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GAO-25-108146 1 (July 23, 2025)

handle is hein.gao/uscnsdfinl0001 and id is 1 raw text is: G go U.S. GOVERNMENT ACCOUNTABILITY OFFICE 441 G St. N.W. Washington, DC 20548 July 23, 2025 Mr. Christopher Johns Deputy Chief Financial Officer U.S. Department of Energy 1000 Independence Ave., SW Washington, DC 20585 U.S. Consolidated Financial Statements: Key Issues for the Department of Energy Dear Mr. Johns: As the Department of Energy's (DOE) Deputy 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 DOE, have a key role in supporting financial reporting at the government-wide level. DOE's strong and sustained commitment is critical to addressing the following key issues that affect the U.S. government's consolidated financial statements. DOE's qualified opinion and material weakness: DOE received a qualified opinion on its fiscal year 2024 financial statements. According to DOE's auditor, the DOE Office of Environmental Management was unable to adequately support $39.1 billion of its environmental liability balance as of September 30, 2024, with valid cost estimates, schedules, and assumptions. This qualification contributed to us being unable to express an opinion on the consolidated financial statements. It is important that DOE address the issues causing the qualified opinion to support accurate reporting for the consolidated financial statements. DOE's auditor also reported a material weakness in the Office of Environmental Management's internal controls over its environmental liability, including deficiencies related to headquarters oversight of field site estimates. The Office of Environmental Management is responsible for nearly 80 percent of DOE's $544 billion environmental liability balance as of September 30, 2024. Since 2017, the U.S. government's environmental liability has been on our High-Risk List of agencies and program areas that are vulnerable to fraud, waste, abuse, and mismanagement 1The 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. 2GAO, Financial Audit: FY 2024 and FY 2023 Consolidated Financial Statements of the U.S. Government, GAO-25- 107421 (Washington, D.C.: Jan. 16, 2025). GAO-25-108146 CFS Issues for DOE Page 1

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