscal year appropriations to cover new motor vehicle 
orders to be finalized in the subsequent fiscal year.[Footnote 14] We 
also issued opinions and legal products addressing DOT’s authority to 
apportion federal highway funds based on states’ “public-private 
partnership” roadways,[Footnote 15] the Department of the Interior’s 
obligation to maintain the navigability of access channels leading to 
major U.S. waterways,[Footnote 16] and USDA’s plans to provide access 
easements to private parties on public lands.[Footnote 17] 

* For fiscal year 2009, we received 12 Antideficiency Act reports for 
our repository and made selected information from these reports 
publicly available on our Web site. Since the Congress amended the 
Antideficiency Act in December 2004, requiring agencies to send us a 
copy of reports of Antideficiency Act violations, we have maintained 
the official repository of Antideficiency Act reports. 

* We continued to report under the Congressional Review Act to the 
standing committees of jurisdiction of both Houses of the Congress on 
major rules proposed by federal agencies. For fiscal year 2009, we 
issued 87 reports. In addition, we updated the Congressional Review Act 
reports page on our external Web site to make the external search 
capacity more useful and user-friendly. 

* The General Counsel’s Legal Services group was instrumental in the 
completion of an interim collective bargaining agreement covering such 
matters as grievance and arbitration procedures and also served on the 
negotiating team that conducted the pay negotiations for the 2009 
analyst pay increases. It also participated in informal, weekly 
meetings with the GAO Employees Organization, International Federation 
of Professional and Technical Engineers, Local 1921, at which a host of 
labor management relations issues were discussed. 

* We were also instrumental in drafting the provisions of H.R. 2646, 
the Government Accountability Office Improvement Act of 2009. This bill 
contains provisions designed to confirm GAO’s access and enhance 
congressional oversight in a number of areas, including the Medicare 
prescription drug benefit as well as antitrust enforcement. 

In fiscal year 2009 we distributed volume III of the third edition of 
Principles of Federal Appropriations Law, commonly known as the Red 
Book. The Red Book is available to the public on our Web site and is 
considered the primary resource for appropriations law guidance in the 
federal financial community. The three-volume Red Book averages 
thousands of downloads per week as attorneys, budget analysts, 
financial managers, project managers, contracting officers, and 
accountable officers from all three branches of the government access 
it to research questions about budget and appropriations law. We also 
issued our annual update of the third edition of the Red Book. By the 
end of calendar year 2009, we will issue an interactive electronic 
Index and Table of Authorities for the third edition. 

Attorneys from General Counsel taught a 2-½-day course on 
appropriations law 19 times this fiscal year to staff at 12 agencies 
and to a number of congressional staff. The course explains the 
framework for analyzing appropriations law issues to ensure that funds 
are available for obligation with regard to purpose, amount, and time. 
In addition, appropriations lawyers taught two half-day and two full-
day seminars on specialized appropriations law topics for three 
agencies. To further communication within the appropriations law 
community across all agencies and within the three branches of 
government, we hosted our fifth annual appropriations law forum in 
March 2009, with an analysis of significant decisions and opinions of 
2008 and interactive sessions on no-cost contracts and interagency 
transactions, personal versus official expenses, and appropriations law 
issues for political appointees. 

Assisted with the Transition: 

While we, as a legislative branch agency, have extensive experience 
helping each new Congress, the year 2000 amendments to the Presidential 
Transition Act point to us as a resource to incoming administrations as 
well. The act specifically identifies GAO as a source of briefings and 
other materials to help inform presidential appointees about the major 
management issues, risks, and challenges they will face. 

Our objectives for assisting the 111th Congress and the new 
administration were to: 

* Provide insight into pressing national issues. 

* Highlight the growing need for innovative, integrated approaches to 
solve national and global challenges. 

* Document targeted opportunities to conserve resources that can be 
applied to new initiatives. 

* Underscore critical capacity-building needs in individual agencies 
that will affect implementation of whatever new priorities are pursued. 

* Help inform the management improvement agendas of the Congress and 
the new administration. 

* Monitor the implementation of the Presidential Transition Act 
provisions and identify potential improvements for future transitions 

Urgent Issues GAO Identified in November 2008 (listed alphabetically): 

* Caring for servicemembers; 
* Defense readiness; 
* Defense spending; 
* Food safety; 
* Iraq, Afghanistan, and Pakistan; 
* Oversight of financial institutions and markets; 
* Preparing for large-scale health emergencies; 
* Protecting the homeland; 
* Public diplomacy and international broadcasting; 
* Retirement of the space shuttle; 
* Surface transportation; 
* The 2010 Census; 
* Transition to digital TV. 

[End of Urgent Issues GAO Identified in November 2008] 

To accomplish these objectives, we synthesized the hundreds of reports 
and testimonies we issue every year to provide congressional and 
executive branch policymakers with a comprehensive snapshot of how 
things are working across government and to emphasize the need to 
update some federal activities to better align them with 21st century 
realities and help transform government. On November 6, 2008, we 
launched our new transition Web site which reflected our institutional 
knowledge and broad-based, nonpartisan work on matters across the 
government spectrum and offered the incoming administration and the 
Congress key perspectives on program, policy, and management issues 
confronting the federal government. The site was organized into six 
major sections: 

Urgent Issues: A number of pressing issues demand urgent attention and 
continuing oversight to ensure the nation’s security and well-being. 
GAO profiles 13 such issues, including oversight of financial 
institutions and markets; U.S. efforts in Iraq, Afghanistan, and 
Pakistan; oversight of food safety; protecting the homeland; and 
preparing for large-scale health emergencies. 

Agency-by-Agency Issues: Each agency faces a range of distinctive major 
challenges affecting its mission, budget, and programs. GAO summarizes 
its work at 28 federal agencies. 

Major Cost-Saving Opportunities: A number of opportunities exist to 
limit costs, reduce waste across agencies and programs, and collect 
revenues already due the government. GAO discusses about 50 such 
opportunities identified in its previously published work. 

Management Challenges across the Government: Agencies share a number of 
management challenges to improve operational efficiency and 
effectiveness and address current and emerging demands. 

Long-Term Fiscal Outlook: Given the federal government’s long-term 
fiscal challenges, consideration should be given to an array of efforts 
to address the growing imbalance between expected spending and tax 
revenues. This is important to America’s long-term economic growth, 
quality of life, and security. 

Examples of Upcoming GAO Reports on Major National Issues: GAO’s 
forthcoming work focuses on a wide range of key federal policies and 
programs. 

The site also included our recommendations, key reports for further 
research, and contacts for specific areas. 

In addition to our Internet outreach through the transition Web site, 
our senior executives met with new and returning members of the 
Congress, key congressional staff, and members of the new 
administration as part of our transition activities. 

Since we launched the transition Web site, we have issued a number of 
products related to the urgent issues we identified for the new 
administration and the Congress, covering topics such as securing, 
stabilizing, and developing Pakistan’s border area with Afghanistan; 
improving solvency mechanisms for the U.S. highway trust fund; and 
sustaining focus on the nation’s planning and preparedness for the 
influenza pandemic. Our transition effort also included our high-risk 
report, which we discussed previously. We updated the site to focus on 
high risk and other major management challenges facing the government. 

The Troubled Asset Relief Program: 

On October 3, 2008, the Congress assigned GAO important 
responsibilities in the Emergency Economic Stabilization Act of 2008 
related to the $700 billion TARP, which was designed to help the nation 
deal with its serious financial and economic problems. Our work 
monitoring TARP, involved examining (1) TARP’s performance in meeting 
the purposes of the act; (2) the financial condition and internal 
controls of TARP, its representatives, and agents; (3) the 
characteristics of both asset purchases and the disposition of assets 
acquired, including any related commitments that are entered into; (4) 
the program’s efficiency in using the funds appropriated for its 
operation; (5) TARP’s compliance with applicable laws and regulations; 
(6) efforts to prevent, identify, and minimize conflicts of interest of 
those involved in TARP’s operations; and (7) the efficacy of 
contracting procedures. 

We are responsible for submitting reports to the Congress at least 
every 60 days regarding findings in these areas, and by the end of 
fiscal year 2009 we had issued over 15 products related to TARP, 
including 7 60-day reports. These products covered issues such as 
financial assistance and restructuring of the automobile industry; the 
status of efforts to address home mortgage defaults and foreclosures; 
and efforts to address the transparency and accountability of TARP, 
which include 35 recommendations for improvements. The act also 
mandates a onetime report to the Congress on the role that leveraging 
and sudden deleveraging of financial institutions played in the nation’
s financial crisis spurred by subprime home loans, which we issued on 
July 22, 2009 [hyperlink, http://www.gao.gov/products/GAO-09-739]. In 
addition, we were given responsibility for auditing the annual 
financial statements of the entity established to implement TARP—the 
Department of the Treasury’s Office of Financial Stability within the 
Office of Domestic Finance. 

To perform this work, we assembled interdisciplinary teams with a wide 
range of technical skills, including financial market and public policy 
analysts, accountants, lawyers, and economists who combined resources 
across the agency. In addition, we leveraged knowledge bases developed 
during our prior work that assessed actions taken in response to 
previous financial crises, such as the savings and loan crisis. We also 
buttressed our in-house technical expertise with targeted new hires and 
outside experts. We conducted this oversight work as we typically do—in 
an objective, fact-based, and independent manner. 

The American Recovery and Reinvestment Act of 2009: 

The $787 billion Recovery Act is intended to address the nation’s most 
serious economic crisis since the Great Depression. The law, passed in 
February 2009, contains 12 mandates for GAO, including requirements to 
conduct bimonthly reviews of how states and localities are using 
Recovery Act funds and to issue subsequent reports based on these 
reviews. We are also required to report quarterly on recipient reports 
on job creation under the act. 

To ensure that our work was coordinated with that of others in the 
accountability community who were also given significant Recovery Act 
responsibilities, we held meetings with the IGs from 17 federal 
agencies and met with the head of the Recovery Accountability and 
Transparency Board. In addition we participated in teleconferences with 
state auditors from 46 states and with local government auditors who 
perform important oversight functions in their jurisdictions. 

In April 2009 we successfully completed our first Recovery Act task—to 
appoint 13 members to a committee that will make recommendations 
concerning the electronic interchange of health information. We 
solicited and reviewed nearly 300 nominations to fill the positions 
within the legislatively mandated 45-day time frame. We also issued our 
assessment on the Small Business Administration’s (SBA) efforts to 
increase liquidity in the secondary market for SBA loans within the 60-
day time frame required by the Recovery Act [hyperlink, 
http://www.gao.gov/products/GAO-09-507R], Apr. 16, 2009. Later that 
month, we issued our first bimonthly report on selected states’ use of the 
Recovery Act funds (GAO-09-580, Apr. 23, 2009) and testified before 
the Congress on our findings and made a number of recommendations 
aimed at the Office of Management and Budget (OMB) to address concerns 
about the act’s accountability and transparency requirements, the use 
of Recovery Act funds to support state efforts to ensure accountability 
and oversight, and notification to interested parties of the 
availability of funds. We subsequently issued our second and third 
bimonthly reports [hyperlink, http://www.gao.gov/products/GAO-09-829] 
and [hyperlink, http://www.gao.gov/products/GAO-09-1016]. These reports 
are based on our longitudinal study of 16 states and certain localities 
within those jurisdictions as well as the District of Columbia that 
covers about two-thirds of the Recovery Act funds administered by states 
and localities. In those 17 locations, we are focusing on federal 
programs estimated to account for about 90 percent of Recovery Act 
outlays administered by states and localities for fiscal year 2009. 
Teams of experienced staff from across our agency gathered information 
on how the states and the District of Columbia plan to use the funds, 
their accountability approaches, and their plans to evaluate the impact 
of funds. In these bimonthly reviews, we made a number of recommendations, 
primarily to OMB. In response, OMB has already issued guidance to federal 
agencies and state and local governments on how to track and report on 
the use and impact of Recovery Act funds. By the close of fiscal year 
2009, we had issued three bimonthly reports and a number of other products. 

Because of the high level of public interest in the Recovery Act, we 
established a separate page on our external Web site devoted to our 
work on Recovery Act mandates. In one place [hyperlink, 
http://www.gao.gov/recovery], individuals can find information about 
the Recovery Act, access our bimonthly reviews on the use of funds, use 
an interactive map to access reports on each the selected states and 
the District of Columbia, learn about other mandates and related work, 
and find out how to report allegations of abuse of Recovery Act funds. 
Our FraudNet also put out a special call for the public to report 
allegations of fraud, waste, abuse, and mismanagement in the use of 
Recovery Act funds (see [hyperlink, 
http://www.gao.gov/press/fraudnet2009mar30.pdf]). 

Managing Our Resources: 

Resources Used to Achieve Our Fiscal Year 2009 Performance Goals: 

Our financial statements for the fiscal year ended September 30, 2009 
were audited by an independent auditor, Clifton Gunderson, LLP, and 
received an unqualified opinion. They found our internal controls to be 
effective—which means that no material weaknesses were identified—and 
reported that we substantially complied with the applicable 
requirements for financial systems in FFMIA. In addition, they found no 
instances of noncompliance with the laws or regulations in the areas 
tested. In the opinion of the independent auditor, our financial 
statements are presented fairly in all material respects and are in 
conformity with generally accepted accounting principles. The auditor’s 
report, along with the statements and their accompanying notes, begin 
on page 100 in this report.[Footnote 18] Table 8 summarizes key data. 

Compared with the statements of large and complex agencies in the 
executive branch, our statements present a relatively simple picture of 
a small yet very important agency in the legislative branch. We focus 
most of our financial activity on the execution of our congressionally 
approved budget with most of our resources devoted to the human capital 
needed for our mission. 

In fiscal year 2009, our budgetary resources included new 
appropriations of $556 million, which includes $25 million, available 
through September 2010, as provided by the Recovery Act. In fiscal year 
2009, we hired 74 re-employed annuitants and other staff under 
temporary appointments, to supplement existing staff conducting the 
reviews and meet the 60-day reporting requirements under the Recovery 
Act, at a cost of $4.2 million for staffing and related travel for the 
six month period ending September 30, 2009. Approximately $20.8 million 
remains available to continue these efforts in fiscal year 2010. 

GAO also received $7.3 million in reimbursement from the Department of 
the Treasury to support activities related to monitoring the 
implementation of TARP including bimonthly reporting and conducting an 
annual financial audit of the $700 billion authorized for TARP. 

Our total assets were $136 million, consisting mostly of property and 
equipment (including the headquarters building, land and improvements, 
and computer equipment and software) and funds with the U.S. Treasury. 
The balance in Funds with the U.S. Treasury increased by $31 million, a 
result of the combination of increased fiscal year annual appropriation 
and the new appropriation for the Recovery Act that is available 
through September 2010. This is also reflected in the increase in 
unexpended appropriations this fiscal year. The net property and 
equipment balance decreased largely due to new assets under capital 
lease added at the end of fiscal year 2008 with related depreciation 
reflected this fiscal year. Total liabilities of $111 million were 
composed largely of employees’ accrued annual leave, amounts owed to 
other government agencies, workers’ compensation, and employees’ 
salaries and benefits. The greatest change in our liabilities is an 
increase of $3.6 million in intragovernmental accounts payable due 
primarily to the timing of government billings resulting in a larger 
accrual this fiscal year as compared to last fiscal year. 

Table 8: GAO’s Financial Highlights: Resource Information (Dollars in 
millions): 

Total budgetary resources[A]; 
Fiscal year 2009: $580.6 million; 
Fiscal year 2008: $519.0 million. 

Total outlays[A]; 
Fiscal year 2009: $539.9 million; 
Fiscal year 2008: $500.4 million. 

Net cost of operations: Goal 1: Well-being and Financial security of 
the American people; 
Fiscal year 2009: $191.3 million; 
Fiscal year 2008: $201.2 million. 

Net cost of operations: Goal 2: Changing security threats and 
challenges of globalization; 
Fiscal year 2009: $168.4 million; 
Fiscal year 2008: $161.1 million. 

Net cost of operations: Goal 3: Transforming the federal government's 
role; 
Fiscal year 2009: $177.1 million; 
Fiscal year 2008: $150.6 million. 

Net cost of operations: Goal 4: Maximizing the value of GAO; 
Fiscal year 2009: $27.7 million; 
Fiscal year 2008: $22.6 million. 

Net cost of operations: Less reimbursable services not attributable to 
goals; 
Fiscal year 2009: ($5.7 million); 
Fiscal year 2008: ($5.9 million). 

Total net cost of operations[A]; 
Fiscal year 2009: $558.8 million; 
Fiscal year 2008: $529.6 million. 

Actual FTEs: 
Fiscal year 2009: 3.204; 
Fiscal year 2008: 3,081. 

Source: GAO. 

[A] The net cost of operations figures include nonbudgetary items, such 
as imputed pension and depreciation costs, which are not
included in the figures for total budgetary resources or total outlays. 

[End of Table 8] 

The net cost of operating GAO during fiscal year 2009 and fiscal year 
2008 was approximately $559 million and $530 million, respectively. 
Expenses for salaries and related benefits accounted for 79 and 78 
percent of our net cost of operations in fiscal years 2009 and 2008, 
respectively. The increase in operating costs reflects, in part, a 
combination of new hires due to TARP and Recovery Act work and a lower 
agencywide attrition rate in fiscal year 2009. Figure 19 shows how our 
fiscal year 2009 costs break down by category. 

We report net cost of operations according to our four strategic goals, 
consistent with our strategic plan. Overall, our net costs of 
operations increased by $29 million, due primarily to increases in 
salaries and benefits. All four of our strategic goals show sizable 
shifts in costs in fiscal year 2009. The change in costs for goals 1, 
2, and 3 can be explained largely by our efforts on both the TARP and 
Recovery Act efforts begun this fiscal year. As a result of these 
efforts, experienced personnel resources were diverted from our goal 1 
(Well-being and financial security of the American people) efforts, 
that shows a net cost decrease, to assist in goal 2 (Changing security 
threats and globalization challenges) and goal 3 (Transforming the 
federal government’s role). These personnel, in addition to the new 
hires previously discussed, contributed to the increases seen in both 
goals 2 and 3, which include TARP and Recovery Act efforts. The 
increase in net costs of goal 4 (Maximizing the value of GAO) reflects 
new technology-related projects, including developing our enterprise 
architecture, improving engagement system support, and beginning the 
process of modernizing our human capital information systems. 

Figure 19: Use of Fiscal Year 2009 Funds by Category: 

[Refer to PDF for image: pie chart] 

Percentage of Total Net Costs: 
Salaries and benefits: 79.0%; 
Building and hardware maintenance services: 12.3%; 
Rent (space and hardware): 2.1%; 
Depreciation: 2.0%; 
Other: 4.6%. 

Source: GAO. 

[End of Figure 19] 

Figures 20 and 21 show our net costs by goal for fiscal year 2006 
through fiscal year 2009. Figure 20 shows costs unadjusted for 
inflation, while figure 21 shows the same costs in 2009 dollars, that 
is, adjusted for inflation. 

Figure 20: Net Cost by Goal, Unadjusted for Inflation: 

[Refer to PDF for image: vertical bar chart] 

Goal 1; 
2006: $191.9 million; 
2007: $177.4 million; 
2008: $201.2 million; 
2009: $191.3 million. 

Goal 2; 
2006: $154.7 million; 
2007: $157.5 million; 
2008: $161.1 million; 
2009: $168.4 million. 

Goal 3; 
2006: $146.8 million; 
2007: $146.6 million; 
2008: $150.6 million; 
2009: $177.1 million. 

Goal 4; 
2006: $23.7 million; 
2007: $23.9 million; 
2008: $22.6 million; 
2009: $27.7 million. 

Source: GAO. 

[End of Figure 20] 

Figure 21: Net Cost by Goal, Adjusted for Inflation: 

[Refer to PDF for image: vertical bar chart] 

Goal 1; 
2006: $205.9 million; 
2007: $185.0 million; 
2008: $205.0 million; 
2009: $191.3 million. 

Goal 2; 
2006: $166.0 million; 
2007: $164.2 million; 
2008: $164.2 million; 
2009: $168.4 million. 

Goal 3; 
2006: $157.5 million; 
2007: $152.9 million; 
2008: $153.5 million; 
2009: $177.1 million. 

Goal 4; 
2006: $25.4 million; 
2007: $24.9 million; 
2008: $23.0 million; 
2009: $27.7 million. 

Source: GAO. 

[End of Figure 21] 

Financial Systems and Internal Controls: 

We recognize the importance of strong financial systems and internal 
controls to ensure our accountability, integrity, and reliability. To 
achieve a high level of quality, management maintains a quality control 
program and seeks advice and evaluation from both internal and external 
sources. 

We complied with the spirit and intent of Appendix A, OMB Circular A-
123, Management’s Responsibility for Internal Control, which provides 
guidance for agencies’ assessments of internal control over financial 
reporting. We performed this assessment by identifying, analyzing, and 
testing internal controls for key business processes. Based on the 
results of the assessment, we have reasonable assurance that internal 
control over financial reporting, as of September 30, 2009, was 
operating effectively and that no material control weaknesses exist in 
the design or operation of the internal controls over financial 
reporting. Additionally, our independent auditor found that we 
maintained effective internal controls over financial reporting and 
compliance with laws and regulations. Consistent with our assessment, 
the auditor found no material internal control weaknesses. 

We are also committed to fulfilling the internal control objectives of 
FMFIA. Although we are not subject to the act, we comply voluntarily 
with its requirements. Our internal controls are designed to provide 
reasonable assurance that transactions are properly recorded, 
processed, and summarized to permit the preparation of financial 
statements and assets are safeguarded against loss from unauthorized 
acquisition, use, or disposition and transactions are executed in 
accordance with the laws governing the use of budget authority and 
other laws and regulations that could have a direct and material effect 
on the financial statements. 

In addition, we are committed to fulfilling the objectives of FFMIA. 
Although not subject to the act, we voluntarily comply with its 
requirements. We believe that we have implemented and maintained 
financial systems that comply substantially with federal financial 
management systems requirements, applicable federal accounting 
standards, and the U.S. Government Standard General Ledger at the 
transaction level as of September 30, 2009. We made this assessment 
based on criteria established under the Improvement Act and guidance 
issued by OMB. 

GAO’s IG also conducts audits and investigations that are internally 
focused. During fiscal year 2009, the IG examined compliance with our 
policy and procedures for conflict-of-interest determinations and 
conducted reviews of our information security program and internal 
control activities. In addition, the IG managed an internal hotline for 
use by our employees and contractors to report potential fraud, waste, 
and abuse in our operations. Finally, the IG independently tested our 
compliance with procedures related to several of our performance 
measures—this is done on a rotating basis. These actions are 
specifically identified in the table that begins on page 79. No 
material weaknesses were reported by the IG. 

In addition, our Audit Advisory Committee assists the Comptroller 
General in overseeing the effectiveness of our financial reporting and 
audit processes, internal controls over financial operations, and 
processes that ensure compliance with laws and regulations relevant to 
our financial operations. The committee is composed of individuals who 
are independent of GAO and have outstanding reputations in public 
service or business with financial or legal expertise. The current 
members of the committee are as follows: 

* Sheldon S. Cohen (Chairman), a certified public accountant and 
practicing attorney in Washington, D.C.; a former Commissioner and 
Chief Counsel of IRS; and a Senior Fellow of the National Academy of 
Public Administration. 

* Edward J. Mazur, CPA, Senior Advisor for Governmental Financial 
Management at Cherry, Bekaert & Holland, LLP; past member of the 
Governmental Accounting Standards Board; former State Comptroller of 
Virginia; and a former Controller of the Office of Federal Financial 
Management in OMB. 

* Judith H. O’Dell, CPA CVA, President of O’Dell Valuation Consulting 
LLC, Chair of Financial Accounting Standards Board’s Private Companies 
Financial Reporting Committee; former trustee of the Financial 
Accounting Foundation which is responsible of overseeing, funding, and 
appointing members of the Financial Accounting Standards Board and the 
Governmental Accounting Standards Board; and former member of the board 
of directors of the American Institute of Certified Public Accountants. 

The committee’s report appears in Part III of this report on page 97. 

Limitation on Financial Statements: 

Responsibility for the integrity and objectivity of the financial 
information presented in the financial statements in this report rests 
with our managers. The statements were prepared to report our financial 
position and results of operations, consistent with the requirements of 
the Chief Financial Officers Act, as amended (31 U.S.C. 3515). The 
statements were prepared from our financial records in accordance with 
the formats prescribed in OMB Circular No. A-136, Financial Reporting 
Requirements. These financial statements differ from the financial 
reports used to monitor and control our budgetary resources. However, 
both were prepared from the same financial records. 

Our financial statements should be read with the understanding that as 
an agency of a sovereign entity, the U.S. government, we cannot 
liquidate our liabilities (i.e., pay our bills) without legislation 
that provides resources to do so. Although future appropriations to 
fund these liabilities are likely and anticipated, they are not 
certain. 

Planned Resources to Achieve Our Fiscal Year 2010 Performance Goals: 

In fiscal year 2010, we received an appropriation of $556.8 million—an 
increase of 4.9 percent over fiscal year 2009—and authorization to use 
$15.2 million in offsetting collections, including new authority to 
seek and retain reimbursements for audits of the financial statements 
of the IRS and the Schedule of Federal Debt. These resources will allow 
us to continue to perform a range of oversight-, insight-, and 
foresight-related engagements that support the Congress in meeting its 
constitutional responsibilities and to meet the performance goals 
outlined in our Strategic Plan. Our fiscal year 2010 budget will be 
used to further strengthen our capacity to provide timely support to 
the Congress in confronting the difficult challenges facing the nation. 
We will also continue mandated work required by the Recovery Act and 
TARP. With the $21 million unobligated balances available from the 
Recovery Act appropriation and $11.3 million in anticipated 
reimbursements for TARP, GAO’s total budget authority in fiscal year 
2010 is $604.4 million. 

Table 9 provides an overview of our staffing full-time equivalent (FTE) 
and monetary resources by strategic goal. 

Table 9: Fiscal Year 2010 Budgetary Resources by Strategic Goal: 

Strategic Goal: Goal 1: Address challenges to the well-being and 
financial security of all Americans; 
FTEs: 1,103; 
Amount: $195.1 million. 

Strategic Goal: Goal 2; Respond to changing security threats of 
globalization; 
FTEs: 1,053; 
Amount: $186.2 million. 

Strategic Goal: Goal 3; Help transform the federal government's role; 
FTEs: 1,147; 
Amount: $202.8 million. 

Strategic Goal: Goal 4; Maximize the value of GAO; 
FTEs: 115; 
Amount: $20.3 million. 

Total; 
FTEs: 3,418; 
Amount: $604.4 million. 

Source: GAO. 

[End of Table 9] 

Our fiscal year 2010 budget supports the strategic goals, including 
work related to the nation’s financial and housing market crisis, as 
well as other emerging issues through the following activities: 

* Increase our staff capacity, including Recovery Act and TARP, by 214 
FTEs from fiscal year 2009 to fiscal year 2010 to meet increased 
congressional demand and provide more timely responses to congressional 
requests. 

* Address human capital challenges and components, such as performance-
based compensation, succession planning, and enhancing staff skills and 
competencies, including leadership and diversity training. 

* Continue progress on (1) planned IT improvements that will enhance 
the productivity and effectiveness of our staff and (2) facility 
infrastructure maintenance and improvements to enhance energy 
efficiency and upgrade antiquated building and security systems. 

Strategic and Annual Work Planning: 

Advisory boards and panels support our strategic and annual work 
planning to identify key trends, opportunities and challenges, and 
lessons learned across the national and international audit community 
that we should factor into our work. During fiscal year 2009, we framed 
the agendas of the Comptroller General advisory entities (i.e., the 
Comptroller General Advisory Board (CGAB), the Domestic Working Group, 
the Global Working Group, the Educators Advisory Panel, and the 
Accountability Advisory Council) around the theme of the global 
financial crisis. The CGAB, with over 40 members from the public, 
private, and nonprofit sectors, has broad expertise in areas related to 
our strategic objectives and advises us on key trends and emerging 
issues that could affect the work we do in support of our strategic 
objectives. 

Domestically, our investment in the Intergovernmental Audit Forum (IAF) 
and the intergovernmental audit and accountability community allowed us 
to quickly tap into this community to facilitate our Recovery Act 
engagement work for the Congress. For example, through our 
participation in the International Organization of Supreme Audit 
Institutions (INTOSAI) Public Debt Working Group, we obtained important 
perspectives on the anticipated consequences of the economic downturn. 
As a result of this and many other inputs, the Acting Comptroller 
General established an internal GAO coordinating group that monitored 
the financial crisis and met periodically to share information and 
knowledge across teams. 

Through the National Intergovernmental Audit Forum, we brought together 
OMB, IGs, state and local auditors, and the accountability community 
for a May meeting built around the theme of the global financial crisis 
and the challenges of performing “real time auditing.” We also 
organized nine meetings/seminars in the eight IAF regions where our 
staff serve as executive directors to promote dialogue among the 
intergovernmental audit and accountability community regarding the 
Recovery Act and associated opportunities and challenges. To facilitate 
coordination and communications with the IGs with substantial Recovery 
Act requirements, we also convened two meetings—a joint meeting with 
the entities formerly known as the President’s Council on Integrity and 
Efficiency and the Executive Council on Integrity and Efficiency, and 
the new entity, the Council of Inspectors General for Integrity and 
Efficiency. 

Typically, the Acting Comptroller General meets annually with the 18-
member Domestic Working Group. However, we convened two meetings this 
year of the Domestic Working Group to leverage the knowledge of and 
network with the heads of select federal, state, and local audit 
institutions. By tapping our relationship with the National Association 
of State Auditors, Comptrollers, and Treasurers we were able to 
leverage its communications infrastructure and quickly facilitate our 
access to people and information in the sample states we identified for 
our Recovery Act longitudinal study. Specifically, we coordinated a 
series of teleconferences that included the Acting Comptroller General, 
our Recovery Act engagement teams, OMB representatives, IGs, state 
auditors, and local auditors. 

The Global Working Group, comprising the Acting Comptroller General and 
18 heads of national audit offices, served a similar purpose as the 
Domestic Working Group. During the fiscal year 2009 annual meeting, we 
gained information and knowledge relating to the experiences and 
lessons learned of supreme audit institutions (SAI) and their 
respective countries in past financial crises and the current global 
financial crisis. We also gained insights into emerging issues related 
to fraud and corruption, changes in the role of national audit offices, 
and environmental audit. 

In fiscal year 2009, we continued our process for updating our 
strategic plan for 2010 through 2015. Our Strategic Planning and 
External Liaison office worked closely with all the teams and units 
across the agency that support our four strategic goals to identify any 
new issues or trends that in the near future could affect the work we 
do for the Congress or our internal initiatives. We also developed and 
incorporated new approaches into our strategic planning process. For 
example, we: 

* documented the strategic planning process as part of GAO’s overall 
enterprise architecture and identified potential inefficiencies and 
pain points, 

* validated the results of our external environmental scan, and, 

* developed a Wiki page to enhance information and knowledge sharing 
regarding strategic planning across teams. 

Collaborating with Others: 

By collaborating with our domestic and global networks, we have 
acquired, expanded, and shared our knowledge and expertise, which 
helped to build capacity within our agency and among our collaborative 
partners. On the international front, this has become increasingly 
important as more of our domestic challenges require global 
collaboration and our staff are engaged in work that requires them to 
obtain information from foreign governments and officials. 

Through INTOSAI, we are leaders and active members of teams working on 
the strategic plan goals of enhancing professional standards, capacity 
building, knowledge-sharing, and good governance. Through our 
participation in the Professional Standards Committee and 
subcommittees, we are able to stay abreast of changes in international 
accounting, auditing, and reporting standards. In participating in the 
knowledge-sharing working groups (i.e., Public Debt, Information 
Technology, Environmental Auditing, Program Evaluation, Fight Against 
International Money Laundering and Corruption, and Key National 
Indicators) and task forces, we acquire knowledge and build a network 
of professionals and experts in other countries that we can access. 
This year, we organized meetings of GAO representatives to the INTOSAI 
working groups to facilitate knowledge sharing among our 
representatives in order to better disseminate knowledge gained through 
our INTOSAI working groups throughout GAO. 

In November 2008, INTOSAI’s Governing Board asked GAO to assume the 
chairmanship of the new Task Force on the Global Financial Crisis: 
Challenges to Supreme Audit Institutions (SAIs). GAO held two meetings 
with the first in-person meeting from June 29 through July 1, 2009, 
that was attended by 24 of the 25 member countries, including eight 
auditors general. The meeting provided a forum to share information and 
knowledge about the effect of the financial crisis globally and helped 
expand GAO’s knowledge about the causes of the financial crisis, the 
stimulus initiatives that had been implemented, the impact on the real 
economy, and challenges to the national audit offices. 

In addition, we published INTOSAI’s quarterly International Journal of 
Government Auditing in five languages to foster global understanding of 
professional standards, best practices, and technical issues. In fiscal 
year 2009, we developed a project plan for expanding the journal’s Web 
presence so that we can continue to make the publication more useful to 
INTOSAI members and more accessible to our global readership. 

As our contribution to building capacity in national audit offices 
around the world, we conduct an annual International Auditor Fellowship 
Program for mid- to senior-level staff from other countries. The 
program is in its 30th year, and is designed to strengthen the ability 
of the national audit offices to fulfill their missions and to enhance 
accountability and governance worldwide. Since the program’s inception, 
over 400 mid- to senior-level officials from counterpart offices of 
more than 101 countries have graduated. Many of them have become 
auditors general, deputy auditors general, or government ministers. 
Through this program, GAO instructors, mentors, and sponsors become 
part of a global network that helps support GAO engagements. Also, the 
goodwill engendered by the program supports our country’s image abroad. 

Other collaborative activities undertaken by our staff this year are as 
follows. 

* Donors Funding Initiative. The Acting Comptroller General assumed the 
responsibility from his predecessor to chair the INTOSAI Task Force on 
the Donor Funding Initiative. We have collaborated with our INTOSAI 
colleagues, the World Bank, donor organizations, and the United States 
government to support the principle that SAIs play an important role in 
good governance and that the donor community should support the SAIs in 
developing countries. On October 20, 2009, representatives of about 15 
donor organizations signed an international memorandum of understanding 
with INTOSAI marking the willingness of all parties to work in a 
coordinated way and make better use of scarce financial and human 
resources. To view the memorandum of understanding, go to [hyperlink, 
http://www.intosai.org/en/portal/]. 

* Peer review. We are part of the Global Working Group peer review 
assistance network. Canada has led the peer review of GAO twice thus 
far. This year, GAO led the peer review of Mexico’s SAI. This 
collaboration with our international counterparts saves GAO money in 
that we pay significantly less for our peer review when it is performed 
by our network rather than by a public accounting firm. In 
participating in the peer review network, we are also able to learn 
from each other and share best practices. 

* Pandemic preparedness. Foreseeing the potential for a pandemic 
related to the avian flu, we collaborated with our Domestic Working 
Group network to assess preparedness at the federal, state, and local 
levels by monitoring preparedness in our respective jurisdictions. The 
collaborative work that we conducted has helped inform our pandemic 
work and is particularly relevant now that we are in the midst of a 
pandemic related to H1N1, commonly known as the swine flu. 

* Communications. In addition to IAF meetings/conferences, GAO staff 
have participated in numerous conferences, Web casts, and 
teleconferences. An example of how this helps leverage GAO resources is 
the collaboration we engaged in with the Institute of Internal Auditors 
(IIA) for an IIA-sponsored Web cast on the Recovery Act. IIA has a 
global membership of 160,000. In collaborating with IIA, we were able 
to tap and educate a much broader audience domestically and 
internationally on GAO’s Recovery Act work than we otherwise could have 
using our existing resources. 

