oversight

Financial Audit: U.S. Government Printing Office's Financial Statements for Fiscal Year 1989

Published by the Government Accountability Office on 1990-11-08.

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

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                           United   States   General   Accounting   Office


     GAO                   Report to the Congress



     November   1990
                           FINANCIAL AUDIT
                           U.S. Government
                           printing Office’s
                           Financial Statements
                       i   for Fiscal Year 1989




i.               ,.
                                                                             .B
                                                                             I.i
:     GAO/AFMD-91-l                                                          ,.I
                                                                             gy
                                                                             :
      United States
GAO   General Accounting
      Washiin,
                            Office
                    D.C. 20648

      Comptroller   General
      of the United States

      B-204646

      November 8, 1990

      To the President of the Senate and the
      Speaker of the House of Representatives

      This report presents the results of our audit of the consolidated finan-
      cial statements of the U.S. Government Printing Office (GPO) for the
      fiscal year ended September 30,1989, and our reports on GPO’s internal
      control structure and on its compliance with laws and regulations. We
      conducted our audit under the authority of 44 U.S.C. 309 (d) and in
      accordance with generally accepted government auditing standards. Our
      audit was also done in response to the June 13, 1989, request of
      Chairman Wendell H. Ford of the Joint Committee on Printing.

      Our report describes limitations on the scope of our examination, as a
      result of which we limited our opinion to GPO’s consolidated balance
      sheet as of September 30, 1989. The report on GPO’s internal control
      structure discloses no material weaknesses. The report on compliance
      with laws and regulations discloses that GPO complied with the provi-
      sions of laws and regulations for the transactions we tested which could
      have materially affected its financial statements.

      We are sending copies of this report to the Director of the Office of Man-
      agement and Budget, the Secretary of the Treasury, and the Public
      Printer of the Government Printing Office.




      Charles A. Bowsher
      Comptroller General
      of the United States




       Page 1                                GAO/AFMDOl-1   Govemment   Printing   Office
Page 3   GAO/AFMBOl-1   Government   Printing   Office
B-204646




to satisfy ourselves as to the balances of accounts receivable, invento-
ries, and accounts payable as of October 1,1988, the scope of our work
was not sufficient to enable us to express, and we do not express, an
opinion on the accompanying consolidated statements of revenue and
expenses by function and retained earnings, changes in financial posi-
tion, and status of appropriated funds for the fiscal year ended Sep-
tember 30, 1989.




Charles A. Bowsher        .    P
Comptroller General
of the United States

May 18,199O




Page 6                                 GAO/AFMD.Ol-1   Government   Printing   Office
Report on internal   Control   structure




Conversion (Printing and Binding): The physical production of a job,
including the inventories of paper, materials, and supplies required for
in-house printing.
Conversion (Superintendent of Documents): The acquisition, disposal,
and cost of inventory for publications sold by the Superintendent of
Documents.
Expenditure (Payroll): Compensating GPO employees and recording lia-
bilities for accrued salaries, wages, benefits, and other withholdings;
state and local payroll taxes; and accrued annual leave.
Expenditure (Printing and Reproduction): Expenditures incurred to pro-
cure printing and binding work from commercial vendors.
Expenditure (Supporting Services): Expenditures incurred to procure
goods and services, including paper, materials, supplies, employee
travel, transportation, rents, communications, and utilities.
 Revenue (Printing and Binding): The billing and collection processes for
both in-house and commercially procured printing and binding work for
 federal customers.
 Revenue (Superintendent of Documents): The collection process for the
 sale of government publications.
 Financial Reporting: The reporting process within GPO, which includes
 the processing and flow of financial data from the other transaction
 cycles to the consolidation and preparation of the financial statements.

For all of the internal control structure categories listed above, we
obtained an understanding of the design of relevant policies and proce-
dures, identified whether they had been placed in operation, and
assessed control risk. We performed tests of control procedures for the
Treasury, Conversion (Printing and Binding), Expenditure (Payroll),
Expenditure (Printing and Reproduction), and Revenue (Printing and
Binding) categories. Such tests included, but were not limited to,
reviewing and analyzing the reconciliation of general ledger accounts to
subsidiary records; reviewing supporting documents, such as vouchers
and purchase orders; reviewing billing computations and reports to
ensure that the proper agencies had been billed at appropriate amounts;
and making observations and inquiries regarding data input and
processing procedures.

