oversight

Civil Financial Audits Issue Area--Active Assignments

Published by the Government Accountability Office on 1997-01-02.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                   United States General Accounting Office

GAO                Accounting
                   Managementand Information
                              Division



January 1997       A
                   Civil Financial Audits
                   Issue Area
                   Active Assignments




                       co     69/g5)C         5
GAO/AA-97-24( 1)
Foreword


           This report was prepared primarily to inform Congressional members and
           key staff of ongoing assignments in the General Accounting Office's Civil
           Financial Audits issue area This report contains assignments that were
           ongoing as of January 2, 1997, and presents a brief background statement
           and a list of key questions to be answered on each assignment. The report
           will be issued quarterly.

           This report was compiled from information available in GAO'S internal
           management information systems. Because the information was
           downloaded from computerized data bases intended for internal use, some
           information may appear in abbreviated form.

           If you have questions or would like additional informationabout
           assignments listed, please contact Gregory Holloway, Director, on
           (202) 512-3406; or Linda Calbom, Director, on (202) 512-8341; or Robert
           Dacey, Associate Director, on (202) 512-3317; or William Hunt, Associate
           Director, on (202) 512-2711.




           Page 1                                                      GAO/AA-97-24(1)
Contents

                                                                                                 Page
FINANCIAL AUDITS                                                                                 Pag
        ,FINANCIAL AUDIT OF THE INTERNAL REVENUE SERVICE FOR FISCAL YEAR 1996.                         1
        *REVIEW OF OMB CREDIT SUBSIDY MODEL.                                                           1
FINANCIAL CONDMON--GGD & GOV'TWIDE
    New ,GOAL SETTING AND PERFORMANCE MEASUREMENY FOR FEDERAL CREDIT PROGRAMS.                         1
    New ,FY96 HIGHWAY FUND FINANCIAL AUDIT.                                                            2
    New   ,TESTIMONY-IRS' PROGRESS IN IMPLEMENTING THE GOVERNMENT PERFORMANCE AND RESULTS ACT.         2
    New   ,CONSOLIDATED FINANCIAL STATEMENT AUDIT OF CASH LINE ITEM - FY 1996.                         2
    New    RECONCILIATION OF AGENCIES' FUND BALANCES WITH TREASURY.                                    3
    New   .OTHER MONETARY ASSETS.                                                                      3
    New ,FMS' ABILITY TO COMPILE AGENCY DATA.                                                          3
FINANCIAL CONDITION--HEHS
    New OPREPARINGFORTHEFY1997AUDITOFEDUCATION, TRAINING, EMPLOYMENT &SOCIALSERVICES                   4
         EXPENSES.
    New ,HRA 1: PREPARING FOR THE FY 1997 AUDIT OF INCOME SECURITY EXPENSES.                           4
    New ,PREPARING FOR THE AUDIT OF VETERANS BENEFITS AND SERVICES.                                    4
FINANCIAL CONDITION-RCED
    New *LOANS RECEIVABLE LINE ITEM FOR GOVERNMENTWIDE FINANCIAL STATEMENT AUDIT.                      5
    New ,LIABILITY FOR LOAN GURANTEES LINE ITEM FOR THE GOVERNMENTWIDE FINANCIAL STATEMENT             5
         AUDIT.
    New ,ENVIRONMENTAL LIABILITIES LINE ITEM FOR GOVERNMENTWIDE FINANCIAL STATEMENT AUDiT.             5
    New  TRANSPORTATION EXPENSE FOR GOVERNMENT-WIDE EXPENSE FINANCIAL STATEMENT AUDIT.                 6
    New ,ENERGY, NATRUAL RESOURCES AND ENVIRONMENT, NET COSTS.                                         6
    New ,COMMITMENTS & CONTINGENCIES FOOTNOTE FOR GOVERNMENTWIDE FINANCIAL STATEMENT                   6
         AUDIT.
    New   SCONSOLIDATED  AUDIT OF STEWARDSHIP LAND.                                                    7
    New   *CONSOLIDATED AUDIT OF HERITAGE ASSETS.                                                      7
    New   .IMPROVING THE FINANCIAL INFORMATION FOREST SERVICE.                                         7
FINANCIAL OPERATIONS-.RCED
    New *MONITORING OF POWER MARKETING ADMINISTRATION DEBT BALANCES AND REPAYMENT.                     8
OTHER ISSUE AREA WORK - CA
    New ,STATUS REPORT ON THE NEW D.C. SPORTS AREAN.                                                   8
    New ,ANALYSIS OF THE DISTRICTS BUDGET AND FINANCIAL CONDITION.                                     8
    New ,REVIEW OF ALASKA NATIVE TRUST FUND ACCOUNTS ADMINISTERED BY THE DEPARTMENT OF THE             9
         INTERIOR'S OFFICE OF TRUST FUNDS MANAGEMENT (OTFM).
    New ,RESPONSE TO THE AMERICAN PUBLIC POWER ASSOCIATION'S COMMENTS ON GAO'S RECENT REPORT           9
         ON POWER MARKETING ADMINISTRATION.
    New ,PREPARING FOR THE FY97 GOVERNMENTWIDE AUDIT OF ACCOUNTS PAYABLE.                              9
    New ,PREPARING FOR THE FY97 CONSOLIDATED AUDIT OF HEALTH.                                      10
Civil Audits




