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Financial Report of the United States Government

Management's Discussion & Analysis

Introduction

The FY 2020 Financial Report provides the President, Congress, and the American people with a comprehensive view of the federal government’s financial position and condition, and discusses important financial issues and significant conditions that may affect future operations, including the need to achieve fiscal sustainability over the long term.

Pursuant to 31 U.S.C. § 331(e)(1), Treasury, in cooperation with OMB, must submit an audited (by GAO) financial statement for the preceding fiscal year, covering all accounts and associated activities of the executive branch of the U.S. government1 to the President and Congress no later than six months after the September 30 fiscal year-end.

The Financial Report is prepared from the financial information provided by 165 federal consolidation entities (see organizational chart on the next page and Appendix A). As it has for the past 22 years, GAO issued a disclaimer of opinion on the accrual-based, consolidated financial statements for the fiscal years ended September 30, 2020 and 2019. GAO also issued a disclaimer of opinion on the sustainability financial statements, which consist of the 2020 and 2019 SLTFP; the 2020, 2019, 2018, 2017, and 2016 SOSI; and the 2020 and 2019 SCSIA. A disclaimer of opinion indicates that sufficient information was not available for the auditors to determine whether the reported financial statements were fairly presented in accordance with GAAP. In FY 2020, 352 of the 40 most significant entities earned unmodified (“clean”) opinions on their financial statements.

The FY 2020 Financial Report consists of:

This Financial Report addresses the government’s financial activity and results as of and for the fiscal years ended September 30, 2020 and 2019. Note 29, Subsequent Events discusses events that occurred after the end of the fiscal year that may affect the government’s financial position and condition.

In addition, the Results in Brief and Executive Summary to this Financial Report provide a quick reference to the key issues in the Financial Report and an overview of the government’s financial position and condition.

Mission & Organization

The government’s fundamental mission is derived from the Constitution: “…to form a more perfect union, establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare and secure the blessings of liberty to ourselves and our posterity.” The government’s functions have evolved over time to include health care, income security, veterans benefits and services, housing and transportation, security, and education. Exhibit 1 provides an overview of how the U.S. government is organized.

Exhibit 1 - Overview of how the United States Government is organized

Notes

1 The Government Management Reform Act of 1994 has required such reporting, covering the executive branch of the government, beginning with financial statements prepared for FY 1997. The consolidated financial statements include the legislative and judicial branches. (Back to Content)

2 The 35 entities include the Department of Health and Human Services, which received disclaimers of opinion on its 2020, 2019, 2018, 2017, and 2016 SOSI and on its 2020 and 2019 SCSIA. (Back to Content)

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Last modified 05/06/21