Our consideration of the internal control structure would not necessarily
disclose all its potential material weaknesses. A material weakness is a
reportable condition in which the design or operation of one or more of
the specific internal control structure elements does not reduce to a low
level the risk that errors or irregularities in amounts that would be
material in relation to the financial statements may occur and not be


Page 7                                     GAO/AFMDOl-1   Government   Printing   Of&e
Report on Compliance With Laws
and Regulations

               We have audited the consolidated financial statements of the U.S. Gov-
               ernment Printing Office (GPO) for the fiscal year ended September 30,
               1989, and have issued our opinion thereon.

               We conducted our audit in accordance with generally accepted govern-
               ment auditing standards. These standards require that we plan and per-
               form the audit to obtain reasonable assurance about whether the
               financial statements are free of material misstatement.

               The management of GPO is responsible for compliance with laws and reg-
               ulations applicable to GPO. As part of obtaining reasonable assurance as
               to whether the consolidated financial statements were free of material
               misstatement, we selected and tested transactions and records to deter-
               mine GPO’s compliance with certain provisions of the following laws and
               regulations:

             . Public Printing and Documents (44 U.S.C. 305,309,310, 1102, 1704, and
               1708);
             . Anti-Deficiency Act (31 U.S.C. 1341);
             . Government Printing and Binding Regulations, Title II; and
             . GPO Printing Procurement Regulations, chapter 1, section 5.

               Our objective was not to provide an opinion on overall compliance with
               these provisions. Also, because of the limited purpose for which our
               tests of compliance were made, the laws and regulations tested did not
               cover all the requirements with which GPO has to comply.

               The results of our tests for fiscal year 1989 indicate that, for the items
               tested, GPO complied in all material respects with those provisions of
               laws and regulations which could have had a material effect on the
               financial statements. With respect to items not tested, nothing came to
               our attention that caused us to believe that GPO had not complied, in all
               material respects, with those provisions.

               During our audit, we identified other compliance matters which, while
               not material, nevertheless warrant management’s attention. We are
               reporting these matters separately to GPO'S management.




               Page 9                                  GAO/APMD-91-1   Government   printing   Office
                        Fhanctal   statement.9




Llabllitles   and Investment                                       1989                  1988




Current Liabilities:
Accounls payable (Note 6)                                    $101,922              $ 82,463
Advances from customers (Note 7)                                69.261               34,993
Accrued salarIes. wages. benefits and other
  wlthholdngs                                                     4.371                  4.156
State and local payroll taxes                                     2.188                  1,233

Total Current Liabilities                                                          6122,645
Other Liabilities:
Accrued annual leave                                                                   10.064
Excess receipts from sales
  of oubkatlons.   due U S Treasurv
  (Note 8)                                                                               4.439

Total Other Liabilities                                      $ 12,616               s 14,503

Total Liabilities                                            $190,366              $137.346
Investment       of U.S. Government:
Approprlatlons
  Unllquldated      obligations                                 33.357                 33.996

Revolving       Fund:
Contributed capital (Note 9)                                   110,051                110,236
Retained earnings                                              166,313                164,411
Reserved for lntra-offce fundIng         (Note 6)                7,377                 11.424

Total Revolving         Fund                                 9265,741               $266,071
Total investment                                             $319,096               $320.067
Total Liabilities       and Investment                       $509,456               $457,415
                                                                                   -__




                        Note Fiscal year 1988 consolidated   financial statements, Including notes, are unaudited




                        Page 11                                                GAO/AFMDOl-1        Government       Printing   office
                                        Financial   Statements




                    lnlormatlon        Dlssemmatlon                                                              Total GPO

                     Agency                 SalarIes                                                            1989              1988
  Sales of         Distrlbutlon               and
Publlcatlons        Serwes                 Expenses               Total        Ellmmatlons




               -                                        -                         ($ 36.869)          5     916.024          $843,798
      75.695                                                     $ 75695                                     75.695             71.751
           -                                  522.858              22.858               (359)                22.499             21.092
           -             $4.821                      -              4.821                                      4.821             4,895
    $75,695             $4,821                $22,058            $103,374         ($37,228)           $1,019,039             $941,536



    $27.043              $2.766               $ 7.231            $ 37040          ($ 3.223)           $     212.101          $205,853
       1322                   46                  433               1801                                      4,872              3,647