Using Our Internal Experts: 

We coordinated extensively within our own organization on our strategic 
and annual performance planning efforts, as well as on the preparation 
of our performance and accountability reports. Our efforts are 
completed under the overall direction of the Acting Comptroller 
General. We relied on our Chief Administrative Officer/Chief Financial 
Officer and her staff to provide key information, such as the financial 
information that is included in part III of this report. Her staff also 
coordinated with others throughout the agency to provide the 
information on goal 4’s results, which appears in part II of this 
report, and provided input on other efforts dealing with issues that 
include financial management, budgetary resources, training, and 
security. We obtained input on all aspects of our strategic and annual 
performance planning and reporting efforts from each of our engagement 
teams and organizational units through their respective managing 
directors, as well as other staff responsible for planning or 
engagement activities in the teams. Staff from QCI prepared the report, 
ensuring, among other things, that the report responded to comments and 
suggestions received from the Association of Government Accountants and 
other reviewers. In short, we involved virtually every part of our 
agency and used our internal expertise in our planning and reporting 
efforts. 

Internal Management Challenges and Mitigating External Factors That 
Could Affect Our Performance: 

At GAO, management challenges are identified by the Comptroller 
General, the Executive Committee, and the agency’s senior executives 
through the agency’s strategic planning, management, and budgeting 
processes. Our progress in addressing the challenges is monitored 
through our annual performance and accountability process. Under 
strategic goal 4, we establish performance goals focused on each of our 
management challenges, track our progress in completing the key efforts 
for those performance goals quarterly, and report each year on our 
progress toward meeting the performance goals. Each year, we ask our IG 
to examine management’s assessment of the challenges and the agency’s 
progress in addressing them. (See part IV for the IG’s assessment.) 

For fiscal year 2009, we continued to address three management 
challenges—physical security, information security, and human capital. 
We anticipate that we will continue to need to address all three 
challenges in future years because they are evolving and will require 
us to continually identify ways to adapt and improve. We will report 
any changes as we monitor and report on our progress in addressing the 
challenges through our annual performance and accountability process. 
The following sections describe our recent and planned efforts to 
address these challenges. 

Physical Security Challenge: 

The impact of domestic and international events, both ongoing and 
anticipated, continues to present us with a physical security 
challenge, including emergency preparedness issues, now and in the 
foreseeable future. To strengthen our ability to protect our people and 
our assets, we must constantly assess our physical security profile and 
continuity of operations programs vis-à-vis the domestic and 
international climate. We continue to build on our previous efforts, 
identifying and implementing improvements and pursuing new initiatives 
to protect our workers and assets and ensure continuity of operations. 
During fiscal year 2009, we: 

* strengthened our continuity of operations program by documenting 
policy and program requirements, and further developed a number of new 
continuity components, including a command and control team, an 
evacuation/shelter in place team, and an IT contingency team to handle 
IT failures; 

* examined the effectiveness of recent improvements implemented to 
address vulnerabilities identified through an independent security 
assessment and developed recommendations for future enhancements; 

* strengthened our emergency readiness in headquarters through 
continuing training, exercises, and drills (e.g., evacuations, shelter 
in place drills, and tests of our Web Emergency Operation Center 
administration); 

* enhanced communications with our workforce, for example by, updating 
information on posters, reference guides, Web sites, and labels 
designating shelter in place areas, sponsoring a national preparedness 
month fair, and implementing emergency e-mail and automated phone 
notification capabilities; 

* coordinated emergency preparedness activities with a number of 
federal and local entities; 

* began upgrading electronic security systems in our field offices and 
conducted an assessment for integrating field office electronic 
security systems into headquarters’ system; 

* initiated actions to develop a comprehensive GAO Facility Security 
Plan and reviewed other agency documents to identify government 
security best practices; 

* opened for competitive bids a new security guard force contract at 
GAO headquarters to strengthen the contract requirements, address areas 
of concern, and gain efficiencies by merging two separate contracts 
into one; 

* initiated security reviews on employees whose investigations are over 
15 years old to meet Homeland Security Presidential Directive (HSPD) 12 
requirements; and; 

* contracted for an assessment and design of a new mobile radio system 
for the Security Operations Center in headquarters. 

To continue to improve our physical security profile, strengthen our 
efforts to become a model security agency, and address the continuing 
and future issues that will challenge us in upcoming years, in fiscal 
year 2010 we plan to: 

* continue upgrading the electronic security systems in field offices 
and begin their integration with headquarters’ system; 

* develop and finalize a facility security plan that outlines all of 
our facility security functions and identifies specific responses to 
the different homeland security threat levels; 

* examine the current visitor management processes to identify ways to 
streamline, improve customer service, and reduce visitor processing 
times while improving accountability and access control; 

* assess the results of the mobile radio system assessment and design, 
and plan for a follow-on contract to install a new system with 
increased communications coverage, reliability, and availability 
throughout and around the headquarters building, to enhance security 
and emergency operations communications; and; 

* initiate security investigations on our contract workforce to meet 
HSPD-12 requirements. 

Information Security Challenge: 

Given the constantly evolving nature of threats to information and 
information system assets, information security will continue to be a 
management challenge for us and all government and private sector 
entities in the foreseeable future. While we are not required by law to 
comply with the Federal Information Security Management Act (FISMA), we 
have adopted FISMA requirements to help us meet the challenges of 
ensuring information system security. 

Our overall goal is to ensure that information protection requirements 
extend across the life cycle of documentation from data collection, 
report production, data transmission, and storage to the eventual 
archiving and disposal of data. In support of this goal, our 
Information Security and Information Systems Security Programs address 
the full range of requirements associated with securely accessing, 
handling, storing, and disposing of classified and sensitive national 
security information stored electronically and on paper. They also work 
hand in hand to educate staff on handling sensitive information and 
raise awareness of the need to maintain appropriate security to reduce 
the risk of compromise of such information. 

In fiscal year 2009, we: 

* implemented a GAO Unit Security Manager’s program for headquarters 
and field offices and provided specialized security training to all 
managers; 

* conducted security inspections at headquarters and field offices to 
identify and address information security trends and weaknesses and 
inform our security education and awareness programs; 

* provided annual security awareness training to all employees and 
specialized training for systems managers, administrators, and 
developers; 

* strengthened our inventory controls over physical IT assets and 
improved our processes and procedures to manage receipt, storage, and 
issuance of equipment; 

* completed assessments of systems operated by third parties, developed 
guidance and testing procedures for conducting site visits, and 
validated the protection of GAO information based upon established 
federal standards; 

* increased oversight and security reviews of information systems and 
identified and remediated potential weaknesses; 

* established new standards for the certification and accreditation of 
information systems, including the mainframe processing system; 

* completed the deployment of secure desktop configurations that 
include encryption, two-factor authentication, and an integrated 
security suite for our new workstations to protect data on our laptops 
and other mobile media, such as USB flash drives; 

* increased our change management and configuration management 
capabilities by automating the monitoring of systems for unauthorized 
internal changes; 

* upgraded our network monitoring capability to better detect 
unauthorized intrusions (i.e., external threats) and monitor changes in 
our information system assets; and; 

* integrated the privacy impact assessment into our processes for 
system security reviews. 

We will further strengthen our information security programs in fiscal 
year 2010 to ensure our capability to address continuing and future 
issues by: 

* revising our new hire, initial, and annual security awareness 
training for staff handling both classified and sensitive unclassified 
information; 

* identifying additional data protection encryption and identity 
management options to provide better access control to the GAO network 
and information; 

* increasing vigilance in the centralized auditing of network servers 
and devices through additional auditing staff resources, automated 
tools, and notebook computer security controls; 

* implementing new and updated security guidance from the National 
Institute of Standards and Technology (NIST) and OMB, and monitoring 
systems in accordance with OMB, NIST, and FISMA guidance; 

* refining our security processes and procedures, enhancing our 
contingency operations, and identifying and implementing appropriate 
new technologies to improve our ability to respond to changing threats; 

* enhancing our configuration and change management capabilities by 
consolidating our automated monitoring process across all network 
systems; and; 

* establishing a program within GAO to address government best 
practices for appropriately declassifying documents based on 
determinations made by the original source of the information. 

To learn more about our information security program, see appendix 3 in 
this report. 

Human Capital Challenge: 

We depend on a talented and diverse, high-performing, knowledge-based 
workforce to accomplish our work and carry out our mission in support 
of the Congress. At the same time, the federal government faces new and 
complex challenges in the 21st century, including long-term fiscal 
constraints, changing demographics, and evolving governance models. We 
expect that human capital will remain a management challenge for 2010 
and into the foreseeable future. To enable us to meet these challenges, 
strategic human capital management must be the centerpiece of our 
change management and transformation efforts. We continue to build on 
our previous efforts, identifying and implementing improvements and 
pursuing new initiatives to promote and maintain a work environment 
that is fair, unbiased, and inclusive, as well as one that offers 
opportunities for all employees to realize their full potential. 

During fiscal year 2009, we continued our efforts to foster an 
inclusive, diverse work environment and took a number of steps to 
strengthen our human capital programs and processes. We: 

* honored our commitments to bargain in good faith and maintain a 
positive working relationship with the union, which resulted in 
successfully negotiating our 2009 pay agreement and an interim 
collective bargaining agreement; 

* fostered and enhanced relationships with our employee advisory groups 
by providing multiple opportunities for staff to engage agency 
leadership in enhancing human capital programs; 

* implemented GAO Act provisions that provided retroactive salary 
payments to GAO staff, bringing closure to concerns raised regarding 
pay issues; 

* completed or initiated most actions in our 2008 Workforce Diversity 
Plan, such as expanding our one-to-one mentoring program, issuing an 
Equal Employment Opportunity statement, establishing a Special 
Assistant for diversity issues to the Acting Comptroller General, 
providing sexual harassment workshops, briefing managers on our 
reasonable accommodations process, and holding facilitated discussions 
on race with a majority of our staff; 

* issued a 2009 Workforce Diversity Plan that identifies 
recommendations for ensuring GAO fosters inclusive workforce practices 
and areas that need continued attention; 

* assessed our recruiting and hiring programs and identified areas for 
near-term and long-term improvements, including developing an 
overarching program goal and implementing strategic and targeted 
efforts to achieve a diverse and highly qualified workforce; 

* enhanced our staffing management practices to (1) provide for timely 
and specific feedback and (2) ensure fair and equitable developmental 
opportunities for all staff; 

* enhanced learning and development for our administrative support 
professionals through implementation of a unified learning curriculum, 
and for training delivery to provide cost-effective, just-in-time 
training to geographically dispersed staff; 

* provided all interns with a core group of experiences through 
implementation of our intern program guidelines; 

* performed a comprehensive evaluation of our performance appraisal 
system that included analysis of past feedback on the system, 
interviews, focus groups, an agencywide survey, and a review of 
findings from the 2008 African American Performance Assessment Study to 
address concerns identified by internal stakeholders and the Ivy 
Planning Group, and developed short- and long-term recommendations for 
improvements that are being vetted with stakeholders; 

* implemented an integrated human resource information system to 
enhance processing capabilities and provide for more timely, accurate 
human resource data; 

* enhanced our leadership training program to help supervisors provide 
feedback to their staff and receive feedback on themselves via a 360-
degree feedback tool; and; 

* completed an interim Human Capital Strategic Plan that establishes 
near-term areas of concentration, including recruiting a diverse 
workforce, enhancing employee engagement, and leveraging data and 
technology solutions to improve our human capital service delivery. 

Efforts planned for fiscal year 2010 to continue addressing human 
capital challenges include: 

* implementing the short-term recommendations and finalizing decisions 
for longer-term changes to improve our performance appraisal system; 

* completing our analyses and implementing human capital 
recommendations in the five areas of our Management Improvement 
Framework; 

* finalizing a 5-year Human Capital Strategic Plan to ensure 
consistency with the new GAO Strategic Plan that is currently being 
developed; 

* improving the efficiency and effectiveness of our recruiting and 
hiring programs through a strategic and targeted approach, and 
increasing representation of certain demographic groups identified in 
our Workforce Diversity Plan through these enhanced programs; 

* equipping managers and supervisors with the requisite skills to 
provide effective feedback, coaching, and development opportunities for 
their staff; 

* ensuring that we promote an inclusive work environment in which all 
employees have equal opportunity to develop and compete; 

* enhancing GAO’s employee engagement through targeted initiatives 
addressing work-life balance, compensation, training, performance 
management, recognition, benefits, and wellness; 

* improving the integration of our strategic workforce and budgeting 
activities to include establishing a human capital governance structure 
that facilitates collaborative, matrixed decision making on human 
capital issues; 

* leveraging technology solutions to improve GAO’s service delivery and 
reporting on human capital performance metrics; and 

* maintaining internal and external ¦¦strategic working relationships 
that support GAO’s efforts to remain a leading practices professional 
services organization. 

Mitigating External Factors: 

Several external factors could affect the achievement of our 
performance goals, including the amount of resources we receive, shifts 
in the content and volume of our work, and national and international 
developments. Limitations imposed on our work by other organizations or 
limitations on the ability of other federal agencies to make the 
improvements we recommend are additional factors that could affect the 
achievement of our goals. 

As the Congress focuses on known challenges facing the nation and 
responds to unforeseen events, the mix of work we are asked to 
undertake may change, diverting our resources from some strategic 
objectives and performance goals. We can and do mitigate the impact of 
these events on the achievement of our goals in various ways. For 
example in fiscal year 2009, we: 

* continued to track current events (such as the financial and housing 
market crises, the automobile industry bailout, vulnerabilities in the 
nation’s food supply system, and the quality of health facilities and 
services for soldiers returning from military conflicts abroad) and 
communicated frequently with our congressional clients in order to be 
alert to possibilities that could shift the Congress’s priorities or 
trigger new priorities; 

* quickly redirected our resources when appropriate (i.e., to respond 
to mandates related to TARP and the Recovery Act) so that we could deal 
with major changes as they occurred; 

* maintained broad-based staff expertise (i.e., in our financial 
markets, accounting, economics, Social Security, health care financing, 
and homeland security areas) so that we could readily address emerging 
needs; and 

* initiated evaluations under the Comptroller General’s authority on a 
limited number of selected topics, including the status of Iraq’s 
reconstruction efforts and our high-risk list update work. 

Congressional demand for our analysis and advice is strong. In fiscal 
year 2009, we received over 900 requests and mandates. The number of 
new congressional mandates, our highest-priority work, increased from 
75 in fiscal year 2007 to 131 in fiscal year 2009. Moreover, in fiscal 
year 2009 we devoted almost one-third of our audit resources to 
mandates such as the Recovery Act; the Emergency Economic Stabilization 
Act, which directs us to perform our TARP oversight activities; and the 
Honest Leadership and Open Government Act of 2007, which directs us to 
report annually on lobbyists’ compliance with registration and 
reporting requirements. In addition, expanded bid protest provisions 
give us, among other things, bid protest jurisdiction over the issuance 
of task and delivery orders valued at over $10 million and contracts 
awarded by the Transportation Security Administration. In addition, the 
Recovery Act gave us a range of recurring responsibilities overseeing 
spending related to the act—including bimonthly reviews of how selected 
states and localities across the country are using the billions of 
dollars of funds provided—and providing targeted studies in several 
areas, such as small business lending, education, and expanded trade 
adjustment assistance. 

As evidenced above, our studies are covering more and more complex 
issues across a broad range of federal programs, requiring greater 
analysis to complete. We expect to continue to receive a high volume of 
requests related to either new challenges, such as the nation’s 
response to address pandemic flu viruses and developments in the 
financial markets and economy, or the many emerging initiatives of the 
Congress and the administration. Moreover, all Senate committees are 
required to review programs within their jurisdiction to root out 
fraud, waste, and abuse in program spending—giving particular scrutiny 
to issues raised in our reports—and develop recommendations for 
improved government performance. In addition, recent changes to House 
rules require each standing committee or subcommittee to hold at least 
one hearing on issues raised by GAO that indicate that federal programs 
or operations authorized by the committee are at high risk for fraud, 
waste, abuse, or mismanagement (see p. 38 for more information about 
our high-risk list areas and programs.) 

Federal funding and budget constraints could also affect our ability to 
serve the Congress and meet our performance targets. As we stated 
previously, almost 80 percent of our budget is composed of people-
related costs, and any serious budget situation will have an impact on 
our staffing and human capital policies and practices. 

Another external factor that affects our ability to serve the Congress 
is the extent to which we can obtain access to agency information. This 
access to information plays an essential role in our ability to report 
on issues of importance to the Congress and the American people. 
Executive departments and agencies are generally very cooperative in 
providing us access to the information we need. It is fairly rare for 
an agency to deny GAO access to information, and rarer still for an 
agency to refuse to work toward an accommodation that will allow GAO to 
do its work. 

While we generally receive very good cooperation, over time GAO has 
experienced access issues at certain departments and agencies. For 
example, the Justice Department has employed a centralized process for 
screening GAO’s access requests, resulting in delays and occasional 
denials of access to information. We actively pursue access issues as 
they arise and are engaged in discussions and efforts across the 
executive branch to enhance our access to information. 

One area of particular focus has involved our access to information at 
DHS. As we indicated last year, DHS has posed access challenges for us 
since it began operations in 2003, due to its highly centralized 
processes. DHS’s processes for working with us have included extensive 
coordination among program officials, liaisons, and attorneys at the 
departmental and component levels and centralized control for all of 
our incoming requests for information and outgoing documents.[Footnote 
19] Appropriations act restrictions for fiscal years 2008 and 2009 
directed DHS to take steps to provide us with more timely access to 
information.[Footnote 20] Accordingly, we are actively working with 
officials at the highest levels of DHS to revise its protocols for 
responding to our requests for information. There appears to be 
encouraging progress in the latest efforts to revise these protocols. 

We have also experienced issues at some agencies due to long-standing 
and erroneous interpretations of our access authority, even where the 
agencies are generally cooperative. Specifically, in some cases 
agencies have interpreted language in program statutes limiting their 
disclosure or use of data as restricting our access, notwithstanding 
our statutory access rights. Examples include interpretations by HHS 
with respect to a provision of the Social Security Act relating to 
Medicare (Part D) data, and the Food and Drug Administration with 
respect to a provision of the Federal Food, Drug, and Cosmetic Act. 
Legislation pending in the House—the Government Accountability Office 
Improvement Act of 2009, H.R. 2646—would confirm our access rights, 
refuting agency interpretations that restrict GAO’s access in these and 
similar circumstances. 

We devote a high level of attention to monitoring and aggressively 
pursuing access issues as they arise. We appreciate the interest of the 
Congress in helping to ensure that we obtain access to information and 
the efforts by agencies to cooperate with our requests. 

[End of Part I, Management's Discussion and Analysis] 

Part II: Performance Information: 

Performance Information by Strategic Goal: 

In the following sections, we discuss how each of our four strategic 
goals contributed to our fiscal year 2008 performance results. 
Specifically, for goals 1, 2, and 3—our external goals—we present 
performance results for the three annual measures that we assess at the 
goal level. Most teams and units also contributed toward meeting the 
targets for the agencywide measures that were discussed in part I of 
this report. 

Goal 1: Overview: Provide timely, quality service to the Congress and 
the federal government to address current and emerging challenges to 
the well-being and financial security of the American people. 

Our first strategic goal upholds our mission to support the Congress in 
carrying out its constitutional responsibilities by focusing on work 
that helps address the current and emerging challenges affecting the 
well-being and financial security of the American people and American 
communities. Our multiyear (fiscal years 2007-2012) strategic 
objectives under this goal are to provide information that will help 
address: 

* the health needs of an aging and diverse population;
* lifelong learning to enhance U.S. competitiveness;
* benefits and protections for workers, families, and children;
* financial security for an aging population; 
* a responsive, fair, and effective system of justice;
* the promotion of viable communities; 
* responsible stewardship of natural resources and the environment; 
and; 
* a safe, secure, and effective national physical infrastructure. 

These objectives, along with the performance goals and key efforts that 
support them, are discussed fully in our strategic plan, which is 
available on our Web site at [hyperlink, http://www.gao.gov/sp.html]. 
The work supporting these objectives was performed primarily by 
headquarters and field office staff in the following teams: Education, 
Workforce, and Income Security; Financial Markets and Community 
Investment; Health Care; Homeland Security and Justice; Natural 
Resources and Environment; and Physical Infrastructure. In line with 
our performance goals and key efforts, goal 1 staff reviewed a variety 
of programs affecting the nation’s students and schools, employees and 
workplaces, health providers and patients, and social service providers 
and recipients. In addition, goal 1 staff performed work for our 
congressional clients related to improving the nation’s law enforcement 
systems and federal agencies’ ability to prevent and respond to 
terrorism and other major crimes. 

Selected Work under Goal 1: 

We identified areas where the Department of Housing and Urban 
Development (HUD) could be more proactive in promoting energy 
efficiency and green building. We reported that HUD had not completed 
regulations to require energy-efficient appliances in public housing or 
collected data to understand its multifamily housing portfolio utility 
costs. We reported that HUD should consider providing additional 
incentive points for energy efficiency and green building in 
competitive grant programs. Since our report was issued, HUD has made 
progress in these areas, including adding strong incentives for energy 
efficiency and green building in competitive grant programs funded 
through the American Recovery and Reinvestment Act of 2009. 

[End of Selected Work under Goal 1]

To accomplish our work under these strategic objectives in fiscal year 
2009, we conducted engagements, audits, analyses, and evaluations of 
programs at major federal agencies, such as the Departments of 
Education, Health and Human Services, Homeland Security (DHS), 
Transportation, Housing and Urban Development, and the Interior, and 
developed reports and testimonies on the efficacy and soundness of 
programs they administer. 

As shown in table 10, we did not meet the goal 1 performance target we 
set for fiscal year 2009 financial benefits and exceeded our 
testimonies target, but did not meet our nonfinancial benefits target. 

Table 10: Strategic Goal 1’s Annual Performance Results and Targets: 

Performance measure: Financial benefits; 
2005 Actual: $15.6 billion; 
2006 Actual: $22.0 billion; 
2007 Actual: $12.9 billion; 
2008 Actual: $19.3 billion; 
2009 Target: $13.4 billion; 
2009 Actual: $12.1 billion; 
Met/Not Met: Not met; 
2010 Target[A]: $13.4 billion. 

Performance measure: Nonfinancial benefits; 
2005 Actual: 277; 
2006 Actual: 268; 
2007 Actual; 238; 
2008 Actual: 226; 
2009 Target: 231; 
2009 Actual: 224; 
Met/Not met: Not met; 
2010 Target[A]: 225. 

Performance measure: Testimonies; 
2005 Actual: 88; 
2006 Actual: 97; 
2007 Actual: 125; 
2008 Actual: 123[B]; 
2009 Target: 77
2009 Actual: 85; 
Met/Not Met: Met; 
2010 Target[A]: 80. 

Source: GAO. 

[A] Our fiscal year 2010 target for nonfinancial benefits differs from 
the target we reported in our fiscal year 2010 performance budget in 
January 2009. Specifically, we decreased the number of nonfinancial 
benefits from 235 to 225. 

[B] In our testimonies calculation for fiscal year 2008, we 
inadvertently counted one hearing twice. We therefore recalculated the 
data for this measure. The number shown reflects the correct 
calculation. 

[End of Table 10] 

To help us examine trends for these measures over time, we look at 
their 4-year averages, which minimize the effect of an unusual level of 
performance in any single year. These averages are shown in table 12. 
This table indicates that goal 1 financial benefits have declined 
steadily since fiscal year 2005, while nonfinancial benefits peaked in 
fiscal year 2007 and have also declined since then. The number of 
hearings at which we testify has generally increased during the 5-year 
period since fiscal year 2005. 

Table 11: Four-Year Rolling Averages for Strategic Goal 1: 

Performance measure: Financial benefits; 
2005: $22.5 billion; 
2006: $22.0 billion; 
2007: $19.3 billion; 
2008: $17.5 billion; 
2009: $16.6 billion. 

Performance measure: Nonfinancial benefits; 
2005: 243; 
2006: 254; 
2007: 259; 
2008: 252; 
2009: 239. 

Performance measure: Testimonies; 
2005: 91; 
2006: 88; 
2007: 99; 
2008: 108[A]; 
2009: 108. 

Source: GAO. 

[A] In our testimonies calculation for fiscal year 2008, we 
inadvertently counted one additional hearing. We therefore recalculated 
the data for this measure. The number shown reflects the correct 
calculation. 

[End of Table 11] 

The following sections describe our performance under goal 1 for each 
of these three quantitative performance measures and describe the 
targets for fiscal year 2010. 

Financial Benefits: 

The financial benefits reported for this goal in fiscal year 2009 
totaled $12.1 billion, which missed the target we set by $1.3 billion. 
We describe this and other goal 1 accomplishments in the goal 1 section 
of appendix 1. 

Because financial benefits often result from work completed in prior 
years, we set our fiscal year 2009 target on the basis of our 
assessment of the progress agencies are making in implementing our past 
recommendations. Our analysis indicates that financial benefits in the 
future for goal 1 are likely to decrease from fiscal year 2009. 
However, we have set the target for fiscal year 2010 at $13.4 billion, 
based on multiyear financial benefits that may accrue from certain work 
in this area. 

Example of Goal 1’s Financial Benefits: 
In 2008, we reported that because the Department of Agriculture (USDA) 
lacked a system to verify incomes, it provided farm program benefits to 
thousands of individuals whose incomes exceeded eligibility caps under 
the Farm Bill. We recommended that USDA work with the Internal Revenue 
Service (IRS) to develop a system for verifying the incomes of 
individuals and businesses before disbursing farm program benefits to 
them. As a result, in 2009 USDA and IRS began work on a verification 
system that is to prevent payments to ineligible individuals and 
businesses and expected to save $99 million annually or about $472 
million over the next 5 years. 

[End of Example of Goal 1’s Financial Benefits] 

Nonfinancial Benefits: 

Nonfinancial benefits reported for goal 1 in fiscal year 2009 included 
200 actions taken by federal agencies to improve their services to the 
public in response to our work and another 24 in which information we 
provided to the Congress resulted in statutory or regulatory changes. 
This total of 224 nonfinancial benefits did not meet our target of 231. 
We report some of our major nonfinancial accomplishments in detail in 
the goal 1 section of appendix 1. 

For fiscal year 2010, we have set a target of 225 for nonfinancial 
benefits. This target is only slightly higher than what goal 1 achieved 
in fiscal year 2009, and it is consistent with our recognition that we 
are more likely to achieve more nonfinancial benefits under goals 2 and 
3 over the next few years. We decreased this target by 10 compared with 
the nonfinancial benefits target we reported in our fiscal year 2010 
performance plan. 

Example of Goal 1’s Nonfinancial Benefits: 
There is ongoing concern about the safety and security of federal 
facilities and their occupants because of the threat of terrorism. The 
Interagency Security Committee, chaired by DHS, decided to use our key 
practices in facility protection to guide its work and issued guidance 
to agencies on performance measurement. On the basis of our work, the 
Congress provided additional staff to address shortfalls at DHS’s 
Federal Protective Service, which protects about 9,000 federal 
buildings with over 1 million federal employees. Also, the Smithsonian 
Institution improved internal communications about risk management and 
security staff resources. 

Example of Goal 1’s Nonfinancial Benefits] 

Testimonies: 

Our witnesses testified at 85 congressional hearings related to this 
strategic goal, which exceeded the fiscal year 2009 target by 8 
testimonies, about 10 percent. Among the testimonies given were those 
related to the quality of health care for female veterans, the 
financial challenges facing the U.S. Postal Service, and wildland fire 
management. (See p. 33 for a list of testimony topics by goal.) We set 
our fiscal year 2010 target at 80 hearings at which we testify on goal 
1 issues because we anticipate a decline in requests for testimony 
during the year on several topics, such as elementary and secondary 
education and juvenile justice issues. 

Examples of Goal 1’s Testimonies: 
The Department of Defense (DOD) reported that over 33,000 
servicemembers have been wounded in action since 2001. Beyond adjusting 
to their injuries, recovering servicemembers also face additional 
challenges, including managing their recovery process, navigating the 
military’s disability system, and transitioning between care provided 
by DOD and the Department of Veterans Affairs (VA). We testified that 
even though DOD and VA experienced numerous challenges to jointly 
developing policies to improve the care, management, and transition of 
recovering servicemembers, the agencies have made significant 
achievements in improving this difficult transition for 
servicemembers.Our testimony on nonprime mortgages examined the 
evolution and condition of the nonprime market segment. Recent 
foreclosure developments have prompted greater scrutiny of lending 
practices in the nonprime market, a number of government efforts to 
modify troubled loans, and proposals to strengthen federal regulation 
of the mortgage industry. We found that aggressive lending practices 
contributed to the recent increases in default and foreclosure rates. 
We also found that the majority of nonprime loans were used to 
refinance existing loans rather than to purchase homes. This 
information will help inform the Congress’s efforts to reform mortgage 
lending practices. 

[End of Examples of Goal 1’s Testimonies] 

[End of Goal 1] 

Goal 2 Overview: Provide timely, quality service to the Congress and 
the federal government to respond to changing security threats and the 
challenges of global interdependence. 

The federal government is working to promote foreign policy goals, 
sound trade policies, and other strategies to advance the interests of 
the United States and its allies. The federal government is also 
working to balance national security demands overseas and at home with 
demands related to an evolving national security environment. Given the 
importance of these efforts, our second strategic goal focuses on 
helping the Congress and the federal government access and improve 
capabilities to respond to various types of threats to our nation and 
the challenges of global interdependency. Our multiyear (fiscal years 
2007-2012) strategic objectives under this goal are to support 
congressional and agency efforts to: 

* protect and secure the homeland from threats and disasters, 

* ensure military capabilities and readiness, 

* advance and protect U.S. international interests, and, 

* respond to the impact of global market forces on U.S. economic and 
security interests. 

These objectives, along with the performance goals and key efforts that 
support them, are discussed fully in our strategic plan, which is 
available on our Web site at [hyperlink, http://www.gao.gov/sp.html]. 
The work supporting these objectives is performed primarily by 
headquarters and field staff in the following teams: Acquisition and 
Sourcing Management, Defense Capabilities and Management, and 
International Affairs and Trade. In addition, the work supporting some 
performance goals and key efforts is performed by headquarters and 
field staff from the Information Technology, Homeland Security and 
Justice, Financial Markets and Community Investment, and Natural 
Resources and Environment teams. 

Selected Work under Goal 2: 
We found that the U.S. government lacks a coordinated strategy to stem 
the flow of firearms from the United States to Mexico. We also found 
over 20,000 firearms seized in Mexico were traced to the United States—
about 87 percent of arms traced from 2004 to 2008; U.S. agencies lack 
dedicated funding to address arms trafficking; and two key agencies 
responsible for combating arms trafficking—the Bureau of Alcohol, 
Tobacco, Firearms and Explosives (ATF) and Immigration and Customs 
Enforcement (ICE)—have not coordinated efforts. Following the release 
of our report, ATF and ICE officials signed a memorandum of 
understanding clarifying their roles in combating arms trafficking. 

[End of Selected Work under Goal 2] 

To accomplish our work in fiscal year 2009 under these strategic 
objectives, we conducted engagements and audits that involved fieldwork 
related to programs that took us across multiple continents, including 
Europe, Africa, Asia, South America, and North America. As in the past, 
we developed reports, testimonies, and briefings on our work. 

As shown in table 12, we did not meet our fiscal year 2009 performance 
targets for financial benefits, but exceeded the targets for 
nonfinancial benefits and testimonies. 

Table 12: Strategic Goal 2’s Annual Performance Results and Targets
Performance: 

Performance measure: Financial benefits; 
2005 Actual: $12.9 billion; 
2006 Actual: $12.0 billion; 
2007 Actual: $10.3 billion; 
2008 Actual: $15.4 billion; 
2009 Target: $12.7 billion; 
2009 Actual: $12.4 billion; 
Met/Not Met: Not met; 
2010 Target[A]: $13.8 billion. 

Performance measure: Nonfinancial benefits; 
2005 Actual: 365; 
2006 Actual: 449; 
2007 Actual: 468; 
2008 Actual: 468; 
2009 Target: 344; 
2009 Actual: 457; 
Met/Not Met: Met; 
2010 Target[A]: 345. 

Performance measure: Testimonies; 
2005 Actual: 42; 
2006 Actual: 68; 
2007 Actual: 73; 
2008 Actual: 93[B]; 
2009 Target: 64; 
2009 Actual: 67; 
Met/Not Met: Met; 
2010 Target[A]: 73. 

Source: GAO. 

[A] Our fiscal year 2010 targets for nonfinancial benefits and 
testimonies differ from the targets we reported in our fiscal year 2010 
performance budget in January 2009. Specifically, we increased the 
number of nonfinancial benefits by five and the number of hearings at 
which we testify by two. 

[B] In our testimonies calculation for fiscal year 2008, we 
inadvertently counted three additional hearings for this strategic 
goal. We therefore recalculated the data for this measure. The number 
shown reflects the correct calculation. 

[End of Table 12] 

To help us examine trends for these measures over time, we look at 
their 4-year averages, which minimize the effect of an unusual level of 
performance in any single year and are shown in table 14. This table 
indicates that goal 2 financial benefits, nonfinancial benefits, and 
testimonies have steadily increased over the last 5 years, with only a 
slight decline in financial benefits from fiscal years 2008 to 2009. 

Table 13: Four-Year Rolling Averages for Strategic Goal 2: 

Performance measure: Financial benefits; 
2005: $9.5 billion; 
2006: $10.4 billion; 
2007: $11.2 billion; 
2008: $12.7 billion; 
2009: $12.5 billion; 

Performance measure: Nonfinancial benefits; 
2005: 306; 
2006: 364; 
2007: 413; 
2008: 438; 
2009: 461. 

Performance measure: Testimonies; 
2005: 50; 
2006: 57; 
2007: 63; 
2008: 69[A]; 
2009: 75. 

Source: GAO. 

[A] In our testimonies calculation for fiscal year 2008, we 
inadvertently counted three additional hearings for this strategic 
goal. We therefore recalculated the data for this measure. The number 
shown reflects the correct calculation. 

[End of Table 13] 

The following sections describe our performance under goal 2 for each 
of our quantitative performance measures and describe the targets for 
fiscal year 2009. 

Financial Benefits: 

The financial benefits reported for this goal in fiscal year 2009 
totaled $12.4 billion which missed our target by about $300 million. 
Among other things, these accomplishments stemmed from engagements 
related to delays and large amounts of unobligated funding in the U.S. 
Coast Guard’s vessel tracking system procurement and our assessment of 
the reasonableness of the Department of Defense’s (DOD) fiscal year 
2009 budget request. We describe these and other accomplishments in the 
goal 2 section of appendix 1. 

Given the large portion of the U.S. budget that defense spending 
consumes, we expect our work under this goal to continue to produce 
economies and efficiencies that yield billions of dollars in financial 
benefits for the American people each year. We set our fiscal year 2010 
target at $13.8 billion based on our assessment of the progress 
agencies are making in implementing our past recommendations that might 
yield financial benefits and our 4-year rolling average. 

Example of Goal 2’s Financial Benefits: 
We reviewed U.S. Coast Guard vessel tracking efforts and identified 
efficiency and effectiveness issues. We reported delays and large 
unobligated balances in the Coast Guard’s procurement of one tracking 
system. Obligating the available funds in fiscal year 2008 would have 
required obligating more than three times the amount that was obligated 
in total for the previous 3 fiscal years. In addition, the Coast Guard 
did not have a detailed spending plan laying out how it planned to 
obligate the available funds. Thus, the Congress reduced the Coast 
Guard’s requested 2009 appropriation by $6 million. 

[End of Example of Goal 2’s Financial Benefits]  

Nonfinancial Benefits: 

The nonfinancial benefits reported for goal 2 in fiscal year 2009 
included 426 actions taken by federal agencies to improve their 
services to the public and business processes in response to our 
recommendations and another 31 in which information we provided to the 
Congress resulted in statutory or regulatory changes. This total of 457 
nonfinancial benefits greatly exceeded our target of 344. Our success 
in this area arose from our increased emphasis on follow-up efforts and 
increased monitoring of our progress toward the targets throughout the 
year. Some of our major accomplishments are reported in detail in the 
goal 2 section of appendix 1. 

Looking ahead, our assessments of the executive branch’s current 
efforts to implement our recommendations made under this goal led us to 
set our fiscal year 2010 target at 345. While we increased this target 
by 5 over the target we reported for goal 2 in our fiscal year 2010 
performance plan, we recognize that this target is lower than our 
fiscal year 2009 actual performance and 4-year average for this 
measure. We believe that this target will best enable staff to document 
the full range of nonfinancial benefits resulting from our goal 2 work. 

