The internal control issues identified by the GAO include weaknesses regarding:
- preparing financial statements and related disclosures;
- recording and reporting of disgorgement and penalties, which amounted to more than $1.6 billion in FY 2005; and
- information security.
Other, less significant weaknesses, identified in the earlier report also remain unresolved. These include:
- responsibilities of the contracting officer's technical representative;
- reviewing filing fee calculations; and
- compliance with the Prompt Payment Act, which requires that the federal government pay invoices within 30 days of receipt of a valid invoice.
In light of the SEC's own responsibilities to assure integrity in financial reporting and internal control processes at public companies, it is ironic that the SEC has this beam in its own eye. In particular, public companies have been engaged in an extensive review process as required by section 404 of the Sarbanes-Oxley Act. It sounds as if the SEC should do the same.