By Arindam Nag and Deborah Zabarenko
New York - As Nasa sets course for the moon and Mars, the space agency's finances are in disarray, with significant errors in its last financial statements and inadequate documentation for $565-billion posted to its accounts, its former auditor reported.
Nasa's chief for internal financial management said the problem stemmed from a rough transition from 10 different internal accounting programs to a new integrated one, but audit firm PriceWaterhouseCoopers noted basic accounting errors and a breakdown in Nasa's financial controls.
PriceWaterhouseCoopers and Nasa parted ways earlier this year, according to the space agency's inspector general, Robert Cobb. PriceWaterhouseCoopers declined to comment, but a source familiar with the situation said the audit firm opted out of the contract because it was unhappy with the relationship.
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In a scathing report on Nasa's September 30, 2003, financial statement - which got scant attention at its release but was detailed in a cover story in the May issue of CFO Magazine - the audit firm accused the space agency of one of the cardinal sins of the accounting world: failing to record its own costs properly.
The same report said the transition to the new accounting program triggered a series of blunders that made completing the Nasa audit impossible.
There were hundreds of millions of dollars of "unreconciled" funds and a $2-billion difference between what Nasa said it had and what was actually in its accounts, which are held by the Treasury Department, PriceWaterhouseCoopers said in its report.
"The documentation Nasa provided in support of its September 30, 2003, financial statements was not adequate to support $565-billion in adjustments to various financial statement accounts," the auditor wrote in a January 20 report to Cobb, Nasa's inspector general.
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