Example of Goal 2’s Nonfinancial Benefits: 
The 2005 Base Realignment and Closure (BRAC) round is the fifth round 
undertaken by DOD since 1988 and is the biggest, most complex, and 
costliest BRAC round ever. Our analyses of DOD’s BRAC budget led to a 
recommendation that DOD take action to better explain its anticipated 
dollar savings after full BRAC implementation in 2011. In response, DOD 
for the first time provided a more descriptive explanation of these 
expected dollar savings in its 2009 budget submission to the Congress. 

[End of Example of Goal 2’s Nonfinancial Benefits] 

Testimonies: 

Our witnesses testified at 67 congressional hearings related to this 
strategic goal in fiscal year 2009, exceeding our target of presenting 
testimony at 64 hearings. Among other things, we testified on the U.S. 
military’s strategies in Iraq and the nation’s approach to 
cybersecurity as well as the security threat posed by the instability 
in our financial markets and institutions and the worldwide economic 
crisis. We also testified on the Troubled Asset Relief Program (TARP). 
(See p. 33 for a list of testimony topics by goal.) We have set our 
target at 73 for presenting testimony at hearings in fiscal year 2010—6 
more hearings than our fiscal year 2009 actual performance. We 
anticipate an increase in hearings because of continued congressional 
interest in our work on homeland security issues and U.S. efforts to 
stabilize and rebuild Afghanistan, Iraq, and Pakistan. 

Examples of Goal 2’s Testimonies: 
Each year, billions of dollars are spent to develop and produce 
technologically advanced weaponry. When the United States must sell 
these technologies, these weapons are targets for theft, espionage, and 
illegal export. We testified that poor interagency coordination, 
inefficiencies in processing licensing applications, and a lack of 
systematic assessments have created significant vulnerabilities in the 
export control system. We recommended that the executive and 
legislative branches conduct a fundamental reexamination of the current 
programs and processes.Our testimony on financial regulation identified 
several shortcomings in the oversight of large financial institutions. 
Regulating agencies failed to address institutions’ failure to manage 
risk adequately—one of the causes of the current financial crisis. 
Regulators identified, but did not fully address, weaknesses in risk 
models, due to these institutions’ strong financial positions and plans 
for change. We found that some aspects of the regulatory system may 
have hindered regulators’ oversight and, in fact, have raised serious 
questions about the adequacy of risk management oversight. 

[End of Examples of Goal 2’s Testimonies] 

[End of Goal 2] 

Goal 3 Overview: Help transform the federal government’s role and how 
it does business to meet 21st century challenges. 

Our third strategic goal focuses on the collaborative and integrated 
elements needed for the federal government to achieve results. The work 
under this goal highlights the intergovernmental relationships that are 
necessary to achieve national goals. Our multiyear (fiscal years 2007-
2012) strategic objectives under this goal are to: 

* reexamine the federal government’s role in achieving evolving 
national objectives; 

* support the transformation to results-oriented, high-performing 
government; 

* support congressional oversight of key management challenges and 
program risks to improve federal operations and ensure accountability; 
and; 

* analyze the government’s fiscal position and strengthen approaches 
for addressing the current and projected fiscal gap. 

These objectives, along with the performance goals and key efforts that 
support them, are discussed fully in our strategic plan, which is 
available on our Web site at [hyperlink, http://www.gao.gov/sp.html]. 
The work supporting these objectives is performed primarily by 
headquarters and field staff from the Applied Research and Methods, 
Financial Management and Assurance, Information Technology, Strategic 
Issues, and Forensic Audits and Special Investigations teams. In 
addition, the work supporting some performance goals and key efforts is 
performed by headquarters and field staff from the Acquisition and 
Sourcing Management and Natural Resources and Environment teams. This 
goal also includes our bid protest and appropriations law work, which 
is performed by staff in General Counsel, and our vulnerability 
assessments and fraud investigations, which are conducted by staff from 
our Forensic Audits and Special Investigations team. 

Selected Work under Goal 3: 
Using fictitious calling scenarios, our undercover investigators tested 
the complaint intake process at the Department of Labor’s (Labor) Wage 
and Hour Division (WHD). WHD’s mission is to ensure that millions of 
workers are protected under the Fair Labor Standards Act. Our tests 
found that WHD frequently responded inadequately to complaints, leaving 
low-wage workers vulnerable to wage theft and other labor violations. 
We also identified at least 1,160 real employees whose complaints were 
inadequately investigated. After reviewing our findings, Labor 
announced that it would hire 250 more investigators. The Congress is 
also considering legislation that we suggested. 

[End of Selected Work under Goal 3] 

To accomplish our work under these four objectives, we will continue to 
perform our foresight work, for example, examining the nation’s long-
term fiscal and management challenges, and our insight work focusing on 
federal programs at high risk for fraud, waste, abuse, and 
mismanagement. 

As shown in table 14, we significantly exceeded our fiscal year 2009 
performance targets for financial benefits and nonfinancial benefits, 
but did not meet our testimonies target for this goal. 

Table 14: Strategic Goal 3’s Annual Performance Results and Targets: 

Performance measure: Financial benefits; 
2005 Actual: $11.0 billion; 
2006 Actual: $17.0 billion; 
2007 Actual: $22.8 billion; 
2008 Actual: $23.4 billion; 
2009 Target: $15.9 billion; 
2009 Actual: $18.5 billion; 
Met/Not Met: Met; 
2010 Target[A]: $14.8 billion. 

Performance measure: Nonfinancial benefits; 
2005 Actual: 767; 
2006 Actual: 625; 
2007 Actual: 648; 
2008 Actual: 704; 
2009 Target: 625; 
2009 Actual: 634; 
Met/Not Met: Met; 
2010 Target[A]: 630. 

Performance measure: Testimonies; 
2005 Actual: 47; 
2006 Actual: 73; 
2007 Actual: 74; 
2008 Actual: 76[B]; 
2009 Target: 56; 
2009 Actual: 49; 
Met/Not Met: Not met; 
2010 Target[A]: 59. 

Source: GAO. 

[A] Our fiscal year 2010 target for nonfinancial benefits differs from 
the target we reported in our fiscal year 2010 performance budget in 
January 2009. Specifically, we increased our target for nonfinancial 
benefits from 625. 

[B] In our testimonies calculation for fiscal year 2008, we 
inadvertently counted one additional hearing for this strategic goal. 
We therefore recalculated the data for this measure. The number shown 
reflects the correct calculation. 

[End of Table 14] 

To help us examine trends for these measures over time, we look at 
their 4-year averages—shown in table 16—which minimize the effect of an 
unusual level of performance in any single year. Table 16 indicates 
that documentation of financial and nonfinancial benefits derived from 
our work under this goal has risen steadily during the 5-year period 
shown. Nonfinancial benefits also increased from fiscal years 2005 
through 2008, but declined in fiscal year 2009 to about its fiscal year 
2007 level. The trend in the number of hearings during which our senior 
executives testified on goal 3 issues also began the period in an 
upward direction but leveled off in fiscal years 2008 and 2009. 

Table 15: Four-Year Rolling Averages for Strategic Goal 3: 

Performance measure: Financial benefits; 
2005: $7.1 billion; 
2006: $10.1 billion; 
2007: $14.6 billion; 
2008: $18.6 billion; 
2009: $20.4 billion; 

Performance measure: Nonfinancial benefits; 
2005: 590; 
2006: 630; 
2007: 654; 
2008: 686; 
2009: 653. 

Performance measure: Testimonies; 
2005: 57; 
2006: 59; 
2007: 64; 
2008: 68; 
2009: 68. 

Source: GAO. 

[End of Table 15] 

The following sections describe our performance under goal 3 for each 
of our quantitative performance measures and describe the targets for 
fiscal year 2009. 

Financial Benefits: 

The financial benefits reported for this goal in fiscal 2009 totaled 
$18.5 billion, exceeding our target of $15.9 billion by over $2.6 
billion. These efforts resulted in increased tax collections based on 
our reviews of agencies’ processes to collect nontax and criminal 
debts, cost reductions in the 2010 Census, and a reduction in improper 
federal payments governmentwide. We describe these and other 
accomplishments in the goal 3 section of appendix 1. 

We significantly exceeded the financial benefits target we set for this 
goal in fiscal year 2009 because we documented several unanticipated, 
large-dollar accomplishments. The federal government realized these 
financial benefits as a result of our work that examined, among other 
issues, improvements in the Federal Emergency Management Agency’s 
disaster cost estimates and budget reductions involving DOD’s 
management of contract services. The executive branch’s current efforts 
to implement the recommendations we made in our work under this goal 
indicate that financial benefits related to this goal are likely to be 
in line with our 4-year average. Consequently, we set the target for 
financial benefits at $14.8 billion for fiscal 2010, which is the same 
as the target we reported in our fiscal year 2010 performance plan. 

Example of Goal 3’s Financial Benefits: 
Over the past several years, we have promoted federal agencies’ 
increased use of key debt collection processes and procedures to 
improve collections of billions of dollars of delinquent federal nontax 
civil debts, and criminal debts owed to the federal government, and 
made a series of related recommendations. Based largely on our 
recommendations, federal agencies, including the Department of 
Education and the Department of Justice, have taken actions to improve 
delinquent federal debt collections. Adding to a steady stream of 
recoveries, these improved collections added almost $1.4 billion to 
federal collections during fiscal year 2009. 

[End of Example of Goal 3’s Financial Benefits] 

Nonfinancial Benefits: 

Nonfinancial benefits reported for goal 3 in fiscal year 2009 included 
620 instances in which agencies’ core business processes were improved 
or governmentwide management reforms were advanced because of our work. 
In addition, there were 14 instances in which information we provided 
to the Congress resulted in statutory or regulatory changes. This total 
of 634 nonfinancial benefits exceeded our target of 625. The larger 
number of nonfinancial benefits occurred mainly in our financial 
management and information technology areas where we tend to make 
multiple, specific recommendations for change to more than one entity. 
We describe some of our major accomplishments in the goal 3 section of 
appendix 1. 

Our forward-looking assessments of the executive branch’s current 
efforts to implement our recommendations made under this goal led us to 
set our fiscal year 2010 target at 630. While we recognize that this 
target is slightly lower than our fiscal year 2009 actual performance 
and 4-year average for this measure, we believe that this target will 
best encourage staff to document the full range of nonfinancial 
benefits possible resulting from our goal 3 work. 

Example of Goal 3’s Nonfinancial Benefits: 
In a series of reports and testimonies, we identified and recommended 
needed improvements in the government’s efforts to define and implement 
a national strategy for achieving nationwide adoption of health 
information technology (IT). Our work helped the National Coordinator 
for Health IT develop a strategy that identified milestones for 
completing important initiatives and achieving strategic goals. As we 
recommended, the strategy addressed an overall approach to protecting 
the privacy of electronic health information within a nationwide health 
information network and provided guidance for addressing challenges 
associated with putting privacy protections in place. 

[End of Example of Goal 3’s Nonfinancial Benefits] 

Testimonies: 

Our witnesses testified at 49 congressional hearings related to this 
strategic goal in fiscal year 2009, missing the target of 56 by 7 
hearings. Among the testimonies presented were those related to the 
American Recovery and Reinvestment Act (Recovery Act), and illegal 
exports of military technology, and the influenza pandemic. (See p. 33 
for a list of testimony topics by goal.) For fiscal year 2010, we have 
set a target of presenting testimony at 59 hearings because we expect 
the level of hearings to be higher than it was in fiscal year 2009. 

Examples of Goal 3’s Testimonies: 
Our testimony on the 2010 Census described the challenges the U.S. 
Census Bureau faces in carrying out the most expensive decennial census 
to date. We found that the bureau has not developed the necessary 
technological tools for monitoring and gathering information for the 
census. Because of these deficiencies, the bureau faces the risk of not 
having these tools ready in time. We upheld previous recommendations to 
improve the bureau’s cost-estimation and address list, as well as to 
further develop the technologies necessary to complete data 
gathering.Much offshore financial activity by individual U.S. taxpayers 
is not illegal, but numerous schemes have been devised to hide the true 
ownership of funds and income moving between the United States and 
offshore jurisdictions. U.S. taxpayers are obligated to report any 
income earned from offshore activity, but they do not always comply. We 
testified that the Internal Revenue Service (IRS) is not always able to 
complete the required examinations of these offshore cases, because the 
3-year statute of limitations is not long enough to finish them. We 
reiterated a previous suggestion that the Congress consider extending 
the time for IRS to complete offshore cases. 

[End of Examples of Goal 3’s Testimonies] 

[End of Goal 3] 

Goal 4 Overview: Maximize the value of GAO by being a model federal 
agency and a world-class professional services organization. 

The focus of our fourth strategic goal is to make us a model 
organization. This means that our work is driven by our external 
clients and internal customers, our managers exhibit the 
characteristics of leadership and management excellence, our employees 
are devoted to ensuring quality in our work process and products 
through continuous improvement, and our agency is regarded by current 
and potential employees as an excellent place to work. Our multiyear 
(fiscal years 2007-2012) strategic objectives under this goal are to: 

* improve client and customer satisfaction and stakeholder 
relationships, 
* lead strategically to achieve enhanced results,
* leverage our institutional knowledge and experience,
* enhance our business and management processes, and; 
* become a professional services employer of choice. 

These objectives, along with the performance goals and key efforts that 
support them, are discussed fully in our strategic plan, which is 
available on our Web site at [hyperlink, http://www.gao.gov/sp.html]. 
The work supporting these objectives is performed under the direction 
of the Chief Administrative Officer with assistance on specific key 
efforts provided by staff from the Applied Research and Methods team 
and from offices such as Strategic Planning and External Liaison, 
Congressional Relations, Opportunity and Inclusiveness, Quality and 
Continuous Improvement, and Public Affairs. To accomplish our work 
under these five objectives, we performed internal studies and 
completed projects that further the strategic goal. 

Selected Work under Goal 4: 

We demonstrated agility and flexibility in addressing unprecedented new 
legislative responsibilities and a delayed budget in fiscal year 2009; 
employing sophisticated modeling of actual and projected workforce data 
on a routine basis to ensure that we were using our staff most 
effectively; and using creative, alternative hiring measures to obtain 
needed expertise and subject area knowledge to respond to new 
legislative responsibilities under TARP and the Recovery Act. 

We completed a comprehensive evaluation of our performance appraisal 
system and developed short- and long-term recommendations for 
strengthening the system and ensuring that it is fair and equitable to 
all staff. 

We revised 36 guidance documents on applied research tools and methods 
to help engagement teams better plan and implement assignments, and 
enhanced the design and implementation of Web-based surveys to 
facilitate (1) efficient data capture and analysis, which was essential 
to support the many staff conducting Recovery Act audit work across 16 
states and the District of Columbia and (2) reuse for subsequent 
efforts given our recurrent reporting responsibilities under the 
Recovery Act. 

We enhanced our communications to our clients and the public by using 
Web technology to more effectively provide timely information on 
critical issues facing the nation, including short video summaries on 
the major issues facing the new Congress and the new administration and 
Web content and documentation supporting GAO’s oversight of the 
Recovery Act. 

[End of Selected Work under Goal 4] 

Data Quality and Program Evaluation: 

Verifying and Validating Performance Data: 

Each year, we measure our performance by evaluating our annual 
performance on measures that cover the outcomes and outputs related to 
our work results, client service, management of our people, and 
internal operations. To assess our performance, we used performance 
data that were complete and actual (rather than projected) for almost 
all of our performance measures. We believe the data to be reliable 
because we followed the verification and validation procedures 
described here to ensure the data’s quality. 

The specific sources of the data for our annual performance measures, 
procedures for independently verifying and validating these data, and 
the limitations of these data are described in table 16. 

Table 16: How We Ensure Data Quality for Our Annual Performance 
Measures: 

Results measures: 

Financial benefits: Definition and background: 
Our work—including our findings and recommendations—may produce 
benefits to the federal government that can be estimated in dollar 
terms. These benefits can result in better services to the public, 
changes to statutes or regulations, or improved government business 
operations. A financial benefit is an estimate of the federal monetary 
effect of agency or congressional actions. These financial benefits 
generally result from work that we completed over the past several 
years. The funds made available as a result of the actions taken in 
response to our work may be used to reduce government expenditures, 
increase revenues, or reallocate funds to other areas. Financial 
benefits included in our performance measures are net benefits—that is, 
estimates of financial benefits that have been reduced by the costs 
associated with taking the action that we recommended. We convert all 
estimates involving past and future years to their net present value 
and use actual dollars to represent estimates involving only the 
current year. Financial benefit amounts vary depending on the nature of 
the benefit, and we can claim financial benefits over multiple years 
based on a single agency or congressional action. 

Financial benefits are linked to specific recommendations or other 
work. To claim that financial benefits have been achieved, our staff 
must file an accomplishment report documenting that (1) the actions 
taken as a result of our work have been completed or substantially 
completed, (2) the actions generally were taken within 2 fiscal years 
prior to the filing of the accomplishment report, (3) a cause-and-
effect relationship exists between the benefits reported and our 
recommendation or work performed, and (4) estimates of financial 
benefits were based on information obtained from non-GAO sources. To 
help ensure conservative estimates of net financial benefits, 
reductions in operating cost are typically limited to 2 years of 
accrued reductions, but up to 5 fiscal years of financial benefits can 
be claimed if the reductions are sustained over a period longer than 2 
years. Multiyear reductions in long-term projects, changes in tax laws, 
program terminations, or sales of government assets are limited to 5 
years. Financial benefits can be claimed for past or future years. For 
financial benefits involving events that occur on a regular but 
infrequent basis—such as the decennial census—we may extend the 
measurement period until the event occurs in order to compute the 
associated financial benefits using our present value calculator. 

Managing directors decide when their staff can claim financial 
benefits. A managing director may choose to claim a financial benefit 
all in 1 year or decide to claim it over several years, if the benefit 
spans future years and the managing director wants greater precision as 
to the amount of the benefit. 

Financial benefits: Data sources: 
Our Accomplishment Reporting System provides the data for this measure. 
Teams use this Web-based data system to prepare, review, and approve 
accomplishments and forward them to our Quality and Continuous 
Improvement office (QCI) for its review. Once accomplishment reports 
are approved, they are compiled by QCI, which annually tabulates total 
financial benefits agencywide and by goal. 

Financial benefits: Verification and validation: 
Our policies and procedures require us to use the Accomplishment 
Reporting System to record the financial benefits that result from our 
work. They also provide guidance on estimating those financial 
benefits. The team identifies when a financial benefit has occurred as 
a result of our work. The team develops estimates based on non-GAO 
sources, such as the agency that acted on our work, a congressional 
committee, or the Congressional Budget Office, and files accomplishment 
reports based on those estimates. When non-GAO estimates are not 
readily available, teams may use GAO estimates—developed in 
consultation with our experts, such as the Chief Economist, Chief 
Actuary, or Chief Statistician, and corroborated with a knowledgeable 
program official from the executive agency involved. The estimates are 
reduced by significant identifiable offsetting costs. The team develops 
workpapers to support accomplishments with evidence that meets our 
evidence standard, supervisors review the workpapers, and an 
independent person within GAO reviews the accomplishment report. For 
all financial accomplishment reports the managing director prepares a 
memorandum addressed to the Chief Quality Officer attesting that the 
accomplishment report meets GAO standards for accomplishment reporting. 
The memorandum specifically (1) addresses how linkage to GAO is 
established and (2) attests that the financial benefits being claimed 
are in accordance with GAO procedures. 

The team’s managing director is authorized to approve financial 
accomplishment reports with benefits of less than $100 million. The 
team forwards the report to QCI, which reviews all accomplishment 
reports and approves accomplishment reports claiming benefits of $100 
million or more. In fiscal year 2009, QCI approved accomplishment 
reports covering 95 percent of the dollar value of financial benefits 
we reported. 

In fiscal year 2009, accomplishments from $500 million to $1 billion 
were also reviewed by independent second and third reviewers 
(reemployed GAO annuitants), who have significant experience and 
knowledge of GAO policies and procedures for accomplishment reporting. 
In addition, our Inspector General (IG) audited accomplishment reports 
of $1 billion or more (totaling $25 billion in all). GAO’s total fiscal 
year 2009 reported financial benefits reflect the views of the IG and 
the independent reviewers. 

Financial benefits: Data limitations: 
Not every financial benefit from our work can be readily estimated or 
documented as attributable to our work. As a result, the amount of 
financial benefits is a conservative estimate. Estimates are based on 
information from non-GAO sources and are based on both objective and 
subjective data, and as a result, professional judgment is required in 
reviewing accomplishment reports. We feel that the verification and 
validation steps that we take minimize any adverse impact from this 
limitation. 

Nonfinancial benefits: Definition and background: 
Our work—including our findings and recommendations—may produce 
benefits to the federal government that cannot be estimated in dollar 
terms. These nonfinancial benefits can result in better services to the 
public, changes to statutes or regulations, or improved government 
business operations. Nonfinancial benefits generally result from past 
work that we completed. 

Nonfinancial benefits are linked to specific recommendations or other 
work that we completed over several years. To claim that nonfinancial 
benefits have been achieved, staff must file an accomplishment report 
that documents that (1) the actions taken as a result of our work have 
been completed or substantially completed, (2) the actions generally 
were taken within the past 2 fiscal years of filing the accomplishment 
report, and (3) a cause-and-effect relationship exists between the 
benefits reported and our recommendation or work performed. 

Nonfinancial benefits: Data sources: 
Our Accomplishment Reporting System provides the data for this measure. 
Teams use this automated system to prepare, review, and approve 
accomplishments and forward them to QCI for its review. Once 
accomplishment reports are approved, they are compiled by QCI, which 
annually tabulates total other (nonfinancial) benefits agencywide and 
by goal. 

Nonfinancial benefits: Verification and validation: 
Our policies and procedures require us to use the Accomplishment 
Reporting System to record the nonfinancial benefits that result from 
our findings and recommendations. Staff in the team file accomplishment 
reports to claim that benefits have resulted from our work. The team 
develops workpapers to support accomplishments with evidence that meets 
our evidence standard. Supervisors review the workpapers; an 
independent person within GAO reviews the accomplishment report; and 
the team’s managing director or director approves the accomplishment 
report to ensure the appropriateness of the claimed accomplishment, 
including attribution to our work. 

The team forwards the report to QCI, where it is reviewed for 
appropriateness. QCI provides summary data on nonfinancial benefits to 
team managers, who check the data on a regular basis to make sure that 
approved accomplishments from their staff have been accurately 
recorded. Additionally, on a periodic basis, the IG independently tests 
compliance with our process for claiming nonfinancial benefits. For 
example, the IG tested this process in fiscal year 2005 and found it to 
be reasonable. In response to the IG’s recommendations, we strengthened 
the documentation of our nonfinancial benefits. 

Nonfinancial benefits: Data limitations: 
The data may be underreported because we cannot always document a 
direct cause-and-effect relationship between our work and benefits it 
produced. However, we feel that this is not a significant limitation on 
the data because the data represent a conservative measure of our 
overall contribution toward improving government. 

Percentage of products with recommendations: Definition and background: 
We measure the percentage of our written products (chapter and letter 
reports and numbered correspondence) issued in the fiscal year that 
included at least one recommendation. We make recommendations that 
specify actions that can be taken to improve federal operations or 
programs. We strive for recommendations that are directed at resolving 
the cause of identified problems; that are addressed to parties who 
have the authority to act; and that are specific, feasible, and cost-
effective. Some products we issue contain no recommendations and are 
strictly informational in nature. 

We track the percentage of our written products that are issued during 
the fiscal year and contain recommendations. This indicator recognizes 
that our products do not always include recommendations and that the 
Congress and agencies often find such informational reports just as 
useful as those that contain recommendations. For example, 
informational reports, which do not contain recommendations, can help 
to bring about significant financial and nonfinancial benefits. 

Percentage of products with recommendations: Data sources: 
Our Documents Database records recommendations as they are issued. The 
database is updated daily. 

Percentage of products with recommendations: Verification and 
validation: 
Through a formal process, each team identifies the number of 
recommendations included in each product and an external contractor 
enters them into a database. We provide our managers with reports on 
the recommendations being tracked to help ensure that all 
recommendations have been captured and that each recommendation has 
been completely and accurately stated. Additionally, on a periodic 
basis, the IG independently tests the teams’ compliance with our 
policies and procedures related to this performance measure. For 
example, during fiscal year 2006, the IG tested and determined that our 
process for determining the percentage of written products with 
recommendations was reasonable. The IG also recommended actions to 
improve the process for developing, compiling, and reporting these 
statistics. We have implemented the IG’s recommendations for fiscal 
year 2007. Since then, we have used the same procedures to compute and 
report this measure. 

Percentage of products with recommendations: Data limitations: 
This measure is a conservative estimate of the extent to which we 
assist the Congress and federal agencies because not all products and 
services we provide lead to recommendations. For example, the Congress 
may request information on federal programs that is purely descriptive 
or analytical and does not lend itself to recommendations. 

Past recommendations implemented: Definition and background: 
We make recommendations designed to improve the operations of the 
federal government. For our work to produce financial or nonfinancial 
benefits, the Congress or federal agencies must implement these 
recommendations. As part of our audit responsibilities under generally 
accepted government auditing standards, we follow up on recommendations 
we have made and report to the Congress on their status. Experience has 
shown that it takes time for some recommendations to be implemented. 
For this reason, this measure is the percentage rate of implementation 
of recommendations made 4 years prior to a given fiscal year (e.g., the 
fiscal year 2009 implementation rate is the percentage of 
recommendations made in fiscal year 2005 products that were implemented 
by the end of fiscal year 2009). Experience has shown that if a 
recommendation has not been implemented within 4 years, it is not 
likely to be implemented. 

This measure assesses action on recommendations made 4 years 
previously, rather than the results of our activities during the fiscal 
year in which the data are reported. For example, the cumulative 
percentage of recommendations made in fiscal year 2005 that were 
implemented in the ensuing years is as follows: 13 percent by the end 
of the first year (fiscal year 2006), 31 percent by the end of the 
second year (fiscal year 2007), 45 percent by the end of the third year 
(fiscal year 2008), and 80 percent by the end of the fourth year 
(fiscal year 2009). 

Past recommendations implemented: Data sources: 
Our Documents Database records recommendations as they are issued. The 
database is updated daily. As our staff monitor implementation of 
recommendations, they submit updated information to the database. 

Past recommendations implemented: Verification and validation: 
Through a formal process, each team identifies the number of 
recommendations included in each product, and an external contractor 
enters them into a database. 

Policies and procedures specify that our staff must verify, with 
sufficient supporting documentation, that an agency’s reported actions 
are adequately being implemented. Staff update the status of the 
recommendations on a periodic basis. To accomplish this, our staff may 
interview agency officials, obtain agency documents, access agency 
databases, or obtain information from an agency’s inspector general. 
Recommendations that are reported as implemented are reviewed by a 
senior executive in the unit and by QCI. 

Summary data are provided to the units that issued the recommendations. 
The units check the data regularly to make sure that the 
recommendations they have reported as implemented have been accurately 
recorded. We also provide to the Congress a database with the status of 
recommendations that have not been implemented, and we maintain a 
publicly available database of open recommendations that is updated 
daily. 

Additionally, on a periodic basis, the IG independently tests our 
process for calculating the percentage of recommendations implemented 
for a given fiscal year. For example, based on the IG’s last review of 
this measure, the IG determined that our process was reasonable for 
calculating the percentage of recommendations that had been made in our 
fiscal year 2002 products and implemented by the end of fiscal year 
2006. The IG also recommended actions to improve the process for 
developing, compiling, and reporting this statistic. In fiscal year 
2007, we implemented the IG’s recommendation for calculating the 
percentage of recommendations that had been made and implemented. Since 
then we have continued to use this approved process to compute and 
report this measure. 

Past recommendations implemented: Data limitations: 
The data may be underreported because sometimes a recommendation may 
require more than 4 years to implement. We also may not count cases in 
which a recommendation is partially implemented. However, we feel that 
this is not a significant limitation to the data because the data 
represent a conservative measure of our overall contribution toward 
improving government. 

Client measures: 

Testimonies: Definition and background: 
The Congress may ask us to testify at hearings on various issues, and 
these hearings are the basis for this measure. Participation in 
hearings is one of our most important forms of communication with the 
Congress, and the number of hearings at which we testify reflects the 
importance and value of our institutional knowledge in assisting 
congressional decision making. When multiple GAO witnesses with 
separate testimonies appear at a single hearing, we count this as a 
single testimony. We do not count statements submitted for the record 
when a GAO witness does not appear. 

Testimonies: Data sources: 
The data on hearings at which we testified are compiled in our 
Congressional Hearing System managed by staff in Congressional 
Relations. 

Testimonies: Verification and validation: 
The units responding to requests for testimony are responsible for 
entering data in the Congressional Hearing System. After a GAO witness 
has testified at a hearing, Congressional Relations verifies that the 
data in the system are correct and records the hearing as one at which 
we testified. Congressional Relations provides weekly status reports to 
unit managers, who check to make sure that the data are complete and 
accurate. Additionally, on a periodic basis, the IG independently 
verifies the total number of hearings at which we testified. As a 
result of the IG’s most recent review, we adjusted the figure for the 
number of hearings we testified at in fiscal year 2008 from 304 to 298. 
We also are improving the guidance and documentation for recording 
hearings at which we testify. 

Testimonies: Data limitations: 
This measure does not include statements for the record that we prepare 
for congressional hearings. Also, this measure may be influenced by 
factors other than the quality of our performance in any specific year. 
The number of hearings held each year depends on the Congress’s agenda, 
and the number of times we are asked to testify may reflect 
congressional interest in work in progress as well as work completed 
that year or the previous year. To mitigate this limitation, we try to 
adjust our target to reflect cyclical changes in the congressional 
schedule. We also outreach to our clients on a continuing basis to 
increase their awareness of our readiness to participate in hearings. 

Timeliness: Definition and background: 
The likelihood that our products will be used is enhanced if they are 
delivered when needed to support congressional and agency decision 
making. To determine whether our products are timely, we compute the 
proportion of favorable responses to a question related to timeliness 
that appears on our electronic client outreach form. Because our 
products often have multiple congressional clients, we often outreach 
to more than one congressional staff person per product. We send a form 
to key staff working for requesters of our testimony statements and to 
clients of our more significant written products—specifically, 
engagements assigned an interest level of “high” by our senior 
management and those requiring an expected investment of 500 GAO staff 
days or more. One question asks the respondent whether the product was 
delivered on time. When a product that meets our criteria is released 
to the public, we electronically send relevant congressional staff an e-
mail message containing a link to the form. When this link is accessed, 
the form recipient is asked to respond to the timeliness question using 
a five-point scale—strongly agree, generally agree, neither agree nor 
disagree, generally disagree, strongly disagree—or choose “not 
applicable/no answer.” For this measure, favorable responses are “
strongly agree” and “generally agree.” 

Timeliness: Data sources: 
To identify the products that meet our criteria (testimonies and other 
products that are high interest or expected to reach 500 staff days or 
more), we run a query against GAO’s Documents Database maintained by a 
contractor. To identify appropriate recipients of the form for products 
meeting our criteria, we ask the engagement teams to provide in GAO’s 
Product Numbering Database e-mail addresses for congressional staff 
serving as contacts on a product. Relevant information from both of 
these databases is fed into another database that is managed by QCI. 
This database then combines product, form recipient, and data from our 
Congressional Relations staff and creates an e-mail message with a Web 
link to the form. (Congressional Relations staff serve as the GAO 
contacts for form recipients.) The e-mail message also contains an 
embedded client password and unique client identifier to ensure that a 
recipient is linked with the appropriate form. Our Congressional 
Feedback Database creates a record with the product title and number 
and captures the responses to every form sent back to us 
electronically. 

Timeliness: Verification and validation: 
QCI staff review a hard copy of a released GAO product or access its 
electronic version to check the accuracy of the addressee information 
in the QCI database. QCI staff also check the congressional staff 
directory to ensure that form recipients listed in the QCI database 
appear there. In addition, our Congressional Relations staff review the 
list of form recipients entered by the engagement teams and identify 
the most appropriate congressional staff person to receive a form for 
each client. E-mail messages that are inadvertently sent with incorrect 
e-mail addresses automatically reappear in the form approval system. 
When this happens, QCI staff correct any obvious typing errors and 
resend the e-mail message or contact the congressional staff person 
directly for the correct e-mail address and then resend the message. 
The IG reviewed the timeliness performance measure in fiscal year 2009, 
and as a result of this work, we have clarified the description of this 
measure and are documenting our procedures. 

Timeliness: Data limitations: 
We do not measure the timeliness of all of our external products 
because we do not wish to place too much burden on busy congressional 
staff. Testimonies and written products that met our criteria for this 
measure represented about 65 percent of the congressionally requested 
written products we issued during fiscal year 2009. We exclude from our 
timeliness measure low, and medium-interest reports expected to take 
fewer than 500 staff days when completed, reports addressed to agency 
heads or commissions, some reports mandated by the Congress, classified 
reports, and reports completed under the Comptroller General’s 
authority. Also, if a requester indicates that he or she does not want 
to complete a form, we will not send one to this person again, even 
though a product subsequently requested meets our criteria. The 
response rate for the form is 28 percent, and 96 percent of those who 
responded answered the timeliness question. We received responses from 
one or more people for about 53 percent of the products for which we 
sent a form in fiscal year 2009. In our timeliness calculations for 
fiscal years 2004 through 2007, we inadvertently included nonresponses 
to the timeliness question and therefore recalculated the results for 
these fiscal years. While the percent of favorable responses did not 
change significantly, the recalculation did result in us meeting our 
target (from 94 to 95 percent). 

People measures: 

New hire rate: Definition and background: 
This performance measure is the ratio of the number of people hired to 
the number we planned to hire. Annually, we develop a workforce plan 
that takes into account our strategic goals; projected workload 
changes; and other changes such as retirements, other attrition, 
promotions, and skill gaps. The workforce plan for the upcoming year 
specifies the number of planned hires. The Acting Comptroller General, 
the Chief Administrative Officer, the Deputy Chief Administrative 
Officer, the Chief Human Capital Officer, and the Controller meet 
monthly to monitor progress toward achieving the workforce plan. 
Adjustments to the workforce plan are made throughout the year, if 
necessary, to reflect changing needs and conditions. 

New hire rate: Data sources: 
The Executive Committee approves the workforce plan. The workforce plan 
is coordinated and maintained by the Chief Administrative Office (CAO). 
Data on accessions—that is, new hires coming on board—is taken from a 
database that contains employee data from the Department of Agriculture’
s National Finance Center (NFC) database, which handles payroll and 
personnel data for GAO and other agencies. 

New hire rate: Verification and validation: 
The CAO maintains a database that monitors and tracks all our hiring 
offers, declinations, and accessions. In coordination with our Human 
Capital Office, our Chief Administrative Office staff input workforce 
information supporting this measure into the Chief Administrative 
Office database. While the database is updated on a daily basis, CAO 
staff provide monthly reports to the Acting Comptroller General and the 
Chief Administrative Officer to monitor progress by GAO units in 
achieving workforce plan hiring targets. The Chief Administrative 
Office continually monitors and reviews accessions maintained in the 
NFC database against its database to ensure consistency and to resolve 
discrepancies. In addition, on a periodic basis, the IG examines our 
process for calculating the new hire rate. During fiscal year 2008, the 
IG independently reviewed this process and recommended actions to 
improve the documentation of the process used to calculate this 
measure. In fiscal year 2009, we developed standard operating 
procedures to document how we calculate and ensure quality control over 
data relevant to this measure. 

New hire rate: Data limitations: 
There is a lag of one to two pay periods (up to 4 weeks) before the NFC 
database reflects actual data. We generally allow sufficient time 
before requesting data for this measure to ensure that we get accurate 
results. 

Retention rate: Definition and background: 
We continuously strive to make GAO a place where people want to work. 
Once we have made an investment in hiring and training people, we would 
like to retain them. This measure is one indicator that we are 
attaining that objective and is the complement of attrition. We 
calculate this measure by taking 100 percent minus the attrition rate, 
where attrition rate is defined as the number of separations divided by 
the average onboard strength. We calculate this measure with and 
without retirements. 

