Government Sponsored Enterprises: Freddie Mac's and Fannie Mae's
Accounting for Costs of Foreclosed Property (Letter Report, 05/27/94,
GAO/AIMD-94-75).

This report provides information on the accounting changes made by two
government-sponsored enterprises--the Federal Home Loan Mortgage
Corporation and the Federal National Mortgage Association--in adopting
the American Institute of Certified Public Accountants' Statement of
Position 92-3, Accounting for Foreclosed Assets.  Freddie Mac and Fannie
Mae are federally chartered, privately owned, for-profit corporations
created by Congress to ensure the availability of reasonably priced
loans to home buyers. GAO (1) assesses whether the accounting changes
made by the government-sponsored enterprises in adopting the Statement
of Position 92-3 were in accordance with generally accepted accounting
principles, (2) estimates the changes' effects on their respective loan
loss reserves, and (3) estimates the changes' effects on compliance with
minimum capital requirements set by the Federal Housing Enterprises
Financial Safety and Soundness Act of 1992. GAO also considers the
potential effects of accounting guidance issued by the Financial
Accounting Standards Board that conflicts with the Statement of Position
92-3 relative to recognizing selling costs.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  AIMD-94-75
     TITLE:  Government Sponsored Enterprises: Freddie Mac's and Fannie 
             Mae's Accounting for Costs of Foreclosed Property
      DATE:  05/27/94
   SUBJECT:  Government sponsored enterprises
             Accounting procedures
             Mortgage programs
             Risk management
             Federal corporations
             Foreclosures
             Internal controls
             Cost accounting
             Losses
             Loan accounting systems

             
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