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Summary

We publicly released our annual report on the Department’s Consolidated Financial Statements, in which we issued an unqualified or “clean” audit opinion for FY 2002. The statements reported the Department had assets of $84 billion, liabilities of $42 billion, operating costs of $63 billion, and total budgetary resources of $105 billion. Despite the clean audit opinion, the report identifies significant financial issues that illustrate the need for the Department to fully implement automated systems and internal controls to avoid the extraordinary efforts required every year to prepare its financial statements. The report also identifies “material internal-control weaknesses” in FTA’s financial management, the Department’s information security, FAA’s oversight of cost-reimbursable contracts, and TSA’s security screening contracts and financial management, as well as several other reportable conditions and instances of nonconformity with laws and regulations. The Department’s chief financial officer agreed with the report.