Financial Audit: House Child Care Center--Fiscal Years Ended 9-30-93,
9-30-92, and Month Ended 9-30-91 (Letter Report, 10/14/94,
GAO/AIMD-95-2).

GAO audited the balance sheets of the House Child Care Center for fiscal
years 1993 and 1992 and the related statements of revenues, expenses,
and fund balances and statements of cash flows. GAO also audited the
balance sheet and related statements of the House Child Care Center,
Inc. (the Corporation), as of September 30, 1991. The Center provides
preschool child care for children of House Members and staff. At the
beginning of fiscal year 1992, the Corporation's activities, except for
its fund-raising activities, were transferred to the Center. GAO found
that the financial statements were reliable in all material respects;
internal controls in effect 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-95-2
     TITLE:  Financial Audit: House Child Care Center--Fiscal Years 
             Ended 9-30-93, 9-30-92, and Month Ended 9-30-91
      DATE:  10/14/94
   SUBJECT:  Financial statement audits
             Internal controls
             Compliance
             Financial records
             Accounting procedures
             Cash management
             Financial management
             Child care programs
             Day care centers
             Congressional employees

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


Report to the Clerk of the House of Representatives and the Acting
Director of the House Office of Non-Legislative and Financial
Services

October 1994

FINANCIAL AUDIT - HOUSE CHILD CARE
CENTER--FISCAL YEARS ENDED
9-30-93, 9-30-92, AND MONTH ENDED
9-30-91

GAO/AIMD-95-2

House Child Care Center


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


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


B-234458

October 14, 1994

The Honorable Donnald K.  Anderson
Clerk of the House of Representatives

Mr.  Randall B.  Medlock
Acting Director, House Office of
 Non-Legislative and Financial Services

As you requested, we audited the balance sheets of the House of
Representatives Child Care Center (the Center) as of September 30,
1993 and 1992, and the related statements of revenues, expenses, and
fund balance and statements of cash flows for the years then ended. 
In addition, as required by section 2(d) of H.  Res.  21, 99th
Congress, 1st Session (1985), we audited the balance sheet of the
House of Representatives Child Care Center, Inc.  (the Corporation),
as of September 30, 1991, and the related statement of revenues,
expenses, and fund balance and statement of cash flows for the month
then ended.  As of the beginning of fiscal year 1992, the
Corporation's activities, except for its fund-raising activities,
were transferred to the Center (see note 1).  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. 

The following sections outline each conclusion in more detail and
discuss the scope of our audit. 


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

The financial statements and the accompanying notes of the Center as
of September 30, 1993 and 1992, and the Corporation as of September
30, 1991, present fairly, in conformity with generally accepted
accounting principles, the Center's and the Corporation's

  assets, liabilities, and fund balances;

  revenues and expenses; and

  cash flows. 

As discussed in note 10, the financial statements present only the
activities funded from tuition and related revenues.  The statements
also include appropriations received by the Center and the
Corporation to cover the costs of employee benefits and employment
taxes.  They do not include costs relating to office space, building
operations, and office furniture and equipment, which are financed by
other legislative appropriations and are not readily identifiable. 


   INTERNAL CONTROLS
------------------------------------------------------------ Letter :2

The internal controls we considered 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 maintain accountability
     for assets. 

Those controls in effect for the Center on September 30, 1993,
provided reasonable assurance that losses, noncompliance, or
misstatements material in relation to the financial statements would
be prevented or detected. 


   COMPLIANCE WITH LAWS AND
   REGULATIONS
------------------------------------------------------------ Letter :3

Our 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 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 control systems to provide
     reasonable assurance that the 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
misstatements 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 the entity's management;

  evaluated and tested relevant internal controls, including those
     over revenues, expenditures, and payroll; and

  tested compliance with selected provisions of section 312 of Public
     Law No.  102-90, as amended, 40 U.S.C.  section 184g (Supp.  IV
     1992), and H.  Res.  423, 102d Cong., 2d Sess., agreed to April
     9, 1992, with respect to the Center; H.  Res.  21, 99th Cong.,
     1st Sess., agreed to December 11, 1985, as enacted into
     permanent law and amended, 40 U.S.C.  sections 184b-184f (1988
     and Supp.  II 1990), with respect to the Corporation; and
     federal, state, and District of Columbia regulations on
     withholding and payment of income and social security taxes. 

We limited our work to accounting and other controls necessary to
achieve the objectives outlined in the section 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 audits in accordance with generally accepted
government auditing standards.  We completed our audit work on June
18, 1994.






Charles A.  Bowsher
Comptroller General
of the United States


FINANCIAL STATEMENTS OF THE CENTER
=========================================================== Appendix 0

   Balance Sheets

   (See figure in printed
   edition.)

   Statements of Revenues,
   Expenses, and Fund Balance

   (See figure in printed
   edition.)

   Statements of Cash Flows

   (See figure in printed
   edition.)


FINANCIAL STATEMENTS OF THE
CORPORATION
=========================================================== Appendix 1

   Balance Sheet

   (See figure in printed
   edition.)

   Statement of Revenues,
   Expenses, and Fund Balance

   (See figure in printed
   edition.)

   Statement of Cash Flows

   (See figure in printed
   edition.)


NOTES TO THE FINANCIAL STATEMENTS
=========================================================== Appendix 2



   (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.)



   (See figure in printed
   edition.)



   (See figure in printed
   edition.)