Government Budgeting Term Paper

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Government Accounting Office in America (GAO)

This is an examination of the Government Accounting Office in America. The writer discusses the history, purpose and background of the GAO as well as the duties that the office is charged with performing. The writer then analyzes literature that illustrates the office in action. The final discussion revolves around the question, "Is the office effective or is it a waste of money." There were four sources used to complete this paper.

During the last few years there has been a public outcry and demand to investigate government spending. The public was brought stories by the media about the government paying thousands of dollars for toilet seats, and spending hundreds of dollars on a screwdriver and other such tools. When the reports began to surface about wasted government spending the public became angry. Lobbyists across the nation began to demand an accounting of not only tax dollars but why they were being spent the way they were. In the last two decades there have been major investigations into the way the government spends its money. The demand for scrutiny has been interesting in light of the fact that there is already a government office in place to do exactly what the public has demanded. The General Accounting Office is a branch of government that is charged with the examination of many financial aspects of government and government run agencies. The GAO is a government branch that complies reports on an almost unlimited number of financial topics and questions. As the public continues to demand the accounting of tax dollar spending the government accounting office works to answer the questions. The office answers questions that are posed by the government but those questions are often driven by public demand. While the GAO spends tax dollars for the purpose of examination, it is money well spent. The GAO provides the public as well as congress with an outline of the agency or area that it examines. It also provides results of its studies, which often serve as a decision breaking report for government budgeting. Though it is a government agency that spends dollars reviewing how government agencies spends dollars it is a needed and effective office. If the office was not in existence the public would have nowhere to turn to get the details of how the tax dollars were being spent that also included expert opinions on the effectiveness of such spending.


The Government Accounting Office provides research and results about many government-spending ventures. The office goes in and studies the way the spending has occurred but it also analyzes the purpose for the spending as well as the question at hand that prompted the examination. Sometimes the examination is about an entire entity such as spending federally for special education students, or it is about an individual entity such as one branch office of one agency. Before one can fully study the effectiveness of the government accounting agency one must first understand how the office operates.

The Background of GAO (

The U.S. General Accounting Office (GAO) is an independent, nonpartisan agency that works for Congress. GAO is often called the "congressional watchdog" because it investigates how the federal government spends taxpayer dollars." It gathers information and then compiles that information in a report that it presents to congress. It is a public document which means that anyone can read its content and that allows the public tax payer to be able to read the results of the study the office conducted. The public must remain ever mindful however, that the office is aware the report is a public document and accept the possibility that the report has been tempered or slanted with that understanding. Some of the main questions that the office answers is whether the studied agency or office or branch of publicly funded duties are meeting their objectives and whether they are providing good and solid service to the public.

Other things that are examined through the government accounting office reports are:

evaluating how well government policies and programs are working;

auditing agency operations to determine whether federal funds are being spent efficiently, effectively, and appropriately;

investigating allegations of illegal and improper activities; and issuing legal decisions and opinions

The office produces over a thousand reports annually and hundreds of congressional testimonies. Each report provides a short review of findings and then an in-depth discussion of the problem, the question and the findings.

The office publishes reports that are open to the public and those reports discuss the findings. They also bring to light the workings of the office or agency that the office is researching and what the purpose of the office or agency is as well as the purpose of the report addressing the question that has been asked.

The agency structure of the government accounting office is led by a fifteen year appointed Comptroller General. There are over 3,000 employees who bring to the office expertise in program evaluation, accounting laws and other field knowledge. The office got its start in 1921 and has grown and changed with the demands of the public as well as Congress.


To answer the question of the office doing its job or being a waste of public funds the published reports o the office itself are solid sources of reference and study. One study actually conducted a review of year end government spending and its purpose and effectiveness. This study was written for the purpose of answering questions regarding thespending reforms that were being implemented the previous fiscal year. (Year, 1998)This published study examined the year end spending that is so common among government agencies throughout the nation. Year end spending occurs at the end of the year because the agency has money left over in the budget and the year is coming to a close. The agency is going to ask the finance committee for more funds therefore feel they have to spend all of the previous funds to prove that they need more funding in the future. The agency finds ways to spend the excess and left over funds before the year ends so that they will have a more valid argument to obtain new funds and not be included in any budget cut backs. The article concludes that the spending has decreased in the last decade. It also concludes that the limits that have been placed in discretionary spending have helped to curtail the spending in many agencies at year end for he sole purpose of using up the funds before fiscal budget talks begin.

Changes in the budget environment and procurement reforms have affected the opportunity and need to obligate funds quickly at year-end. Agencies spend far less today than they did in 1980 on providing goods and services directly, as payments to individual beneficiaries and grants to state and local governments have increased. This trend, combined with limits on discretionary spending, has significantly changed the budget environment for most agencies. At the same time, Congress has made funds available for longer periods for many agencies, which reduces the pressure to spend funds at the end of each year. In addition, systemic procurement reforms addressed most of the issues raised in the Subcommittee's report although problems persist in certain agencies and with some procurements. Our work and that of others indicates that today there are more safeguards against unplanned year-end spending and, in most discretionary programs, fewer resources available for low-priority purchases than in 1980.

1] Hurry-Up Spending. A report prepared by the Subcommittee on Oversight of Government Management, Senate Committee on Governmental Affairs, July 23, 1980.

2] Obligations are recorded when the government makes a firm commitment to acquire goods or services. In general, they consist of orders placed, contracts awarded, and similar transactions.

Despite these changes, it is difficult to assess the Patterns of spending during the year because reported quarterly budget execution data are not reliable. Without complete and timely information for oversight, the Office of Management and Budget (OMB) and other decisionmakers do not have an accurate assessment of the financial status of federal programs during the year. Even at year-end, there are significant differences in three comparable sets of data that agencies report to OMB and the Department of the Treasury. Although OMB officials stated that a new system they have built jointly with Treasury to collect year- end data starting in fiscal year 1999 should resolve or greatly alleviate the differences in year-end budget data, more work is needed to assure compliance with the requirement for quarterly data. Agencies' failure to report and reconcile budget execution information mirrors broader financial management problems found in our financial audit of the fiscal year 1997 Consolidated Financial Statements of the United States Government.[3]


Wasteful year-end spending can occur when agencies rush to use funds at the end of the fiscal year. This is often an attempt to spend funds that would otherwise expire, meaning they would no longer be available…

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