can't run a government like you do business. I have run it that way three times in my life, and I know it can be if men want to be honest and forthright in the discharge of their public responsibilities. I don't accept the principle that public affairs cannot be run with the same efficiency as private business.

We wanted to see the title of Comptroller General assigned to the chief accounting officer and the head of the General Accounting Office called the Auditor General of the United States, in order to conform to verities. A comptroller is an accounting officer, not an auditing officer, and we wanted the Comptroller General's office given its proper title of Auditor General. But it is sort of like consolidating the counties of Virginia. You have that old thing called tradition staring you in the face. Some of these early counties do not want to lose their traditional names, so we have to contend with tradition. So it was here. We were confronted with the question of tradition. The head of the General Accounting Office had become known as the Comptroller General, so we invented a new title, the Accountant General.

The CHAIRMAN. Let me ask you, Mr. Andrews, if your recommendation were to be carried out and you established an accountant general in the executive branch of the Government, what powers that the Comptroller General now has would you take from him and place in the Accountant General in the executive branch of the Government?

Mr. ANDREWS. We would take from the Comptroller General all of his accounting duties, those that are presumed to be and those that actually are his accounting duties. There aren't very many.

The CHAIRMAN. At present the Comptroller General passes on accounts with reference to whether under the law they are allowable and whether they should be approved and paid. Where would you place that authority in the changes you would make?

Mr. ANDREWS. As independent auditor the Comptroller General should examine into the legality of transactions as a part of his independent auditing function. I would not take that from him. There were some members of our committee-all but I, in fact-who felt very strongly that the Comptroller General should not be permitted to settle accounts, that that is an administrative function and should be left with the administration. As a matter of principle, that view is as sound as a dollar, and I agree with it; but if yielding on that point would settle the other differences, I'd be willing.

The CHAIRMAN. Of course, you know the purpose of setting up the Comptroller General's office was so that the Congress, which has the final responsibility for making appropriations, should have some control over these expenditures, to see that they were made under authority of law and to try to prevent any being made that were not authorized, rather than to audit and then find out later that funds had been misspent. The Congress is trying to keep some control, to have an agency of its own exercise some powers with reference to these expenditures.

Senator O'CONOR. That is the very reason I propounded the other question to the witness, to secure the benefit of his advice as to whether or not this is entirely comparable to the ordinary business set-up.

Mr. ANDREWS. It is completely comparable, for this reason, ladies and gentlemen: An independent auditor goes in to review the acts

of management. Boards of directors, to which the Congress more or less corresponds, set policy; they do not attempt to run the business. The independent auditor goes in to see whether that policy is carried out, to see among other things, whether the expenditures of the organization have been made in accord with the policies of the board of directors. Whatever you may think about the need for Congress to have some control, a hand on the spigot of expenditures, let us look experience in the face. What we actually have done in business over a period of many, many years is to establish beyond peradventure of doubt that the process of independent auditing following along after the proper discharge of the accounting responsibility has tended to give the board the control that they want. In the Federal Government we have spent an untold amount of money for the purpose of keeping people honest, and very little, ladies and gentlemen, to provide the proper accounts for this Government. That is one of the fundamental faults that we have to find with the present set-up. It is a system, as now conceived and maintained, to keep people honest. A proper system would greatly aid the managers of the Government's affairs and afford an equally effective check on these managers' honesty. And it would cost a whale of lot less money than we have been spending with fruitless results as far as getting useful accounting is concerned.

Senator MUNDT. Mr. Andrews, how do you propose to get this independent audit under your recommendation? I am not clear on that.

Mr. ANDREWS. Under our recommendations? You already have that on the statute books. The Comptroller General is your independent auditor.

Senator MUNDT. I understood you were going to change that.
Mr. ANDREWS. No, sir; absolutely not.

Senator MUNDT. What changes, if any, do you recommend for the present office of Comptroller General?

