I don’t know if I should be the one to berate the National Aeronautics and Space Administration for the condition of its finances or accounting practices. If you ever had the opportunity to see a balanced version of my checkbook, you’d understand.
But then again, if I forget to enter in a check, which I tell my cynical wife happens only on certain occasions — like once a day — it’s not quite as catastrophic as, say, inadequately documenting $565 billion to your accounts.
Yes, that’s billion. Needless to say, I was disappointed.
This from someone who built model replicas of every Mercury and Atlas capsule available, could recite the biographies of Werner Von Braun and Robert Goddard, and who re-read “The Right Stuff” a minimum of six times.
According to published reports, the agency contends that its little financial disarray stems from transitioning from a series of 10 internal accounting programs to a single, integrated platform. Yet its former auditor, Big Four firm PricewaterhouseCoopers, detected more garden-variety accounting errors than meteors, and also what it termed a breakdown in financial controls. And incidentally, those accounting errors were unrelated to the aforementioned transition.
What errors, you ask? How about an undocumented line item of more than $200 million? Or a scant $2 billion difference between the agency’s stated fund balance (what it said it has) and the balance in its Treasury account (what it actually has), which the auditor claimed was changed by NASA to balance out without NASA disclosing that it had done so.
Unbeknownst to me, the agency has had a lengthy record of financial malaise. In its prior-year auditor report, PwC had basically told the agency what had to be fixed and identified a number of internal control point breakdowns. Their warnings obviously had the same effect as when I ask my daughters to clean up their rooms.
Not only that, its year-end financial statements were delivered to the auditor some two months late. Small wonder PwC and NASA no longer enjoy a working relationship.
It also seems that NASA has consistently held a spot on the General Accounting Office’s roster of “high risk” agencies for at least a decade. It also distinguished itself as just one of three government agencies to receive a disclaimer on its audit opinion.
At a recent conference in New York, an attendee who was quite familiar with the trend of financial mismanagement among government entities confided to me that one of the few agencies in worse shape with regard to internal controls than NASA was the Department of Defense.
You should have seen me feigning surprise.
Last month, the GAO issued a scathing report on NASA’s financial maelstrom, stating that it faces “major challenges” in righting its wobbly ship.
Maybe it wouldn’t be such a bad idea for their new chief financial officer, Gwendolyn Brown, to use some of NASA’s budget coffers to weed out auditors who are entrenched in a carefree zone of government protection, but who keep financial records as diligently as I do my checkbook.
It appears as if Mission Control is embarking on one of its toughest missions ever.
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