FINANCIAL AUDITS
     TITLE:   FINANCIAL AUDIT OF THE INTERNAL REVENUE SERVICE FOR FISCAL YEAR 1996 (901702)

              BACKGROUND: Under the CFO Act of 1990, IRS is required to prepare financial statements for fiscal year
              1996. This is the fifth year in which GAO will perform the audit of IRS' financial statements.
              KEY QUESTIONS: 1) Are the financial management and internal controls effective? 2) Are the financial
              statements reliable, free of misstatements, and presented in conformity with applicable accounting principles?
              3) Is IRS in compliance with laws and regulations?




     TITLE:   REVIEW OF OMB CREDIT SUBSIDY MODEL (913751)

              BACKGROUND: OMB's credit subsidy model, a complex computer software program, is used by federal
              agencies to calculate the subsidy rate for their credit programs, as required by the Federal Credit Reform Act of
              1990. GAO believes that a one-time independent audit of the model is needed to provide accountants and
              auditors assurance that the model produces accurate results.
              KEY QUESTIONS : Question #1: Is there reasonable assurance that OMB's credit subsidy model calculates an
              accurate subsidy rate? Question #2: Do adequate internal controls exist over the model's development,
              maintenance, and use.


FINANCIAL CONDITION--GGD & GOV'TWIDE
     TITLE: GOAL SETTING AND PERFORMANCE MEASUREMENY FOR FEDERAL CREDIT PROGRAMS (901721)

              BACKGROUND: The Government Performance and Results Act (GPRA) mandates a June 1, 1997 GAO
              Report on the Act's implementation. The Federal Credit Policy Working Group (FCPWG) has key efforts
              underway to develop and reach consensus on core measures for credit programs. This job code covers work
              performed by AIMD on a joint assignment with GGD (410058).
              KEY QUESTIONS: (1) What progress have selected federal credit programs made since 1994 in developing
              and using mission-based performance goals and measures? (2) What challenges, if any, do these programs face
              in implementing such measures and what actions are needed to address those challenges?
Civil Audits




FINANCIAL CONDITION--GGD & GOV'TWIDE
    TITLE: FY'96 HIGHWAY FUND FINANCIAL AUDIT (901747)

             BACKGROUND: P.L. 104-21 required DC establish the highway and revolving funds, and temporarily waived
             DC's requirement to pay its share of FY'95 and FY'96 roadway costs. The federal govt paid DC's share and DC is
             required to repay the federal govt. GAO is required to annually audit the highway fund and report to Congress
             by on the results of the audit.
             KEY QUESTIONS: What is the financial condition of the District's Highway Fund and associated revolving
             fund for the fiscal year ending September 30, 1996? What is the Highway Fund's expected condition and results
             of operation for the next 5 years?




    TITLE: TESTIMONY-IRS' PROGRESS IN IMPLEMENTING THE GOVERNMENT PERFORMANCE AND RESULTS ACT
           (901749)




    TITLE:   CONSOLIDATED FINANCIAL STATEMENT AUDIT OF CASH LINE ITEM - FY 1996 (919013)




                                                                2
Civil Audits




FINANCIAL CONDITION-GGD & GOV'TWIDE
    TITLE:   RECONCILIATION OF-AGENCIES' FUND BALANCES WITH TREASURY (919015)




     TIE:    OTHER MONETARY ASSETS (919016)




     TITLE: FMS' ABILITY TO COMPILE AGENCY DATA (919034)




                                                      3
Civil Audits




FINANCIAL CONDITION--HEHS
     TITLE:   PREPARING FOR THE FY 1997 AUDIT OF EDUCATION, TRAINING, EMPLOYMENT & SOCIAL SERVICES
              EXPENSES (919022)




    TITLE:    HRA 1: PREPARING FOR THE FY 1997 AUDIT OF INCOME SECURITY EXPENSES (919025)




    TITLE: PREPARING FOR THE AUDIT OF VETERANS BENEFITS AND SERVICES (919028)




                                                        4
Civil Audits




FINANCIAL CONDITION--RCED
     TITLE: LOANS RECEIVABLE LINE ITEM FOR GOVERNMENTWIDE FINANCIAL STATEMENT AUDIT (919004)

            BACKGROUND: The 1994 GMRA requires GAO to audit the FY97 governmentwide consolidated financial
            reports. Loans receivable is a material line item estimated to be about $190 billion. USDA, ED, HUD, & SBA
            account for over 75 percent of this line item. We will assess FY96 ending balances to assure that FY97 opening
            balances are fairly stated.
            KEY QUESTIONS: Determine whether (1) fiscal year 1996 governmentwide loans receivable and related
            allowance, interest income, and subsidy expense accounts are fairly stated; (2) internal controls relating to these
            accounts are operating effectively; and (3) the government is in compliance with significant provisions of laws
            and regulations related to these accounts.