      13,346                1.502                2,439               17287               (578)               30,430             32,012
       1,207                  115               11,564               12886           (32.737)               662,641            590.688
       1,191                  106                  500                1797               (483)                 5,118             3.531
       1798                   182                  479                2459               (207)               63.900             61,491
         204                   22                  212                  A38                                    6.491              6,646
      19.851                                         -               19.851                  -                19.851            16,384
       4.533                                         -                4 533                  -                 4,533              4,898
                                                             ___~
    $70,495              $4,739               $22,858          $ 98,092            ($37,228)          $1.009.937             $925,150
    $ 5,200             $         82                             $   5,202                            $        9,102         $ 16,386
                   _____           -

                                                                                                      $ 164,411              $152,464
                                                                                                      5     173.513          $168.850


                                                                                                              (5 200)           (4.439)


                                                                                                      t     168,313          $164.411




                                         Note Fiscal year 1988 consolidated   flnanclalstatements,        lnclud~ng notes, are unaudited




                                         Page 13                                                     GAO/-91-l            Government       Printing   Offke
Status of Appropriated   Funds

                             Fiscal Years Ended Seotember                 30. 1989. and 1988 (Notes            1 and 2)
m--                          (in thousands of dollars)

                                                                                                                        Total
                                                         Congressional        Prlntlng        Salaries         Appropriated       Funds
                                                          Prlntlng and          and             and
                                                             Etmding          BindIng        Expenses      -       1989             1988


                             Status of
                               Appropriations,
                               Beginning of
                               Fiscal Year                    $11,306             $3,063      $16,425      S 32,796             $ 46,271

                                 Funds Provided:
                             Appropriations                      72 000                         13 731           85,731           89,521
                             Intra-OflIce FundIng                                               11,424           11 424            5,500
                             Reimbursements                                                                                        4,895

                                 Total Funds Available        $83,306             $3,063      $43,560      $129,951             $146,167

                                 Funds Applied:
                                 Obligated
                                    approprlatlons
                                 Current Fiscal Year             59.999                         15905            75,904            a4 029
                                 Prior Fiscal Years              10.267            3,063         6 459           19.789            24.207
                                 Funds returned to
                                    U S Treasury                                                                                    5.155

                                 Total Funds Applied          $70,266             $3,063      622,364          $ 95,693         $113,391
                                                             ___             ~~
                                 Status of
                                   Appropriations,
                                   End of
                                   Fiscal Year                $13,042                    -    $21.216       6 34,256            $ 32,796
                                                                                                         ~~__


                                 The accompanying       notes are an Integral part 01 :tlese ‘inanclal          statements




                                                       Note Fiscal year 1986 consolidated       flnanclal statements, lncludlng notes, are unaudited.




                                                       Page 16                                                        GAO/AFMD91-1          Govemment   Printing   Offke
                     Financial statements




       Inventories-Publrcatlons           for sale are valued usrng the lrrst-in, first-out cost
method The allowance for unsaleable                 publrcatrons IS established to estimate the
value of potentrally obsolete publrcatrons held rn Inventory at fiscal yearend.
Paper, materials and suppiles are valued using the movrng~average                        cost
method.
       Property, Plant, and Equipment-                 Property. plant, and equipment are
cawed at cost Expenditures              whrch substantrally      increase the useful life of the
assets are caprtalized.         Marntenance      and reparrs are expensed as mcurred
Deprecration       IS computed      usrng the strarght line method wrth estrmated useful
lwes rangtng from 42 to 50 years for burldrngs and from 3 to 30 years for
machinery and equipment and burldIng Improvements                         Deprecratlon    expense
for machinery and equipment              and building rmprovemenls           IS recovered from
brllrngs to customer agencies            Burldings and structures have been pard from
Legrslatlve Branch approprlatrons              Accordrngly      deprecratron    IS recorded but not
rermbursed on these items
       Intra-Office Funding-The              Salanes and Expenses Approprratron             was
funded In pan by excess recerpts derived lrom sales of publrcations                        Pursuant
to Pub L 100-458 this type of fundIng provrded $1 1 424,000 to the
Approprratron        In llscal year 1989 For irscal year 1990, Pub L. 101-163 and
 Pub L. 101 164 wll provide the Salaries and Expenses Approprlatron
$7.377.000 from the sale of publrcatrons.               and $513 000 from the sale of land
        Pensions-GPO           employees      are covered by the CIVII Servrce Retirement
 and Dlsabillty Fund. the Federal Old-Age                Survwor. and Drsabrlrty Insurance
 Fund. and/or the Federal Employee Retrrement Fund Consequently,                           GPO IS
 responsible     lor wrthholding the requrred peicen’age              from each employee’s
 salary and for contributtng         to the funds GPO’s zontrlbutrons            were $13,723,000
 and $12.645000            rn 1989 and 1988. respectrvely
        Prior Period Adjustment-The                prior period adtustment to excess receipts
 results from decreasrng          Deferred SubscriptIon        Revenue by $640 000 Thus
 amount represents the value of subscrlptlons                that were actually shopped in
 fiscal year 1988. but the appropriate             revenue was not recognized           In
 accordance       wrth Generally Accepted Accounting               Pr ncrples, retarned earnrngs at
 September 30 1988 have been adtusteo .ind mcomparatrve data recast to
 reflect the correctIon