Retention rate: Data sources: 
Data on retention—that is, people who are on board at the beginning of 
the fiscal year and people on board at the end of the fiscal year—are 
taken from a Chief Administrative Office database that contains some 
data from the NFC database, which handles payroll and personnel data 
for GAO and other agencies. 

Retention rate: Verification and validation: 
Chief Administrative Office staff continually monitor and review 
accessions and attritions against the contents of their database that 
has NFC data and they follow up on any discrepancies. In addition, on a 
periodic basis, the IG examines our process for calculating the 
retention rate. During fiscal year 2008, the IG reviewed this process 
and recommended actions to improve the documentation of the process 
used to calculate this measure. In fiscal year 2009, we developed 
standard operating procedures to document how we calculate and ensure 
quality control over data relevant to this measure. 

Retention rate: Data limitations: 
See New hire rate, Data limitations. 

Staff development: Definition and background: 
One way that we measure how well we are doing and identify areas for 
improvement is through our annual employee feedback survey. This Web-
based survey, which is conducted by an outside contractor to ensure the 
confidentiality of every respondent, is administered to all of our 
employees once a year. Through the survey, we encourage our staff to 
indicate what they think about GAO’s overall operations, work 
environment, and organizational culture and how they rate our managers—
from the immediate supervisor to the Executive Committee—on key aspects 
of their leadership styles. The survey consists of over 100 questions. 
To further ensure confidentiality, in fiscal year 2009 the contractor 
also analyzed the data. 

This measure is based on staff’s favorable responses to three of the 
six questions related to staff development on our annual employee 
survey. This subset of questions was selected on the basis of senior 
management’s judgment about the questions’ relevance to the measure and 
specialists’ knowledge about the development of indexes. Staff were 
asked to respond to three questions on a five-point scale or choose “no 
basis to judge/not applicable” or “no answer.” 

Staff development: Data sources: 
These data come from our staff’s responses to an annual Web-based 
survey. The survey questions we used for this measure ask staff how 
much positive or negative impact (1) external training and conferences 
and (2) on-the-job training had on their ability to do their jobs 
during the last 12 months. From the staff who expressed an opinion, we 
calculated the percentage of staff selecting the two categories that 
indicate satisfaction with or a favorable response to the question. For 
this measure, the favorable responses were either “very positive 
impact” or “generally positive impact.” In addition, the survey 
question asked how useful and relevant to your work did you find 
internal (Learning Center) training courses. From staff who expressed 
an opinion, we calculated the percentage of staff selecting the three 
categories that indicate satisfaction with or a favorable response to 
the question. For this measure, the favorable responses were “very 
greatly useful and relevant,” “greatly useful and relevant,” and “
moderately useful and relevant.” Responses of “no basis to judge/not 
applicable” or “no answer” were excluded from the calculation. While 
including “no basis to judge/not applicable” or “no answer” in the 
calculation would result in a different percentage, our method of 
calculation is an acceptable survey practice and we believe it produces 
a better and more valid measure because it represents only those 
employees who have an opinion on the questions. 

Beginning in fiscal year 2006 we changed the way that the staff 
development people measure was calculated. Specifically, we dropped one 
question regarding computer-based training because we felt such 
training was a significant part of (and therefore included in) the 
other questions the survey asked regarding training. We also modified a 
question on internal training and changed the scale of possible 
responses to that question. We show the fiscal year 2004 and 2005 data 
on a separate line to indicate that those data are not comparable to 
the data beginning in fiscal year 2006. 

Staff development: Verification and validation: 
The employee feedback survey gathers staff opinions on a variety of 
topics. The survey is password protected, and only the outside 
contractor has access to passwords. In addition, when the survey 
instrument was developed, extensive focus groups and pretests were 
undertaken to refine the questions and provide definitions as needed. 
In fiscal year 2009, our response rate to this survey was about 74 
percent, which indicates that its results are largely representative of 
the GAO population. In addition, many teams and work units conduct 
follow-on work to gain a better understanding of the information from 
the survey. 

In addition, on a periodic basis, the IG independently reviews the 
reliability and validity of the staff development measure. The IG’s 
most recent evaluation showed that for fiscal year 2007 we accurately 
calculated the measure. 

Staff development: Data limitations: 
The information contained in the survey is the self-reported opinions 
of staff expressed under conditions of confidentiality. Accordingly, 
there is no way to further validate those expressions of opinion. 

The practical difficulties of conducting any survey may introduce 
errors, commonly referred to as nonsampling errors. These errors could 
result from, for example, respondents misinterpreting a question or 
data entry staff incorrectly entering data into a database used to 
analyze the survey responses. Such errors can introduce unwanted 
variability into the survey results. We took steps in the development 
of the survey to minimize nonsampling errors. Specifically, when we 
developed the survey instrument we held extensive focus groups and 
pretests to refine the questions and define terms used to decrease the 
chances that respondents would misunderstand the questions. We also 
limited the chances of introducing nonsampling errors by creating a Web-
based survey for which respondents entered their answers directly into 
an electronic questionnaire. This approach eliminated the need to have 
the data keyed into a database by someone other than the respondent, 
thus removing an additional source of error. 

Staff utilization: Definition and background: 
This measure is based on staff’s favorable responses to three of the 
six questions related to staff utilization on our annual employee 
survey. This subset of questions was selected on the basis of senior 
management’s judgment about the questions’ relevance to the measure and 
specialists’ knowledge about the development of indexes. Staff were 
asked to respond to these three questions on a five-point scale or 
choose “no basis to judge/not applicable” or “no answer.” (For 
background information about our entire employee feedback survey, see 
Staff development.) 

Staff utilization: Data sources: 
These data come from our staff’s responses to an annual Web-based 
survey. The survey questions we used for this measure ask staff how 
often the following occurred in the last 12 months: (1) my job made 
good use of my skills; (2) GAO provided me with opportunities to do 
challenging work; and (3) in general, I was utilized effectively. From 
the staff who expressed an opinion, we calculated the percentage of 
staff selecting the two categories that indicate satisfaction with or a 
favorable response to the question. For this measure, the favorable 
responses were either “very positive impact” or “generally positive 
impact.” Responses of “no basis to judge” or “no answer” were excluded 
from the calculation. Including “no basis to judge/not applicable” or “
no answer” in the calculation (in those few instances where it 
occurred) would not result in a different percentage. Our method of 
calculation is an acceptable survey practice, and we believe it 
produces a better and more valid measure because it represents only 
those employees who have an opinion on the questions. 

Staff utilization: Verification and validation: 
See Staff development, Verification and validation. The IG’s most 
recent evaluation showed that for fiscal year 2007 we accurately 
calculated the measure. 

Staff utilization: Data limitations: 
See Staff development, Data limitations. 

Effective leadership by supervisors: Definition and background: 
This measure is based on staff’s favorable responses to 10 of 20 
questions related to six areas of supervisory leadership on our annual 
employee survey. This subset of questions was selected on the basis of 
senior management’s judgment about the questions’ relevance to the 
measure and specialists’ knowledge about the development of indexes. 
Specifically, our calculation included responses to 1 of 4 questions 
related to empowerment, 2 of 4 questions related to trust, all 3 
questions related to recognition, 1 of 3 questions related to 
decisiveness, 2 of 3 questions related to leading by example, and 1 of 
3 questions related to work life. Staff were asked to respond to these 
10 questions on a five-point scale or choose “no basis to judge/not 
applicable” or “no answer.” In fiscal year 2009 we changed the name of 
this measure from “Leadership” to its current nomenclature to clarify 
that the measure reflects employee satisfaction with the immediate 
supervisor’s leadership. (For background information about our entire 
employee feedback survey, see Staff development, Definition and 
background.) 

Effective leadership by supervisors: Data sources: 
These data come from our staff’s responses to an annual Web-based 
survey. The survey questions we used for this measure ask staff about 
empowerment, trust, recognition, decisiveness, leading by example, and 
work life as they pertain to the respondent’s immediate supervisor. 
Specifically, the survey asked staff the following questions about 
their immediate supervisor during the last 12 months: (1) gave me the 
opportunity to do what I do best; (2) treated me fairly; (3) acted with 
honesty and integrity toward me; (4) ensured that there was a clear 
link between my performance and recognition of it; (5) gave me the 
sense that my work is valued; (6) provided me meaningful incentives for 
high performance; (7) made decisions in a timely manner; (8) 
demonstrated GAO’s core values of accountability, integrity, and 
reliability; (9) implemented change effectively; and (10) dealt 
effectively with equal employment opportunity and discrimination 
issues. (Beginning with the 2010 survey, question 10 will be not be 
used for this measure and we will substitute a question on respecting 
and valuing differences among individuals. We are making this change 
because there is a large number of respondents who answer “no basis/not 
applicable” to the Equal Employment Opportunity/discrimination 
question. We believe this is due to GAO having so few discrimination 
cases and the safeguarding of private information, thus many employees 
do not have direct knowledge about how supervisors deal with such 
issues.) From the staff who expressed an opinion, we calculated the 
percentage of staff selecting the two categories that indicate 
satisfaction with or a favorable response to the question. For this 
measure, the favorable responses were either “always or almost always” 
or “most of the time.” Responses of “no basis to judge/not applicable” 
or “no answer” were excluded from the calculation. While including “no 
basis to judge/not applicable” or “no answer” in the calculation would 
result in a different percentage, our method of calculation is an 
acceptable survey practice and we believe it produces a better and more 
valid measure because it represents only those employees who have an 
opinion on the questions. 

Effective leadership by supervisors: Verification and validation: 
See Staff development, Verification and validation. The IG’s most 
recent evaluation showed that for fiscal year 2007 we accurately 
calculated the measure. 

Effective leadership by supervisors: Data limitations: 
See Staff development, Data limitations. 

Organizational climate: Definition and background: 
This measure is based on staff’s favorable responses to 5 of the 13 
questions related to organizational climate on our annual employee 
survey. This subset of questions was selected on the basis of senior 
management’s judgment about the questions’ relevance to the measure and 
specialists’ knowledge about the development of indexes. Staff were 
asked to respond to these 5 questions on a five-point scale or choose “
no basis to judge” or “no answer.” (For background information about 
our entire employee feedback survey, see Staff development.) 

Organizational climate: Data sources: 
These data come from our staff’s responses to an annual Web-based 
survey. The survey questions we used for this measure ask staff to 
think back over the last 12 months and indicate how strongly they agree 
or disagree with each of the following statements: (1) a spirit of 
cooperation and teamwork exists in my work unit; (2) I am treated 
fairly and with respect in my work unit; (3) my morale is good; (4) 
sufficient effort is made in my work unit to get the opinions and 
thinking of people who work here; and (5) overall, I am satisfied with 
my job at GAO. From the staff who expressed an opinion, we calculated 
the percentage of staff selecting the two categories that indicate 
satisfaction with or a favorable response to the question. For this 
measure, the favorable responses were either “strongly agree” or “
generally agree.” Responses of “no basis to judge” or “no answer” were 
excluded from the calculation. While including the “no basis to 
judge/not applicable” or “no answer” in the calculation (in those few 
instances where it occurred) would result in a different percentage, 
our method of calculation is an acceptable survey practice, and we 
believe it produces a better and more valid measure because it 
represents only those employees who have an opinion on the questions. 

Organizational climate: Verification and validation: 
See Staff development, Verification and validation. The IG’s most 
recent evaluation showed that for fiscal year 2007 we accurately 
calculated the measure. 

Organizational climate: Data limitations: 
See Staff development, Data limitations. 

Internal operations measures: 

Help get job done and quality of work life: Definition and background: 
To measure how well we are doing at delivering internal administrative 
services to our employees and identify areas for improvement, we 
conduct an annual Web-based survey in November. The customer 
satisfaction survey on administrative services, conducted by an outside 
contractor to ensure the confidentiality of every respondent, is 
administered to all of our employees once a year. Through the survey we 
encourage our staff to indicate how satisfied they are with 19 services 
that help them get their jobs done and another 12 services that affect 
their quality of work life. 

As part of the survey, employees are asked to rate, on a scale of 1 
(low) to 5 (high), those services that are important to them and that 
they have experience with or used recently. Then, for each selected 
service, employees are asked to indicate their level of satisfaction 
from 1 (low) to 5 (high), and provide a written reason for their rating 
and recommendations for improvement if desired. Based on employees’ 
responses to these questions, we calculate a composite score. 

Help get job done and quality of work life: Data sources: 
These data come from our staff’s responses to an annual Web-based 
survey. To determine how satisfied GAO employees are with internal 
administrative services, we calculate composite scores for two 
measures. One measure reflects the satisfaction with the 18 services 
that help employees get their jobs done. These services include 
Internet and intranet services, information technology customer 
support, mail services, and voice communication services. The second 
measure reflects satisfaction with another 11 services that affect 
quality of work life. These services include assistance related to pay 
and benefits, building maintenance and security, and workplace safety 
and health. The composite score represents how employees rated their 
satisfaction with services in each of these areas relative to how they 
rated the importance of those services to them. The importance scores 
and satisfaction levels are both rated on a scale of 1 (low) to 5 
(high). 

Help get job done and quality of work life: Verification and 
validation: 
The satisfaction survey on administrative services is housed on a Web 
site maintained by an outside contractor, and only the contractor has 
the ability to link the survey results with individual staff. Our 
survey response rate was 56 percent in 2008. To ensure that the results 
are largely representative of the GAO population, we analyze the 
results by demographic representation (unit, tenure, location, band 
level, and job type). Each GAO unit responsible for administrative 
services conducts follow-on work, including analyzing written comments 
to gain a better understanding of the information from the survey. In 
addition, on a periodic basis, the IG independently assesses the 
internal operations performance measures. The IG examined the measures 
during fiscal year 2007 and found the measures reasonable. The IG also 
recommended actions to improve the measures’ reliability and 
objectivity. We are in the process of implementing the IG’s 
recommendations. 

Help get job done and quality of work life: Data limitations: 
The information contained in the survey is the self-reported opinion of 
staff expressed under conditions of confidentiality. Accordingly, there 
is no way to further validate those expressions of opinion. We do not 
plan any actions to remedy this limitation because we feel it would 
violate the pledge of confidentiality that we make to our staff 
regarding the survey responses. 

The practical difficulties of conducting any survey may introduce 
errors, commonly referred to as nonsampling errors. These errors could 
result, for example, from respondents misinterpreting a question or 
entering their data incorrectly. Such errors can introduce unwanted 
variability into the survey results. We limit the chances of 
introducing nonsampling errors by using a Web-based survey for which 
respondents enter their answers directly into an electronic 
questionnaire. This eliminates the need to have the data keyed into a 
database by someone other than the respondent. 

Source: GAO. 

[End of Table 16] 

Program Evaluation: 

To assess our progress toward our first three strategic goals and their 
objectives and to update them for our strategic plan, we evaluate 
actions taken by federal agencies and the Congress in response to our 
recommendations. The results of these evaluations are conveyed in this 
performance and accountability report as financial benefits and 
nonfinancial benefits that reflect the value of our work. 

In addition, we actively monitor the status of our open recommendations—
those that remain valid but have not yet been implemented—and report 
our findings annually to the Congress and the public (see [hyperlink, 
http://www.gao.gov/openrecs.html]). We use the results of that analysis 
to determine the need for further work in particular areas. For 
example, if an agency has not implemented a recommended action that we 
consider to be worthwhile, we may decide to pursue further action with 
agency officials or congressional committees, or we may decide to 
undertake additional work on the matter. 

We also use our biennial high-risk update report to provide a status 
report on those major government operations considered high risk 
because of their vulnerabilities to fraud, waste, abuse, and 
mismanagement or the need for broad-based transformation. The report is 
a valuable evaluation and planning tool because it helps us to identify 
those areas where our continued efforts are needed to maintain the 
focus on important policy and management issues that the nation faces. 
(See [hyperlink, http://www.gao.gov/docsearch/featured/highrisk.html].) 

In fiscal year 2009, various task teams worked under the umbrella of a 
large, multi-focused effort called GAO’s Management Improvement 
Initiative. A coordinating committee reporting directly to the 
Executive Committee was chartered to oversee the coordination and 
implementation of each project within the following five priority 
areas: Recognizing and Valuing Diversity; Reassessing the Performance 
Appraisal System; Managing Workload, Quality, and Streamlining 
Processes; Enhancing Staffing Practices and Developing the Workforce; 
and Strengthening Recruitment and Retention Initiatives. The task teams 
examined a number of internal issues, operations, and processes 
spanning all four of our strategic goals. The following studies helped 
to inform the work being done in several of these priority areas: 

* Performance appraisal system study. An internal task team performed a 
comprehensive evaluation of our performance appraisal system used for 
all staff assessed during annual reviews as well as for staff in GAO’s 
development programs who are assessed every 6 months. The evaluation 
included analyzing past feedback on the system; obtaining employee and 
manager perspectives through 53 interviews and 28 focus groups; 
implementing an agencywide survey, which had a 67 percent response rate 
and solicited over 5,000 comments; and assessing findings from the 2008 
African American Performance Assessment—a contractor-conducted study of 
the differences in average performance appraisals between GAO’s African 
American and Caucasian analysts. While we found through our survey that 
a majority of employees reported that their contributions to GAO are 
accurately appraised and the feedback they receive is useful and 
relevant, their satisfaction with the overall system and its 
transparency is low. 

* Recruiting practices study. An internal task team conducted a 
comprehensive study of our recruiting and hiring programs that 
established baseline data on the results of our recruiting efforts. We 
found that while we are extremely successful in attracting highly 
qualified candidates to our job announcements, our recruiting program 
was in need of additional structure and oversight to deliver the best 
return on investment. 

* Staff development assessment. An internal task team implemented a 
survey for staff completing our entry-level development programs to 
assess the quality of the development and support they were provided. 
The results from the first iteration of this survey show that almost 
all developmental staff have developed a good understanding of GAO’s 
performance standards and almost all staff were satisfied with the 
mission teams they were assigned to after the program, but that we need 
to provide greater clarity on program goals, improve the usefulness of 
professional development tools, and increase interaction between 
Professional Development Program management and program participants. 

* Rotational program assessment. An internal task team conducted an 
assessment of the rotational program for developmental analysts (i.e., 
where staff work in three to four mission teams on different 
engagements during their first 24 months on the job) to determine the 
impact, if any, of rotations on engagements.Managers identified a 
number of positive benefits of rotating development staff among mission 
teams and generally did not believe that rotations negatively affected 
engagements unless the developmental staff member was the only member 
on the engagement team in addition to the engagement leader. 

We also completed two additional evaluations related to goal 4’s 
strategic objectives. 

* Financial management practices and processes. We have a comprehensive 
management control program to meet the objectives of the Federal 
Managers’ Financial Integrity Act, even though, as part of the 
legislative branch of the federal government, we are not legally 
required to do so. The program includes an integration of management 
controls into our financial processes[Footnote 21] and financial 
management systems, review of management controls and financial 
management systems controls on a recurring basis, and development of 
corrective action plans for any control issues found and monitoring of 
those plans until the issues are resolved or corrected. Our Senior 
Assessment Team (SAT), consisting of senior managers and chaired by the 
Chief Financial Officer, ensures our commitment to an appropriate 
system of internal control, actively oversees the process of assessing 
internal controls, and provides input for the level and priority of 
resource needs to correct any control issue identified. In addition to 
the SAT, our Internal Control Working Group (ICWG) planned, conducted, 
and managed the assessment in accordance with Office of Management and 
Budget (OMB) Circular A-123 guidelines. The ICWG was composed of 
individuals designated as business unit managers, the project 
management team, technical consultants, and field office 
representatives. We monitor management controls through internal 
control reviews that included identification of key controls over 
financial reporting; performance of interviews, walk-throughs, and 
observations to determine whether those controls were in operation; 
documentation of key controls; testing and evaluation of the operating 
effectiveness of the key controls; and reporting the results to our 
ICWG and SAT. The review of our financial management systems was 
performed consistent with OMB Circular A-127, and included analyzing 
the Statement on Auditing Standard 70 audit reports of our shared 
service providers. Our review of financial management systems to 
determine that they were in substantial compliance with the Federal 
Financial Management Improvement Act included consideration of all 
information available, including the results of financial management 
systems reviews and the auditor’s opinions on GAO’s financial 
statements and on internal controls over financial reporting and the 
auditor’s report on compliance with laws and regulations. 

* Knowledge-sharing survey. The Office of Public Affairs implemented 
its first reader survey of both internal and external readers of the 
GAO Management News to identify suggestions for enhancing the content 
and format. 

The studies above resulted in internal products or briefings in fiscal 
year 2009 that are not available publicly. 

[End of Goal 4] 

[End of Part II, Performance Information] 

Part III: Financial Information: 

From the Chief Financial Officer: 

[Refer to PDF for picture of Sallyanne Harper, Chief Financial Officer] 

Source: See Image Sources. 

November 13, 2009: 

I am pleased to report that during fiscal year 2009 the U.S. Government 
Accountability Office continued to honor its commitment to lead by 
example in government financial management. For the 23rd consecutive 
year, independent auditors gave us an unqualified opinion on our 
financial statements citing no material weaknesses and no major 
compliance problems. The financial statements that follow were 
prepared, audited, and made publicly available as an integral part of 
this performance and accountability report (PAR) 45 days after the end 
of the fiscal year. Our fiscal year 2008 PAR received a certificate of 
excellence in accountability reporting from the Association of 
Government Accountants (AGA). Our annual reports have received this AGA 
honor each year since we first applied with our fiscal year 2001 PAR. 

Consistent with our role as the “congressional watchdog,” we played a 
significant role in helping ensure government accountability during 
this year of fiscal stress. In addition to our statutory oversight role 
for the $700 billion Troubled Asset Relief Program (TARP), we received 
new legislative mandates to perform bimonthly reviews of state and 
local government spending under the American Recovery and Reinvestment 
Act (Recovery Act). Our responsibilities under TARP included reporting 
at least every 60 days on findings resulting from GAO’s oversight of 
the program’s performance and auditing the financial statements of TARP 
on an annual basis. For our work on the Recovery Act, we received a $25 
million appropriation available through fiscal year 2010 to meet our 
new responsibilities. To ensure that we held ourselves to the same 
level of accountability for the spending and recording of special 
appropriations as we hold the rest of the federal government, we 
instituted an oversight committee to review tracking, reporting, and 
spending controls; integrated Recovery Act funds control into our 
internal Office of Management and Budget Circular A-123 reviews; and 
consulted timely with our external auditors. 

Fiscal year 2009 marked our second year of operations with the Delphi 
financial system and contracted services provided by the Department of 
Transportation’s (DOT) Enterprise Services Center (ESC). We continue to 
be pleased with the services provided by both, and this year expanded 
those services with the ESC to include budgetary transaction 
processing. As a result, the majority of our accounting data entry is 
now handled by our service provider. We further expanded the use of the 
integrated capabilities of the system by migrating to a purchase card 
system and a procurement system, which are both fully compatible with 
Delphi. The technology of our new financial system also allowed us to 
prepare comparative quarterly financial statements for the first time 
in fiscal year 2009, taking advantage of fluctuation analyses to 
improve our insights into our operations. Finally, we engaged in a 
rigorous procurement for a new e-Gov automated travel transaction 
processing system with the contract being awarded for the GovTrip 
system. This new system, which will be fully integrated with the Delphi 
accounting system, will be tested and implemented during fiscal year 
2010. 

As we continue to expand our use of federal shared service providers, 
we recognize the accompanying challenges in terms of monitoring and 
maintaining sound internal controls. To address these challenges, we 
have adopted a more comprehensive approach in reviewing the 
effectiveness of controls throughout the processes regardless of the 
physical location where systems are operated and data entry services 
are performed. For example, we now test all business cycles and key 
areas, such as financial reporting, payroll expenses, and entitywide 
controls, with a focus on processing integration points and process 
changes. We also review independent auditors’ reports on our service 
providers to ensure that we are able to proactively address any issues 
with appropriate compensating controls. All of these efforts 
contributed to our independent auditors providing a positive opinion on 
the effectiveness of our internal controls again this year. 

During fiscal year 2009, our Human Capital Office planned and initiated 
the migration to a new Web-based human resources management system, HR 
Connect. The first phase of the implementation, which automated many of 
the personnel processing activities associated with payroll, was rolled 
out on schedule and under budget. In subsequent phases, HR Connect will 
consolidate and streamline a patchwork of existing stand-alone human 
capital systems. The full implementation of HR Connect will move us 
toward achieving our vision of having modern, integrated, and user-
friendly human capital practices, processes, and tools that are both 
efficient and effective. 

Looking ahead to fiscal year 2010, we will continue our progress in 
achieving more efficient and effective financial operations and overall 
agency operations. A few of the challenges we face include upgrading to 
a new version of our integrated procurement system, Prism; maintaining 
financial operations during new releases of the Delphi system; 
completing the implementation of a payment document flow system; 
transitioning to our new eTravel system, GovTrip; and obtaining an 
automated solution to better integrate and manage budget and staff 
resource planning activities. Each of these efforts is a key component 
in extending our use of fully automated and integrated financial 
systems. Furthermore, we continue to serve as a member of the DOT 
Financial Management Business Council, participating in a project to 
transform GAO’s financial coding structure to align with the executive 
branch’s migration to the Common Government Accounting Classification 
Structure. 

Our continued focus on these “behind the scenes” improvements to our 
business processes is consistent with our efforts to achieve our 
strategic goal of being a model federal agency, while striving to 
support the Congress in meeting its constitutional responsibilities to 
help improve government performance and ensure its accountability for 
the benefit of the American people. 

Signed by: 

Sallyanne Harper: 
Chief Financial Officer: 

[End of From the Chief Financial Officer] 

Audit Advisory Committee’s Report: 

The Audit Advisory Committee (the Committee) assists the Comptroller 
General in overseeing the U.S. Government Accountability Office’s (GAO) 
financial operations. As part of that responsibility, the Committee 
meets with agency management and its internal and external auditors to 
review and discuss GAO’s external financial audit coverage, the 
effectiveness of GAO’s internal controls over its financial operations, 
and its compliance with certain laws and regulations that could 
materially impact GAO’s financial statements. GAO’s external auditors 
are responsible for expressing an opinion on the conformity of GAO’s 
audited financial statements with the U.S. generally accepted 
accounting principles. The Committee reviews the findings of the 
internal and external auditors, and GAO’s responses to those findings, 
to ensure that GAO’s plan for corrective action includes appropriate 
and timely follow-up measures. In addition, the Committee reviews the 
draft Performance and Accountability Report, including its financial 
statements, and provides comments to management who have primary 
responsibility for the Performance and Accountability Report. The 
Committee met three times with respect to its responsibilities as 
described above. During two of these sessions, the Committee met with 
the internal and external auditors without GAO management being present 
and discussed with the external auditors the matters that are required 
to be discussed by generally accepted auditing standards. Based on 
procedures performed as outlined above, we recommend that GAO’s audited 
statements and footnotes be included in the 2009 Performance and 
Accountability Report. 

Signed by: 

Sheldon S. Cohen: 
Chairman: 
Audit Advisory Committee: 

[End of Audit Advisory Committee’s Report] 

Independent Auditor’s Report: 

Clifton Gunderson LLP: 
Certified Public Accountants & Consultants: 
11710 Beltsville Drive, Suite 300: 
Calverton, Maryland 20705-3106: 
Offices in 17 states and Washington, DC: 	
tel: 301-931-2050: 		
fax: 301-931-1710: 		
[hyperlink, http://www.cliftoncpa.com] 

Independent Auditor's Report: 

Acting Comptroller General of the United States: 

In our audits of the Government Accountability Office (GAO) for fiscal 
years 2009 and 2008, we found: 

* The financial statements are presented fairly, in all material 
respects, in conformity with accounting principles generally accepted 
in the United States of America. 

* GAO maintained, in all material respects, effective internal control 
over financial reporting. 

* GAO's financial management systems substantially complied with the 
applicable requirements of the Federal Financial Management Improvement 
Act of 1996 (FFMIA). 

* No reportable noncompliance with laws and regulations we tested. 

The following sections discuss in more detail (1) these conclusions, 
(2) our conclusions on Management's Discussion and Analysis (MD&A) and 
other supplementary information, and (3) our objectives, scope and 
methodology. 

Opinion on Financial Statements: 

In our opinion, the financial statements including the accompanying 
notes present fairly, in all material respects, in conformity with 
accounting principles generally accepted in the United States of 
America, GAO's assets, liabilities and net position as of September 30, 
2009 and 2008, and net costs; changes in net position; and budgetary 
resources for the years then ended. 

Opinion on Internal Control: 

In our opinion, GAO maintained, in all material respects, effective 
internal control over financial reporting as of September 30, 2009 that 
provided reasonable assurance that misstatements, losses, or 
noncompliance material in relation to the financial statements would be 
prevented or detected and corrected on a timely basis. Our opinion is 
based on criteria established under 31 U.S.C. 3512 (c), (d), the 
Federal Managers' Financial Integrity Act (FMFIA). 

We noted other nonreportable matters involving internal control and its 
operation that we will communicate in a separate management letter.
			
Opinion on FFMIA Compliance: 

In our opinion, GAO's financial management systems, as of September 30, 
2009, substantially complied with the following requirements of FFMIA: 
(1) federal financial management systems requirements, (2) federal 
accounting standards, and (3) the United States Government Standard 
General Ledger (SGL) at the transaction level. Our opinion is based on 
criteria established under FFMIA for federal financial management 
systems, accounting principles generally accepted in the United States 
of America, and the SGL. 

Compliance with Laws and Regulations: 

Our tests for compliance with selected provisions of laws and 
regulations disclosed no instances of noncompliance that would be 
reportable under Government Auditing Standards. The objective of our 
audit was not to provide an opinion on overall compliance with laws and 
regulations. Accordingly, we do not express such an opinion.
This conclusion on laws and regulations is intended solely for the use 
of the management of GAO, OMB, and Congress and is not intended to be, 
and should not be, used by anyone other that these specified parties. 

Consistency of Other Information: 

The MD&A included as Part I is not a required part of the financial 
statements but is supplementary information required by accounting 
principles generally accepted in the United States of America. We have 
applied certain limited procedures, which consisted principally of 
inquiries of management regarding the methods of measurement and 
presentation of the required supplementary information. However, we did 
not audit the information and express no opinion on it. 

The introductory information, performance information and appendixes 
listed in the table of contents are presented for additional analysis 
and are not a required part of the financial statements. Such 
information has not been subjected to the auditing procedures applied 
in the audit of the financial statements and, accordingly, we express 
no opinion on them. 

Objectives, Scope, and Methodology: 

Management is responsible for (1) preparing the financial statements in 
conformity with accounting principles generally accepted in the United 
States of America, (2) establishing and maintaining effective internal 
control over financial reporting, and evaluating its effectiveness, (3) 
ensuring that GAO's financial management systems substantially comply 
with FFMIA requirements, and (4) complying with applicable laws and 
regulations. GAO management evaluated the effectiveness of GAO's 
internal control over financial reporting as of September 30, 2009, 
based on criteria established under FMFIA. GAO management's assertion 
is included in the Overview of Financial Management and Controls. 

We are responsible for planning and performing our audits to obtain 
reasonable assurance about whether the financial statements are free of 
material misstatement. An audit includes examining, on a test basis, 
evidence supporting the amounts and disclosures in the financial 
statements. An audit also includes assessing the accounting principles 
used and significant estimates made by management, as well as 
evaluating the overall financial statement presentation. 

We are responsible for planning and performing our examination to 
obtain reasonable assurance about whether management maintained, in all 
material respects, effective internal control over financial reporting 
as of September 30, 2009. Our examination included obtaining an 
understanding of the entity and its operations, including its internal 
control over financial reporting; considering GAO's process for 
evaluating and reporting on internal control over financial reporting 
the GAO is required to perform by FMFIA; assessing the risk that a 
material misstatement exists in the financial statements and the risk 
that a material weakness exists in internal control over financial 
reporting; evaluating the design and operating effectiveness of 
internal control and assessing risk; testing relevant internal controls 
over financial reporting; and performing such other procedures as we 
considered necessary in the circumstances. We did not test all internal 
controls relevant to operating objectives as broadly defined by the 
Federal Managers' Financial Integrity Act. 

An entity's internal control over financial reporting is a process 
effected by those charged with governance, management, and other 
personnel, the objectives of which are to provide reasonable assurance 
that (1) transactions are properly recorded, processed, and summarized 
to permit the preparation of financial statements in accordance with 
accounting principles generally accepted in the United States, and 
assets are safeguarded against loss from unauthorized acquisition, use, 
or disposition; and (2) transactions are executed in accordance with 
the laws governing the use of budget authority and other laws and 
regulations that could have a direct and material effect on the 
financial statements. 

Because of inherent limitations in any internal control, misstatements 
due to error or fraud may occur and not be detected. Also, projections 
of any evaluation of the internal control to future periods are subject 
to the risk that the internal control may become inadequate because of 
changes in conditions, or that the degree of compliance with the 
policies or procedures may deteriorate. 

We are responsible for planning and performing our examination to 
obtain reasonable assurance about whether GAO's financial management 
systems substantially complied with the three FFMIA requirements. We 
examined, on a test basis, evidence about GAO's substantial compliance 
with those requirements, and performed such other procedures as we 
considered necessary in the circumstances. 

We are also responsible for testing compliance with selected provisions 
of laws and regulations that have a direct and material effect on the 
financial statements. We did not test compliance with all laws and 
regulations applicable to GAO. We limited our tests of compliance to 
selected provisions of those laws and regulations that have a direct 
and material effect on the financial statements and those required by 
OMB audit guidance that we deemed applicable to the financial 
statements for the fiscal year ended September 30, 2009. We caution 
that noncompliance may occur and not be detected by these tests and 
that such testing may not be sufficient for other purposes. 

We conducted our audits and examinations in accordance with auditing 
standards generally accepted in the United States of America; 
Government Auditing Standards, issued by the Comptroller General of the 
United States; attestation standards established by the American 
Institute of Certified Public Accountants; and OMB audit guidance. We 
believe that our audits and examinations provide a reasonable basis for 
our opinions. 

Signed by: 

Clifton Gunderson LLP: 
Calverton, Maryland: 
November 10, 2009: 

[End of Independent Auditor's Report] 

Purpose of Each Financial Statement: 

The financial statements on the next four pages present the following 
information: 

* The balance sheet presents the combined amounts we had available to 
use (assets) versus the amounts we owed (liabilities) and the residual 
amounts after liabilities were subtracted from assets (net position). 

* The statement of net cost presents the annual cost of our operations. 
The gross cost less any offsetting revenue earned from our activities 
is used to arrive at the net cost of work performed under our four 
strategic goals. 

* The statement of changes in net position presents the accounting 
items that caused the net position section of the balance sheet to 
change from the beginning to the end of the fiscal year. 

* The statement of budgetary resources presents how budgetary resources 
were made available to us during the fiscal year and the status of 
those resources at the end of the fiscal year. 

Financial Statements: 
U.S. Government Accountability Office: 
Balance Sheets: 
As of September 30, 2009 and 2008: 
Dollars in thousands: 

Assets: 

Intragovernmental: Funds with the U.S. Treasury and cash (Note 3); 
2009: $101,710; 
2008: $70,472. 

Intragovernmental: Accounts receivable; 
2009: $983; 
2008: $602. 

Total Intragovernmental; 
2009: $102,693; 
2008: $71,074. 

Property and equipment, net (Note 4); 
2009: $32,684; 
2008: $39,964. 

Other; 
2009: $307; 
2008: $284. 

Total Assets; 
2009: $135,684; 
2008: $111,322. 

Liabilities: 

Intragovernmental: Accounts payable; 
2009: $14,857; 
2008: $11,252. 

Intragovernmental: Employee benefits (Note 6); 
2009: $3,662; 
2008: $2,965. 

Intragovernmental: Workers' compensation (Note 7); 
2009: $2,764; 
2008: $2,514. 

Total Intragovernmental; 
2009: $21,283; 
2008: $16,731. 

Accounts payable and other; 
2009: $12,500; 
2008: $15,711. 

Salaries and benefits (Note 6); 
2009: $23,069; 
2008: $21,304. 

Accrued annual leave and other (Note 5); 
2009: $33,351; 
2008: $30,953. 

Workers' compensation (Note 7); 
2009: $16,332; 
2008: $16,687. 

