Government Accountability Office (GAO)

What Is the Government Accountability Office (GAO)?

The Government Accountability Office (GAO) is an independent and non-partisan U.S. legislative agency that monitors and audits government spending and operations. Often called the "congressional watchdog," GAO examines how taxpayer dollars are spent and provides recommendations on how to save the government money or operate more fiscally responsibly.

Understanding the Government Accountability Office

The Government Accountability Office (GAO) tracks how the legislative and executive branches of the government use taxpayer dollars and then provide results directly to Congress. The comptroller general runs the GAO and serves a 15-year term. The position is appointed by the president from a bipartisan list of congressional recommendations. The current comptroller general, Gene L. Dodaro, was appointed in 2010.

Essentially, the GAO serves as a congressional watchdog over government spending. It monitors the operating results, financial positions, and accounting systems used by the various governmental agencies and conducts routine audits on all branches of government.

The GAO conducts audits of federal government agencies to ensure that funds are allocated properly and not misappropriated. For example, it conducts audits and reviews of the Pentagon, including U.S. military spending on personnel and weapons systems. The GAO reviews government programs and policies to determine if the established goals are properly aligned with their original purpose and are being satisfied. 

This office also investigates allegations of illegal activity within the government and issues legal determinations on proposed rules regarding other government agencies. 

The GAO has broad authority to review the Federal Reserve's function and operations, and it conducts reviews of the emergency lending programs that were enacted following the 2008 financial markets' collapse. However, it does not have the authority to review individual meetings and monetary policy decisions made by the Fed.

Another set of legislative duties includes establishing standards, referred to as the Generally Accepted Government Auditing Standards (GAGAS), for government audits and providing reports, such as reports about the Federal Budget and Education.

History of Government Accountability Office

During World War I, government spending and debt rose sharply, which prompted demand for a formal system to review, monitor, and control government expenditures. As a result, the Budget and Accounting Act of 1921 established the General Accounting Office (GAO), which assumed budget, accounting, and auditing responsibilities from the U.S. Treasury Department. In addition, this act also required the president to prepare an annual budget for the federal government. In 2004, the name changed to the Government Accountability Office after the passing of the GAO Human Capital Reform Act.