Published on Wednesday, 30 November -0001 00:00
Truth in Accounting Act Makes Government Finances Transparent and Open
Tuesday, Feb. 10, Congresswoman Michele Bachmann reintroduced the Truth in Accounting Act, a bipartisan bill that would force our nation to take a critical step toward transparency for government's balance sheets. Simply put, the bill forces government to be accountable to the taxpayers just as government has required corporate America to face its own responsibilities to its shareholders. "When citizens and government officials come to understand our true long-term fiscal exposures and their potential claims on future budgets-and future taxpayers," said Bachmann, "they are more likely to insist on prudent policy choices today and sensible levels of fiscal risk in the future. In the wake of the accounting scandals at Enron and other big companies, shareholders and Congress demanded truth in accounting from Wall Street giants. The American taxpayers-our nation's shareholders-should demand no less from their government." The Truth in Accounting Act requires the Treasury Department, in coordination with the Office of Management and Budget (OMB), to begin reporting in the annual Financial Report of the U.S. Government a measure to track the costs of the federal government's long-term fiscal exposures, based on accrual accounting principles. In technical terms, the bill measures the present value of projected spending minus projected revenues, over the 75-year and indefinite time horizons, for several long-term spending obligations. The result is the budget shortfall that must be met by our government in order to put our fiscal policies on a sustainable path. The bill also requires the President to consider this important data when proposing his budget to ensure the budget process is always focused on a true accounting.