Capital leases (Note 9); 
2009: $4,814; 
2008: $7,018. 

Total Liabilities; 
2009: $111,349; 
2008: $108,404. 

Net Position: Unexpended appropriations; 
2009: $48,330; 
2008: $24,064. 

Net Position: Cumulative results of operations; 
2009: ($23,995); 
2008: ($21,146). 

Total Net Position (Note 13); 
2009: $24,335; 
2008: $2,918. 

Total Liabilities and Net Position; 
2009: $135,684; 
2008: $111,322. 

The accompanying notes are an integral part of these statements. 

[End of Balance Sheets] 

Financial Statements: 
U.S. Government Accountability Office: 
Statements of Net Cost: 
For Fiscal Years Ended September 30, 2009 and 2008: 
Dollars in thousands: 

Net Costs by Goal (Note 2): 

Goal 1: Well-Being/Financial Security of American People; 
2009: $191,316; 
2008: $201,159. 

Less: reimbursable services; 
2009: [Empty]; 
2008: [Empty]. 

Net goal costs; 
2009: $191,316; 
2008: $201,159. 

Goal 2: Changing Security Threats/Challenges of Global Interdependence; 
2009: $173,645; 
2008: $161,144. 

Less: reimbursable services; 
2009: ($5,283); 
2008: [Empty]. 

Net goal costs; 
2009: $168,362; 
2008: $161,144. 

Goal 3: Transforming the Federal Government's Role; 
2009: $182,384; 
2008: $153,719. 

Less: reimbursable services; 
2009: ($5,255); 
2008: ($3,145). 

Net goal costs; 
2009: $$177,129; 
2008: $150,574. 

Goal 4: Maximize the Value of GAO; 
2009: $27,658; 
2008: $22,706. 

Less: reimbursable services; 
2009: [Empty]; 
2008: ($91). 

Net goal costs; 
2009: $27,658; 
2008: $22,615. 

Less: reimbursable services not attributable to goals; 
2009: ($5,672); 
2008: ($5,890). 

Net Cost of Operations (Note 10); 
2009: $558,793; 
2008: $529,602. 

The accompanying notes are an integral part of these statements. 

[End of Statements of Net Cost] 

Financial Statements: 
U.S. Government Accountability Office: 
Statements of Changes in Net Position: 
For Fiscal Years Ended September 30, 2009 and 2008: 
Dollars in thousands: 

Cumulative Results of Operations, Beginning of fiscal year; 
2009: ($21,146); 
2008: ($17,953). 

Budgetary Financing Sources - Appropriations used; 
2009: $530,184; 
2008: $503,368. 

Other Financing Sources: Intragovernmental transfer of property and 
equipment; 
2009: ($1); 
2008: ($3). 

Other Financing Sources: Federal employee retirement benefit costs paid 
by OPM and imputed to GAO (Note 6); 
2009: $25,761; 
2008: $23,044. 

Total Financing Sources; 
2009: $555,944; 
2008: $526,409. 

Net Cost of Operations; 
2009: ($558,793); 
2008: ($529,602). 

Net Change; 
2009: ($2,849); 
2008: ($3,193). 

Cumulative Results of Operations, End of fiscal year; 
2009: ($23,995); 
2008: ($21,146). 

Unexpended Appropriations, Beginning of fiscal year; 
2009: $24,064; 
2008: $30,562. 

Budgetary Financing Sources and Uses: Current year appropriations; 
2009: $556,000; 
2008: $501,000. 

Budgetary Financing Sources and Uses: Appropriations transferred in; 
2009: [Empty]; 
2008: $250. 

Budgetary Financing Sources and Uses: Permanently not available; 
2009: ($1,550); 
2008: ($4,380). 

Budgetary Financing Sources and Uses: Appropriations used; 
2009: ($530,184); 
2008: ($503,368). 

Total unexpended appropriations, End of fiscal year; 
2009: $48,330; 
2008: $24,064. 

Net Position; 
2009: $24,335; 
2008: $2,918. 

The accompanying notes are an integral part of these statements. 

[End of Statements of Changes in Net Position] 

Financial Statements: 
U.S. Government Accountability Office: 
Statements of Budgetary Resources: 
For Fiscal Years Ended September 30, 2009 and 2008: 
Dollars in thousands: 

Budgetary Resources (Note 11): Unobligated balance, brought forward 
October 1; 
2009: $6,756; 
2008: $10,010. 

Budgetary Resources (Note 11): Recoveries of prior year unpaid 
obligations; 
2009: $2,370; 
2008: $2,014. 

Budgetary Resources (Note 11): Budget authority: Appropriations; 
2009: $556,000; 
2008: $501,000. 

Budgetary Resources (Note 11): Budget authority: Spending authority 
from offsetting collections: Earned and collected; 
2009: $16,299; 
2008: $10,462. 

Budgetary Resources (Note 11): Budget authority: Spending authority 
from offsetting collections: Change in receivable from Federal 
sources: 
2009: $373; 
2008: ($385). 

Budgetary Resources (Note 11): Budget authority: Spending authority 
from offsetting collections: Change in unfilled customer orders- 
advance received; 
2009: $433; 
2008: ($91). 

Budgetary Resources (Note 11): Budget authority: Spending authority 
from offsetting collections: Change in unfilled customer orders- 
without advance; 
2009: ($125); 
2008: $125. 

Budgetary Resources (Note 11): Budget authority: Spending authority 
from offsetting collections: Subtotal; 
2009: $572,980; 
2008: $511,111. 

Budgetary Resources (Note 11): Nonexpenditure transfers, net and 
actual; 
2009: [Empty]; 
2008: $250. 

Budgetary Resources (Note 11): Permanently not available; 
2009: ($1,550); 
2008: ($4,380). 

Total Budgetary Resources; 
2009: $580,556; 
2008: $519,005. 

Status of Budgetary Resources: Obligations incurred: Direct; 
2009: $536,692; 
2008: $500,362. 

Status of Budgetary Resources: Obligations incurred: Reimbursable; 
2009: $13,491; 
2008: $11,887. 

Status of Budgetary Resources: Obligations incurred: Subtotal; 
2009: $550,183; 
2008: $512,249. 

Status of Budgetary Resources: Unobligated balance-Apportioned; 
2009: $26,463; 
2008: $2,588. 

Status of Budgetary Resources: Unobligated balance not available; 
2009: $3,910; 
2008: $4,168. 

Total Status of Budgetary Resources; 
2009: $580,556; 
2008: $519,005. 

Change in Obligated Balance: Obligated balance, net: Unpaid Obligated 
balance, brought forward October 1; 
2009: $64,448; 
2008: $54,606. 

Change in Obligated Balance: Uncollected customer payments from Federal 
sources, brought forward October 1; 
2009: ($730); 
2008: ($990). 

Change in Obligated Balance: Total, Unpaid Obligation, net, brought 
forward October 1; 
2009: $63,718; 
2008: $53,616. 

Change in Obligated Balance: Obligations incurred; 
2009: $550,183; 
2008: $512,249. 

Change in Obligated Balance: Less: Gross Outlays; 
2009: ($539,944); 
2008: ($500,393). 

Change in Obligated Balance: Recoveries of prior-year unpaid 
obligations, actual; 
2009: ($2,370); 
2008: ($2,014). 

Change in Obligated Balance: Change in uncollected customer payments 
from Federal sources; 
2009: ($248); 
2008: $260. 

Change in Obligated Balance: Obligated balance, net, end of period: 
Unpaid Obligations; 
2009: $72,317; 
2008: $64,448. 

Change in Obligated Balance: Obligated balance, net, end of period: 
Uncollected customer payments from Federal sources; 
2009: ($978); 
2008: ($730). 

Change in Obligated Balance: Total, Unpaid obligations, net, end of 
period; 
2009: $71,339; 
2008: $63,718. 

Net Outlays: Gross outlays; 
2009: $539,944; 
2008: $500,393. 

Net Outlays: Less: Offsetting collections; 
2009: ($16,733); 
2008: ($10,372). 

Net outlays; 
2009: $523,211; 
2008: $490,021. 

The accompanying notes are an integral part of these statements. 

[End of Statements of Budgetary Resources] 

[End of Financial Statements] 

Notes to Financial Statements: 

Note 1. Summary of Significant Accounting Policies: 

Reporting Entity: 

The accompanying financial statements present the financial position, 
net cost of operations, changes in net position, and budgetary 
resources of the United States Government Accountability Office (GAO). 
GAO, an agency in the legislative branch of the federal government, 
supports the Congress in carrying out its constitutional 
responsibilities. GAO carries out its mission primarily by conducting 
audits, evaluations, analyses, research, and investigations and 
providing the information from that work to the Congress and the public 
in a variety of forms. The financial activity presented relates 
primarily to the execution of GAO’s congressionally approved budget. 
GAO’s budget consists of an annual appropriation covering salaries and 
expenses and revenue from reimbursable audit work and rental income. 
The revenue from audit services and rental income is included on the 
Statement of Budgetary Resources as “reimbursable services.” The 
financial statements, except for federal employee benefit costs paid by 
the Office of Personnel Management (OPM) and imputed to GAO, do not 
include the effects of centrally administered assets and liabilities 
related to the federal government as a whole, such as interest on the 
federal debt, which may in part be attributable to GAO. The Davis-Bacon 
trust’s assets, related liabilities, revenues, and costs related to 
beneficiary payments are not those of GAO and therefore are not 
included in the accompanying financial statements. See Note 14, Davis-
Bacon Act Trust Function. 

Basis of Accounting: 

GAO’s financial statements have been prepared on the accrual basis and 
the budgetary basis of accounting in conformity with generally accepted 
accounting principles for the federal government. Accordingly, revenues 
are recognized when earned and expenses are recognized when incurred, 
without regard to the receipt or payment of cash. These principles 
differ from budgetary reporting principles. The differences relate 
primarily to the capitalization and depreciation of property and 
equipment, as well as the recognition of other long-term assets and 
liabilities. The statements were also prepared in conformity with the 
most current version of OMB Circular A-136, Financial Reporting 
Requirements. 

Assets: 

Intragovernmental assets are those assets that arise from transactions 
with other federal entities. Funds with the U.S. Treasury comprise the 
majority of intragovernmental assets on GAO’s Balance Sheet. 

Funds with the U.S. Treasury: 

The U.S. Treasury processes GAO’s receipts and disbursements. Funds 
with the U.S. Treasury represent appropriated funds Treasury will 
provide to pay liabilities and to finance authorized purchase 
commitments. 

Accounts Receivable: 

GAO’s accounts receivable are due principally from federal agencies for 
reimbursable services; therefore, GAO has not established an allowance 
for doubtful accounts. 

Property and Equipment: 

The GAO headquarters building qualifies as a multiuse heritage asset, 
is GAO’s only heritage asset, and is reported with property and 
equipment on the balance sheet. The designation of multiuse heritage 
asset is a result of both being listed in the National Register of 
Historic Places and being used in general government operations. 
Statement of Federal Financial Accounting Standards No. 29 requires 
accounting for multiuse heritage assets as general property, plant, and 
equipment to be included in the balance sheet and depreciated. 
Maintenance of the building has been kept on a current basis. The 
building is depreciated on a straight-line basis over 25 years. 

Generally, property and equipment individually costing more than 
$15,000 are capitalized at cost. Building improvements and leasehold 
improvements are capitalized when the cost is $25,000 or greater. Bulk 
purchases of lesser-value items that aggregate more than $150,000 are 
also capitalized at cost. Assets are depreciated on a straight-line 
basis over the estimated useful life of the property as follows: 
building improvements, 10 years; computer equipment, software, and 
capital lease assets, ranging from 3 to 6 years; leasehold 
improvements, 5 years; and other equipment, ranging from 5 to 20 years. 
GAO’s property and equipment have no restrictions as to use or 
convertibility except for the restrictions related to the GAO 
building’s classification as a multiuse heritage asset. 

Liabilities: 

Liabilities represent amounts that are likely to be paid by GAO as a 
result of transactions that have already occurred. 

Accounts Payable: 

Accounts payable consists of amounts owed to federal agencies and 
commercial vendors for goods and services received. 

Federal Employee Benefits: 

GAO recognizes its share of the cost of providing future pension 
benefits to eligible employees over the period of time that they render 
services to GAO. The pension expense recognized in the financial 
statements equals the current service cost for GAO’s employees for the 
accounting period less the amount contributed by the employees. OPM, 
the administrator of the plan, supplies GAO with factors to apply in 
the calculation of the service cost. These factors are derived through 
actuarial cost methods and assumptions. The excess of the recognized 
pension expense over the amount contributed by GAO and employees 
represents the amount being financed directly through the Civil Service 
Retirement and Disability Fund administered by OPM. This amount is 
considered imputed financing to GAO (see Note 6). 

The Federal Employees’ Compensation Act (FECA) provides income and 
medical cost protection to covered federal civilian employees injured 
on the job, employees who have incurred a work-related occupational 
disease, and beneficiaries of employees whose deaths are attributable 
to a job-related injury or occupational disease. Claims incurred for 
benefits for GAO employees under FECA are administered by the 
Department of Labor (Labor) and are paid, ultimately, by GAO (see Note 
7). 

GAO recognizes a current-period expense for the future cost of 
postretirement health benefits and life insurance for its employees 
while they are still working. GAO accounts for and reports this expense 
in its financial statements in a manner similar to that used for 
pensions, with the exception that employees and GAO do not make current 
contributions to fund these future benefits. 

Federal employee benefit costs paid by OPM and imputed to GAO are 
reported on the Statements of Changes in Net Position and are also 
included as a component of net cost by goal on the Statement of Net 
Cost. 

Annual, Sick, and Other Leave: 

Annual leave is recognized as an expense and a liability as it is 
earned; the liability is reduced as leave is taken. The accrued leave 
liability is principally long term in nature. Sick leave and other 
types of leave are expensed as leave is taken. All leave is funded when 
expensed. 

Contingencies: 

GAO has certain claims and lawsuits pending against it. GAO’s policy is 
to include provision in the financial statements for any losses 
considered probable and estimable. Management believes that losses from 
certain other claims and lawsuits are reasonably possible but are not 
material to the fair presentation of GAO’s financial statements and 
provision for these losses is not included in the financial statements. 

Estimates: 

Management has made certain estimates and assumptions when reporting 
assets, liabilities, revenue, expenses, and in the note disclosures. 
Actual results could differ from these estimates. 

Note 2: Intragovernmental Costs and Exchange Revenue: 

Intragovernmental costs arise from exchange transactions made between 
two reporting entities within the federal government in contrast with 
public costs, which arise from exchange transactions made with a 
nonfederal entity. Intragovernmental costs and exchange revenue for the 
periods ended September 30, 2009, and September 30, 2008, are as 
follows: 

Dollars in thousands: 

Goal 1: Well-being/Financial Security of American People: 

Intragovernmental costs: 
2009: $49,421; 
2008: $52,132. 

Public costs: 
2009: $141,895; 
2008: $149,027. 

Net goal 1 costs: 
2009: $191,316; 
2008: $201,159. 

Goal 2: Changing Security Threats/Challenges of Global Interdependence: 

Intragovernmental costs: 
2009: $44,368; 
2008: $41,409. 

Public costs: 
2009: $129,277; 
2008: $119,735. 

Net goal 2 costs:  
2009: $173,645; 
2008: $161,144. 

Goal 2 intragovernmental earned revenue: 
2009: ($5,283); 
2008: [Empty]. 

Net goal 2 costs: 
2009: $168,362; 
2008: $161,144. 

Goal 3: Transforming the Federal Government’s Role: 

Intragovernmental costs: 
2009: $45,260; 
2008: $39,680. 

Public costs: 
2009: $137,124; 
2008: $114,039. 

Total goal 3 costs: 
2009: $182,384; 
2008: $153,719. 

Goal 3 intragovernmental earned revenue: 
2009: ($5,255); 
2008: ($3,145). 

Net goal 3 costs: 
2009: $177,129; 
2008: $150,574. 

Goal 4: Maximize the Value of GAO: 

Intragovernmental costs: 
2009: $10,084; 
2008: $12,160. 

Public costs: 
2009: $17,574; 
2008: $10,546. 

Total goal 4 costs: 
2009: $27,658; 
2008: $22,706. 

Goal 4 Intergovernmental earned revenue: 
2009: [Empty]; 
2008: ($91). 

Net Goal 4 Costs: 
2009: $27,658; 
2008: $22,615. 

Earned revenue not attributable to goals: 

Intragovernmental: 
2009: ($5,534); 
2008: ($5,757). 

Public: 
2009: ($138); 
2008: ($133). 

Total earned revenue not attributable to goals:
2009: ($5,672); 
2008: ($5,890). 

[End of Table: Intragovernmental Costs and Exchange Revenue] 

Goal 1 has no associated year to date intragovernmental revenue. The 
increase in intergovernmental earned revenue for both goals 2 and 3 is 
a result of reimbursements for GAO’s new statutory oversight role in 
2009 over the Troubled Asset Relief Program (TARP). 

Note 3. Funds with the U.S. Treasury: 

GAO’s funds with the U.S. Treasury consist of only appropriated funds. 
The status of these funds as of September 30, 2009, and September 30, 
2008, is as follows: 

Dollars in thousands: 

Unobligated balance: Available; 
2009: $26,461; 
2008: $2,586. 

Unobligated balance: Unavailable; 
2009: $3,910; 
2008: $4,168. 

Obligated balances not yet disbursed; 
2009: $71,339; 
2008: $63,718. 

Total funds with U.S. Treasury; 
2009: $101,710; 
2008: $70,472. 

[End of Table: Funds with the U.S. Treasury] 

A significant portion of the unobligated balance available in fiscal 
year 2009 is due to the remaining unobligated balance of GAO’s 
supplemental multiyear appropriation (approximately $20,800,000) for 
efforts that include reviewing states’ uses of the American Recovery 
and Reinvestment Act (Recovery Act) funds. 

Note 4. Property and Equipment, Net: 

The composition of property and equipment as of September 30, 2009, is 
as follows: 
Dollars in thousands: 

Classes of property and equipment: Building; 
Acquisition value: $15,664; 
Accumulated depreciation: $13,158; 
Book value: $2,506. 

Classes of property and equipment: Land; 
Acquisition value: $1,191; 
Accumulated depreciation: [Empty]; 
Book value: $1,191. 

Classes of property and equipment: Building improvements; 
Acquisition value: $109,841; 
Accumulated depreciation: $96,780; 
Book value: $13,061. 

Classes of property and equipment: Computer and other equipment and 
software; 
Acquisition value: $40,258; 
Accumulated depreciation: $30,360; 
Book value: $9,898. 

Classes of property and equipment: Leasehold improvements; 
Acquisition value: $6,238; 
Accumulated depreciation: $6,037; 
Book value: $201. 

Classes of property and equipment: Assets under capital lease; 
Acquisition value: $20,954; 
Accumulated depreciation: $15,127; 
Book value: $5,827. 

Classes of property and equipment: Total property and equipment; 
Acquisition value: $194,146; 
Accumulated depreciation: $161,462; 
Book value: $32,684. 

[End of Property and Equipment, Net] 

The composition of property and equipment as of September 30, 2008, is 
as follows: 

Dollars in thousands: 

Classes of property and equipment: Building; 
Acquisition value: $15,664; 
Accumulated depreciation: $12,531; 
Book value: $3,133. 

Classes of property and equipment: Land; 
Acquisition value: $1,191; 
Accumulated depreciation: [Empty]; 
Book value: $1,191. 

Classes of property and equipment: Building improvements; 
Acquisition value: $108,652; 
Accumulated depreciation: $93,367; 
Book value: $15,285. 

Classes of property and equipment: Computer and other equipment and 
software; 
Acquisition value: $38,579; 
Accumulated depreciation: $27,689; 
Book value: $10,890. 

Classes of property and equipment: Leasehold improvements; 
Acquisition value: $6,242; 
Accumulated depreciation: $5,803; 
Book value: $439. 

Classes of property and equipment: Assets under capital lease; 
Acquisition value: $27,237; 
Accumulated depreciation: $18,211; 
Book value: $9,026. 

Classes of property and equipment: Total property and equipment; 
Acquisition value: $197,565; 
Accumulated depreciation: $157,601; 
Book value: $39,964. 

[End of Table: Classes of property and equipment] 

Note 5. Liabilities Not Covered by Budgetary Resources: 

The liabilities on GAO’s Balance Sheets as of September 30, 2009, and 
September 30, 2008, include liabilities not covered by budgetary 
resources, which are liabilities for which congressional action is 
needed before budgetary resources can be provided. Although future 
appropriations to fund these liabilities are likely and anticipated, it 
is not certain that appropriations will be enacted to fund these 
liabilities. The composition of liabilities not covered by budgetary 
resources as of September 30, 2009, and September 30, 2008, is as 
follows: 

Dollars in thousands: 

Intragovernmental liabilities-Workers' compensation; 
2009: $2,764; 
2008: $2,514. 

Salaries and benefits-Comptrollers' General retirement plan[A]; 
2009: $1,961; 
2008: $1,975. 

Accrued annual leave and other; 
2009: $33,351; 
2008: $30,953. 

Workers' compensation[B]; 
2009: $16,332; 
2008: $16,687. 

Capital leases; 
2009: $4,814; 
2008: $7,018. 

Total liabilities not covered by budgetary resources; 
2009: $59,222; 
2008: $59,147. 

[A] See Note 6 for further discussion of the Comptrollers’ General 
retirement plan. 

[B] See Note 7 for further discussion of workers’ compensation. 

[End of Table: Liabilities Not Covered by Budgetary Resources] 

Note 6. Federal Employee Benefits: 

All permanent employees participate in the contributory Civil Service 
Retirement System (CSRS) or the Federal Employees Retirement System 
(FERS). Temporary employees and employees participating in FERS are 
covered under the Federal Insurance Contributions Act (FICA). To the 
extent that employees are covered by FICA, the taxes they pay to the 
program and the benefits they will eventually receive are not 
recognized in GAO’s financial statements. GAO makes contributions to 
CSRS, FERS, and FICA and matches certain employee contributions to the 
thrift savings component of FERS. All of these payments are recognized 
as operating expenses. 

In addition, all permanent employees are eligible to participate in the 
contributory Federal Employees Health Benefits Program (FEHBP) and 
Federal Employees’ Group Life Insurance (FEGLI) Program and may 
continue to participate after retirement. GAO makes contributions 
through OPM to FEHBP and the FEGLI Program for active employees to pay 
for their current benefits. GAO’s contributions for active employees 
are recognized as operating expenses. Using the cost factors supplied 
by OPM, GAO has also recognized an expense in its financial statements 
for the estimated future cost of postretirement health benefits and 
life insurance for its employees. These costs are financed by OPM and 
imputed to GAO. 

Amounts owed to OPM and Treasury as of September 30, 2009, and 
September 30, 2008, are $3,662,000 and $2,965,000, respectively, for 
FEHBP, the FEGLI Program, FICA, FERS, and CSRS contributions and are 
shown on the Balance Sheet as an employee benefits liability.
Details of the major components of GAO’s federal employee benefit costs 
for the periods ended September 30, 2009, and September 30, 2008, are 
as follows: 

Dollars in thousands: 

Federal Employee Benefits Costs: Federal employee retirement benefit 
costs paid by OPM and imputed to GAO: Estimated future pension 
costs(CSRS/FERS); 
2009: $9,372; 
2008: $8,584. 

Federal Employee Benefits Costs: Federal employee retirement benefit 
costs paid by OPM and imputed to GAO: Estimated future postretirement 
health and life insurance (FEHBP/FEGLIP); 
2009: $16,389; 
2008: $14,460. 

Federal Employee Benefits Costs: Federal employee retirement benefit 
costs paid by OPM and imputed to GAO: Total; 
2009: $25,761; 
2008: $23,044. 

Federal Employee Benefits Costs: Pension expenses(CSRS/FERS); 
2009: $33,895; 
2008: $31,070. 

Federal Employee Benefits Costs: Health and life insurance expenses 
(FEHBP/FEGLIP); 
2009: $17,377; 
2008: $16,098. 

Federal Employee Benefits Costs: FICA payment made by GAO; 
2009: $19,436; 
2008: $17,578. 

Federal Employee Benefits Costs: Thrift Savings Plan-matching 
contribution by GAO; 
2009: $11,436; 
2008: $10,391. 

[End of Table: Federal Employee Benefits] 

Comptrollers General and their surviving beneficiaries who qualify and 
so elect to participate are paid retirement benefits by GAO under a 
separate retirement plan. These benefits are paid from current year 
appropriations. Because GAO is responsible for future payments under 
this plan, the estimated present value of accumulated plan benefits of 
$1,961,000 as of September 30, 2009, and $1,975,000 as of September 30, 
2008, is included as a component of salary and benefit liabilities on 
GAO’s Balance Sheet. 

Note 7. Workers’ Compensation: 

GAO utilizes the services of an independent actuarial firm to calculate 
its FECA liability. GAO recorded an estimated liability for claims 
incurred but not reported as of September 30, 2009, and September 30, 
2008, which is expected to be paid in future periods. This estimated 
liability of $16,332,000 and $16,687,000 as of September 30, 2009, and 
September 30, 2008, respectively, is reported on GAO’s Balance Sheet. 
GAO also recorded a liability for amounts paid to claimants by Labor as 
of September 30, 2009, and September 30, 2008, of $2,764,000 and 
$2,514,000, respectively, but not yet reimbursed to Labor by GAO. The 
amount owed to Labor is reported on GAO’s Balance Sheet as an 
intragovernmental liability. 

Note 8. Building Lease Revenue: 

In fiscal year 2000 the U.S. Army Corps of Engineers (USACE) entered 
into an agreement with GAO to lease the entire third floor of the GAO 
building. USACE provided all funding for the third floor renovation. 
Occupancy began August 3, 2000, for an initial period of 3 years, with 
options to renew on an annual basis for 7 additional years. Total 
rental revenue to GAO includes a base rent, which remains constant for 
the entire 10-year period, plus operating expense reimbursements at a 
fixed amount for the first 3 years, with escalation clauses from year 4 
through year 10 if the option years are exercised. Beginning in fiscal 
year 2002, USACE leased additional space on the sixth floor with 
occupancy lasting through the original lease term. 

Rent received by GAO for fiscal year 2009 and 2008 was $5,264,000 and 
$5,194,000, respectively. These amounts are included in reimbursable 
services shown on the Statement of Net Costs. Total rental revenue for 
the remaining period of the 10-year lease, fiscal year 2010, is 
$5,179,000. Negotiations for an additional 10-year extension of this 
lease are in process between GAO and USACE. Once signed, this agreement 
would cover fiscal years 2011 through 2020. 

Note 9. Leases: 

Capital Leases: 

GAO has entered into capital leases for office equipment and computer 
equipment under which the ownership of the equipment covered under the 
leases transfers to GAO when the leases expire. When GAO enters into 
these leases, the present value of the future lease payments is 
capitalized, net of imputed interest, and recorded as a liability. The 
acquisition value and accumulated depreciation of GAO’s capital leases 
are shown in Note 4, Property and Equipment, Net. As of September 30, 
2009, and September 30, 2008, the capital lease liability was 
$4,814,000 and $7,018,000, respectively. This decrease is due to the 
lease payments made throughout fiscal year 2009 with no significant 
additional capital leases entered into during the year.
These lease agreements are written as contracts with a base year and 
option years. The option years are subject to the availability of 
funds. Early termination of the leases for reasons other than default 
is subject to a negotiation between the parties. These leases are lease-
to-ownership agreements. GAO’s leases are short term in nature and no 
liability exists beyond the years shown in the table below. GAO’s 
estimated future minimum lease payments under the terms of the leases 
are as follows: 

Dollars in thousands: 

Fiscal year ending September 30: 2010; 
Total: $2,663. 

Fiscal year ending September 30: 2011; 
Total: $2,332. 

Fiscal year ending September 30: 2012; 
Total: $162. 

Fiscal year ending September 30: 2013; 
Total: $2. 

Total estimated future lease payments: $5,159. 

Less: imputed interest: ($345). 

Net capital lease liability: $4,814. 

[End of Table: Capital Leases] 

Operating Leases: 

GAO leases office space, predominately for field offices, from the 
General Services Administration and has entered into various other 
operating leases for office communication and computer equipment. Lease 
costs for office space and equipment for fiscal year 2009 and fiscal 
year 2008 amounted to approximately $11,780,000 and $12,040,000, 
respectively. Leases for equipment under operating leases are generally 
less than 1 year; therefore there are no associated future minimum 
lease payments. Estimated future minimum lease payments for field 
office space under the terms of the leases are as follows: 

Dollars in thousands: 

Fiscal year ending September 30: 2010; 
Total: $8,231. 

Fiscal year ending September 30: 2011; 
Total: $6,641. 

Fiscal year ending September 30: 2012; 
Total: $6,368. 

Fiscal year ending September 30: 2013; 
Total: $5,441. 

Fiscal year ending September 30: 2014; 
Total: $4,772. 

Fiscal year ending September 30: 2015 and thereafter; 
Total: $10,639. 

Total estimated future lease payments: $42,042. 

[End of Table: Operating Leases] 

Leased property and equipment must be capitalized if certain criteria 
are met (see Capital Leases description). Because property and 
equipment covered under GAO’s operating leases do not satisfy these 
criteria, GAO’s operating leases are not reflected on the Balance 
Sheets. However, annual lease costs under the operating leases are 
included as components of net cost by goal in the Statements of Net 
Cost. 

Note 10. Net Cost of Operations: 

Expenses for salaries and related benefits for fiscal year 2009 and 
fiscal year 2008 amounted to $441,438,000 and $414,406,000, 
respectively, which were about 79 percent of GAO’s annual net cost of 
operations in fiscal year 2009 and 78 percent in fiscal year 2008. 
Included in the net cost of operations are federal employee benefit 
costs paid by OPM and imputed to GAO of $25,761,000 in fiscal year 2009 
and $23,044,000 in fiscal year 2008. 

Revenues from reimbursable services are shown as an offset against the 
full cost of the goal to arrive at its net cost. Earned revenues that 
are insignificant or cannot be associated with a major goal are shown 
in total, the largest component of which is rental revenue from the 
lease of space in the GAO building. Revenues from reimbursable services 
for fiscal year 2009 and fiscal year 2008 amounted to $16,210,000 and 
$9,126,000, respectively. Further details of the intragovernmental 
components are provided in Note 2. 

The net cost of operations represents GAO’s operating costs that must 
be funded by financing sources other than revenues earned from 
reimbursable services. These financing sources are presented in the 
Statement of Changes in Net Position. 

Note 11. Budgetary Resources: 

Budgetary resources made available to GAO include current year 
appropriations, spending authority from budget transfers, prior years’ 
unobligated balances, and reimbursements arising from both revenues 
earned by GAO from providing goods and services to other federal 
entities for a price (reimbursable services) and cost-sharing and pass-
through contract arrangements with other federal entities. In fiscal 
year 2009, in addition to appropriations made available for salaries 
and expenses, GAO received supplemental appropriations of $25,000,000, 
available through fiscal year 2010, to cover program reviews required 
by the Recovery Act. 

Earned revenue consists primarily of rent collected from USACE for 
lease of space and related services in the GAO building and program and 
financial audits of federal entities, such as TARP, the Securities and 
Exchange Commission, the Federal Deposit Insurance Program, and the 
Federal Housing Finance Agency. Earned revenue from rent is available 
indefinitely, subject to available obligation ceilings, and must be 
used to offset the cost of operating and maintaining the GAO 
headquarters building. Reimbursement from financial audits is available 
indefinitely, without limitations on its use, subject to annual 
obligation ceilings. GAO’s pricing policy for reimbursable services is 
to seek reimbursement for actual costs incurred, including overhead 
costs where allowed by law. Reimbursements from cost-sharing and pass-
through contract arrangements consisted primarily of collections from 
other federal entities (1) for the support of the Federal Accounting 
Standards Advisory Board and (2) to utilize GAO contracts to obtain 
services. The costs and reimbursements for cost-sharing and pass-
through contract arrangements are not included in the Statement of Net 
Cost. 

Fiscal year 2008 included budget authority transferred for the 
assessment of programs and activities funded under the heading “
Millennium Challenge Corporation” to include a review of financial 
controls and procurement practices. Fiscal year 2009 does not include 
any transfers of budget authority. 

Comparison of GAO’s fiscal year 2008 Statement of Budgetary Resources 
with the corresponding information presented in the 2010 President’s 
Budget is as follows: 

Dollars in thousands: 

Fiscal year 2008 Statement of Budgetary Resources; 
Budgetary Resources: $519,005; 
Obligations Incurred: $512,249. 

Unobligated balances, beginning of year - (prior year funds activity); 
Budgetary Resources: ($7,010); 
Obligations Incurred: [Empty]. 

Permanently not available – (prior year funds activity); 
Budgetary Resources: $4,380; 
Obligations Incurred: [Empty]. 

Spending Authority from offsetting collections – (prior year funds 
activity); 
Budgetary Resources: ($2,111); 
Obligations Incurred: ($1,249). 

Non-expenditure transfer; 
Budgetary Resources: ($250); 
Obligations Incurred: [Empty]. 

Other - rounding in President's Budget: 
Budgetary Resources: ($14); 
Obligations Incurred: [Empty]. 

2010 President's Budget - fiscal year 2008, actual; 
Budgetary Resources: $514,000; 
Obligations Incurred: $511,000. 

[End of Table: Budgetary Resources] 

As the fiscal year 2011 President’s Budget will not be published until 
February 2010, a comparison between the fiscal year 2009 data reflected 
on the Statement of Budgetary Resources and fiscal year 2009 data in 
the President’s Budget cannot be performed, though we expect similar 
differences will exist. The fiscal year 2011 President’s Budget will be 
available on the OMB’s Web site and directly from the Government 
Printing Office. 

Budgetary resources obligated for undelivered orders at the end of 
fiscal year 2009 and the end of fiscal year 2008 totaled $20,670,000 
and $15,237,000, respectively. GAO’s apportionments fall under Category 
A, quarterly apportionment. Apportionment categories of obligations 
incurred for fiscal years 2009 and 2008 are as follows: 

Dollars in thousands: 

Fiscal year ending September 30: Direct-Category A; 
2009: $536,692; 
2008: $500,362. 

Fiscal year ending September 30: Reimbursable-Category A; 
2009: $13,491; 
2008: $11,887. 

Fiscal year ending September 30: Total obligations incurred; 
2009: $550,183; 
2008: $512,249. 

[End of Table: Apportionment categories of obligations] 

Note 12. Reconciliation of Net Costs of Operations to Budget: 

Details of the relationship between budgetary resources obligated and 
the net costs of operations for the fiscal years ending September 30 
are as follows: 

Dollars in thousands: 

Fiscal year ending September 30: Resources Used to Finance Activities: 
Budgetary Resources Obligated: Obligation incurred; 
2009: $550,183
2008: $512,249. 

Fiscal year ending September 30: Resources Used to Finance Activities: 
Budgetary Resources Obligated: Less: spending authority from offsetting 
collections and recoveries; 
2009: ($19,351); 
2008: ($12,126). 

Fiscal year ending September 30: Resources Used to Finance Activities: 
Budgetary Resources Obligated: Obligations net of offsetting 
collections and recoveries; 
2009: $530,832; 
2008: $500,123. 

Fiscal year ending September 30: Resources Used to Finance Activities: 
Other resources: Intragovernmental transfer of property and equipment; 
2009: ($1); 
2008: ($3). 

Fiscal year ending September 30: Resources Used to Finance Activities: 
Other resources: Federal employee retirement benefit costs paid by OPM 
imputed to GAO; 
2009: $25,761
2008: $23,044. 

Fiscal year ending September 30: Resources Used to Finance Activities: 
Other resources: Net other resources used to finance activities; 
2009: $25,760; 
2008: $23,041. 

Fiscal year ending September 30: Resources Used to Finance Activities: 
Other resources: Total resources used to finance activities; 
2009: $556,592; 
2008: $523,164. 

Fiscal year ending September 30: Resources used to finance items not 
part of the net cost of operations; Change in unliquidated obligations; 
2009: ($5,127)
2008: $5,338). 