                      Note. Frscal year 1988 consolrdated     frnancral statements, rncludrng notes, are unaudrted.




                      Page 17                                                     GAO/AFMD-91.1       Government      Printing   OiIIce
(6) Accounts         Payable
  Accounts      payable     comprised     the followtng
                                                                         September     30
Category                                                                 1989                     1988

Commetclal pnntlng                                           $    88.770.000          $71,090.000
U S Government    agencies                                         7.649,OOO             6,538.OOO
Other                                                              5.503.000             4.835.000
       Totals                                                $101,922,000             $82,463,000



(7) Advances          from Customers
  Advances          from customers      comprised   the lollowing:
                                                                         September     30
Category                                                                  1989                     1988

Advanced    bllltngs to customer agencies *                      $38.222.000           $    6.127.000
Customer deposits for publlcatlon    orders                         8,308.OOO               8,314,OOO
Deferred subscriptIon      revenue                                 20.338.000              17.895.000
Undelivered    publlcatlon    orders                                2.393.000               2.657.000
           Totals                                                $69,261,000           534,993,ooo

 * Fiscal year 1989 includes $33.304.000             advanced from the Bureau of the Census
   for prlntlng and reproduction  services           related to the 1990 Decennial Census



(8) Amount          Due U.S. Treasury
    Title 44 requires GPO to deposit in the U S Treasury excess receipts from
 sales of publlcatlons  The amount due the U S Treasury as of September 30
 1989. was determlned     as follows

 Amount due U S Treasury,
    September 30. 1988                                                                 $3.799.000
 Prior Penod Adjustment to Excess Recefpts                                                 640,000
 Fiscal Year 1989 Excess Receipts                                                        5.200.000
 Amount of Excess Receipts to be used to linance
    Fiscal Year 1990 SalarIes and Expenses
    Appropriation as per Pubk Laws 101~163 and 101-164                                     (7.377.000)

   Amount Due U.S. Treasury,
   September 30, 1989                                                                  $2,262,000




                        Note Fiscal year 1988 consolidated       flnanc!al statements, lncludlng notes, are unaudited




                        Page 19                                                      GAO/AFMD-91-l        Government    Printing   Office
         Ordering   Information
2
I.       The fiit  five copies of each GAO report are free. Additional copies
         are $2 each. Orders should be sent to the following address, accom-
         panied by a check or money order made out to the Superintendent
         of Documents, when necessary. Orders for 100 or more copies to be
         mailed to a single address are discounted 25 percent.

         U.S. General Accounting Office
         P.O. Box 6015
         Gaithersburg, MD 20877

         Orders may also be placed by calling   (202) 275-6241.


     i
           (9) Contributed       Capital
             Contrrbuted     capital   was derived   from the followrng
                                                                                September       30

           Contnbuted      Caprtal                                              1999                    1988

           Begrnnrng net worth when the Revolvrng
             Fund was established                                  $    33.807,ooo          s    33.807.000
           Book value of contnbuted     burldrngs
             and land                                                        454,000                 530,000
           Approprratrons for rmprovements      to arr
             condrtronrng and electrical systems                          12.900.000             12.900.000
           Appropnatrons  for workrng caprtal and sate
             acqutsrtron                                                  62.600,OOO             62.600.000
           Donated equrpment                                                  290,000               399,000

             Totals                                                $110,051,000             $110,236,000

           (10) Expended        Appropriatlons
             Expended       approprtatrons   were    as follows
                                                                                September       30

           Programs                                                              1989                   1986

           Congressronal    Prlntrng and Brndrng                       $71.890.000          $    77.642.000
           Prrntrng and BindIng                                           3.063.000               2.235.000
           Deposttory lrbrary drstnbutton                                19,332.ooo              17,391,ooo
           Cataloging    and rndextng                                     2.103.000               2.184.000
           Statutory drstrrbutron                                            924,000              1,213.ooo
           lnternatronal exchange                                            482,000                292,000
           Agency Drstributron Servrces                                             -             5.333.000

             Totals                                                    s97,794,000          S106,290,000




                                Note. Fiscal year 1988 consalrdated financral statements, includrng notes, are unaudited.




