107-40  (Sept. 13, 2001), Authorization for Use of Military Force, and other  operations and related activities in support of the global war on terrorism. Congress has also appropriated funds for the reconstruction of Iraq and  Department of State and U.S. Agency for International Development  projects. Obligations for GWOT Operations

As of September 30, 2003, DOD reported obligating a total of over  $61 billion in fiscal year 2003 in support of the war. Within the operation and  maintenance account, the operating support category had the largest  amount of reported obligations for fiscal year 2003—over $32 billion or  74 percent of the total. Within the military  personnel account, the category reserve component called to active duty  had the highest level of reported obligations—almost $9.3 billion or  59 percent of the total. Funding Adequacy for GWOT Varied by Service

The adequacy of funding available for fiscal year 2003 GWOT obligations  reported in military personnel and operation and maintenance accounts  varied by service. Within the military personnel accounts, as shown in table 1, in fiscal year  2003 the Army, Navy, and Air Force reported more obligations in support  of the war than they received in funding for the war. To cover the shortfall  in GWOT funding, these services had to use funds appropriated for their  budgeted peacetime operations. Within the operation and maintenance accounts, as shown in table 2, in  fiscal year 2003 the Army, Air Force, and Navy received funding that  exceeded their reported GWOT obligations. The Army reported slightly more funding than obligations for the war. Air Force officials told us that the $176.6 million, which appeared to be  unobligated GWOT funding, was actually obligated late in the fiscal year. Navy officials told us that the apparent unobligated GWOT funds  ($299 million) were in fact obligated in support of the war but were  originally, and incorrectly, reported as obligations in support of budgeted  peacetime operations. Returning these funds is in keeping  with recommendations we made in our September 2003 report discussed  above to monitor the obligation of funds in the services’ operation and  maintenance accounts and ensure that all funds transferred to the services  that are not likely to be obligated by the end of the fiscal year are  transferred back to the Iraqi Freedom Fund. While the Marine Corps obligated $72.5 million more for GWOT than it had  in funds at the end of fiscal year 2003, it, like the Navy, returned money to  the Iraqi Freedom Fund.
Why GAO Did This Study

The Global War on Terrorism--principally involving operations in Afghanistan and Iraq--was funded in fiscal year 2003 by Congress's appropriation of almost $69 billion. To assist Congress in its oversight of spending, GAO is undertaking a series of reviews relating to contingency operations in support of the Global War on Terrorism. In September 2003, GAO issued a report that discussed fiscal year 2003 obligations and funding for the war through June 2003. This report continues the review of fiscal year 2003 by analyzing obligations reported in support of the Global War on Terrorism and reviews whether the amount of funding received by the military services was adequate to cover DOD's obligations for the war from October 1, 2002, through September 30, 2003. GAO will also review the war's reported obligations and funding for fiscal year 2004.

What GAO Found

In fiscal year 2003, DOD reported obligations of over $61 billion in support of the Global War on Terrorism. GAO's analysis of the obligation data showed that 64 percent of fiscal year 2003 obligations reported for the war on terrorism went for Operation Iraqi Freedom; among the DOD components, the Army had the most obligations (46 percent); and among appropriation accounts the operation and maintenance account had the highest level of reported obligations (71 percent). The adequacy of funding available for the Global War on Terrorism for fiscal year 2003 military personnel and operation and maintenance accounts varied by service. For military personnel, the Army, Navy, and Air Force ended the fiscal year with more reported obligations for the war than funding and had to cover the shortfalls with money appropriated for their budgeted peacetime personnel costs. For operation and maintenance accounts, the Army, Navy, and Air Force appeared to have more funding than reported obligations for the war. However, the Navy and Air Force have stated that the seeming excess funding ($299 million and $176.6 million respectively) were in support of the war on terrorism, but had not been recorded as such. Therefore, Navy and Air Force obligations exactly match funding. The Marine Corps used funds appropriated for its budgeted peacetime operation and maintenance activities to cover shortfalls in funding for the war.