     TITLE: LIABILITY FOR LOAN GURANTEES LINE ITEM FOR THE GOVERNMENTWIDE FINANCIAL STATEMENT
            AUDIT (919005)

            BACKGROUND: The 1994 GMRA requires GAO to audit the governmentwide consolidated financial reports
            beginning with FY 1997. The Liability for Loan Guarantees, a material line item, totaled about $33B (related to
            $737B in guaranteed loans) at 9/30/95. We will assess the reasonableness of the FY 96 ending balances to
            assure ourselves that FY 97 opening balances are fairly stated.
           KEY QUESTIONS: Determine whether (1) fiscal year 1996 governmentwide Liability for Loan Guarantees and
           related accounts are reasonably stated; (2) internal controls relating to these accounts are operating effectively;
           and (3) the government is in compliance with significant provisions of laws and regulations related to these
           accounts.




     TITLE: ENVIRONMENTAL LIABILITIES LINE ITEM FOR GOVERNMENTWIDE FINANCIAL STATEMENT AUDIT
            (919006)

            BACKGROUND: The 1994 GMRA requires GAO to audit the FY97 governmentwide financial statements.
            Environmental liabilities, a material line item is estimated at more than $300 billion. We believe that USDA,
            DOD, DOE, and DOI will account for most of this line item. We will assess FY96 ending balances to assure
            that FY97 opening balances are fairly stated.
           KEY QUESTIONS: Determine whether (1) fiscal year 1996 governmentwide environmental liabilities are
           fairly stated; (2) internal controls relating to this line item are operating effectively; and (3) the government is in
           compliance with significant provisions of laws and regulations related to this line item.




                                                                   5
Civil Audits




FINANCIAL CONDITION--RCED
    TITLE: TRANSPORTATION EXPENSE FOR GOVERNMENT-WIDE EXPENSE FINANCIAL STATEMENT AUDIT (919007)

           BACKGROUND: The 1994 GMRA requires GAO to audit the FY 97 govemment-wide consolidated financial
           reports. This includes auditing DOT's expenses of $40 billion in the transportation line item. Grants and
           payroll expenses account for 75% of DOT's expenses. We will assess FY 96 ending balances to determine
           whether FY 97 opening balances are fairly stated.
           KEY QUESTIONS: Determine whether (1) fiscal year 1996 transportation expenses and related accruals are
           fairly stated, (2) internal controls relating to these accounts are operating effectively, and (3) the government is
           in compliance with significant provisions of laws and regulations related to these accounts.




    TITLE: ENERGY, NATRUAL RESOURCES AND ENVIRONMENT, NET COSTS (919009)

           BACKGROUND: As part of the FY97 governmentwide consolidated financial audit, GAO must envision the
           Energy, Natural Resources & Environment (budget line items 270 and 300) totaling about $28 billion, net of
           exchange revenue of about $14 billion. DOE, DOD, USDA, EPA, DOC, DOI, NRC, NSF, and TVA accounts
           make up these items.
           KEY QUESTIONS: Determine whether (1) fiscal year 1996 govemmentwide disbursements and receipts for
           Energy, Natural Resources, and Environment accounts are fairly stated; (2) internal controls relating to these
           accounts are operating effectively; and (3) the government is in compliance with significant provisions of laws
           and regulations related to these accounts.




    TITLE: COMMITMENTS & CONTINGENCIES FOOTNOTE FOR GOVERNMENTWIDE FINANCIAL STATEMENT
           AUDIT (919010)

           BACKGROUND: The 1994 GMRA requires GAO to audit the governmentwide consolidated financial
           statements beginning with FY97. Commitments and contingencies, a footnote item, totals almost $6 trillion.
           The financial activities of 14 agencies account for 97% of this line item. We will assess FY96 ending balances
           to gain a basis of reliance for our audit of the FY97 balances.
           KEY QUESTIONS: Determine whether (1) fiscal year 1996 govemmentwide commitments and contingencies
           are fairly stated; (2) internal controls relating to commitment and contingencies are operating effectively; and (3)
           the government is in compliance with significant provisions of laws and regulations related to commitment and
           contingencies.