(916964)                        Page20                                                  GAO/AF’MlNU-1          Gcwmment     l’htlng   0Pfk.e
                   Pinandal Statements




(3) Accounts       Receivable
   .Accounts     receivable       comprised      the folIowIng
                                                                              September           30
                                                                             1989                            1988

U S Government     agencies                                  $    34.548.000                  $    35285,000
Unbllled completed   work                                        159.986.000                      121 sa8.000
Unbilled work In process                                          53.030.000                       59,324,ooo
Other                                                              3,390,000                         1,950,000
  Totals                                                     $250,954,000                      $218,147,000

(4) Inventory-Publications       for Sale, Net
   Publications for sale, net, comprised the following
                                                                               September          30
                                                                             1989                            19RR

Publications for sale                                            $ 16.506.000                     $ 15.585000
Allowance for unsaleable            publlcatlons                   (3.500.000)                      (3.400.000)
  Publications       for sale, net                               513,006,OOO                     $12,185,000
                                                                                               -___

(5) Property, Plant, and Equipment
   Property. plant. and equipment consist                of the followlng
                                                                                     September          30
                                                                                       i 989                  i 988
                                    Acquisition      Accumulated                    Net                       Net
                                          Value       Depreclatlon           Book Value                Book Value

Land                          $      9992 000                       ~    $     9.992.000          $     9.992.000
BulldIngs                            8,656,OOO      $    8631     000              25,000                  lOl,@OO
BulldIng
   improvements                    35,621.OOO           17 668 000            17.953.000               i 8.250.000
Leasehold
   Improvements                        824.000             .75 000               649,000                  671,000
Plant machinery
   and equipment                   67.368.000           46 027 000           21,341,ooo                22.702.000
OffIce machinery
   and equipment                     8.305.000           5 835.000             2.470.000                1.832.000
Computer software                      420,000             315.000               105,000                    10,000
Furntture and
   fixtures                            349.000             205.000                  144,000                58 000
Motor vehicles                         746.000             664.000                   82.000               109 000
Capital
    improvements  in
   progress                            347.000                       -           347,000                  324 000
        Totals                $132,626,000           $79,520,000         $53,106,000              $54,049,000
                                                                                                  ___-


                    Note Fiscal year 1988 consolidated            flnanclal statements, lncludlng notes, are unaudited




                     Page 18                                                               GAO/AFTdD-91-l             Government   Printing   Office
                                                       Financial   statements




