United States General Accounting Office GAO Report to the Congress May 1997 FINANCIAL AUDIT Congressional Award Foundation’s 1996 and 1995 Financial Statements GAO/AIMD-97-87 United States GAO General Accounting Office Washington, D.C. 20548 Comptroller General of the United States B-275453 May 15, 1997 To the President of the Senate and the Speaker of the House of Representatives This report presents our opinion on the financial statements of the Congressional Award Foundation for the fiscal years ended September 30, 1996 and 1995. These financial statements are the responsibility of the Congressional Award Foundation. This report also presents (1) our opinion on the Foundation management’s assertions regarding the effectiveness of its internal controls as of September 30, 1996, and (2) our evaluation of the Foundation’s compliance with laws and regulations during fiscal year 1996. We conducted our audits pursuant to section 8 of the Congressional Award Act, as amended (2 U.S.C. 807), and in accordance with generally accepted government auditing standards. We are sending copies of this report to the Chairman of the National Board of Directors, Congressional Award Program; the National Director, Congressional Award Foundation; the Chairmen and Ranking Minority Members of the Senate Committee on Governmental Affairs and the House Committee on Education and the Workforce; and other interested parties. This report was prepared under the direction of Robert W. Gramling, Director, Corporate Audits and Standards. James F. Hinchman Acting Comptroller General of the United States Page 1 GAO/AIMD-97-87 Congressional Award Foundation Contents Letter 1 Opinion Letter 4 Financial Statements 8 Statements of Financial Position 8 Statements of Activities 9 Statements of Cash Flows 10 Notes to the Financial Statements 11 Page 2 GAO/AIMD-97-87 Congressional Award Foundation Page 3 GAO/AIMD-97-87 Congressional Award Foundation United States GAO General Accounting Office Washington, D.C. 20548 Accounting and Information Management Division B-275453 To the President of the Senate and the Speaker of the House of Representatives We have audited the statements of financial position of the Congressional Award Foundation as of September 30, 1996 and 1995, and the related statements of activities and statements of cash flows for the fiscal years then ended. We found • the financial statements were reliable in all material respects; • the Congressional Award Foundation’s management fairly stated that internal controls in place on September 30, 1996, were effective in safeguarding assets from material loss, assuring material compliance with relevant laws and regulations, and assuring that there were no material misstatements in the financial statements; and • no reportable noncompliance with laws and regulations we tested for the fiscal year ended September 30, 1996. The following sections provide additional detail concerning our conclusions and the scope of our audit. The financial statements and accompanying notes present fairly, in all Opinion on Financial material respects, in conformity with generally accepted accounting Statements principles, the Congressional Award Foundation’s financial position as of September 30, 1996 and 1995, and the results of its activities and its cash flows for the fiscal years then ended. We evaluated the Foundation management’s assertions about the Opinion on effectiveness of its internal controls designed to Management’s Assertions About the • safeguard assets against loss from unauthorized acquisition, use, or disposition; Effectiveness of • assure the execution of transactions in accordance with management’s Internal Controls authority and with selected provisions of those laws and regulations that have a direct and material effect on the financial statements of the Foundation; and • properly record, process, and summarize transactions to permit the preparation of reliable financial statements and to maintain accountability for assets. Page 4 GAO/AIMD-97-87 Congressional Award Foundation B-275453 Management of the Congressional Award Foundation fairly stated that those controls in place on September 30, 1996, provided reasonable assurance that losses, noncompliance, or misstatements material in relation to the financial statements would be prevented or detected on a timely basis. Management made this assertion based upon criteria established under the Federal Managers’ Financial Integrity Act of 1982 and the Office of Management and Budget Circular A-123, Management Accountability and Control. Although management’s assertion regarding the effectiveness of internal controls is fairly stated in all material respects based on the control criteria cited above, we noted certain matters involving the Foundation’s internal accounting controls and its operations. These matters, while not significant, will be reported to management separately, and copies will be provided to the appropriate congressional committees. Our tests for compliance with selected provisions of laws and regulations Compliance With disclosed no instances of noncompliance that would be reportable under Laws and Regulations generally accepted government auditing standards. However, the objective of our audit was not to provide an opinion on overall compliance with laws and regulations. Accordingly, we do not express such an opinion. The Foundation’s management is responsible for Objectives, Scope, and Methodology • preparing the Foundation’s annual financial statements in conformity with generally accepted accounting principles; • establishing, maintaining, and assessing the Foundation’s internal control to provide reasonable assurance that the internal control objectives mentioned above are met; and • complying with applicable laws and regulations. We are responsible for obtaining reasonable assurance about whether (1) the financial statements are free of material misstatement and presented fairly, in all material respects, in conformity with generally accepted accounting principles and (2) management’s assertion about the effectiveness of internal controls is fairly stated, in all material respects, based upon the internal control criteria used by the Foundation’s management in making this assertion. We are also responsible for testing compliance with selected provisions of laws and regulations. Page 5 GAO/AIMD-97-87 Congressional Award Foundation B-275453 In order to fulfill these responsibilities, we • examined, on a test basis, evidence supporting the amounts and disclosures in the financial statements; • assessed the accounting principles used and significant estimates made by the Foundation’s management; • evaluated the overall presentation of the financial statements; • obtained an understanding of the Foundation’s internal controls related to safeguarding assets, compliance with laws and regulations, and financial reporting; • tested relevant internal controls over safeguarding, compliance, and financial reporting and evaluated management’s assertion about the effectiveness of internal controls; and • tested compliance with selected provisions of the Congressional Award Act, as amended. We did not evaluate all internal controls relevant to operating objectives, such as controls relevant to ensuring efficient operations. We limited our internal control testing to those controls necessary to achieve the objectives outlined in our opinion on management’s assertion about the effectiveness of internal controls. Because of inherent limitations in any internal control, losses, noncompliance, or misstatements may nevertheless occur and not be detected. We also caution that projecting our evaluation to future periods is subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with controls may deteriorate. We conducted our audits from November 5, 1996, to April 11, 1997. Our audits were conducted in accordance with generally accepted government auditing standards. Page 6 GAO/AIMD-97-87 Congressional Award Foundation B-275453 We provided a draft of our report to Congressional Award Foundation Foundation officials for their review and comment. The Foundation officials agreed Comments and Our with the contents of our report. Evaluation Jeffrey C. Steinhoff Director of Planning and Reporting April 11, 1997 Page 7 GAO/AIMD-97-87 Congressional Award Foundation Financial Statements Statements of Financial Position Page 8 GAO/AIMD-97-87 Congressional Award Foundation Financial Statements Statements of Activities Page 9 GAO/AIMD-97-87 Congressional Award Foundation Financial Statements Statements of Cash Flows Page 10 GAO/AIMD-97-87 Congressional Award Foundation Financial Statements Notes to the Financial Statements Page 11 GAO/AIMD-97-87 Congressional Award Foundation Financial Statements Page 12 GAO/AIMD-97-87 Congressional Award Foundation Financial Statements Page 13 GAO/AIMD-97-87 Congressional Award Foundation Financial Statements (917771) Page 14 GAO/AIMD-97-87 Congressional Award Foundation Ordering Information The first copy of each GAO report and testimony is free. Additional copies are $2 each. 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Financial Audit: Congressional Award Foundation's 1996 and 1995 Financial Statements
Published by the Government Accountability Office on 1997-05-15.
Below is a raw (and likely hideous) rendition of the original report. (PDF)