Independent U.S. investigators say the Iraqi government did not meet 11 of the 18 benchmarks set by the United States to mark progress.
The report by the Government Accountability Office (GAO) says that key legislation has not been passed, violence remains high, and it is unclear whether the Iraqi government will spend $10 billion in reconstruction funds.
It says three of the 18 political and security benchmarks have been met, while four of them have been partially met.
The document says Iraq has not enacted legislation on de-Baathification, oil revenue sharing, provincial elections, amnesty and militia disarmament.
The report says investigators could not determine if sectarian violence has decreased, citing the difficulty in determining the intent behind an attack.
U.S. Comptroller David Walker testified Tuesday about the report to the Senate Foreign Relations Committee. The GAO is known as the investigative arm of Congress.
The report says the Iraqi government has met the goal of protecting the rights of minority political parties in Iraq's legislature.
The White House has acknowledged that not all benchmarks have been met, but has urged Americans to wait for a report on Iraq this month from U.S. Ambassador to Iraq Ryan Crocker and the top U.S. military commander in Iraq, General David Petraeus.
President Bush on Monday made an unannounced visit to Iraq.
Some information for this report was provided by AP and Reuters.