Mr. ANDREWS. Let us put it broadly to start out with, and then if you have specific questions I will try to answer them. We want to raise the Comptroller General to the full stature of an independent auditor without involvement in any way in the accounting function of management. We feel very honestly, ladies and gentlemen, that if that were accomplished, that office and the Comptroller General would be a far more effective officer than he is now. We must not overlook the fact that, with all of its desire to have someone who acts as its man between it and the administration, many reports of the Comptroller General have come to this Congress disclosing deplorable situations about which nothing has been done. That is why in our report we recommend that there be established a means whereby there would be prompt action upon the reports brought here by your Comptroller General.

We feel that if the Comptroller General becomes strictly the independent auditor-the chief investigator-for Congress, then he could so organize that he would be able to keep his work very much more up to date and perform his audits with more timeliness. The Comptroller General has in the past been involved in so much detailed checking of papers that there have been cases where his office has been 4 or 5 years behind in its work. I submit that under those circumstances

Senator MUNDT. I just do not understand yet the agency that you intend to set up. I wonder if you could tell us the kind of organization chart you have in mind, without having all the argument involved in telling us. Give the arguments later. I just do not know what it is that you are trying to sell us.

Mr. ANDREWS. I would like to tell the Senator very plainly I am not trying to sell you anything.

Senator MUNDT. I am here to entertain an idea; we are looking for ideas.

Mr. ANDREWS. I am giving you, at the request of your chairman, the benefit of my humble advice. It may not be very humbly given, but I am just one person and I realize I don't know it all. I am giving you the benefit of my experience. We conceive of the Comptroller General as a person who should go in behind management and check its accounts thoroughly on the spot in their own offices, using the same checking devices and procedures as are used in auditing the books of any other kind of enterprise or organization, and then making

Senator MUNDT. May I interrupt again. Up to now the change involves that each department would maintain its own set of books, and the Comptroller General would send his people to that department to check them rather than maintaining any records himself; is that correct?

Mr. ANDREWS. That is right. The Comptroller General would go into the departments and audit them on the spot.

Senator MUNDT. It is very similar to the way State bank auditors operate.

Mr. ANDREWS. Exactly, sir.

Senator MUNDT. What other changes do you suggest? Is that the basis of the whole proposal?

Mr. ANDREWs. That is the whole basic proposal.

Senator MUNDT. 1o whom would the Comptroller General, if you want to call him that, or the Auditor General, which seems to be the more appropriate name if that became his function, to whom would he be responsible? To whom would he make these reports?

Mr. ANDREWS. He would be responsible to the Congress, as he is

now.

Senator MUNDT. There would be no change in that.

Mr. ANDREWS. No, sir. We do not propose any change whatsoever in the Comptroller General's status as the independent auditor of Congress. We merely want him to be truly independent. He isn't now; nor can he be so long as he is required to assume a part of the executive branch's responsibility. We would change his name from Comptroller General to Auditor General.

Senator MUNDT. I take it you feel that S. 2054 does not achieve this objective which you have just described.

Mr. ANDREWS. No, sir, it does not.

Senator MUNDT. Do you have anything in mind which would achieve that?

Mr. ANDREWS. I have not drawn any bill, if that is what you mean. I go back to our report to the Commission. It is specific and tells. you exactly the steps we would take to do it.

Senator MUNDT. I understood, Mr. Chairman, that this bill is the outgrowth of the report.

The CHAIRMAN. I would say the bill is the outgrowth of the Hoover Commission recommendations, but the Hoover Commission did not follow the task-force report and recommendations. That is correct, is it not?

Mr. ANDREWS. There was division of opinion there. I think you will find that Mr. Hoover subscribed to our views. As a matter of fact, just this morning I ran across something he said I think back in 1932. Let me read it to you. It is only one short paragraph. He said:

It is not, however, a proper function of an establishment created primarily for the purpose of auditing Government accounts to make the necessary studies and to develop and prescribe accounting systems involving the entire field of Government accounting. Neither is it a proper function of any such establishment to prescribe the procedure for nor to determine the effectiveness of the administrative examination of accounts. Accounting is an essential element of effective administration, and it should be developed with the primary objective of serving this purpose.

That was in 1932. Ladies and gentlemen, frankly, it is not possible for anybody to come to any other conclusion. That has been the conclusion of every reputable auditor, accountant, and systems specialist who has ever studied the accounting of the Federal Government.