                                                                  6
Civil Audits




FINANCIAL CONDITION--RCED
     TITLE:   CONSOLIDATED AUDIT OF STEWARDSHIP LAND (919011)

              BACKGROUND: The Federal Accounting Standards Advisory Board has developed new federal accounting
              standards which require financial statement and stewardship reporting for stewardship land. Stewardship land
              includes 650 M acres of public domain land administered by Interior and Agriculture.
              KEY QUESTIONS: (1) What plans and processes have agencies established for determining and reporting land
              values, acreage, and condition? (2) Are plans and processes adequate to ensure reliable financial reporting in
              governmentwide financial statements and stewardship reports?




     TITLE: CONSOLIDATED AUDIT OF HERITAGE ASSETS (919012)

              BACKGROUND: The Federal Accounting Stanards Advisory Board has developed new federal accounting
              standards which require financial statement and stewardship reporting for heritage assets. Heritage assets
              include buildings, monuments and other structures with historical significance; cultural, educational, or esthetic
              value; and significant architectural characteristics.
              KEY QUESTIONS: (1) What plans and processes have agencies established for identifying, reporting, and
              safeguarding heritage assets? (2) Are plans and processes adequate to ensure reliable financial reporting in
              governmentwide financial statements and stewardship reports?




    TITLE: IMPROVING THE FINANCIAL INFORMATION FOREST SERVICE (919042)

              BACKGROUND: USDA's IG concluded that the Forest Service's 95 fin statements were unreliable. There has
              been much Congressional interest in resolving FS fin reporting problems. FS does not plan to prepare F/S for
              FY 96, but rather will focus its efforts on correcting problems identified in the 95 audit. To prepare for our 97
              audit, we will closely monitor and assess these efforts.
              KEY QUESTIONS: (1) What are USDA's plans to resolve the FS's financial reporting shortcomings and the
              timeframes for accomplishing the work? (2) What impact will this work have on the preparation, issuance, and
              audit of USDA FY 96 and FY 97 consolidated financial statements?




                                                                  7
Civil Audits




FINANCIAL OPERATIONS--RCED
    TITLE:   MONITORING OF POWER MARKETING ADMINISTRATION DEBT BALANCES AN) REPAYMENT (913801)




OTHER ISSUE AREA WORK - CA
    TITLE:   STATUS REPORT ON THE NEW D.C. SPORTS AREAN (901723)

             BACKGROUND: GAO has been requested to monitor the costs, financing and the timeframes for the
             completion of the new D.C. Sports Arena.
             KEY QUESTIONS: Key questions for the sports arena project are: (1) What are the predevlopment costs? (2)
             How are the costs financed? and (3) What revenues are generated from the Arena Tax?




    TITLE: ANALYSIS OF THE DISTRICT'S BUDGET AND FINANCIAL CONDITION (901748)




                                                              8
Civil Audits




OTHER ISSUE AREA WORK - CA
     TITLE: REVIEW OF ALASKA NATIVE TRUST FUND ACCOUNTS ADMINISTERED BY THE DEPARTMENT OF THE
            INTERIOR'S OFFICE OF TRUST FUNDS MANAGEMENT (OTFM) (913779)

            BACKGROUND: At the Committee's request, we have testified in the past on Interior's efforts to reconcile
            Indian trust fund accounts and its efforts to correct Indian trust fund management problems. The Committee's
            current request asks that we provide information on seven specific aspects of Alaska Native trust fund accounts.
            KEY QUESTIONS: For Alaska Native accounts: (1) How many OTFM employees formerly worked on trust
            accounting in other DOI offices? (2) How many accounts are not reported on to owners? (3) How many tribal
            accounts were not part of the reconciliation? (4) How many IlMs are there? (5) How many IlMs have no mailing
            address? (6) What are IIM revenue sources? (7) What is the profile of IIM balances?




     TITLE: RESPONSE TO THE AMERICAN PUBLIC POWER ASSOCIATION'S COMMENTS ON GAO'S RECENT REPORT
            ON POWER MARKETING ADMINISTRATION (913803)

            BACKGROUND: GAO recently issued a report on the cost recovery practices, financing, and comparison to
            nonfederal utilities of three PMAs. The Staff Director of the Subcommittee on Water and Power Resources
            asked GAO to provide a written response to comments on our report that the Subcommittee and other
            Congressional members received from the American Public Power Association (APPA).
            KEY QUESTIONS: 1) What are GAO's views on APPA's comments on the GAO's recent report on Power
            Marketing Administrations (PMAs) (GAO/AIMD-96-145, September 19, 1996)?




     TITLE: PREPARING FOR THE FY97 GOVERNMENTWIDE AUDIT OF ACCOUNTS PAYABLE (919021)




                                                                9
Civil Audits




OTHER ISSUE AREA WORK - CA
    TITLE:   PREPARING FOR THE FY97 CONSOLIDATED AUDIT OF HEALTH (919023)   '-




                                                     10