Source: United States Navy
As expected of a maturing and complex audit environment, the independent auditors issued a disclaimer of opinion on the FY 2023 Navy General Fund (GF) and DON Working Capital Fund (WCF) financial statements. The Marine Corps General Fund audit has been extended to February 2024 in an effort to achieve an audit opinion, the first of its kind for any Military Service.
The DON made substantial progress toward the transformation vision outlined in its Financial Management (FM) Strategy in FY 2023. The FM Strategy supports the FM workforce, drives accountability and fiscal discipline and further demonstrates the operational value of audit. The Audit Roadmap highlights interdependencies between business processes and needed system improvements and documents the path to achieving an audit opinion. Executing this strategy, along with the detailed Audit Roadmap, allows DON leadership to monitor progress in real time.
In FY 2023, the DON downgraded two significant audit findings, known as material weakness. The first is the GF and WCF Oversight and Monitoring material weakness, improving insights into the DON internal control environment and compliance with internal control requirements. The DON also downgraded the GF Fund Balance with Treasury, the Navy’s “cash,” material weakness one year ahead of schedule. These improvements demonstrate the DON’s commitment to improving its business operations and accelerating audit progress. In FY 2023, the DON also:
· Launched an enhanced training platform to support career development and prepare the workforce for the FM challenges of today and tomorrow.
· Enabled the FM workforce to focus on more complex and high-value analytical tasks through automation. The DON currently uses 168 bots, saving more than 160,000 labor hours that can now be directed to more value-added tasks.
· Sustained all prior year material weakness downgrades and closed more than 25 percent of its prior year audit findings.
· Sustained the lowest improper payment rate for military pay in the Department of Defense, demonstrating the DON’s commitment to taking care of its people.
· Improved transparency of its financial information through improvements in data quality and timeliness of reporting.
· Continued strengthening cybersecurity by automating system account provisioning, account removal and access reviews for two audit-relevant systems.
· Expanded the use of budget execution tools, providing real-time insight into the status of funds across the DON and allowing Commanders to optimize budgetary resources.
· Continued migration to the Navy’s Enterprise Resource Planning system and decommissioning of legacy systems, avoiding millions of dollars of cost.
The DON remains committed to building on these accomplishments and improving internal controls to address long-standing challenges to its business operations and ensure sound financial management.
The audit fosters a culture that encourages innovation, solves problems and achieves results to increase our lethality, improve readiness and get the most out of every dollar entrusted to us. The DON remains in synch with the Secretary of Defense Audit Priorities, including reporting a complete and accurate cash balance with the Department of Treasury and strengthening user access in our financial systems.
For more information, see the DON FY 2023 Agency Financial Report.