Senator MUNDT. Do you have amendments in mind to S. 2054 which would achieve the objective which you desire, or is it your recommendation that we discard this and start over in the writing of a bill to achieve your objectives?

Mr. ANDREWS. I am not sufficiently experienced in legislative procedures, Senator, to say which should be done. I certainly think, and I would certainly hope, to see either amendments to this bill or another bill prepared that would carry into effect the proposals that we have made. We know that that is the thing that is necessary. It isn't a matter of politics with us. It isn't a matter of expediency. We have no axes to grind with anybody.

Senator MUNDT. By the pronoun "we" to whom do you refer? Mr. ANDREWS. I am speaking now of the committee that worked with me, the group of seven accountants.

Senator MUNDT. The task force?

Mr. ANDREWS. Every one of those men.
Senator MUNDT. They were unanimous?

Mr. ANDREWS. They were unanimous as to these provisions; yes, sir.

Senator MUNDT. Since there is some difference from that recommendation, the Hoover Commission must have stepped in and altered that unanimous report, is that correct?

Mr. ANDREWS. That is right. I think frankly that we must recognize that the difference between that bill and the Hoover Commission report is probably the difference between the understanding of a professional man and the lack of understanding of the layman. In other words

Senator MUNDT. You are working on a layman now.

Mr. ANDREWS. I hope I am doing some good with this layman. They called in a whole flock of doctors and then didn't take their advice. That is the answer. Of course, that is not unusual. Doctors don't always get listened to. Mine tells me to stop smoking, but I am still smoking. Nevertheless, that is just my life that is involved.

The thing that is involved here is part and parcel of preserving a system of government that we all want to see maintained.

I think, gentlemen, it is just that serious if you want my honest view about it. We cannot neglect this thing much longer without endangering the very system of government under which we live.

The CHAIRMAN. Mr. Andrews, to clarify something in my mind, do you recommend the transfer from the General Accounting Office of all responsibility for designing and installing accounting systems in the executive branch.

Mr. ANDREWS. That is just one of the things, sir.

The CHAIRMAN. I understand, but you do recommend that point. Mr. ANDREWs. Yes, sir.

The CHAIRMAN. That they have no control over that whatsoever. Mr. ANDREWS. For instance, Senator

The CHAIRMAN. Is that correct?

Mr. ANDREWS. Yes, that is one of the things.

The CHAIRMAN. Let me ask you this, and then you make any comments you like. Is it not true that in private enterprise the board of directors and the management of the business frequently consult with their independent auditors with reference to and get them to help design and install an accounting system for their business? Is that not a general practice?

Mr. ANDREWS. Yes, it is.

The CHAIRMAN. In this particular bill that is what is being done in a sense because, when it sets up this office in the Treasury, this bill requires the approval or disapproval of the proposed accounting systems then proposed by the Comptroller General. If the law does not require that, then in Government we would not be following the general practice in private enterprise. We would simply be turning over responsibility, without any check, entirely to the executive branch of the Government.

Mr. ANDREWS. Senator, I have heard that argument raised time. and time again, and I can assure you, sir, that it is absolutely without validity. I will tell you why. It goes back to the fundamental question that the responsibility for accounting is the responsibility of management. Sure, public accountants, independent public accountants design and install systems, but who decides what a system is going to be before it is put in? The auditor? No, sir. The management decides it.

The CHAIRMAN. In this case the Congress is trying to have something to do with it to be certain that it is satisfactory.

Mr. ANDREWS. All right, let your Comptroller General have all the authority that he wants to criticize the kind of system that the management of the Government puts in. That is a part of the responsibility of an independent auditor.

The CHAIRMAN. That leads me to ask you another question. What is there in the law or not in the law that has prevented the executive department from installing a satisfactory system up to date?

Mr. ANDREWS. There is no provision whatsoever in the law for anyone to have the primary responsibility for accounting or for an accounting office.

The CHAIRMAN. Does each agency not have that responsibility now?

Mr. ANDREWs. Not clearly.