Notes to Financial   Statements

                                  As of September       30, 1989, and September            30. 1988




                                  (1) Organization
                                        The Government        Printing Offlce (GPO) provides printing, binding, and
                                  dlstrlbutlon serwes       to the Congress and Federal agencies and dlstnbutes
                                  publlcatlons    to the public Title 44 of the U S Code authorizes the GPO
                                  Revolving Fund to finance these operations                The Revolwng Fund IS reimbursed
                                  by payments from agencies, receipts from sales of publlcatlons.                      and by
                                  transfers from the SalarIes and Expenses. Congressional                   Prlntlng and EmdIng,
                                  and prior year Prlntlng and BIndIng Appropnatlons                   In accordance       wth
                                  Pub L 100-458. for fiscal year 1989 Agency Dtstrlbutlon Serwes                          became part
                                  of the Revolwng Fund For prior years this program was Included in the
                                  SalarIes and Expenses Approprlatlon
                                         BegInnIng I” fiscal year 1988. the Printing and BInding and the
                                  Congressional      Prlntlng and BIndIng Approprlatlons             were combined Into one
                                  approprlatw        This approprlatlon      IS for printing and bInding performed directly
                                  for Congress and for printing and bIndIng of publications                  authorized by law to
                                   be dlstrlbuted without charge to reclpienrs
                                         The Salaries and Expenses Approprtatlo,r             IS for necessary expenses
                                   Incurred by the Superintendent          of Document for depository           Ilbrary, international
                                  exchange       and oiher statutory dlstrlbutloll       ol publications,    and for the cataloging
                                  and Indexing of Government            publicatlow
                                  (2) Summary        of Significant     Accounting      Policies
                                         Principles of Consolidation-The          ,:onsolldated      finawal     statements
                                  Include all GPO funds Inter-fund and Inter operational               lransactlons    and
                                  balances have been ellmlnated
                                         Basis of Accounting ~ Assets. llabllltles revenue, and expenses are
                                  recognized      on the accrual basis of accoilnting       followlng generally accepted
                                  accounting      pnnclples and the assoclateo      principles of fund accounting            During
                                  fiscal year 1989, the method of determln ng !he liability for publications                received
                                  but not bllled at vearend was changed           -he effect of this change on the
                                  flnanclal statements was Immaterial
                                         Expense Allocations-General          arx: adrnlnlstratwe         expenses have been
                                  distributed among the various expense categories                To the extent practicable
                                  general and admimstratlve        expenses were allocated to the various programs
                                   based on the estimated level of effort associated with each program
                                         Revenue Recognition-Prlntlng          and bInding revenue IS recognized on the
                                   basis of work performed       by GPO due to the fact that all printing and bindIng
                                  work IS reqwed        by law to be reimbursesi 011 the basis of serwces rendered
                                   Revenue from commercially         procured pr %ncj and binding IS recognized               on the
                                  constructive-receipt     concept    Revenue frllm tiistributlng        and selling publlcatlons
                                  to the puhllc IS recognized      when publlcawnc        have been shipped. or when
                                   services have Deen oerformea

L                                                       Note. Fiscal year 1988 consolidated        flnanclal statements, lncludlng notes, are unaudited




                                                        Page 16                                                       GAO/-91-l          Government       F’rlntlng   Off&
                                                    Financial     Statements




Consolidated   Statement   of Changes    in Financial        Position

                              Fiscal Years Ended September              30. 1989     and 1988 (Notes              1 and 2)
                              (in thousands of dollars)

                                                                                                                  1989                   1988

                              Funds Provided:
                              Net Income                                                               $         9,102           $ 16.386
                              Add expenses       not requ~nng working          caplial
                                Depreclatlon                                                                     6.491                   6.646

                                   Total Funds Provided by Operations                                           15,593                 23.032
                              Book value of retired assets                                                           67                    209
                              Approprlatlons                                                                    85.731                 89,521
                              Reimbursements     to Approprlatlon                                                                       4 895
                              Increase I” accrued annual leave                                                     290                  1.060

                              Total Funds Provided                                                     $101,661                  $118,717
                                                                                                                                ~-
                              Funds Applied:
                              Purchase of flxed assets                                                            5,804                  5.019
                              Funds returned to U S Treasury from approprlatlons                                                         5.155
                              Expended   Approprlatlons (Note 10)                                               97.794                 106,290
                                                                                                      --
                              Total Funds Applied                                                      $103,596                   $116,464
                              Increase    (Decrease)         in Working    Capital                     ($ 1,917)                  $      2,253
                                                                                                      .__..-


                                                                Changes    in Working       Capital
                              Current    Assets:
                              Cash
                                On-hand and In-trarwi                                                      ($       126)          ($        710)
                                Revolving    Fund                                                               13,511                  20.344
                                Approprlatlons                                                                    1 462                (13,475)
                              Accounts receivable                                                               32,807                 (18,039)
                              Publlcatlons   for sale                                                               821                      (2%
                              Paper                                                                              2,508                   2.995
                              Materials and supplies                                                              1.999                     339

                              Current    Liabilities:
                              Accounts payable                                                                  (19 459)                 5,234
                              Advances from customers                                                           (34 268)                    122
                              Accrued salaries. wages. benefits           and other
                                 withholdIngs                                                                      (216)                 5.883
                              State and local payroll taxes                                                        (956)                  (411)
                                                                                                      ~-
                              Increase    (Decrease)         in Working    Capital                     (5 1,917)                  $      2,253



                              The accompanying            notes are an Integral      part of these financial              statements


                                                        Note Fiscal year 1988 consolidated    flnanclal statements, lncludlng notes, are unaud!ted.




