Page 1 GAO-25-108145 CFS Issues for DOD
August 21, 2025
Mr. Jules W. Hurst III
Performing the Duties of the Under Secretary
of Defense (Comptroller)/Chief Financial Officer
U.S. Department of Defense
1100 Defense Pentagon
Washington, D.C. 20301-1100
U.S. Consolidated Financial Statements: Key Issues for the Department of Defense
Dear Mr. Hurst:
As the Department of Defense’s (DOD) senior official with the responsibility to perform the
duties of DOD’s Chief Financial Officer, you have an important role in helping to ensure that
reliable and complete federal financial information is available. The purpose of this letter is to
highlight important issues for your awareness related to financial management in the federal
government.
GAO is responsible for conducting the annual audit of the U.S. government’s consolidated
financial statements, or CFS.
1
On January 16, 2025, we issued a disclaimer of opinion on these
statements for fiscal years 2024 and 2023.
2
The consolidated financial statements are compiled
from federal entity financial statements and other federal entity information. As such, federal
entities, including DOD, have a key role in supporting financial reporting at the government-wide
level.
DOD’s strong and sustained commitment is critical to addressing the following key issues that
affect the U.S. government’s consolidated financial statements.
DOD’s disclaimers of opinion and material weaknesses: DOD continues to face long-
standing financial management problems. After many years of working toward financial
statement audit readiness, DOD underwent full financial statement audits for fiscal years 2018
through 2024. These audits resulted in disclaimers of opinion, identification of material
weaknesses in internal control over financial reporting, and thousands of audit findings. For
fiscal year 2024, DOD’s auditor reported 28 material weaknesses related to DOD’s internal
controls over financial reporting, which contributed to DOD’s inability to obtain an audit opinion.
These weaknesses limit the reliability of DOD’s financial reporting. DOD’s auditor made a
number of recommendations to help address these weaknesses.
1
The Secretary of the Treasury, in coordination with the Director of the Office of Management and Budget, is required
to annually submit audited financial statements for the executive branch of the U.S. government to the President and
Congress. These statements, as submitted, also include the legislative and judicial branches.
2
GAO, Financial Audit: FY 2024 and FY 2023 Consolidated Financial Statements of the U.S. Government, GAO-25-
107421 (Washington, D.C.: Jan. 16, 2025).
