Financial Audit: Congressional Award Foundation's Financial Statements
for the Periods Ended 9/30/93 and 12/31/92 (Letter Report, 11/25/94,
GAO/AIMD-95-14).

GAO audited the Congressional Award Foundation's statements of financial
position as of September 30, 1993, and December 31, 1992, and the
related statements of revenues, expenses, and changes in fund balance
and statements of cash flows.  The Foundation was established to promote
achievement among youth in public service, personal development, and
physical fitness. 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
material to the financial statement would be prevented or detected; and
there was no material noncompliance with laws and regulations.  GAO's
last report, covering financing statements for 1990 through 1992, noted
that although the Foundation had made some minor improvements to its
internal controls, serious problems remained.  Since then, management
pursued additional accounting expertise and aggressively implemented
internal control procedures, which yielded significant improvements and
allowed GAO to provided an unqualified opinion on internal controls as
of September 30, 1993.

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

 REPORTNUM:  AIMD-95-14
     TITLE:  Financial Audit: Congressional Award Foundation's Financial 
             Statements for the Periods Ended 9/30/93 and 12/
             31/92
      DATE:  11/25/94
   SUBJECT:  Financial statement audits
             Financial management
             Internal controls
             Financial records
             Funds management
             Accounting procedures
             Foundations (organizations)
             Financial disclosure

             
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Cover
========================================================================== COVER


Report to the Congress

November 1994

FINANCIAL AUDIT - CONGRESSIONAL AWARD
FOUNDATION'S FINANCIAL STATEMENTS FOR
THE PERIODS ENDED 9/30/93 AND 12/31/92

GAO/AIMD-95-14

Congressional Award Foundation


Abbreviations
========================================================================= ABBREV


Letter
========================================================================= LETTER


B-259269

November 25, 1994

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

As required by Public Law 101-525, we audited the Congressional Award
Foundation's statements of financial position as of September 30, 1993, and
December 31, 1992, and the related statements of revenues, expenses, and
changes in fund balance and statements of 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. 

In our last report,\1 covering the 1992, 1991, and 1990 financial statements,
we noted, while the Foundation had made some minor improvements to its internal
controls, that serious problems remained.  We suggested that the Foundation (1)
aggressively pursue access to more staff with financial management expertise
and (2) develop, document, and enforce appropriate internal control policies
and procedures to obtain reasonable assurance that all transactions are
properly recorded, processed, and summarized and that assets are safeguarded. 
We also mentioned that the Foundation had secured the pro bono services of a
major accounting firm to provide assistance and counsel in financial management
matters beginning in January 1993.  Management pursued additional accounting
expertise and aggressively implemented internal control procedures, which
resulted in significant improvements and enabled us to provide an unqualified
opinion on internal controls as of September 30, 1993. 

The following sections outline each conclusion in more


--------------------
\1 Financial Audit:  Congressional Award Foundation's Financial Statements for
1992, 1991, and 1990 (GAO/AIMD-94-87 July 14, 1994). 


   OPINION ON FINANCIAL STATEMENTS
---------------------------------------------------------------------- Letter :1

The financial statements and accompanying notes present fairly, in conformity
with generally accepted accounting principles, the Foundation's

assets, liabilities, and fund balance;

revenues, expenses, and changes in fund balance; and

cash flows. 


   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. 

As of September 30, 1993, the Foundation corrected internal control weaknesses
we identified in two areas in our last report.  As a result, we were able to
substantiate general ledger amounts for fixed assets which were previously
incomplete.  Further, the Foundation institutionalized several internal control
procedures during the 9 months ended September 30, 1993, such as performing
routine reconciliations which were not previously conducted. 

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. 


   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

Management is responsible for

preparing annual financial statements in conformity with generally accepted
accounting principles,

establishing and maintaining internal controls and systems 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:  treasury, revenues, expenditures, equipment, payroll, and financial
reporting; and

tested compliance with selected provisions of Public Law 96-114, as amended,
and federal and state regulations on employee withholding and filing
requirements for tax-exempt entities. 

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

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 September 28, 1994. 

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, Expenses,
   and Changes in Fund Balance

   (See figure in printed edition.)

   Statements of Cash Flows

   (See figure in printed edition.)

   Notes to the Financial Statements

   (See figure in printed edition.)



   (See figure in printed edition.)



   (See figure in printed edition.)


*** End of document. ***