Fiscal year ending September 30: Resources used to finance items not 
part of the net cost of operations; Reduction in lease liability and 
other; 
2009: ($2,203); 
2008: ($1,303). 

Fiscal year ending September 30: Resources used to finance items not 
part of the net cost of operations; Assets capitalized; 
2009: ($3,784); 
2008: ($9,514). 

Fiscal year ending September 30: Resources used to finance items not 
part of the net cost of operations; Net decrease in receivables not 
generating resources until collected and other adjustments; 
2009: ($17); 
2008: $17. 

Fiscal year ending September 30: Resources used to finance items not 
part of the net cost of operations; Total resources used to fund items 
not part of the net cost of operations; 
2009: ($11,131); 
2008: ($5,462). 

Fiscal year ending September 30: Resources used to finance items not 
part of the net cost of operations; Total resources used to finance Net 
Cost of Operations; 
2009: $545,461; 
2008: $517,702. 

Fiscal year ending September 30: Components of net costs that will not 
require or generate resources in the current period; 
Decrease) in workers’ compensation; 
2009: ($118); 
2008: ($670). 

Fiscal year ending September 30: Components of net costs that will not 
require or generate resources in the current period; 
Increase in accrued annual leave; 
2009: $2,398; 
2008: $1,381. 

Fiscal year ending September 30: Components of net costs that will not 
require or generate resources in the current period; Total Components 
of net cost that will not require or generate resources in the current 
period; 
2009: $2,280; 
2008: $711. 

Fiscal year ending September 30: Costs that do not require resources: 
Depreciation and other; 
2009: $11,052; 
2008: $11,189. 

Fiscal year ending September 30: Net Cost of Operations; 
2009: $558,793; 
2008: $529,602. 

[End of Table: Reconciliation of Net Costs of Operations to Budget] 

Note 13. Net Position: 

Net position on the Balance Sheets comprises unexpended appropriations 
and cumulative results of operations. Unexpended appropriations is the 
sum of the total unobligated appropriations and undelivered goods and 
services. Cumulative results of operations represent the excess of 
financing sources over expenses since inception. Details of the 
components of GAO’s cumulative results of operations for the fiscal 
years ended September 30, 2009 and 2008, are as follows: 

Dollars in thousands: 

Investment in property and equipment, net; 
2009: $32,684; 
2008: $39,964. 

Rent related reimbursable funds expended in current year; 
2009: $2,378; 
2008: ($2,116). 

Other-supplies inventory; 
2009: $165; 
2008: $153. 

Liabilities not covered by budgetary resources; 
2009: ($59,222); 
2008: ($59,147). 

Cumulative results of operations; 
2009: ($23,995); 
2008: ($21,146). 

[End of Table: Net Position] 

Liabilities not covered by budgetary resources are liabilities for 
which congressional action is needed before budgetary resources can be 
provided. See Note 5 for components. 

Note 14. Davis-Bacon Act Trust Function: 

GAO is responsible for administering for the federal government the 
trust function of the Davis-Bacon Act revenue and costs related to 
beneficiary payments and prepares separate, audited financial schedules 
for this fund. GAO maintains this fund to pay claims relating to 
violations of the Davis-Bacon Act and Contract Work Hours and Safety 
Standards Act. Under these acts, Labor investigates violation 
allegations to determine if federal contractors owe additional wages to 
covered employees. If Labor concludes that a violation has occurred, 
GAO collects the amount owed from the contracting federal agency, 
deposits the funds into an account with the U.S. Treasury, and remits 
payment to the employee. GAO is accountable to the Congress and to the 
public for the proper administration of the assets held in the trust. 
Trust assets and liabilities under GAO’s administration as of September 
30, 2009, totaled approximately $4,781,000. These assets are not the 
assets of GAO or the federal government and are held for distribution 
to appropriate claimants. During fiscal year 2009, revenues and costs 
related to beneficiary payments in the trust amounted to $528,000. 

[End of Notes to Financial Statements] 

[End of Part III] 

Part IV: From the Inspector General: 

From the Inspector General: 

Office of the Inspector General: 
United States Government Accountability Office: 

Memorandum: 
	
Date: November 5, 2009: 

To: Acting Comptroller General – Gene L. Dodaro: 

From: [Signed by] Inspector General – Frances Garcia: 

Subject: GAO Management Challenges and Performance Measures: 

We have considered management’s assessment of the agency’s management 
challenges. Based on our work and institutional knowledge, we agree 
that physical security, information security, and human capital 
continue to be management challenges that may affect GAO’s performance. 
We also examined, and agree with, management’s assessment of progress 
made in addressing these challenges. 

During fiscal year 2009, GAO claimed $43 billion in financial benefits 
in its accomplishment reports. Based on our audit of accomplishment 
reports of $1 billion or more—$25 billion in total or 58 percent of the 
benefits reported for the fiscal year—we believe that GAO had a 
reasonable basis for claiming the financial benefits we audited. In 
addition, we assessed four of GAO’s people performance measures—staff 
development, staff utilization, leadership, and organizational climate—
and made recommendations to enhance disclosure and understanding about 
the measures. We also initiated a review of the agency’s timeliness 
measure, and based on methodological and other issues raised during our 
review, GAO has agreed that the issues are worthy of further 
examination and will be fully analyzed. As a result, we will monitor 
the changes made and reassess the measure when those changes are 
completed. Finally, we are completing a review of the agency’s 
testimony performance measure for fiscal year 2008. 

[End of letter from the Inspector General] 

[End of Part IV] 

Part V: Appendixes: 

Appendixes 

1. Accomplishments and Other Contributions: 

In pursuing our strategic goals during fiscal year 2009, we recorded 
hundreds of accomplishments and numerous other contributions. This 
appendix provides details on the most significant of these. In 
reporting financial benefits, nonfinancial benefits, and contributions 
(designated by an F, N, or C in the item number below), we are holding 
ourselves accountable for the resources we received to implement our 
strategic plan. 

Typically, the accomplishments describe work we completed in prior 
fiscal years because it takes time to implement recommendations, 
realize benefits, and record them. Contributions, which often refer to 
work completed in fiscal year 2009, describe instances in which we 
provided information or recommendations that aided congressional 
decision making or informed the public debate to a significant degree. 
At the end of each accomplishment and contribution summary, we list the 
reference number of products associated with the work discussed. In the 
online PDF version of this document, readers can link directly to these 
products if they want additional information. 

Strategic Goal 1: Provide timely, quality service to the Congress and 
the federal government to address current and emerging challenges to 
the well-being and financial security of the American people. 

The health needs of an aging and diverse population: 

1.01.N. Improving Oversight of Clinical Laboratories: 

The Centers for Medicare & Medicaid Services (CMS) oversees 
organizations that survey clinical laboratories for quality of 
services. In response to our recommendations for improving oversight, 
CMS collected data from survey organizations in 2007 and 2008 that 
permit comparison of their results, took steps to ensure that changes 
to inspection requirements are approved before implementation, enhanced 
a database that allows the identification of labs that lose 
accreditation, and established a process and closer communication with 
survey organizations, and conducts regular internal calls to discuss 
enforcement activities. 
[hyperlink, http://www.gao.gov/products/GAO-06-416] 

1.02.N. Encouraging Efficiency by Profiling Medicare Physicians’ 
Practice Patterns: 

Because physicians prescribe health care services for Medicare 
beneficiaries, those with inefficient practice patterns can lead to 
excessive costs. In 2007, we recommended that the CMS develop a system 
that identifies individual physicians with inefficient practice 
patterns and use the results to improve program efficiency, and in 2008 
the Congress mandated that the agency develop a physician feedback 
program. The agency has begun sending out reports to selected 
physicians in several localities to profile their resource use compared 
to that of their peers, which includes elements that address our 
recommendations. 
[hyperlink, http://www.gao.gov/products/GAO-07-307] 

1.03.N. Improving Oversight of Medicare Part D Grievances: 

During our work related to the Medicare Part D program, we found 
weaknesses in CMS oversight of beneficiary grievances. We recommended 
that CMS undertake efforts to improve the consistency, reliability, and 
usefulness of grievances data reported by plan sponsors and undertake 
systematic oversight of these data. In response, CMS has clarified 
requirements in order to improve the reliability and consistency of 
grievance data, hired a contractor to routinely monitor the data, and 
developed a plan to target its audits to monitor plan sponsor 
compliance with CMS grievance reporting requirements. 
[hyperlink, http://www.gao.gov/products/GAO-08-719] 

1.04.N. Highlighting Weaknesses in the Food and Drug Administration’s 
Oversight of Medical Devices: 

In January 2009, we reported on weaknesses in the Food and Drug 
Administration’s (FDA) premarket oversight of medical devices that led 
it to approve marketing some of the highest-risk medical devices 
through a less-rigorous approval process designed for lower-risk items 
that does not require submission of clinical data. We recommended that 
FDA expeditiously classify the devices needing more rigorous review 
and, in April 2009, FDA announced its decision that manufacturers of 25 
types of devices marketed prior to 1976 must submit information on 
their safety and effectiveness. 
[hyperlink, http://www.gao.gov/products/GAO-09-190] 
[hyperlink, http://www.gao.gov/products/GAO-09-370T] 

1.05.N. Improving Oversight of Care in Nursing Homes: 

Since July 1998, GAO has made numerous recommendations to improve 
oversight of care in nursing homes, which is conducted through on-site 
surveys. CMS has taken multiple steps in the last 2 years to improve 
care oversight, including improving survey methodology, guidance on 
care quality standards, quality controls on survey information, and its 
management information systems. CMS also took steps to better track 
survey results. 
[hyperlink, http://www.gao.gov/products/GAO-08-517] 
[hyperlink, http://www.gao.gov/products/GAO-03-561] 
[hyperlink, http://www.gao.gov/products/GAO/HEHS-99-46] 

1.06.C. Improving Care for Returning Servicemembers: 

In March 2007, we testified about the challenges facing recovering 
servicemembers and in May 2007, the Departments of Defense (DOD) and 
Veterans Affairs (VA) established the Wounded, Ill, and Injured Senior 
Oversight Committee (SOC) to address identified problems. This year we 
testified that DOD and VA made substantial progress in jointly 
developing policies for servicemembers’ care and management, return to 
active duty, and transition from care provided by DOD to VA and for an 
improved disability evaluation system. In addition, the SOC reported on 
the feasibility of consolidating the DOD and VA disability evaluation 
systems. 
[hyperlink, http://www.gao.gov/products/GAO-09-540T] 
[hyperlink, http://www.gao.gov/products/GAO-07-606T] 
[hyperlink, http://www.gao.gov/products/GAO-07-589T] 

1.07.C. Undercover Operation Shows the Institutional Review Board 
System Is Vulnerable to Unethical Manipulation: 

Using fictitious companies, counterfeit documents, and a fictitious 
medical device, undercover investigators found that the Institutional 
Review Board (IRB) system is vulnerable to unethical manipulation. IRBs 
review and monitor human subjects research, with the intended purpose 
of protecting research subjects. However, we found that one company 
approved our bogus test protocol for a fake medical device after only 
minor edits. Two other companies rejected the fake protocol. As a 
result of our investigation, the deficient IRB was forced out of 
business after FDA issued it a warning letter; the Department of Health 
and Human Services (HHS) also indicated that it would take several 
actions. 
[hyperlink, http://www.gao.gov/products/GAO-09-448T] 

1.08.C. Investigating Fraud, Waste, and Abuse in Medicaid: 

For five states, we found that approximately 65,000 Medicaid 
beneficiaries acquired the same type of controlled substances from six 
or more medical practitioners during fiscal years 2006 and 2007. Such 
activities, known as “doctor shopping,” resulted in about $63 million 
in Medicaid payments. In the most egregious case, one beneficiary 
received prescriptions of the painkiller Vicodin from 112 different 
practitioners. The Administrator of CMS generally agreed with our four 
recommendations to help establish an effective fraud prevention system 
for the Medicare program. 
[hyperlink, http://www.gao.gov/products/GAO-09-957] 

Lifelong learning to enhance U.S. competitiveness: 

1.09.F. Changing Federal Student Loan Program Yields Savings: 

The Federal Family Education Loan Program reimburses private lenders if 
a borrower defaults. Designated lenders that meet certain requirements 
as “exceptional performers” can qualify for a 99 percent reimbursement 
rate rather than the standard 97 percent rate. The Congress authorized 
the Secretary of Education to terminate the exceptional performer 
program after a GAO study. GAO found that the program had not achieved 
its goals and recommended that it be eliminated. The Congress 
eliminated the program by enacting the College Cost Reduction and 
Access Act (Pub. L. No. 110-84). The Congressional Budget Office 
estimates savings of $1.7 billion over 10 years. 
[hyperlink, http://www.gao.gov/products/GAO-07-1087] 

Benefits and protections for workers, families, and children: 

1.10.N. Improving Access to Trade Adjustment Assistance Benefits: 

Our work on the Trade Adjustment Assistance (TAA) Program found that 
workers were not getting needed assistance to make training decisions, 
training enrollment was sometimes hampered by enrollment deadlines, 
qualification rules limited worker participation in wage insurance 
benefits, training fund allocation had weaknesses, and high costs 
limited participation in the Health Care Tax Credit (HCTC). The 
Congress amended the TAA Program to provide more funds for employment 
and case management services, simplify the training enrollment 
deadline, ease access to wage insurance benefits, improve the 
allocation of training funds, and make HCTC more affordable. 
[hyperlink, http://www.gao.gov/products/GAO-07-701] 
[hyperlink, http://www.gao.gov/products/GAO-07-702] 
[hyperlink, http://www.gao.gov/products/GAO-07-995T] 
[hyperlink, http://www.gao.gov/products/GAO-07-919] 
[hyperlink, http://www.gao.gov/products/GAO-08-165] 

1.11.N. Improving Disability Benefit Program: 

We reported that the Social Security Administration’s (SSA) Ticket to 
Work and Self-Sufficiency Program, which helps SSA beneficiaries return 
to work and stop receiving disability payments, lacked participation by 
SSA beneficiaries and service providers. We identified solutions that 
SSA incorporated into new regulations it issued in 2008, including 
allowing beneficiaries who are expected to improve medically to 
participate in the program, increasing payments to service providers, 
and allowing state vocational rehabilitation agencies and other service 
providers to receive payments to provide needed services to the same 
beneficiaries. 
[hyperlink, http://www.gao.gov/products/GAO-05-248] 

1.12.C. Performing Undercover Tests of the Department of Labor’s Wage 
and Hour Division: 

Using fictitious calling scenarios, our undercover investigators tested 
the complaint intake process at Labor’s Wage and Hour Division (WHD). 
WHD’s mission is to ensure that millions of workers are protected under 
the Fair Labor Standards Act. Our tests found that WHD frequently 
responded inadequately to complaints, leaving low-wage workers 
vulnerable to wage theft and other labor violations. We also identified 
at least 1,160 real employees whose complaints were inadequately 
investigated. After reviewing our findings, Labor announced that it 
would hire 250 more investigators. The Congress is also considering 
legislation that we suggested. 
[hyperlink, http://www.gao.gov/products/GAO-09-458T] 
[hyperlink, http://www.gao.gov/products/GAO-09-629] 

1.13.C. Improving Evaluation of Voluntary Protection Programs Regarding 
Workplace Safety: 

GAO found that limitations in internal controls and oversight of Labor’
s Occupational Safety and Health Administration (OSHA) voluntary 
protection programs (VPP) affected its ability to ensure that 
participating companies maintain effective workplace safety and health 
management systems. In response to GAO recommendations for additional 
oversight and additional controls, OSHA will evaluate VPPs, including 
conducting a comprehensive evaluation of its VPP and Alliance Program, 
to determine how the agency should best allocate its resources among 
cooperative programs, enforcement, and other agency activities. 
[hyperlink, http://www.gao.gov/products/GAO-09-395] 

1.14.C. Investigating the Death and Abuse of Children at Public and 
Private Schools: 

No federal regulations govern the use of restraint and seclusion in 
public and private schools. After finding hundreds of allegations that 
children across the nation were harmed or killed by these techniques, 
we examined the facts surrounding 10 case studies of abuse or death and 
found common themes, such as no evidence of physical aggression by the 
victim, lack of parental consent for the use of the techniques, and 
lack of training for staff. This investigation contributed to 
congressional and national public awareness of the issue, and we 
received an extraordinary number of inquiries from parents, teachers, 
and other concerned citizens. 
[hyperlink, http://www.gao.gov/products/GAO-09-719T] 

1.15.C. Improving Food Nutrition and Safety in Schools: 

To help the Congress better understand federal school meals programs 
before reauthorizing the Child Nutrition Act, GAO provided information 
on efforts to improve nutrition and reduce hunger by serving more 
children, ways to better ensure the safety of food served in schools, 
and strategies for reducing improper payments because of errors in 
counting school meals or claiming federal reimbursements. In response 
to GAO recommendations, federal agencies agreed to improve their 
notification procedures and instructions when recalling foods served in 
schools and to revise federal guidance and improve the review process 
to reduce improper payments. 
[hyperlink, http://www.gao.gov/products/GAO-09-156R] 
[hyperlink, http://www.gao.gov/products/GAO-09-584] 

Financial security for an aging population: 

1.16.C. Enhancing Governance and Management at the Pension Benefit 
Guaranty Corporation: 

GAO testified that poor economic conditions brought the Pension Benefit 
Guaranty Corporation (PBGC) new underfunded pension plan terminations, 
exacerbating its administrative and financial challenges. These 
developments highlight the continued need for improved governance and 
management at PBGC, yet its board continues with only three members, 
precluding sufficient oversight. GAO called for a restructured Board of 
Directors and various management and policy changes at PBGC. The Senate 
introduced a bill with such a change. GAO also reported that PBGC 
understated risk in its development of a new investment policy, which 
has now been suspended. 
[hyperlink, http://www.gao.gov/products/GAO-09-207] 
[hyperlink, http://www.gao.gov/products/GAO-09-291] 
[hyperlink, http://www.gao.gov/products/GAO-09-503T]
[hyperlink, http://www.gao.gov/products/GAO-09-702T] 

A responsive, fair, and effective system of justice: 

1.17.N. Improving Enforcement of Federal Crime Victims’ Rights: 

In the Crime Victims’ Rights Act of 2004 (CVRA), the Congress 
reaffirmed a number of rights for victims of federal crimes. As part of 
our review of the Department of Justice’s (DOJ) efforts to implement 
CVRA, we found that federal crime victims were generally not aware of 
mechanisms the law provided to ensure that their rights were enforced. 
In addition, we reported that DOJ’s process for reviewing victims’ 
complaints that their rights had been denied lacked independence and 
impartiality. We made several recommendations to DOJ to address these 
issues, and the agency agreed and has established a working group to 
pursue implementation. 
[hyperlink, http://www.gao.gov/products/GAO-09-54] 

1.18.N. Enhancing Federal Efforts to Combat Drug Trafficking: 

Because most of the nation’s illegal drug supply is smuggled from 
abroad, the Drug Enforcement Administration’s (DEA) partnerships with 
agencies that have border-related missions—especially Immigration and 
Customs Enforcement (ICE), the largest investigative agency of the 
Department of Homeland Security (DHS)—are important. In response to our 
recommendations, DEA and ICE reached an agreement in June 2009 to share 
intelligence and leverage investigative resources. The interagency 
agreement resolves a long-standing and counterproductive rivalry that 
for years has generated concerns about duplicative investigations and 
officer safety. 
[hyperlink, http://www.gao.gov/products/GAO-09-63] 

Promoting viable communities: 

1.19.C. Greening the Department of Housing and Urban Development’s 
Affordable Housing Programs: 

We identified areas where the Department of Housing and Urban 
Development’s (HUD) could be more proactive in promoting energy 
efficiency and green building. We reported that HUD had not completed 
regulations to require energy-efficient appliances in public housing or 
collected data to understand its multifamily housing portfolio utility 
costs. We reported that HUD should consider providing additional 
incentive points for energy efficiency and green building in 
competitive grant programs. Since our report was issued, HUD has made 
progress in these areas, including adding strong incentives for energy 
efficiency and green building in competitive grant programs funded 
through the American Recovery and Reinvestment Act of 2009 (Recovery 
Act). 
[hyperlink, http://www.gao.gov/products/GAO-09-46] 

1.20.C. Improving Oversight of HUBZone Firms by Addressing Program 
Deficiencies: 

Through the Small Business Administration’s (SBA) HUBZone program, 
small firms located in distressed areas received about $8 billion in 
federal contracts in fiscal year 2007. As a result of GAO’s work 
identifying multiple deficiencies in SBA’s management of the program, 
the agency updated its inaccurate map, took steps to improve its 
application review process by issuing a staff guide and obtaining and 
verifying applicant information, reviewed the continued eligibility of 
existing firms, and formalized the time frame for decertifying 
ineligible firms. These actions help to ensure that SBA has initiated 
steps to improve its oversight of HUBZone firms. 
[hyperlink, http://www.gao.gov/products/GAO-09-532T] 
[hyperlink, http://www.gao.gov/products/GAO-08-643] 
[hyperlink, http://www.gao.gov/products/GAO-08-975T] 

Responsible stewardship of natural resources and the environment: 

1.21.F. Strengthening Integrity of Federal Farm Programs: 

In 2008, we reported that because the Department of Agriculture (USDA) 
lacked a system to verify incomes, it provided farm program benefits to 
thousands of individuals whose incomes exceeded eligibility caps under 
the Farm Bill. We recommended that USDA work with the Internal Revenue 
Service (IRS) to develop a system for verifying the incomes of 
individuals and businesses before disbursing farm program benefits to 
them. As a result, in 2009 USDA and IRS began work on a verification 
system that is to prevent payments to ineligible individuals and 
businesses and is expected to save $99 million annually or about $472 
million over the next 5 years. 
[hyperlink, http://www.gao.gov/products/GAO-09-67] 

1.22.N. Improving Contract Management at the Department of Energy: 

For nearly 20 years, we have identified significant problems with 
Department of Energy (DOE) management of its contracts, which account 
for about 90 percent of DOE’s more than $20 billion budget. Solving 
these problems is even more critical because of the additional billions 
of Recovery Act dollars DOE received in 2009. Our work led to DOE 
identifying causes of its contract management problems and developing a 
corrective action plan. The House committee report for the fiscal year 
2010 energy and water development appropriations also cited our work in 
its direction to DOE to report within 60 days on specific activities 
undertaken to improve DOE cost estimating practices. 
[hyperlink, http://www.gao.gov/products/GAO-09-406T] 
[hyperlink, http://www.gao.gov/products/GAO-09-271] 

1.23.N. Transforming a Key Environmental Protection Agency Toxic 
Chemical Assessment Process: 

The Environmental Protection Agency (EPA) does not have sufficient 
chemical assessment data to determine whether it should establish 
controls to limit public exposure to many chemicals that may pose 
substantial health risks. To address this significant deficiency, we 
recommended that EPA streamline and increase the transparency of its 
Integrated Risk Information System (IRIS) chemical assessment process 
to support the development of timely and credible chemical risk 
information. In May 2009, EPA announced comprehensive IRIS assessment 
reforms that are responsive to our recommendations. 
[hyperlink, http://www.gao.gov/products/GAO-09-773T] 
[hyperlink, http://www.gao.gov/products/GAO-09-774T] 
[hyperlink, http://www.gao.gov/products/GAO-08-440] 
[hyperlink, http://www.gao.gov/products/GAO-08-743T] 
[hyperlink, http://www.gao.gov/products/GAO-08-1168T] 

1.24.C. Informing the Debate on Hardrock Mining Reform: 

We reported and testified on several issues central to the debate on 
reforming the General Mining Act of 1872—which for 137 years has 
allowed individuals to stake claims and obtain exclusive rights to the 
gold, silver, copper, and other valuable hardrock minerals on federal 
lands without having to pay a royalty. The House and Senate have 
undertaken reform of the General Mining Act, and although some 
provisions of the proposed legislation are still being worked out, key 
concerns in our work have been addressed in the legislative proposals, 
and our work has informed the public debate to a significant degree. 
[hyperlink, http://www.gao.gov/products/GAO-09-854T] 
[hyperlink, http://www.gao.gov/products/GAO-09-429T] 
[hyperlink, http://www.gao.gov/products/GAO-08-849R] 
[hyperlink, http://www.gao.gov/products/GAO-08-574T] 

1.25.C. Improving Federal Oil and Gas Management: 

In 2009, we reported on the Department of the Interior’s (Interior) 
management of federal oil and gas resources. We found gaps in 
oversight, which could lead to $100 million in uncollected royalties 
and other problems, raising further doubts about Interior’s ability to 
identify and collect royalties. We recommended a comprehensive 
reevaluation of Interior’s oil and gas programs to better ensure that 
the agency is collecting an appropriate amount for federal oil and gas 
leases. The Congress is using our findings and recommendations as it 
drafts legislation to address these issues. 
[hyperlink, http://www.gao.gov/products/GAO-09-549] 
[hyperlink, http://www.gao.gov/products/GAO-09-506T] 
[hyperlink, http://www.gao.gov/products/GAO-09-556T] 
[hyperlink, http://www.gao.gov/products/GAO-09-744] 
[hyperlink, http://www.gao.gov/products/GAO-09-1014T] 

A safe, secure, and effective national physical infrastructure: 

1.26.N. Improving Transparency at Federal Agencies: Transparency in 
federal activities is important to ensuring fairness and 
accountability. In response to GAO recommendations, the Federal 
Communications Commission, which is routinely lobbied by stakeholders, 
has improved the transparency of its rule-making process by making its 
rulemaking docket publicly available to all stakeholders at the same 
time. Similarly, the Department of Transportation (DOT) has improved 
transparency related to the Highway Account within the Highway Trust 
Fund by more closely monitoring the account balance and proactively 
communicating with stakeholders about an anticipated shortfall for 
fiscal year 2009. 
[hyperlink, http://www.gao.gov/products/GAO-09-316] 
[hyperlink, http://www.gao.gov/products/GAO-09-845T] 
[hyperlink, http://www.gao.gov/products/GAO-07-1046] 

1.27.N. Improving the Safety and Security of Federal Facilities: 

There is ongoing concern about the safety and security of federal 
facilities and their occupants because of the threat of terrorism. The 
Interagency Security Committee, chaired by DHS, decided to use our key 
practices in facility protection to guide its work and issued guidance 
to agencies on performance measurement. On the basis of our work, the 
Congress provided additional staff to address shortfalls at DHS’s 
Federal Protective Service, which protects about 9,000 federal 
buildings with over 1 million federal employees. Also, the Smithsonian 
Institution improved internal communications about risk management and 
security staff resources. 
[hyperlink, http://www.gao.gov/products/GAO-08-683] 
[hyperlink, http://www.gao.gov/products/GAO-07-1127] 
[hyperlink, http://www.gao.gov/products/GAO-06-612] 
[hyperlink, http://www.gao.gov/products/GAO-05-49] 

1.28.C. Restructuring the U.S. Postal Service to Achieve Sustainable 
Financial Viability: 

We have testified frequently before the Congress about the U.S. Postal 
Service’s (USPS) deteriorating financial situation caused by 
unprecedented volume decline and its inability to increase revenue or 
reduce costs enough to cover its expenses. We added USPS’s financial 
condition to our high-risk list in July 2009 and called for USPS to 
develop and implement a restructuring plan detailing how it plans to 
address the changing use of mail and better align its costs and 
revenues to achieve long-term financial viability. The Congress has 
often referred to our work as it considers legislative relief for USPS. 
[hyperlink, http://www.gao.gov/products/GAO-09-332T] 
[hyperlink, http://www.gao.gov/products/GAO-09-475T] 
[hyperlink, http://www.gao.gov/products/GAO-09-674T] 
[hyperlink, http://www.gao.gov/products/GAO-09-790T] 
[hyperlink, http://www.gao.gov/products/GAO-09-958T] 

1.29.C. Improving Transportation Safety and Mobility: 

We continued to highlight improvements needed in DOT’s efforts to 
reduce transportation accidents and address growing congestion. For 
example, we called for (1) better targeting of highway safety funding 
and greater efforts to address safety issues related to small air cargo 
carriers and (2) enhancements in funding of surface transportation 
infrastructure and the resolution of management issues that have arisen 
in transforming the nation’s air transportation system. Our work has 
assisted the Congress in overseeing these and other transportation 
programs. For example, we highlighted safety and mobility issues in 
recent congressional hearings. 
[hyperlink, http://www.gao.gov/products/GAO-09-219] 
[hyperlink, http://www.gao.gov/products/GAO-09-479T] 
[hyperlink, http://www.gao.gov/products/GAO-09-35] 
[hyperlink, http://www.gao.gov/products/GAO-09-614] 
[hyperlink, http://www.gao.gov/products/GAO-09-435T] 

1.30.C. Advising Policymakers and Consumers on the Digital Television 
Transition: 

In 2009, television broadcasters transitioned to digital-only 
broadcasts. We identified the digital television transition as an 
urgent issue for attention by the new Congress and administration. In a 
series of reports and testimonies, we found that despite high awareness 
of the transition, many people were not prepared. We reported that the 
government’s converter box subsidy program would likely face an 
increase in requests as the transition date approached, and as a 
result, required plans to cover higher demand and costs. The government 
developed such plans, providing more money for the subsidy program, 
ensuring consumers were prepared, and leading to a successful 
transition. 
[hyperlink, http://www.gao.gov/products/GAO-08-43] 
[hyperlink, http://www.gao.gov/products/GAO-08-510] 
[hyperlink, http://www.gao.gov/products/GAO-08-881T] 
[hyperlink, http://www.gao.gov/products/GAO-08-1040] 
[hyperlink, http://www.gao.gov/products/GAO-08-1161T] 

1.31.C. Informing Congressional Decision Making on Surface and Aviation 
Reauthorization: 

GAO has called for a reexamination of surface transportation programs—
which provide funding for surface infrastructure and safety—during the 
upcoming reauthorization of these programs. Recent proposals for 
reauthorization incorporate GAO’s findings on a host of surface 
transportation programs and embody the principles that we have 
articulated for restructuring these programs. GAO has also called for a 
timely reauthorization of the Federal Aviation Administration (FAA), 
noting that continued short-term extensions could delay key capital 
projects, including progress toward implementation of the Next 
Generation Air Transportation System. 
[hyperlink, http://www.gao.gov/products/GAO-09-845T] 
[hyperlink, http://www.gao.gov/products/GAO-09-377T] 
[hyperlink, http://www.gao.gov/products/GAO-09-219] 
[hyperlink, http://www.gao.gov/products/GAO-08-400] 
[hyperlink, http://www.gao.gov/products/GAO-08-843R] 

[End of Strategic Goal 1] 

Strategic Goal 2: Provide timely, quality service to the Congress and 
the federal government to respond to changing security threats and the 
challenges of global interdependence. 

Protect and secure the homeland from threats and disasters: 

2.01.F. Realizing Financial Benefits in Vessel Tracking System 
Procurement: 

We reviewed U.S. Coast Guard vessel tracking efforts and identified 
efficiency and effectiveness issues. We reported delays and large 
unobligated balances in the Coast Guard’s procurement of one tracking 
system. Obligating the available funds in fiscal year 2008 would have 
required obligating more than three times the amount that was obligated 
in total for the previous 3 fiscal years. In addition, the Coast Guard 
did not have a detailed spending plan laying out how it planned to 
obligate the available funds. Therefore, the Congress reduced the Coast 
Guard’s requested 2009 appropriation by $6 million. 
[hyperlink, http://www.gao.gov/products/GAO-09-337] 

2.02.N. Strengthening Aviation Security through Improved Passenger 
Watch-List Matching: 

In a series of reports and testimonies over the past 5 years, we 
reported on the Transportation Security Administration’s (TSA) efforts 
to develop and implement the Secure Flight program to assume from air 
carriers the function of matching passenger information against 
terrorist watch-list records. We recommended numerous actions to 
improve—among other things—systems testing, information security 
controls, privacy protections, and cost and schedule estimates. TSA’s 
actions to address these recommendations have reduced the risks 
associated with implementing Secure Flight and allowed the program to 
begin initial operations in January 2009. 
[hyperlink, http://www.gao.gov/products/GAO-09-292] 
[hyperlink, http://www.gao.gov/products/GAO-08-456T] 
[hyperlink, http://www.gao.gov/products/GAO-08-992] 
[hyperlink, http://www.gao.gov/products/GAO-06-374T] 
[hyperlink, http://www.gao.gov/products/GAO-05-356] 

2.03.N. Strengthening Methods to Assess National Emergency 
Preparedness: 

We reported that as of April 2009, the Federal Emergency Management 
Agency (FEMA) has no reliable means of assessing improvements in 
emergency preparedness. As a result, the House and Senate Committees on 
Appropriations have inserted requirements in the fiscal year 2010 
appropriation bills to address this issue. The Senate committee has 
required that FEMA brief the committee monthly on its progress in 
developing plans to measure the nation’s preparedness. The House 
committee has directed GAO to monitor the development of any DHS system 
to measure the effectiveness of grant programs and to report regularly 
to the committee on FEMA’s efforts. 
[hyperlink, http://www.gao.gov/products/GAO-09-369] 

2.04.N. Strengthening the Employment Verification Process: 

We found that the large number and variety of documents acceptable for 
proving employees’ work eligibility complicated the employment 
verification process used by millions of employers. DHS had not yet 
completed its review of the process, including revising the form used 
to certify employees’ work authorization. We recommended that DHS set a 
time frame for completing its review and issue regulations on changes 
to the process and form. In December 2008, DHS amended its regulations 
on the type of acceptable work eligibility documents to strengthen the 
integrity of the employment verification process. 
[hyperlink, http://www.gao.gov/products/GAO-05-813] 

2.05.C. Exposing Significant Fraud Vulnerabilities in State’s Passport-
Issuance Process: 

We found that terrorists or criminals could steal an American citizen’s 
identity, use basic counterfeiting skills to create fraudulent 
documentation, and obtain a genuine passport from the State Department 
(State). Undercover investigators obtained four genuine passports from 
State using these methods in a simulation of identity theft. In the 
most egregious case, an investigator obtained a passport using the 
Social Security number of a man who died in 1965. In response to our 
work, State officials said that they took several immediate actions, 
including the elimination of production targets for 2009. Officials 
told us that more actions are under way. 
[hyperlink, http://www.gao.gov/products/GAO-09-447] 
[hyperlink, http://www.gao.gov/products/GAO-09-583R] 

2.06.C. Bolstering Information Security at Federal Agencies: 

We informed the Congress on the threats/vulnerabilities confronting 
federal systems and identified needed improvements to sufficiently 
safeguard sensitive information. We made about 160 recommendations to 
better protect the confidentiality, integrity, and availability of 
federal systems and some of the most sensitive information possessed by 
the federal government. Based on our prior recommendations, numerous 
agencies, including FAA, IRS, the Securities and Exchange Commission 
(SEC), the Federal Deposit Insurance Corporation, and DHS, bolstered 
their security programs and strengthened controls to prevent, limit, 
and detect unauthorized access to information resources. 
[hyperlink, http://www.gao.gov/products/GAO-09-136] 
[hyperlink, http://www.gao.gov/products/GAO-09-195] 
[hyperlink, http://www.gao.gov/products/GAO-09-203] 
[hyperlink, http://www.gao.gov/products/GAO-09-661T] 
[hyperlink, http://www.gao.gov/products/GAO-09-546] 

Ensure military capabilities and readiness: 

2.07.F. Contributing to Properly Funding the Military’s Needs: 

In a number of reviews, we analyzed DOD’s base budget request for 
fiscal year 2009 and DOD’s approach for requesting the funds and 
reporting obligations for overseas contingency operations. Our analysis 
of unobligated balances (i.e., funding that has been approved or is 
available but not yet committed for a particular purpose); operations 
and maintenance execution trends; and active, reserve, and civilian 
personnel expenditures resulted in financial benefits of $2.3 billion. 
In response to our contingency operations work, DOD has taken steps to 
improve transparency in its funding requests and the reliability of its 
cost reporting. 
[hyperlink, http://www.gao.gov/products/GAO-09-302] 

2.08.N. Improving DOD’s Sexual Assault Prevention and Response Program: 

