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DOD acknowledged the following deficiencies related to the Statement of Net Cost: (1) the amounts presented for the GFs may not report actual accrued costs, (2) although WCFs are generally recorded on an accrual basis, as required by accounting principles generally accepted in the United States, the systems do not always capture actual costs in a timely manner, (3) the Statement of Net Cost is not presented by program, in alignment with major goals and outputs described in DOD strategic and performance plans as required by the Government Performance and Results Act, and (4) revenues and expenses are reported by appropriation category because financial processes and systems do not collect costs according to performance measures." {DOD IG Report 2010-002, pp. 10-11] |