r 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
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)