In our report on DOD’s program to prevent and respond to incidents of 
sexual assault, we made a number of recommendations to improve 
implementation of the program, for example, by analyzing installation-
level assault data to better target resources and evaluating factors 
that may discourage servicemembers from accessing mental health 
services following an assault. As a result of this work, DOD is 
currently developing a centralized database of assault incidents and 
has completed an assessment of the military health system’s support of 
the program, and Army Central Command and individual bases have taken 
actions in response to our site visits. 
[hyperlink, http://www.gao.gov/products/GAO-08-924] 

2.09.N. Assessing the U.S. Military Drawdown in Iraq: 

In our report, we recommended that the Secretary of Defense, in 
consultation with U.S. Central Command and the military departments, 
take steps to clarify the chain of command over logistical operations 
in support of the retrograde effort—movement of materiel from Iraq to 
Kuwait. Recently, DOD officials told us that this report formed the 
basis for a restructuring of the logistical chain of command in support 
of the retrograde effort. Specifically the 1st Theater Sustainment 
Command was put in charge of the retrograde effort, while several 
supporting organizations were also emplaced to assist the command in 
this mission. 
[hyperlink, http://www.gao.gov/products/GAO-08-930] 

2.10.N. Assessing DOD’s Ability to Provide Trained and Ready Forces for 
Military Operations: 
In numerous reports and testimonies on military operations in Iraq and 
Afghanistan, we identified actions to improve DOD’s ability to provide 
trained and ready forces, supply and reset equipment, strengthen force 
protection for deployed troops, and plan for troop drawdown. Our work 
has helped frame significant issues for congressional and public 
debate, and prompted DOD and the Congress to take action. For example, 
the Congress has required DOD to report on plans to improve supply 
distribution in support of operational commanders. 
[hyperlink, http://www.gao.gov/products/GAO-09-380T] 
[hyperlink, http://www.gao.gov/products/GAO-09-220R] 
[hyperlink, http://www.gao.gov/products/GAO-09-720] 
[hyperlink, http://www.gao.gov/products/GAO-07-807] 

2.11.N. Providing the Impetus for Weapon System Acquisition Reform: 

Over the years, GAO has recommended changes in DOD’s requirements, 
funding, and acquisition processes to help prevent poor program 
outcomes, such as cost growth in major weapon programs, which 
cumulatively amounted to almost $300 billion (fiscal year 2009 dollars) 
for DOD’s 2008 portfolio of major defense programs. The President and 
congressional defense committees have cited our work as an impetus for 
the Weapon System Acquisition Reform Act of 2009. The act emphasizes 
improving cost estimates, assessing technological maturity, and 
conducting early disciplined systems engineering, as recommended in 
GAO’s body of work on weapons programs. 
[hyperlink, http://www.gao.gov/products/GAO-09-295R] 
[hyperlink, http://www.gao.gov/products/GAO-08-619] 
[hyperlink, http://www.gao.gov/products/GAO-08-1060] 
[hyperlink, http://www.gao.gov/products/GAO-01-288] 
[hyperlink, http://www.gao.gov/products/GAO/NSIAD-99-162] 

2.12.N. Reducing Spending on and Terminating Poor-Performing Defense 
Programs: 

In 2009, GAO reported on the performance and risks in many of DOD’s 
major defense acquisitions programs. We found that DOD’s portfolio has 
grown from 77 to 96 programs and its investment has grown from $1.2 
trillion to $1.6 trillion (fiscal year 2009 dollars). The 
administration used our work to identify over $7 billion in potential 
budget reductions for fiscal year 2010 and to terminate some poor 
performing programs. Also, subsequent to our report on the technical 
and financial risks in the $159 billion Future Combat System program, a 
major portion of the program was terminated. The Office of Management 
and Budget (OMB) estimates that this will result in net savings of 
$22.9 billion. 
[hyperlink, http://www.gao.gov/products/GAO-09-326SP] 
[hyperlink, http://www.gao.gov/products/GAO-09-288] 
[hyperlink, http://www.gao.gov/products/GAO-09-338] 
[hyperlink, http://www.gao.gov/products/GAO-07-866] 

2.13.C. Reducing Risks Facing the Global Positioning System: 

In 2009, GAO identified risks in acquisition programs supporting the 
Global Positioning System (GPS) that could lead to degradation in 
capability that supports vital military operations, the transportation 
sector, search and rescue operations, and computer networks and other 
infrastructures that rely on GPS for synchronizing purposes. GAO’s work 
focused worldwide attention on the need for better coordination and 
oversight for GPS. As a result, officials from DOD and other federal 
agencies, other countries, and the commercial sector are fully aware of 
the concerns with the GPS program and the need to address acquisition 
delays and plan for potential impacts. 
[hyperlink, http://www.gao.gov/products/GAO-09-325] 

2.14.C. Improving Management of DOD’s Contractors Supporting 
Contingency Operations: 

GAO’s examination of DOD’s reliance on contractor support for 
contingency operations has resulted in numerous recommendations and DOD 
actions. For example, in response to our recommendations DOD has taken 
the following actions: (1) issued new DOD-wide guidance that 
establishes DOD’s doctrine for managing and overseeing contractors in 
contingency operations, (2) developed training programs on contractor 
management for forces deploying to Iraq and Afghanistan, and (3) 
undertaken a review of its use of contractors in Iraq and Afghanistan 
intended to determine if DOD relies too heavily on contractors in 
contingency operations. 
[hyperlink, http://www.gao.gov/products/GAO-09-362T] 
[hyperlink, http://www.gao.gov/products/GAO-09-615] 
[hyperlink, http://www.gao.gov/products/GAO-09-114R] 
[hyperlink, http://www.gao.gov/products/GAO-08-1087] 

2.15.C. Enhancing Defense Base Realignment and Closure Accountability: 

The 2005 Base Realignment and Closure (BRAC) round is the fifth round 
undertaken by DOD since 1988 and is the biggest, most complex, and 
costliest BRAC round ever. Our analyses of DOD’s BRAC budget led to a 
recommendation that DOD take action to better explain its anticipated 
dollar savings after full BRAC implementation in 2011. In response, DOD 
for the first time provided a more descriptive explanation of these 
expected dollar savings in its 2009 budget submission to the Congress. 
[hyperlink, http://www.gao.gov/products/GAO-09-217] 
[hyperlink, http://www.gao.gov/products/GAO-08-159] 

Advance and protect U.S. international Interests: 

2.16.N. Accounting for Weapons Provided to Afghan National Security 
Forces: 

We found that DOD did not establish clear guidance for U.S. personnel 
to follow when obtaining, transporting, and storing weapons for Afghan 
national security forces. This led to significant lapses in 
accountability, including failure to maintain complete records for over 
half of the 375,000 weapons reported to have been shipped to 
Afghanistan. Moreover, despite U.S. training efforts, Afghan forces 
could not fully safeguard and account for weapons and sensitive 
equipment. As a result of our review and recommendations, DOD revised 
its weapons accountability procedures to include serial number tracking 
and more systematic inventory checks. 
[hyperlink, http://www.gao.gov/products/GAO-09-267] 
[hyperlink, http://www.gao.gov/products/GAO-09-366T] 

2.17.C. Combating Firearms Trafficking to Mexico: 

We found that the U.S. government lacks a coordinated strategy to stem 
the flow of firearms from the United States to Mexico. We also found 
that over 20,000 firearms seized in Mexico were traced to the United 
States—about 87 percent of arms traced from 2004 to 2008; U.S. agencies 
lack dedicated funding to address arms trafficking; and two key 
agencies responsible for combating arms trafficking—the Bureau of 
Alcohol, Tobacco, Firearms and Explosives (ATF) and ICE—have not 
coordinated efforts. Following the release of our report, ATF and ICE 
officials signed a memorandum of understanding clarifying arms-
trafficking roles. 
[hyperlink, http://www.gao.gov/products/GAO-09-781T] 
[hyperlink, http://www.gao.gov/products/GAO-07-709] 

2.18.C. Building Capacity in Iraq: 

Building a sustainable and accountable Iraqi government is essential to 
U.S. efforts in Iraq. In a June 2009 report, we found that the 
Department of State (State) could not ensure that its capacity-building 
program in Iraq was achieving its objective to build provincial 
government capacity. We recommended that State fix critical management 
control weaknesses. In response, State assigned an overall manager for 
its program, accepted our recommendation to develop outcome measures of 
program effectiveness, and agreed to report to the Congress on Iraqi 
government matching contributions to the program. 
[hyperlink, http://www.gao.gov/products/GAO-09-526] 

2.19.C. Enhancing Food Aid through Local and Regional Procurement: 

We found local and regional procurement (LRP) food aid generally costs 
less than U.S. in-kind food aid. LRP has a shorter delivery time to sub-
Saharan Africa than food procured internationally. Better market data 
can mitigate LRP’s potential for adverse market impacts. U.S. legal 
requirements to procure U.S.-grown agricultural commodities and 
transport up to 75 percent of them on U.S. flag vessels may constrain 
use of LRP. Properly implemented, LRP offers opportunities for delivery 
of food aid to hungry people. Our work has informed the Congress’s 
deliberations on proposed global food security legislation, which 
includes provisions for LRP. 
[hyperlink, http://www.gao.gov/products/GAO-09-570] 
[hyperlink, http://www.gao.gov/products/GAO-09-757T] 

2.20.C. Improving Management of Cuba Program Democracy Grant Funds: 

In 2008 we reported steps the U.S. Agency for International Development 
(USAID) had taken to improve award and oversight of Cuba Program 
democracy grant funds, which address problems we reported in 2006. Our 
2008 report noted several USAID actions responding to misuses of grant 
funds at two organizations with the largest program grants. However, as 
of October 2008, the Cuba Program was not staffed as needed for 
appropriate oversight, and the impact of USAID’s recently started 
efforts to improve oversight and reduce risk of further misuse of grant 
funds was not evident. Following our 2008 report, USAID stated that it 
would provide sufficient staff for oversight and continue monitoring 
grantee risk. 
[hyperlink, http://www.gao.gov/products/GAO-07-147] 
[hyperlink, http://www.gao.gov/products/GAO-09-165] 

Respond to the impact of global market forces on U.S. economic and 
security interests: 

2.21.N. Improving DOD Efforts to Identify Critical Technologies: 

The U.S. government spends billions on weapons and defense-related 
technologies to maintain military superiority. To help safeguard these 
items when they are exported, DOD’s Militarily Critical Technologies 
Program is to identify and assess technologies that are critical to 
U.S. military dominance. Based on our finding that the military 
critical technologies list was out-dated and rarely used and 
recommendations to address this, DOD updated the list and implemented 
procedures to ensure that it is regularly reviewed and meets user 
needs. As a result, DOD has a better framework to guide critical 
decisions on what to control and protect. 
[hyperlink, http://www.gao.gov/products/GAO-06-793] 

2.22.C. Informing the Congress about Federal Oversight and Enforcement 
of the Fair Lending Laws: 

We reported that limitations in data that lenders report pursuant to 
the Home Mortgage Disclosure Act undermine the ability of federal 
agencies to identify institutions at heightened risk of lending 
discrimination. Moreover, because of the fragmented financial 
regulatory system, lenders that may represent higher risks are 
generally subject to less comprehensive oversight than other lenders. 
We recommended that the Congress assess options to improve available 
data and reform the regulatory structure to enhance fair lending. The 
report will be constructive to the Congress as it considers legislation 
to revamp the financial regulatory system. 
[hyperlink, http://www.gao.gov/products/GAO-09-704] 

2.23.C. Improving Federal Financial Literacy Efforts: 

We testified that the federal government’s Financial Literacy and 
Education Commission still did not have a true functional strategy for 
improving the nation’s financial literacy that incorporates specific 
plans for roles, funding, and activities. However, we reported that as 
a result of previous recommendations we had made, the commission had 
made progress in fostering sustainable partnerships among the federal, 
state, local, private, and nonprofit sectors for improving the 
financial literacy of American consumers. 
[hyperlink, http://www.gao.gov/products/GAO-09-638T] 

2.24.C. Highlighting the Need for Financial Regulatory Reform: 

The current financial crisis illustrated that the fragmented regulatory 
system created over the past 150 years was not adequate to oversee a 
21st century financial marketplace. Given the failure of the existing 
system to adequately address recent developments, our January 2009 
report provided a framework that can be used to help reform the 
regulatory system and to evaluate regulatory proposals that have 
emerged to ensure that any new regulatory system is sufficiently 
comprehensive, addresses systemwide risks, and adequately protects 
consumers. Moreover, we testified numerous times and presented this 
framework at a variety of conferences. 
[hyperlink, http://www.gao.gov/products/GAO-09-216] 

2.25.C. Encouraging SEC to More Effectively Protect Investors: 

Our work showed that resource challenges have affected the ability of 
SEC Enforcement Division staff to bring enforcement actions effectively 
and efficiently. We recommended that SEC enhance communication and 
utilization of resources in the division. Our work helped lead to 
several broad reforms that SEC is planning, including reducing a layer 
of management and expediting the enforcement process, improving staff 
training, fostering communication among Enforcement Division personnel, 
streamlining internal processes, and harnessing technology for 
operational efficiency. 
[hyperlink, http://www.gao.gov/products/GAO-09-358] 

2.26.C. Considering Trade Measures Related to Climate Change: 

A challenge faced by the Congress in addressing global climate change 
is how to encourage firms to reduce greenhouse gas emissions without 
harming their international competitiveness or causing production and 
emissions to shift abroad. To assist and facilitate Senate deliberation 
on legislative climate proposals, we explained key issues regarding 
estimating the effects of emissions pricing, potentially vulnerable 
industries, design trade-offs of proposed trade measures, and 
international trade implications. Our report and testimony clarified 
issues for Senate Finance Committee members as they addressed trade-
related measures of a climate bill. 
[hyperlink, http://www.gao.gov/products/GAO-09-724R] 

[End of Strategic Goal 2] 

Strategic Goal 3: Help transform the federal government’s role and how 
it does business to meet 21st century challenges. 

Reexamine the federal government’s role in achieving evolving national 
objectives: 

3.01.N. Strengthening Planning and Preparedness for an Influenza 
Pandemic: 

In the aftermath of the H1N1 influenza outbreak, our work helped inform 
the Congress and the new administration about significant gaps in 
federal government pandemic influenza planning and preparedness 
efforts. In the summer of 2009, our testimony alerted the Congress to 
the need for the federal government to test shared federal pandemic 
leadership roles, update the National Pandemic Implementation Plan, 
improve coordination with state and local governments and the private 
sector, and monitor agencies’ readiness to protect federal workers in a 
pandemic. The House Homeland Security Committee directed DHS and HHS) 
to report on progress by fall 2009. 
[hyperlink, http://www.gao.gov/products/GAO-09-909T] 
[hyperlink, http://www.gao.gov/products/GAO-09-783T] 
[hyperlink, http://www.gao.gov/products/GAO-09-404] 
[hyperlink, http://www.gao.gov/products/GAO-09-760T] 
[hyperlink, http://www.gao.gov/products/GAO-09-334] 

3.02.C. Evaluating How DOT Exercises Foresight: 

To update the Congress on 21st century trends and agency efforts to 
keep pace, we designed a “grounded foresight” reporting strategy that—
while acknowledging uncertainty about the future—combines discussion of 
key trends and possible directions in the years ahead with evaluation 
of agency decisions, research, and communication about these trends. We 
applied this strategy to DOT and highway safety trends, including fast-
changing electronic driver distractions. DOT recently announced a “
Distraction Summit” aimed at moving ahead on distraction issues, such 
as texting while driving. 
[hyperlink, http://www.gao.gov/products/GAO-09-56] 

Support the transformation to results-oriented, high-performing 
government: 

3.03.F. Improving Collections of Federal Nontax and Criminal Debts: 

Over the past several years, we have promoted federal agencies’ 
increased use of key debt collection processes and procedures to 
improve collections of billions of dollars of delinquent federal nontax 
civil debts and criminal debts owed to the federal government, and made 
a series of related recommendations. Based largely on our 
recommendations, federal agencies, including the Department of 
Education and DOJ, have taken actions to improve delinquent federal 
debt collections. Adding to a steady stream of recoveries, these 
improved collections added almost $1.4 billion to federal collections 
during fiscal year 2009. 
[hyperlink, http://www.gao.gov/products/GAO-04-338] 
[hyperlink, http://www.gao.gov/products/GAO-02-313] 
[hyperlink, http://www.gao.gov/products/GAO-01-664] 

3.04.F. Improving IRS’s Methodology for Pursuing Delinquent Taxes: 

For many years, we have reported that IRS did not have systems or 
procedures in place to effectively identify and pursue delinquent 
federal tax debts with collection potential. We recommended that IRS 
focus its collection resources on tax debts with the greatest potential 
for collection. In response, IRS has taken action to implement more 
sophisticated modeling technology to more effectively identify 
delinquent tax debt cases more likely to be productive. During fiscal 
year 2009, IRS’s records showed that it increased collections of 
delinquent taxes by about $5.7 billion using approximately the same 
level of resources. 
[hyperlink, http://www.gao.gov/products/GAO-01-42] 

3.05.F. Monitoring the 2010 Census: 

In March 2008, we placed the 2010 Census on our high-risk list, in part 
because of risks associated with the use of the handheld computers 
(HHC) to collect data and uncertainty over the cost of the census. Our 
recommendations have helped the U.S. Census Bureau to reduce cost and 
mitigate risk. The bureau updated its cost assumption, reducing the 
cost to fingerprint employees by approximately $293 million, and 
improved the performance of the HHC. In 2009 during the address 
canvassing operation, while there were some technical difficulties with 
the HHCs, those problems were promptly resolved and the bureau finished 
address updates ahead of schedule. 
[hyperlink, http://www.gao.gov/products/GAO-08-554] 
[hyperlink, http://www.gao.gov/products/GAO-08-550T] 
[hyperlink, http://www.gao.gov/products/GAO-08-886T] 
[hyperlink, http://www.gao.gov/products/GAO-08-936] 

3.06.N. Improving OMB Oversight and Transparency—Federal IT Dashboard: 

Since 2005, we have issued a series of reports and testimonies with 
recommendations to OMB for improving its oversight and transparency of 
federal information technology (IT) investments. As a result, OMB 
recently used this body of work to develop and implement improved 
processes to oversee and increase transparency of IT investments. 
Specifically, in June 2009, OMB publicly deployed a “dashboard,” which 
is a Web site clearinghouse of information that provides details on all 
major federal IT investments and provides OMB and others with the 
ability to track the progress of these investments over time. 
[hyperlink, http://www.gao.gov/products/GAO-09-624T] 
[hyperlink, http://www.gao.gov/products/GAO-08-1174T] 
[hyperlink, http://www.gao.gov/products/GAO-08-1051T] 
[hyperlink, http://www.gao.gov/products/GAO-08-925] 

3.07.N. Improving Governmentwide Sharing on Contractor Past Performance 
Information: 

In 2009, GAO identified shortfalls in the governmentwide system 
established to facilitate use of contractor past performance 
information. Given that in fiscal year 2007, federal agencies worked 
with over 160,000 contractors, obligating over $456 billion, this 
information is necessary to properly evaluate a contractor’s prior 
performance and better inform agencies’ contract award decisions. In 
response to our recommendations, the Office of Federal Procurement 
Policy revised the Federal Acquisition Regulation to improve past 
performance reporting across government, which will help agencies make 
better contract award decisions. 
[hyperlink, http://www.gao.gov/products/GAO-09-374] 

3.08.N. Improving DHS Acquisition Management: 

DHS obligates billions of dollars annually to meet its expansive 
mission—$14 billion in fiscal year 2008 alone. Over the past several 
years, GAO has identified shortcomings in DHS’s management of major 
acquisitions, including insufficient acquisition planning, oversight, 
and workforce, and made recommendations to improve acquisition 
outcomes. In the past year, DHS has made efforts to address these areas 
by issuing a revised acquisition management directive, establishing 
supporting processes, creating an executive position to oversee 
acquisitions at each component agency, and expanding an acquisition 
workforce hiring initiative. 
[hyperlink, http://www.gao.gov/products/GAO-09-30]
[hyperlink, http://www.gao.gov/products/GAO-09-29] 
[hyperlink, http://www.gao.gov/products/GAO-07-900] 
[hyperlink, http://www.gao.gov/products/GAO-06-996] 
[hyperlink, http://www.gao.gov/products/GAO-05-179] 

3.09.N. Improving DOD’s Business Systems Modernization Management: 

Since 2001, our work on DOD’s approach to modernizing its business 
systems, a designated high-risk area, has produced recommendations to 
provide a comprehensive framework for instituting a successful 
modernization program. In response to our work and congressional 
mandates, DOD has made progress implementing key institutional 
modernization management controls. More recently, our recommendations 
were aimed at helping DOD better address the formidable challenge of 
ensuring that its thousands of business system programs and IT services 
employ acquisition management rigor and discipline. 
[hyperlink, http://www.gao.gov/products/GAO-09-586] 
[hyperlink, http://www.gao.gov/products/GAO-08-462T] 
[hyperlink, http://www.gao.gov/products/GAO-08-705] 
[hyperlink, http://www.gao.gov/products/GAO-07-733] 
[hyperlink, http://www.gao.gov/products/GAO-07-538] 

3.10.N. Advancing the Implementation of Health IT: 

In a series of reports and testimonies, we identified and recommended 
needed improvements in the government’s efforts to define and implement 
a national strategy for achieving nationwide adoption of health IT. Our 
work helped the National Coordinator for Health IT develop a strategy 
that identified milestones for completing important initiatives and 
achieving strategic goals. As we recommended, the strategy addressed an 
overall approach to protecting the privacy of electronic health 
information within a nationwide health information network and provided 
guidance for addressing challenges associated with putting privacy 
protections in place. 
[hyperlink, http://www.gao.gov/products/GAO-08-1138] 
[hyperlink, http://www.gao.gov/products/GAO-07-238] 
[hyperlink, http://www.gao.gov/products/GAO-05-628] 

3.11.C. Improving DOD and VA Electronic Health Record Sharing Efforts: 

Through our reports and testimonies, we supported increased 
congressional oversight of DOD and VA efforts to develop and implement 
interoperable electronic health record systems. This mandated 
initiative is focused on expediting the electronic sharing of patient 
health information for military personnel and veterans. By raising 
management issues at congressional hearings and recommending results-
focused improvements in our reports, we helped the Congress press DOD 
and VA to continue making progress toward achieving interoperable 
sharing of health information to improve the quality and efficiency of 
health care. 
[hyperlink, http://www.gao.gov/products/GAO-09-775] 
[hyperlink, http://www.gao.gov/products/GAO-09-895T] 
[hyperlink, http://www.gao.gov/products/GAO-09-427T] 
[hyperlink, http://www.gao.gov/products/GAO-09-268] 
[hyperlink, http://www.gao.gov/products/GAO-08-1158T] 

3.12.C. Improving Oversight of Two Costly but Critical Environmental 
Satellite Programs: 

We continued to assist the Congress with oversight of two satellite 
program acquisitions: the National Polar-orbiting Operational 
Environmental Satellite System since 2002 and the Geostationary 
Operational Environmental Satellites-R program since 2006. Both will be 
critical for weather forecasting and climate monitoring for the next 
two decades. Our multiple reports and testimonies (four in 2009) 
identifying status and risks and recommending program improvements have 
helped focus congressional, administration, agency, and public 
attention on these important programs and have led to management change 
and more active oversight. 
[hyperlink, http://www.gao.gov/products/GAO-09-772T] 
[hyperlink, http://www.gao.gov/products/GAO-09-546] 
[hyperlink, http://www.gao.gov/products/GAO-09-596T] 
[hyperlink, http://www.gao.gov/products/GAO-09-323] 
[hyperlink, http://www.gao.gov/products/GAO-08-518] 

3.13.C. Identifying the Makeup of the Senior Executive Service: 

Having a diverse workforce is an organizational strength. We enhanced 
congressional oversight of diversity within the Senior Executive 
Service (SES) by reporting for the first time on the average age and 
disability status among SES employees. We found that the representation 
of both women and minorities in the SES increased governmentwide from 
October 2000 through September 2007 but continued to vary significantly 
among agencies. Average age at appointment to the SES and retirement 
from the SES, at ages 50 and 60, respectively, did not vary much by 
race, ethnicity, or gender. Less than 1 percent of SES employees self-
reported targeted disabilities. 
[hyperlink, http://www.gao.gov/products/GAO-09-110] 

Support congressional oversight of key management challenges and 
program risks to improving federal operations and ensuring 
accountability: 

3.14.F. Reducing Governmentwide Improper Payments: 

Since fiscal year 2000, our work has served to increase visibility over 
the extent of federal improper payments and contributed to the Congress 
passing the Improper Payments Information Act of 2002. The provisions 
of the act responded to our recommendations to better estimate, 
publicly report, and reduce federal improper payments. For 2008, 22 
federal agencies reported estimated improper payments totaling about 
$72 billion. With the increased scrutiny of improper payments, agencies 
took actions to reduce such payments. We estimate reduced federal 
improper payments of over $1 billion (present value) during fiscal year 
2008. 
[hyperlink, http://www.gao.gov/products/GAO-09-628T] 
[hyperlink, http://www.gao.gov/products/GAO-07-92] 
[hyperlink, http://www.gao.gov/products/GAO-06-347] 
[hyperlink, http://www.gao.gov/products/GAO-04-99] 
[hyperlink, http://www.gao.gov/products/GAO-02-749] 

3.15.N. Improving Federal Financial Reporting: 

We continued to effect a number of significant improvements in federal 
financial reporting disclosures. In the past year, the Department of 
the Treasury took a number of actions in response to our findings aimed 
at improving information presented in the U.S. government’s 
consolidated financial statements, including more complete and accurate 
disclosure of federal actions taken to address the current fiscal 
crisis and disclosures on the extent of federal commitments related to 
potential future losses. These additional disclosures improved 
transparency over the federal government’s operations, financial 
condition, and fiscal outlook. 
[hyperlink, http://www.gao.gov/products/GAO-09-387] 

3.16.N. Holding Federal Employees Accountable for Transit Benefit 
Fraud: 

Our investigators identified dozens of federal employees who 
fraudulently sold their transit benefits over the Internet. Many of the 
employees admitted to intentionally falsifying their benefit 
applications to receive excess benefits. For seven agencies, we 
determined that the amount of potentially fraudulent transit benefits 
claimed during 2006 in the National Capital Region was at least $17 
million and likely more. Agencies took action to hold federal employees 
accountable based on our work. For example, one DOT employee repaid 
$1,440 and resigned in lieu of removal, while a Department of Commerce 
employee was fired and criminally prosecuted. 
[hyperlink, http://www.gao.gov/products/GAO-07-724T] 

3.17.C. Strengthening DOD Financial Management Strategic Planning: 

We have long reported on pervasive weaknesses in DOD’s financial 
management operations and related strategic plans necessary to provide 
a foundation for effective transformation. We have recommended numerous 
actions to help guide DOD’s strategic financial and business 
transformation plans. In response, DOD leadership has begun taking 
steps to align planned actions with strategic goals and to incorporate 
strategic planning best practices. Our recommendations strengthen DOD’s 
ability to make steady progress toward transforming its financial and 
related business operations to effectively support achieving critical 
mission goals. 
[hyperlink, http://www.gao.gov/products/GAO-09-373] 
[hyperlink, http://www.gao.gov/products/GAO-08-866] 
[hyperlink, http://www.gao.gov/products/GAO-09-460T] 
[hyperlink, http://www.gao.gov/products/GAO-08-462T] 

3.18.C. Assessing Technologies to Understand the Effects of 
Technological Applications: 

From 2002 to 2006, in response to the appropriations committees’ 
direction to establish a technology assessment pilot program at GAO, we 
completed four technology assessment reports. Based on the positive 
response to the pilot program, the appropriations committees asked GAO 
to continue conducting technology assessments on a permanent basis. GAO’
s conduct of technology assessments will provide the Congress with 
information regarding the effects of scientific and technical 
developments on its legislative process. 
[hyperlink, http://www.gao.gov/products/GAO-05-380] 
[hyperlink, http://www.gao.gov/products/GAO-04-321] 
[hyperlink, http://www.gao.gov/products/GAO-03-174] 

3.19.C. Enhancing Federal Inspector General Oversight: 

Over the past few years, we reported on opportunities to improve 
federal inspectors general (IG) oversight, including concerns over 
whether IGs had sufficient independence to fully exercise their 
authorities, for example, insulation from arbitrary removal. Consistent 
with our findings, the Congress passed the IG Reform Act of 2008 to 
strengthen IGs’ independence and provide statutory authority for an 
independent council to oversee IGs’ integrity. This legislation should 
help strengthen federal agency IGs’ role in helping ensure that 
taxpayer dollars are used efficiently and effectively. 
[hyperlink, http://www.gao.gov/products/GAO-09-88] 
[hyperlink, http://www.gao.gov/products/GAO-09-524T] 
[hyperlink, http://www.gao.gov/products/GAO-09-660R] 
[hyperlink, http://www.gao.gov/products/GAO-09-270] 

Analyze the government’s fiscal position and strengthen approaches for 
addressing the current and projected fiscal gap: 

3.20.F. Improving Disaster Cost Estimates Reduced Unneeded FEMA 
Appropriations: 

In 2008, we examined the $1.9 billion request for FEMA’s fiscal year 
2009 disaster relief budget. We reported that FEMA had underestimated 
the funds it might recover from prior year obligations and identified a 
potential reduction of $850 million that it would not need. Fiscal year 
2009 appropriations for DHS provided only $1.4 billion for disaster 
relief—a $500 million reduction of unneeded funds—and transferred an 
additional $121.6 million from disaster relief to other DHS accounts. 
In total, $621.6 million in financial benefits resulted from this GAO 
work. (Based on a budget justification review) 

3.21.C. Improving the Design of Federal User Fees and the Operations 
They Fund: 

Agencies improved their fee-based operations and their cost information 
based on recommendations we made to improve forecasting assumptions, 
better audit fee collections, and jointly review and report on certain 
inspection fees for commercial vessels. Our work also informed 
congressional deliberations on immigration user fees and helped improve 
fee-based immigration operations by ensuring that contractor invoices 
reflect services actually received. Our User Fee Design Guide is used 
by federal, international, and local governments to inform the design 
and review of user fees. 
[hyperlink, http://www.gao.gov/products/GAO-09-70] 
[hyperlink, http://www.gao.gov/products/GAO-09-180] 
[hyperlink, http://www.gao.gov/products/GAO-08-386SP] 
[hyperlink, http://www.gao.gov/products/GAO-08-321] 
[hyperlink, http://www.gao.gov/products/GAO-07-1131] 

3.22.C. Reducing the Tax Gap: 

In 2009, IRS agreed to implement recommendations we made to reduce 
noncompliance in reporting rental real estate income, miscellaneous 
income, and deductions for home mortgage interest and real estate 
taxes. Other work showed that requiring federal tax compliance to 
qualify for states’ business licenses and increasing sole proprietors’ 
compliance by improving information reporting could improve tax 
compliance. Legislation has been introduced consistent with our 
recommendations to require payees to report payments to corporations 
and to grant IRS more time to investigate the compliance of individuals 
with offshore transactions. 
[hyperlink, http://www.gao.gov/products/GAO-09-478T] 
[hyperlink, http://www.gao.gov/products/GAO-09-238] 
[hyperlink, http://www.gao.gov/products/GAO-09-769] 
[hyperlink, http://www.gao.gov/products/GAO-09-521] 
[hyperlink, http://www.gao.gov/products/GAO-08-956] 

[End of Strategic Goal 3] 

Strategic Goal 4: Maximize the value of GAO by being a model federal 
agency and a world-class professional services organization. 

Improve client and customer satisfaction and stakeholder relationships: 

4.01.C. Strengthening Communication with Our Congressional Clients and 
Our Stakeholders: 

We strengthened communications with our clients and agency stakeholders 
by reaching out to numerous members of the Congress and senior agency 
officials during the transition to the new administration and new 
Congress to highlight a number of pressing issues that demand urgent 
attention and continuing oversight to ensure the nation’s security and 
well-being. We also discussed persistent management challenges facing 
the federal government and opportunities for reducing federal 
expenditures with these officials. 

In addition, we improved our communications to our clients and the 
public by enhancing and expanding our use of Web technology to more 
effectively provide timely information on critical issues facing the 
nation, for example by: 

* implementing the 2009 Congressional and Presidential Transition 
section on our external Web site, which provided short video summaries 
and references to GAO products on the major issues facing the new 
Congress and the new administration and contributed to increased hits 
to GAO’s Web site by over 65 percent within 2 weeks after its launch; 

* implementing the Following the Money: GAO’s Oversight of the Recovery 
Act section on our Web site, enabling the public to review Web content 
and link to documentation supporting GAO’s oversight of the Recovery 
Act and demonstrating the agency’s commitment to ensuring the 
transparency of the actions we are taking to ensure effective 
implementation of the act—our legislatively mandated bimonthly reports 
and related testimonies are consistently among the most downloaded 
products from our Web site; 

* improving our external Web site in response to continuous monitoring 
of user feedback by, for example, adding topical collections that bring 
together products in areas of current interest; and; 

* implementing a GAO channel on YouTube and an information feed to 
Twitter to increase public awareness of GAO products and mission. 

4.02.C. Assessing Internal Customer Satisfaction with Our Services and 
Processes and Implementing and Measuring Improvement Efforts: 

We conducted GAO’s sixth annual customer satisfaction survey in 
November 2008. Fiscal year 2009 is the fourth year in which we reported 
how well we performed against the targets we set for our internal 
operations measures on services in two categories—how well our internal 
operations (1) help employees get their jobs done and (2) improve 
employees’ quality of work life. Fifty-six percent of our staff 
provided input. On a scale of 1 to 5, we met our target of “4” for both 
categories of services. Survey data provide us information on our 
administrative services that we use to proactively identify areas to 
address customer issues and recommendations. In addition, we 
implemented an individualized automated e-mail reminder to encourage 
nonrespondents to reply, which helped to significantly increase our 
response rate 13 points over last year. We also implemented multiple 
improvements in response to customer feedback that are discussed in 
other sections of this report. 

4.03.C. Strengthening Relationships with External National and 
International Audit Organizations: 

We contributed to implementing strong standards in the accountability 
profession and capacity building through our relationships with both 
domestic and international accountability organizations by: 

* assuming chairmanship of the new International Organization of 
Supreme Audit Institutions (INTOSAI) Task Force on the Global Financial 
Crisis and engaging speakers from accountability organizations, private 
foundations, the World Bank, and the International Monetary Fund, which 
enhanced our knowledge of the financial crisis, helped us identify 
emerging issues, and strengthened our relationships with auditors 
general around the world; 

* organizing meetings with the National Intergovernmental Audit Forum 
(NIAF), which focused on the presidential and congressional transitions 
and financial crisis, and a meeting of the new Council of Inspectors 
General on Integrity and Efficiency; 

* sponsoring 16 fellows from 13 countries through our International 
Auditor Fellowship program to contribute to increasing the capacity of 
supreme audit institutions around the globe to fulfill their missions 
and enhance accountability and governance worldwide; 

* organizing a number of meetings with the domestic audit community to 
enhance the capability of audit agencies at all levels of government to 
prevent fraud, waste, and abuse of federal funds, which is particularly 
important now given the substantial increase in federal funding to 
state and local governments under the Recovery Act; 

* facilitating the refinement of legislation to reform the Single Audit 
Act, an important step in enhancing compliance with professional 
standards by states and localities and their contractors when auditing 
federal funds; and; 

* chairing the INTOSAI task force on the donor funding initiative and 
playing a key role in developing a memorandum of understanding that 
brought together INTOSAI and donor organizations to support the supreme 
audit institutions in developing countries—work that will contribute to 
providing important oversight of U.S. funds provided to these 
countries. 

Lead strategically to achieve enhanced results: 

4.04.C. Enhancing our Integrated Workforce Planning and Budgeting 
Process: 

We seamlessly implemented unprecedented new legislative 
responsibilities and a delayed budget in fiscal year 2009 through 
enhanced techniques and processes in our integrated workforce planning 
and budgeting process. We: 

* employed sophisticated modeling techniques using actual and projected 
workforce data to continuously ensure effective staff utilization; 

* used creative, alternative hiring measures to obtain needed expertise 
and subject area knowledge to respond to new legislative 
responsibilities under the Troubled Asset Relief Program; 

* further expanded our portfolio of hiring approaches to quickly hire 
needed expertise and resources in response to the challenge of 
expeditiously staffing up to meet new mandated requirements under the 
Recovery Act to “follow the money”; 

* responded to new legislative responsibilities by swiftly developing 
workforce assessment tools and shifting resources across units; and; 

* developed and issued a workforce planning guide to facilitate 
internal and external understanding of the process we use to manage 
resources needed to meet the agency’s strategic goals and objectives. 