                                                        Page 14                                                             GAO/AFMD91-1           Government   Mting   Off&
Consolidated   Statement   of Revenue     and Expenses          by Function      and Retained           Earnings

                              Fwal   Years 1989 and 1988 (Notes               1 and 2) (ID thousands


                                                                                             Printing
                                                                                                                of dollars)


                                                                                                        and Blndmg
                                                                                                                                                                              1
                                                                            In-house                    Purchased
                                                                             Prlntlng                    Prlntmg                     Total



                              Revenue:
                              Prmtlng and Bmdmg                             $226.530                    $726.363              $952,893
                              Sales of Publlcatlons                                                                                  -
                              Appropnatlons                                                                        -                 -
                              Reimbursements                                                                                         -

                              Total Revenue                                 9226,530                    $726,363              $952,893

                              Expenses:
                              Personnel compensation     and
                                 benefits                                   $148.284                        $30000            $178,284
                              Travel and transportation                             697                        2.374              3,071
                              Rents commumcatlons       and
                                 utllltles                                       11 104                        2,617                13.721
                              Printing and reproduction                                                     682.492               682,492
                              Other services                                      3 116                          688                 3,804
                              Supplies and materials                             60 606                        1.042               61.648
                              Depreclatlon                                        5412                           641                 6.053
                              Pubkations     sold                                                                                        -
                              Unsaleable publlcatlons                                                              -
                                                                                                        __-
                              Total Expenses                                $229,219                    $719,854              $949.073
                              Net Income or (Loss)                          ($    2,689)                $     6,509           $     3,820
                                                                           -~~

                              Retained     Earnings,     Beginning         of Fiscal Year
                              RetaIned    Earnings     Before    Payable    to U !; Treasury
                              Less
                                Excess    receipts   from sales of publlcatlons             due U S Treasury



                               Retained    Earnings,      End of Fiscal Year


                              The accompanying          notes are an Integral           part of these flnanclal        statements




                                                     Note Fiscal year 1988 consolidated          flnanclal statements, Including notes. are unaudited




                                                     Page 12                                                             GAO/-91-l           Government   printing   Office
FSnmcid Statements


Consolidated   Balance   Sheet
I
                             As of Seplember          30. 1989, and 1988 (Notes         1 and 2) (In thousands     of dollars)
                             __-



                             Assets                                                                    1989                  1988




                             Current Assets:
                             Cash
                               On-hand and In-trawl                                             $      1 024          $     1,150
                                Revolving Fund                                                      128.420               114.909
                                Appropriations                                                       34,258                32,796
                             Accounts recewable (Note 3)                                            250,954               218 147
                             Inventones
                                Publlcatlons   ‘or sale. net (Note 4)                                13.006                12.185
                                Paper                                                                17918                 15.410
                                Materials and supplles                                               10 768                 8,769




                                 Total Current Assets                                           5456,348             $403,366



                                 Property,     Plant, and Equipment         (Note 5):
                                 Land and bulldIngs                                                  18.648              18,648
                                 Equipment and bullding          Improvements                       113.980            111 887
                                                                                                                     __-
                                                                                                    132.628            130,535

                                   Less      accumulated     depreclatlon                        ( 79.520)            ( 76,486)
                                   Net Property,     Plant, and Equipment                             53.108                54,049




                                 Total Assets                                                   $509,456              $457,415



                                 The accompanying           notes are an Integral   part of these flnanclal    statements




                                                           Note Fiscal year 1988 consolidated   flnanclal statements, lncludlng notes, are unaudited




                                                           Page 10                                                 GAO/AFMB91-1       Government       Printing   Office
Report on lntemal   c!ontrol   structure




detected within a timely period by employees in the normal course of
performing their assigned functions. We found no matters involving the
internal control structure and its operation that we consider to be mate-
rial weaknesses.

However, we did identify weaknesses in the internal control structure
and its operations which, while not material to the consolidated finan-
cial statements, nevertheless warrant management’s attention. We are
reporting these matters separately to GPO’s management.




Page 8                                     GAO/AFMDsl-1   Government   Printing   Office
Report on Internal Control Structure


                   We have audited the consolidated financial statements of the U.S. Gov-
                   ernment Printing Office (GPO) for the fiscal year ended September 30,
                   1989, and have issued our opinion thereon.

                   We conducted our audit in accordance with generally accepted govern-
                   ment auditing standards. These standards require that we plan and per-
                   form the audit to obtain reasonable assurance about whether the
                   financial statements are free of material misstatement.

