This report reviews the status of government agencies and operations that have been identified as at "high risk" for waste, fraud, abuse, and mismanagement; describes successful progress in some agencies; and looks at recent reform legislation. Six categories being targeted include accountability of defense programs, ensuring that all revenues are collected and accounted for, obtaining an adequate return on investments in information technology, controlling Medicare claims fraud and abuse, minimizing loan program losses, and improving management of federal contracts. In the area of loan program losses, the guaranteed student loan program cost $2.4 billion in losses in fiscal year 1994. The Department of Education is addressing some of the program's weaknesses by transferring some risks and financial costs to lenders and guaranty agencies, and is phasing out the guaranteed loan program and replacing it with a direct loan program. However, loan data continue to be unreliable, and a viable strategy is needed to prevent unscrupulous schools from participating in the new direct loan program. Five programs have made enough progress to have their high-risk designation removed. Legislative changes are moving toward a smaller, more efficient government that focuses on accountability and managing for results, such as the Government Performance and Results Act and the Chief Financial Officers Act. (JB)