4.05.C Enhancing Strategic Planning Processes: 

We helped enhance governance in the domestic and global audit and 
accountability community by sharing our knowledge and experience in 
strategic planning with INTOSAI and NIAF by (1) leading the INTOSAI 
strategic plan task force that is charged with updating the plan for 
2011 through 2016 and providing critical support to the plan’s 
development and dissemination and (2) working with the NIAF Executive 
Committee on revising and implementing the forum’s charter and 
membership. 

4.06C. Achieving External Recognition: We received the following 
external recognition during fiscal year 2009: 

* Certificate of Excellence in Accountability Reporting from the 
Association of Government Accountants for the eighth year in a row; 

* American Inhouse Design awards for three of our products—the Fiscal 
Year 2008 Performance and Accountability Report, the Fiscal Year 2008 
Citizen’s Report, and GAO’s 2009 diversity poster; 

* American Graphic Design Award from Graphic Design USA for the GAO 
Cost Estimating and Assessment Guide, Best Practices for Developing and 
Managing Capital Program Costs (GAO-09-3SP); 

* Silver Communicator Award in Excellence and Distinction from the 
International Academy of Arts and a MarCom Gold Award for Excellence in 
Creative Communication by the Association of Marketing and 
Communication Professionals for the GAO Overview video; 

* Excellence in Enterprise Architecture award for leadership in 
enterprise-driven results; and; 

* Government Energy Leader award from the World Energy Engineering 
Congress. 

4.07.C. Strengthening Our Strategic Human Capital Management to Achieve 
Enhanced Results: 

We issued an interim human capital strategic plan that establishes 
several areas for short-term concentration, which will be our blueprint 
for human capital projects over the next 12 to 18 months, and includes 
taking steps to recruit a diverse workforce, enhance employee 
engagement, and leverage data and technology solutions to improve our 
human capital service delivery. 

We honored our commitment to bargain in good faith and maintain a 
positive working relationship with the union, which resulted in 
successfully negotiating our 2009 pay agreement and an interim 
collective bargaining agreement. 

We conducted a comprehensive study of our recruiting and hiring 
programs that established baseline data on the results of our 
recruiting and hiring efforts and resulted in our establishing an 
overarching recruiting goal and several objectives, such as enhancing 
representation of certain demographic groups. 

We redesigned and expanded our learning programs to leverage technology 
solutions and enhance leadership and career progression programs, while 
taking into account increasing constraints on staff time and fiscal 
resources. We: 

* piloted a “virtual classroom” using the Internet and a 
teleconferencing bridge to connect staff from their homes and offices 
in headquarters and the field; 

* introduced a bundled delivery approach to transition workshops and 
leadership skills programs, resulting in more efficient use of travel 
dollars and adjunct faculty time and improvement in the ability of 
staff to complete required training programs in a timely manner; 

* developed and implemented a certification workshop to expand the 
number of staff qualified to serve as facilitators for GAO training; 

* designed and implemented eight new leadership courses for Band IIs 
and Administrative Professional and Support Staff (APSS) staff and six 
new classes for Band IIIs, including courses to help supervisors 
provide feedback to their staff and receive feedback on themselves via 
a 360-degree feedback tool; and; 

* launched 25 courses that constitute the first unified learning track 
for APSS staff. 

We also took a number of steps to ensure that our performance 
management system provides for a fair and equitable assessment of all 
staff performance by: 

* implementing a standardized appraisal review process for all staff 
assessed during annual reviews as well as for staff in GAO’s 
development programs who are assessed every 6 months; 

* conducting GAO-wide reviews of appraisal data; 

* monitoring appraisal data on Professional Development Program entry-
level staff and Band IIA staff, between entry-level and journeymen 
level; 

* tracking data on midpoint and end-of-year feedback processes to 
ensure that staff received feedback; and; 

* performing a comprehensive evaluation of our performance appraisal 
system, including content analysis of past feedback on the system, 53 
interviews and 28 focus groups with managers and employees, 
implementing an agencywide survey that had a 67 percent response rate 
and solicited over 5,000 comments, and assessing findings from the 2008 
African American Performance Assessment Study. 

We installed, on time and slightly under budget, an integrated Web-
based human capital management system that will provide transaction 
processing and a broad range of improved applications, services, and 
information to human capital staff, managers, and employees, and will 
be fully implemented in fiscal year 2010. 

4.08.C. Ensuring Sound Financial Practices and Robust Systems in Our 
Fiscal Operations: 

We took several steps to refine processes and controls and add new 
capabilities in our financial operations in fiscal year 2009. We: 

* successfully completed our first financial audit under our new 
financial management system, receiving an unqualified, or “clean,” 
opinion in November 2008; 

* created an internal Recovery Act oversight task force with 
representatives from all mission support areas to ensure proper 
accounting and oversight of our new appropriation under the act; 

* implemented additional internal controls in the GAO Purchase Card 
Program by reducing the number of cardholders and performing audits on 
all transactions; 

* achieved savings in the GAO Purchase Card Program by automating the 
bill payment process and paying charges on a daily basis, which 
resulted in rebates of more than $29,000; 

* selected a new, fully integrated online reservation booking and 
document processing travel system, which will move GAO from a manual 
travel booking process to an online automated process, that will be 
implemented in fiscal year 2010; 

* began quarterly reporting on our statement of net costs and conducted 
fluctuation analyses using the capabilities provided in our new 
financial management system; and; 

* fully implemented the interface between our automated procurement 
system and our financial management system. 

4.09.C. Enhancing IT Governance by Applying Best Practices in IT 
Processes and Management: 

In order to deliver and manage measurably efficient and effective IT 
services that align with the current and future needs of GAO, we began 
implementation of the Information Technology Infrastructure Library 
framework (ITIL). We developed an implementation plan, trained over 80 
percent of technology staff, and obtained a suite of tools that will be 
implemented in fiscal year 2010 to provide automated support for 
implementation of ITIL processes. 

We developed and implemented a centralized, Web-based repository of 
GAO’s architectural information that will be utilized by GAO executives 
for investment decisions, midlevel management for infrastructure 
improvements and efficiencies of scale, and operational staff for 
logistics support. 

Leverage our institutional knowledge and experience: 

4.10.C. Increasing Our Knowledge-Sharing Capability: 

We supported formal and informal initiatives that significantly improve 
our knowledge-sharing capability internally and externally. We: 

* developed an agencywide communication strategy that outlines how GAO 
provides authoritative information to staff on a wide range of issues 
and that uses the newly redesigned intranet as the central tool for the 
agency’s primary communications, 

* supported informal information sharing through creation of a GAO Wiki—
with approximately one-third of our staff trained to enter and edit 
content—that allows staff to share lessons learned and institutional 
knowledge and discuss emerging issues, and; 

* implemented our first reader survey of both internal and external 
readers of the GAO Management News to identify suggestions for 
enhancing the content and format. 

We leveraged the National Association of State Auditors, Controllers, 
and Treasurers teleconferencing infrastructure, which enabled us to 
engage in regular teleconferences with principals in the accountability 
community on our Recovery Act work, including the IGs, 50 state 
auditors, and several hundred of local auditors, and saved us the cost 
of the teleconferences. 

We took steps to support technology solutions for information sharing 
among the domestic and international accountability community by: 

* hosting the FedEval.net Web site in support of domestic federal, 
state, and local auditing agencies; 

* operating and maintaining the International Journal of Government 
Auditing Web site for the international community and developing a plan 
for short-, medium-, and long-term activities to improve the form, 
function, and utility of the Journal with a special emphasis on 
enhancing the journal’s Web presence to promote knowledge-sharing and 
advancing capacity building; and; 

* taping NIAF meetings to provide access to the discussions and no-cost 
training to GAO staff and the NIAF community. 

We continued to participate in a number of efforts under legislative 
branch councils, including: 

* identifying technology solutions related to improving fiscal 
operations for the legislative branch; 

* coordinating an effort to promote a cross-council information-sharing 
program that will cover topics such as financial management, 
acquisitions, human resources, and IT; and; 

* contributing to savings of more than $2.7 million through 
implementation of common contracts and acquisition activities in 2007 
and 2008. 

Enhance our business and management processes: 

4.11.C. Streamlining the Engagement Process and Improving Engagement 
Services: 

We took a number of steps in fiscal year 2009 to assist in engagement 
design and support and to simplify and clarify our product development 
and issuance processes. We: 

* revised 36 guidance documents on applied research tools and methods 
to help engagement teams better plan and implement assignments; 

* enhanced and standardized the design and implementation of Web-based 
surveys to facilitate (1) efficient data capture and analysis, which 
was essential to support the many staff conducting Recovery Act audit 
work across 16 states, and (2) reuse for subsequent efforts given our 
recurrent reporting responsibilities under the act; 

* upgraded our automated time and attendance system to provide an 
automated process for GAO staff to regularly affirm their independence, 
which is required by government auditing standards for all staff 
working on engagements; 

* developed a target architecture and multiyear program plan for an 
overhaul of GAO’s engagement and work management systems; 

* developed and implemented publishing process improvements designed to 
both simplify and standardize operations among product assistance 
groups and teams and maximize use of available resources; 

* developed and implemented a production calendar template to enhance 
understanding of the production process for engagements and facilitate 
communications between publications staff and customers; 

* developed and implemented standard operating procedures for GAO’s 
product tracking system to ensure consistent use of the system, and 
enhanced the system to provide product status; 

* developed and piloted a color palette to enhance the appearance of 
our audit products using colors that translate well to grayscale and 
support accessibility standards for the visually impaired, while not 
adding costs; and; 

* expanded e-dissemination to other products, such as special 
publications, which continues to reduce the costs of printing. 

4.12.C. Improving our Administrative and Management Processes and Using 
Enabling Technology to Improve Crosscutting Processes: 

We made system improvements to aid in performance management and travel 
support. Specifically, we: 

* created a more current and user-friendly interface for all 
performance management–related data in our competency based performance 
system by improving formatting capabilities and providing GAO-wide 
reviewers access to both individual appraisals and unit-level 
statistical data; 

* enhanced our performance system to facilitate the capture and review 
of individual development plans for specific performance appraisal 
periods and provide the capability for unit-level reporting on 
development plan participation and the nature of requested 
developmental activities; and; 

* implemented a new procedure for obtaining feedback from staff on our 
travel agent. 

We also made several contracting improvements for IT support services. 
We: 

* consolidated firewall support, remote access connectivity, Internet 
Protocol service, and wide area network service into a single contract 
to obtain improved service and reduced costs and; 

* began using performance-based contracting for information systems 
operations and engineering labor support, including for delivery of 
help desk and logistics support, and enterprise network services. 

Become a professional services employer of choice: 

4.13.C. Promoting an Environment That Is Fair and Unbiased and That 
Values Opportunity and Inclusiveness: 

We demonstrated our commitment to ensuring a fair and inclusive work 
environment by continuing implementation of initiatives under our 
framework for management improvement and actions in our Workforce 
Diversity Plan, including: 

* fostering and enhancing relationships with our employee advisory 
groups by providing multiple opportunities for staff to engage agency 
leadership in enhancing human capital programs; 

* establishing and staffing a new executive-level position of Special 
Assistant to the Acting Comptroller General for Diversity Issues; 

* conducting workshops on preventing sexual harassment and briefing 
managers on the Americans with Disabilities Act and our reasonable 
accommodation process; 

* re-issuing an equal employment opportunity policy statement; 

* updating our Workforce Diversity Plan, which includes recommendations 
for ensuring that GAO fosters inclusive workplace practices and 
identifies areas that need continued attention; 

* developing and conducting approximately 130 facilitated conversations 
on race and ethnicity from October 2008 to January 2009 with 
approximately 80 percent of GAO staff attending; 

* monitoring implementation of our intern program guidelines to ensure 
that all interns are provided with a core group of experiences that 
will help them make good decisions about working at GAO; 

* implementing a survey for staff completing our entry-level 
development programs to assess the quality of the development and 
support they were provided; and; 

* completing an analysis of the rotational program for developmental 
analysts to determine the impact, if any, of rotations on engagements. 

4.14.C. Providing Tools, Technology, and a World-class Working 
Environment: 

We implemented several initiatives to provide staff with modern 
technology and easy access to GAO systems. We: 

* replaced all staff-assigned laptops and selected workstations with 
laptops with larger storage capacity, faster processing power, wireless 
capability, and added security features; 

* upgraded the cellular antennae system to provide expanded coverage in 
the headquarters building, enabling better connectivity; and; 

* improved remote access capability to accommodate 2,000 concurrent 
user connections to ensure adequate access during inclement weather or 
pandemic flu. 

We also negotiated new lease agreements for our offices in Chicago, Los 
Angeles, Norfolk, and San Francisco. Work space designs have been 
developed and construction has begun in Chicago; construction in other 
offices will occur in fiscal year 2010. 

4.15.C. Providing a Safe and Secure Workplace: 

We took several steps to ensure that we provide a safe and secure work 
environment for our employees. 

* We upgraded electronic security systems in two field offices and 
conducted an assessment for integrating field office systems into 
headquarters’ system. 

* We enhanced our emergency preparedness program by implementing a Web-
based emergency operations center—WebEOC—to support fast and effective 
decision making about incident response through real-time information 
sharing; improving identification of shelter-in-place locations; and 
implementing emergency e-mail and automated phone notification 
capabilities. 

* We opened for competitive bids a new security guard force contract at 
headquarters to strengthen the contract requirements, address areas of 
concern, and gain efficiencies by merging two separate contracts into 
one. 

* We initiated security reviews on employees whose investigations are 
over 15 years old to meet Homeland Security Presidential Directive 12 
requirements. 

* We completed phase 1 of an alternate computing facility upgrade that 
enhances access and communications capabilities in the event of a 
disaster that shuts down IT systems in headquarters. The facility is 
able to support 500 concurrent remote users with Web-based e-mail 
capability, Internet access, and remote desktop functionality similar 
to the services available via systems at headquarters. Implementation 
of the facility upgrade resulted in a cost avoidance of over $200,000 a 
year through use of House-owned fiber technology. 

* We implemented Tripwire—a network security feature that facilitates 
standardization of system configurations, supports a more refined 
configuration management process, detects authorized and unauthorized 
changes to network systems, and streamlines the validation of security 
compliance. 

* We completed implementation of desktop security upgrades that meet 
OMB memorandum M-06-16 requirements for encrypting all sensitive data 
on mobile computers and devices. We combined this effort with our 
laptop replacement project so all employees have this capability, 
regardless of the security level of their work. The capability encrypts 
all data on a user’s laptop and provides authentication to the desktop. 

* We continued to implement our information security program that 
includes security awareness training to staff, contractors, and other 
users of agency systems on the agency’s security policies and 
procedures, the information security risks associated with user 
activities, and individuals’ responsibilities for complying with agency 
policies and procedures. Additional training is provided to users who 
have been identified as having significant security-related 
responsibilities. The security awareness video used in this training 
was updated to reflect current technologies, such as antivirus software 
and encryption, in use to protect GAO assets. 

[End of Strategic Goal 4] 

[End of Appendix 1] 

2. GAO’s Report on Personnel Flexibilities: 

As required by section 11 of the GAO Human Capital Reform Act of 2004 
(Pub. L. No. 108-271), GAO is reporting actions that have taken place 
in fiscal year 2009 under sections 2, 3, 4, 6, 7, 9, and 10. 

Section 2 of the GAO Human Capital Reform Act of 2004 made permanent 
GAO’s authority to offer voluntary early retirements and separation 
incentive payments. GAO did not offer its employees an agencywide 
voluntary early retirement opportunity in fiscal year 2009, but did 
permit employees to apply for voluntary early retirement outside of an 
open season. The use of this authority supported efforts to ensure that 
GAO had the appropriate numbers and skill mix of employees to respond 
to the requests of congressional clients. Five employees applied for 
voluntary early retirement under this authority; two applicants were 
approved, two applicants were denied, and one applicant withdrew the 
application. Because of high costs, GAO did not authorize any voluntary 
incentive payments, for the reasons indicated in prior performance and 
accountability reports. 

Section 3 of the act, codified at 31 U.S.C. § 732(c)(3), authorizes the 
Comptroller General to determine the amount of the annual pay 
adjustments provided to GAO employees and prescribes the factors to be 
considered in making this determination. In September 2008, section 2 
of the Government Accountability Act of 2008 (Pub. L. No. 110-323) 
added subsection (j) to 31 U.S.C. § 732 that set a minimum adjusted 
amount that employees must receive if they were performing 
satisfactorily. Subsection (j) requires that if an employee’s total 
increase from both the annual adjustment and performance-based 
compensation (PBC) results in an increase to the employee that is less 
than the increase the employee would have received under the General 
Schedule (GS) increase for the employee’s locality, then the employee 
is entitled to an increase equal to the GS increase. Such increase is 
made effective on the same date that the GS increase is effective. 
Subsection (j) applies to all GAO employees except wage grade 
employees, Senior Level (SL) and Senior Executive Service (SES) 
members, and employees in a developmental program. 

In determining the amount of the annual adjustment for 2009 and 
consistent with subsection 732 (c)(3), the Acting Comptroller General 
considered various data, including salary planning data reported by 
professional services, public administration, and general industry 
organizations; the GS adjustment; various purchasing power indexes; 
overall budgetary resources; and the possible distributions of 
available funds between the annual adjustment and individual PBC. For 
2009, GAO’s compensation system provided that all employees performing 
at a satisfactory level were entitled to receive an annual adjustment 
and to be eligible for PBC based on their individual performance. 

Absent a final fiscal year 2009 budget at the beginning of the fiscal 
year, GAO and the GAO Employees Association, International Federation 
of Professional and Technical Engineers (IFPTE), Local 1921, agreed to 
bifurcate pay negotiations. Initial negotiations would cover just the 
annual adjustment component of pay with PBC negotiations deferred until 
the agency’s appropriation was finalized. 

As a result of the first set of negotiations, GAO and IFPTE agreed in 
April 2009 to an annual adjustment equal to the GS increase, including 
locality in each area in which GAO has offices. The agreement also 
provided for adjusting salary range minimum, maximum, and competitive 
rates for each of GAO’s five geographic zones. Salary range minimum 
rates were increased by the average of the GS adjustment(s) (i.e., base 
plus locality) for the locations in each geographic zone. The 
competitive and maximum rates for each range in all geographic zones 
were increased by 4.78 percent not to exceed the GS-15, step 10-rate 
applicable to each location. The Acting Comptroller General authorized 
the same increases for nonbargaining unit staff. 

The annual adjustment was to be effective on January 4, 2009, for all 
banded employees, including developmental staff who were performing at 
a satisfactory level. Adjustments were provided without regard to 
salary range maximum rates other than the GS-15, step 10 rate. This “
annual adjustment” satisfied the minimum percentage increase required 
by subsection (j) of title 31. 

After GAO received its final fiscal year 2009 appropriation in March 
2009, subsequent pay negotiations were concluded in May 2009 with an 
agreement to use a 2.65 percent “budget factor” for PBC calculations. 
In addition to establishing this percentage, the agreement provided for 
a new method for calculating bargaining unit employees’ PBC payout. 
Rather than the “standardized rating score” (SRS), which has been used 
since 2005, the bargaining unit agreed to an alternative. The 
alternative method calculates the difference between the employee’s 
appraisal average and the appraisal average for a comparison group of 
staff in the same band and organization. To determine the percentage of 
PBC, this difference is added to the budget factor (2.65), and the 
resulting percentage is multiplied by the employee’s competitive rate. 
After ratification by 86.2 percent of union voters, the agreement was 
implemented and PBC was processed in July 2009 retroactive to January 
4, 2009. 

PBC for Administrative Professional and Support Staff, Attorneys, and 
Band III Analysts (i.e., nonbargaining unit staff) was provided using 
the same 2.65 percent budget factor. However, these groups retained the 
SRS as the method for calculating PBC. Rather than the difference 
between the employee’s appraisal average and the comparison group 
average, the SRS measures the number of standard deviations between 
these two averages. This number is added to the budget factor, and the 
resulting percentage is multiplied by the competitive rate. 

For all staff, 100 percent of the PBC amount was provided as a base pay 
adjustment not to exceed the maximum rate of the employee’s pay range. 
Any PBC amount that could not be paid because of the salary cap was 
provided as a lump sum performance bonus (cash payment). 

GAO’s SES and SL employees rated “Fully Successful” were provided a 2.8 
percent pay adjustment pursuant to 31 U.S.C. § 733(a)(3)(B) effective 
January 4, 2009. SES and SL members were also eligible for PBC using a 
budget factor of 2.65 percent. PBC was provided to the SES and SL staff 
as a base pay increase not to exceed $174,000. At the Acting 
Comptroller General’s discretion, remaining amounts were provided as 
bonuses to staff rated “Outstanding” or “Exceeds.” 

Employees of GAO’s Personnel Appeals Board and student employees are 
paid according to GS rates, and GAO’s wage grade employees are paid 
according to the Federal Wage System (FWS) salary rates. These 
employees received the same percentage across-the-board adjustment on 
the same effective date as the increases authorized for GS and FWS 
employees in the executive branch. The pay ranges for these employees 
incorporated the changes made to the comparable executive branch pay 
ranges. Lastly, in regard to the annual pay adjustment for employees, 
there were no extraordinary economic conditions or budgetary 
constraints that had a significant impact on the determination of the 
annual pay adjustment. 

Section 4 of the act authorizes the Comptroller General to place 
employees on pay retention; however, there were no employees on pay 
retention at GAO during fiscal year 2009. 

Section 6 of the act authorizes the Comptroller General to increase the 
annual leave accrual rate for officers and employees in high-grade 
managerial or supervisory positions who have less than 3 years of 
federal service. In fiscal year 2009, GAO increased the annual leave 
accrual rate of seven employees as an incentive to retain them. 

Section 7 of the act authorized GAO to establish an Executive Exchange 
Program, to bring executives from private industry to work on special 
projects at GAO and to permit GAO officers and employees to be assigned 
to private sector organizations. This authority was not used in fiscal 
year 2009. The authority expired on July 7, 2009. 

Section 9 of the act establishes requirements for GAO’s performance 
appraisal system. GAO’s performance appraisal system meets these 
requirements; however, the agency continues to pursue actions designed 
to ensure that the system meets its objectives and is fair and 
equitable for all employees. A study conducted by the Ivy Planning 
Group in 2008 made over 25 major recommendations that GAO could take to 
help ensure fair, consistent, and nondiscriminatory application of the 
appraisal system. GAO has committed to implementing the Ivy Planning 
Group’s recommendations and has initiated a Management Improvement 
Priorities Action Plan that includes five areas of concentration: 
recognizing and valuing diversity; reassessing the performance 
appraisal system; managing workload, sustaining quality, and 
streamlining processes; enhancing staffing practices and developing the 
workforce; and, finally, strengthening recruitment and retention 
incentives. 

GAO completed a full, systematic, and inclusive review of the 
performance appraisal system identifying what is working well and not 
working well with the system, including addressing concerns raised by 
the Ivy Planning Group. Data collected included a comprehensive content 
analysis of existing data, the results of 28 focus groups of employees, 
and 53 semistructured interviews with managing directors and a random 
sample of SES/SL, Band III, and field office managers. In addition, GAO 
conducted an agencywide, Web-based survey of employees, with an overall 
survey response rate of 67 percent. Data from all of these sources were 
synthesized into a draft report with extensive findings and short- and 
long-term recommendations for improving GAO’s performance appraisal 
system. 

GAO continues to provide training on the performance appraisal system 
and the roles and responsibilities of staff, supervisors, and managers. 
To ensure that all new designated performance managers are 
knowledgeable about appraisal policies, procedures, and practices, GAO 
is requiring new raters to take online training prior to preparing 
fiscal year 2009 appraisals. GAO also developed additional training 
regarding giving and receiving performance feedback that will be 
available for all staff. 

Section 10 requires the Comptroller General to consult with any 
interested groups or associations representing officers and employees 
of GAO before implementing any changes under the act. During this 
reporting period, changes to GAO’s compensation regulations were issued 
for notice and comment. However, even prior to the passage of the act, 
the Comptroller General and other relevant agency officials were 
meeting periodically with the Employee Advisory Council (EAC) and IFPTE 
to discuss current and emerging issues of mutual interest and concern, 
especially those in the human capital area. GAO also uses employee 
forums, focus groups, and other mechanisms to obtain employee input on 
major proposals. GAO provides all employees with advance copies of 
draft orders concerning proposed policies and regulations for comment 
prior to their publication in final form. These steps were taken in the 
promulgation of all policies and regulations implementing the 
provisions of the GAO Human Capital Reform Act of 2004, as amended. The 
Executive Committee considered all input from EAC members, IFPTE, and 
other GAO employees before implementing any changes. GAO consults, and 
negotiates where appropriate, with IFPTE with respect to Band I, II, 
IIA, and IIB analyst employees in the bargaining unit. EAC now 
represents Band III analysts, Attorneys, and Administrative 
Professional and Support Staff employees who are not included in the 
bargaining unit. 

In summary, GAO human capital management continues to use the value-
added flexibilities provided under sections 2, 3, 4, 6, 9, and 10 to 
acquire and maintain the talent necessary to carry out and meet its 
strategic mission and goals.[Footnote 22] These and other human capital 
tools and flexibilities support the achievement of GAO’s strategic 
objective to be a world-class professional services organization and 
model federal agency. Without these provisions, GAO would have 
difficulty attracting and retaining top-flight talent in adequate 
numbers to properly support the Congress and serve the American people 
within current and expected resource levels. 

[End of Appendix 2] 

3. GAO’s FISMA Efforts: 

GAO has established a strong Information Security Program that relies 
on a “defense-in-depth” technical approach to protection and detection, 
while the compliance component of our program is based upon the 
implementation of federal and industry security standards. Even though 
we are not obligated by law to comply with the Federal Information 
Security Management Act (FISMA) under the EGovernment Act of 2002, we 
have adopted FISMA requirements to strengthen our information security 
program and demonstrate our ongoing commitment to lead by example. 
FISMA and related federal guidance from the Office of Management and 
Budget constitute the cornerstone of our security program, establishing 
the procedures and practices that strengthen our protections through 
the implementation of security “best practices.” Our security standards 
are based on the federal guidance found in the National Institute of 
Standards and Technology (NIST) 800 series and Federal Information 
Processing Standards publications. As existing NIST guidance has been 
updated and new guidance disseminated, we have adjusted our internal 
information technology (IT) security policies and procedures and 
expanded our efforts to effectively integrate these governmentwide 
policies and practices into our security program. 

GAO’s Information Security Program seeks to continually improve the 
protection of data, strengthen access controls, and streamline security 
processes. GAO has implemented systemwide security controls that meet 
or exceed key requirements set forth in NIST Special Publication 800-
53, Revision 2, Recommended Security Controls for Federal Information 
Systems. We monitor these requirements and work to ensure that our 
protections evolve as our environment changes. We also support 
recurring assessments of our information security program, including 
internal reviews by GAO program offices, GAO’s Inspector General (IG), 
and security staff, as well as external audit reviews, to strengthen 
and streamline our security practices. For example, our IG 
independently evaluates our information security program annually, 
consistent with FISMA requirements, to identify weaknesses in our 
implementation of FISMA and offers recommendations to further 
strengthen our IT security program. In addition, we follow the standard 
practice of using a public accounting firm, as well as other external 
sources, to provide independent external evaluations and testing of IT 
controls on our major applications. We have leveraged third-party 
audits to successfully validate our security controls through a 
rigorous certification and accreditation process. During this past 
year, we conducted a full certification and accreditation of our 
Mainframe System using a third party to conduct the system test and 
evaluation. 

We maintain excellent information systems security practices at GAO 
through implementation of FISMA requirements, including efforts to: 

* implement and refine an enterprisewide, risk-based security program; 

* develop and update essential policies, procedures, and reporting 
mechanisms to ensure that our security program is integrated into every 
aspect of IT system life cycle planning and maintenance; 

* provide recurring security training and awareness to all of our staff 
through annual awareness training, security fairs, and focused security 
briefings; 

* integrate security into our Capital Planning and Investment Control 
and project management processes; and; 

* implement and refine an enterprise disaster recovery solution. 

The dynamic nature of security threats requires that our Information 
Systems Security Group constantly monitor activities and adjust our 
strategy to address these challenges and meet the needs of GAO. As we 
continue to evolve and improve our Information Security Program, our 
strategies have also evolved to reduce the risk to GAO, streamline 
processes through the use of technologies, and reduce costs through 
standardization. 

Activities undertaken to improve our Information Security Program 
during fiscal year 2009 are listed below. 

* Information systems inventory. We increased the security oversight of 
information systems from 12 to 32 systems. This now covers all systems 
identified as mission-essential functions that support GAO normal and 
contingency operations. We completed initial security assessments and 
implemented annual continuous monitoring reviews of security controls 
for all systems within the inventory. 

* Security assessments of outsourced systems. All outsourced systems 
have a completed security risk assessment. The security program has 
updated our existing risk assessments to include the evaluation of 
security controls for systems operated by third parties. We have 
established and implemented a process for visiting third-party vendors 
or federal program managers to validate security processes, practices, 
and system controls, to provide assurance to GAO management that the 
risk to GAO information is minimized and vendor operations are within 
acceptable federal security guidance. 

* Certification and accreditation of information systems. We continue 
to implement security practices to cover the entire life cycle of our 
information systems. Our process starts with an initial security 
assessment, establishes requirements for a system security plan, 
provides an independent system test and evaluation, provides 
remediation of security risks, and implements a continuous monitoring 
process, until the system is retired. 

* Integrating security with other programs. We use our initial security 
assessment and our integrated program assessment to identify systems 
that process privacy information. During these processes, a privacy 
information assessment is initiated and coordinated through the privacy 
program office. 

* Automating security processes. We identified the requirements and 
procured a tool to assist in the automation of security control 
validation. This tool will support our continuous monitoring 
requirements for all information systems. In addition, this tool will 
improve our change and configuration management procedures, validate 
the deployment and maintenance of our security standards, and provide 
real-time alerting of unauthorized changes to our information systems. 

* Enterprise workstation security. We completed the implementation of 
our security standard for workstations that includes full-disk 
encryption; mobile computers and Blackberry encryption; an integrated 
antivirus, antispyware, and personal firewall application; and two-
factor authentication. To enhance our enterprise workstation security 
solution, we continued implementation of workstation configurations 
based upon the Center for Internet Security hardening standards and the 
Federal Desktop Core Configuration using a “least privilege” access for 
staff, limiting staff’s ability to change the workstation configuration 
by installing software and preventing the unintentional downloading of 
malware and viruses. The enterprise end point security application 
continues to provide centralized policy management and control and 
automatic monitoring and remediation of security threats to the 
workstation, and events identified by the application flow to the event 
correlation engine. 

* Business partner connections. We implemented virtual private networks 
to secure our connections to our financial and human capital 
applications operated by third parties. These secure tunnels control 
direct access from GAO to these remote sites in a secure and encrypted 
manner. In support of continuity operations, we implemented these 
private network connections at both the GAO primary and alternate 
computing facilities. 

[End of Appendix 3] 

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graphics in this product, as appropriate, when that information was not 
listed adjacent to the image or graphic. 

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Footnotes: 

[1] FMFIA requires ongoing evaluations and annual reports on the 
adequacy of the systems of internal accounting and administrative 
control of each agency. GPRA seeks to improve public confidence in 
federal agency performance by requiring that federally funded agencies 
develop and implement accountability systems based on performance 
measurement, including setting goals and objectives and measuring 
progress toward achieving them. FFMIA emphasizes the need to improve 
federal financial management by requiring that federal agencies 
implement and maintain financial management systems that comply with 
federal financial management systems requirements, applicable federal 
accounting standards, and the U.S. Government Standard General Ledger 
at the transaction level. 

[2] In fiscal year 2009, our FSI team—which investigates fraud, waste, 
and abuse; evaluates security vulnerabilities; and conducts other 
investigative services—functioned as a unit within our FMA team; it is 
now a separate team. 

[3] In fiscal years 2007 and 2008, the work performed under the 
Comptroller General’s authority represented 10 percent and 6 percent, 
respectively, of our engagement efforts. 

[4] GAO, The Nation’s Long-Term Fiscal Outlook: March 2009 Update, 
[hyperlink, http://www.gao.gov/products/GAO-09-405SP] (Washington, 
D.C.: April 2009); Bid Protests at GAO: A Descriptive Guide (Ninth 
Edition, 2009), [hyperlink, http://www.gao.gov/products/GAO-09-471SP] 
(Washington, D.C.: April 2009), and U.S. Public Diplomacy: Key Issues 
for Congressional Oversight, [hyperlink, 
http://www.gao.gov/products/GAO-09-679SP] (Washington, D.C.: May 27, 
2009). 

[5] Our most recent performance plan is available on our Web site at 
[hyperlink, http://www.gao.gov/cgi-bin/getrpt?rptno=GAO-09-304SP]. 

[6] Over the last 4 fiscal years, our return on investment has ranged 
from $83 in fiscal year 2005 to $114 in fiscal year 2008—a record year 
for us. 

[7] As part of our risk-based engagement management process, we 
identify a new engagement as high interest if the work we need to 
perform will likely require a large investment of our resources, 
involve a complex methodology, or examine controversial or sensitive 
issues. 

[8] B-400837 et al., Feb. 17, 2009. 

[9] B-400697 et al., Jan. 12, 2009. 

[10] B-400953 et al., Mar. 30, 2009. 

[11] B-401016, B-401016.2, Apr. 22, 2009. 

[12] B-316443, July 21, 2009. 

[13] B-317450, Mar. 23, 2009. 

[14] B-317249, July 1, 2009. 

[15] B-317634, Aug. 17, 2009. 

[16] B-316760, Feb. 19, 2009. 

[17] B-317292, Oct. 10, 2008. 

[18] Note 14 to the financial statements describes our Davis-Bacon Act 
trust function. For more detailed Davis-Bacon Act financial 
information, contact our General Counsel. 

[19] See, GAO, Department of Homeland Security: Observations on GAO 
Access to Information on Programs and Activities, [hyperlink, 
http://www.gao.gov/products/GAO-07-700T] (Washington, D.C.: Apr. 25, 
2007). 

[20] Consolidated Appropriations Act, 2008 (Pub. L. No. 110-161, Div. 
E, 121 Stat. 1844, 2042-43 (2007)) made $15,000,000 unavailable for 
obligation until the Secretary certified and reported that DHS revised 
departmental guidance concerning relations with GAO. The objective of 
the statutory provision was to provide expedited time frames for 
granting GAO timely and complete access to records and interviews and 
to provide for a “significant streamlining” of the review process for 
document and interview requests. DHS made some revisions to its 
departmental guidance in response to this requirement. These revisions, 
however, did not result in a significant streamlining of the process. 
The fiscal year 2009 appropriations act for DHS required it to submit 
quarterly reports to the House and Senate Appropriations Committees and 
GAO of each instance where a GAO request for records was not granted 
within 20 calendar days and where a GAO request for an interview was 
not granted within 7 calendar days. Consolidated Security, Disaster 
Assistance, and Continuing Appropriations Act, 2009, Pub. L. No. 110-
329, Div. D, 122 Stat. 3574, 3652 (2008). 

[21] In fiscal year 2009, GAO operations were segmented into 10 
business cycles: Entity-Wide Controls, IT Controls, Facilities and 
Property Management, Travel, Procurement, Disbursements, Budget, Fund 
Balance with Treasury, Financial Reporting, and Payroll. 

[22] In fiscal year 2009, GAO operations were segmented into 10 
business cycles: Entity-Wide Controls, IT Controls, Facilities and 
Property Management, Travel, Procurement, Disbursements, Budget, Fund 
Balance with Treasury, Financial Reporting, and Payroll. 

[End of United States Government Accountability Office's Performance 
and Accountability Report Fiscal Year 2008]