                   In planning and performing our audit of the financial statements of GPO
                   for the fiscal year ended September 30,1989, we considered its internal
                   control structure in order to determine our auditing procedures. Our
                   purpose was to express an opinion on the financial statements, not to
                   provide assurance on the internal control structure.

                   GPO’S  management is responsible for establishing and maintaining an
                   internal control structure. To fulfill this responsibility, management
                   must make estimates and judgments that assess the expected benefits
                   and related costs of internal control structure policies and procedures.
                   The objectives of an internal control structure are to provide manage-
                   ment with reasonable, but not absolute, assurance that (1) assets are
                   safeguarded against loss from unauthorized use or disposition and
                   (2) transactions are executed in accordance with management’s authori-
                   zation and recorded properly so that financial statements can be pre-
                   pared in accordance with generally accepted accounting principles.
                   Because of inherent limitations in any internal control structure, errors
                   or irregularities may nevertheless occur and not be detected. Projection
                   of any evaluation of the current structure to future periods is subject to
                   the risk that procedures may become inadequate because of changes in
                   conditions or that t.he effectiveness of the design and operation of poli-
                    cies and procedures may deteriorate.

                   For purposes of this report, we have classified GPO’S significant internal
                   control structure policies and procedures into the following transaction
                   cycles:

               l Treasury: Cash (funds with the U.S. Treasury), Investment of the U.S.
                 Government, the Congressional Printing and Binding Appropriation, and
                 the Salaries and Expenses Appropriation.
               * Conversion (Fixed Assets): Acquiring, improving, depreciating, and dis-
                 posing of property.




                   Page 6                                  GAO/AF’MD-91-1   Government   Printing   OffIce
      United States
GAO   General Accounting Office
      Washington, D.C. 20548

      Comptroller   General
      of the United States

      B-204646



      To the Public Printer
      U.S. Government Printing Office

      We have audited the accompanying consolidated balance sheet of the
      U.S. Government Printing Office (GPO) as of September 30, 1989, and the
      related consolidated statements of revenue and expenses by function
      and retained earnings, changes in financial position, and status of
      appropriated funds for the fiscal year then ended. These consolidated
      financial statements are the responsibility of GPO’S management. Our
      responsibility is to express an opinion on these statements based on our
      audit. We did not audit the consolidated financial statements of the Gov-
      ernment Printing Office for the year ended September 30, 1988, and,
      accordingly, do not express an opinion on them. In addition to this
      report on our audit, we are reporting on our consideration of GPO’S
      internal control structure and compliance with laws and regulations.

      We conducted our audit in accordance with generally accepted govern-
      ment auditing standards. Those standards require that we plan and per-
      form the audit to obtain reasonable assurance about whether the
      financial statements are free of material misstatement. An audit
      includes examining, on a test basis, evidence supporting the amounts
      and disclosures in the financial statements. An audit also includes
      assessing the accounting principles used and significant estimates made
      by management, as well as evaluating the overall financial statement
      presentation. We believe that our audit provides a reasonable basis for
      our opinion. However, we were unable to satisfy ourselves as to the
      amounts of accounts receivable, inventories, and accounts payable as of
      October 1, 1988, as well as to the consistent application of accounting
      principles because it was not practical for us to perform adequate
      auditing procedures without an inordinate expenditure of time. These
      amounts are material to determining the consolidated revenue and
      expense and funds provided and applied for the year ended Sep-
      tember 30, 1989.

      In our opinion, the accompanying consolidated balance sheet presents
      fairly, in all material respects, the financial position of the Government
      Printing Office as of September 30, 1989, in conformity with generally
      accepted accounting principles, except for our inability to express an
      opinion on the consistent application of accounting principles for the
      reasons discussed in the preceding paragraph. Because we were unable



      Page 4                                  GAO/AFML)-91-1   Government   Printing   Office
Contents


Letter
Opinion Letter
Report on Internal                                                                                       6
Control Structure
Report on Compliance                                                                                     9
With Laws and
Regulations
Financial Statements                                                                                   10
                       Consolidated Balance Sheet                                                      10
                       Consolidated Statement of Revenue and Expenses by                               12
                            Function and Retained Earnings
                       Consolidated Statement of Changes in Financial Position                         14
                       Status of Appropriated Funds                                                    15
                       Notes to Financial Statements                                                   16




                       Abbreviation

                       GPO        U.S. Government Printing Office


                       Page 2                                GAO/AFMDOl-1   Government   Printing   Oftice