Financial Audit: House Recording Studio Revolving Fund for the Periods
Ended 9/30/93 and 9/30/92 (Letter Report, 11/08/94, GAO/AIMD-95-11).
GAO audited the financial statements of the House Recording Studio
Revolving Fund as of September 30, 1993, and September 30, 1992, and the
related statements of revenues and expenses and cash flows. The Studio
makes photographic prints, as well as radio and television tape
recordings, for House Members and Committees. GAO found that the
financial statements were reliable in all material respects; internal
controls reasonably ensured that losses, noncompliance with laws and
regulations, and misstatements affecting the financial statements would
be prevented or detected; and there was no material noncompliance with
laws and regulations.
--------------------------- Indexing Terms -----------------------------
REPORTNUM: AIMD-95-11
TITLE: Financial Audit: House Recording Studio Revolving Fund for
the Periods Ended 9/30/93 and 9/30/92
DATE: 11/08/94
SUBJECT: Revolving funds
Accounting systems
Internal controls
Federal fund accounts
Auditing standards
Financial records
Financial management
Legislative bodies
Financial statement audits
IDENTIFIER: House Recording Studio Revolving Fund
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Cover
========================================================================== COVER
Report to the Clerk of the House of Representatives
November 1994
FINANCIAL AUDIT - HOUSE RECORDING
STUDIO REVOLVING FUND FOR THE PERIODS
ENDED 9/30/93 AND 9/30/92
GAO/AIMD-95-11
House Recording Studio Revolving Fund
Abbreviations
========================================================================= ABBREV
Letter
========================================================================= LETTER
B-114842
November 8, 1994
The Honorable Donnald K. Anderson
Clerk of the House of Representatives
Dear Mr. Anderson:
As you requested, we audited the accompanying statements of financial position
of the House of Representatives Recording Studio Revolving Fund (the Fund) as
of September 30, 1993, and September 30, 1992, and the related statements of
revenues and expenses and cash flows for the periods then ended. We found
the financial statements were reliable in all material respects;
internal controls in effect on September 30, 1993, provided reasonable
assurance that losses, noncompliance with laws and regulations, and
misstatements material to the financial statements would be prevented or
detected; and
no material noncompliance with laws and regulations we tested for 1993.
The following sections outline each conclusion in more detail and discuss the
scope of our audits.
OPINION ON FINANCIAL STATEMENTS
---------------------------------------------------------------------- Letter :1
The financial statements and accompanying notes present fairly, in conformity
with generally accepted accounting principles, the Fund's
assets, liabilities, and government equity;
revenues and expenses; and
cash flows.
As discussed in note 4, the financial statements present the results of
activities financed through the House Recording Studio Revolving Fund and are
not intended to present the financial position and results of operations of the
House Recording Studio as a whole. Other significant identifiable costs, such
as salaries and benefits, which are financed by other appropriated funds are
not included on the financial statements, but are disclosed in note 4. Also,
the statements do not include such costs as space and utilities, which are not
readily identifiable.
OPINION ON INTERNAL CONTROLS
---------------------------------------------------------------------- Letter :2
The internal controls we evaluated were those designed to
safeguard assets against loss from unauthorized use or disposition;
assure the execution of transactions in accordance with laws and regulations;
and
properly record, process, and summarize transactions to permit the preparation
of financial statements and to maintain accountability for assets.
Those controls in effect on September 30, 1993, provided reasonable assurance
that losses, noncompliance, or misstatements material to the financial
statements would be prevented or detected.\1
--------------------
\1 Our reports on the Fund's internal control structure and compliance with
laws and regulations for 1992 are presented in GAO/AIMD-94-82, dated May 19,
1994.
COMPLIANCE WITH LAWS AND REGULATIONS
---------------------------------------------------------------------- Letter :3
Our current year audit tests for compliance with selected provisions of laws
and regulations disclosed no material instances of noncompliance. Also,
nothing came to our attention in the course of our other work to indicate that
material noncompliance with such provisions occurred.
OBJECTIVES, SCOPE, AND METHODOLOGY
---------------------------------------------------------------------- Letter :4
Studio management is responsible for
preparing annual financial statements in conformity with generally accepted
accounting principles,
establishing and maintaining internal controls 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 reliable (free of material misstatement and presented
fairly in conformity with generally accepted accounting principles) and (2)
relevant internal controls are in place and operating effectively. We are also
responsible for testing compliance with selected provisions of laws and
regulations.
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
management;
evaluated the overall presentation of the financial statements;
evaluated and tested relevant internal controls which encompassed the following
areas: (1) treasury, (2) revenues, (3) expenditures, (4) property (equipment),
(5) inventory, and (6) financial reporting; and
tested compliance with selected provisions of section 105 of the Legislative
Branch Appropriations Act, 1957, as amended (2 U.S.C. 123b) and of the rules
and regulations of the Special Committee on the House Recording Studio and of
the Committee on House Administration.
We limited our work to accounting and other controls necessary to achieve the
objectives outlined in our opinion on internal controls. Because of inherent
limitations in any system of 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 performed our work in accordance with generally accepted government auditing
standards. We completed our audit work on August 12, 1994. The Clerk of the
House of Representatives provided written comments on a draft of this report.
These comments have been incorporated into the report where appropriate and are
included in appendix I.
Sincerely yours,
Charles A. Bowsher
Comptroller General
of the United States
FINANCIAL STATEMENTS
===================================================================== Appendix 0
Statements of Financial Position
(See figure in printed edition.)
Statements of Revenues and Expenses
(See figure in printed edition.)
Statements of Cash Flows
(See figure in printed edition.)
Notes to Financial Statements
(See figure in printed edition.)
(See figure in printed edition.)
(See figure in printed edition.)
(See figure in printed edition.)
(See figure in printed edition.)
(See figure in printed edition.)Appendix I
COMMENTS FROM THE OFFICE OF THE CLERK
OF THE HOUSE OF REPRESENTATIVES
===================================================================== Appendix 0
See comment 1.
See comment 2.
The following are GAO's comments on the Office of the Clerk of the House of
Representatives, letter dated October 6, 1994.
GAO COMMENTS
1. We believe that costs financed by other appropriated funds are
"significant" and, therefore, did not delete the word.
2. House Recording Studio management is responsible for preparing the
financial statements and accompanying notes. Accordingly, we deleted the
words, "which are furnished without charge to the Fund," from the notes. The
change did not affect our opinion on the financial statements.
*** End of document. ***