Financial Audit: Capitol Preservation Fund's Fiscal Year 1996 and 1995
Financial Statements (Letter Report, 05/30/97, GAO/AIMD-97-99).

Pursuant to a legislative requirement, GAO audited the Capitol
Preservation Fund's financial statements for fiscal years ended
September 30, 1996 and 1995, and assessed the effectiveness of the
Fund's internal controls.

GAO noted that: (1) the financial statements were reliable in all
material respects; (2) there were no material weaknesses in the internal
controls GAO tested; and (3) there was no reportable noncompliance with
selected provisions of laws and regulations GAO tested for the fiscal
year ended September 30, 1996.

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

 REPORTNUM:  AIMD-97-99
     TITLE:  Financial Audit: Capitol Preservation Fund's Fiscal Year 
             1996 and 1995 Financial Statements
      DATE:  05/30/97
   SUBJECT:  Fund audits
             Accounting procedures
             Legislative bodies
             Financial statement audits
             Reporting requirements
             Internal controls
             Funds management
IDENTIFIER:  Capitol Preservation Fund
             
**************************************************************************
* This file contains an ASCII representation of the text of a GAO        *
* report.  Delineations within the text indicating chapter titles,       *
* headings, and bullets are preserved.  Major divisions and subdivisions *
* of the text, such as Chapters, Sections, and Appendixes, are           *
* identified by double and single lines.  The numbers on the right end   *
* of these lines indicate the position of each of the subsections in the *
* document outline.  These numbers do NOT correspond with the page       *
* numbers of the printed product.                                        *
*                                                                        *
* No attempt has been made to display graphic images, although figure    *
* captions are reproduced. Tables are included, but may not resemble     *
* those in the printed version.                                          *
*                                                                        *
* A printed copy of this report may be obtained from the GAO Document    *
* Distribution Facility by calling (202) 512-6000, by faxing your        *
* request to (301) 258-4066, or by writing to P.O. Box 6015,             *
* Gaithersburg, MD 20884-6015. We are unable to accept electronic orders *
* for printed documents at this time.                                    *
**************************************************************************


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


Report to the Congress

May 1997

FINANCIAL AUDIT - CAPITOL
PRESERVATION FUND'S FISCAL YEARS
1996 AND 1995 FINANCIAL STATEMENTS

GAO/AIMD-97-99

Capitol Preservation Fund

(917740)


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


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


B-277057

May 30, 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
Capitol Preservation Fund for the fiscal years ended September 30,
1996 and 1995.  It also discusses our (1) consideration of internal
controls in conducting our audit and (2) evaluation of compliance
with laws and regulations during fiscal year 1996.  We conducted our
audit pursuant to 40 U.S.C.  188a-3 and in accordance with generally
accepted government auditing standards. 

We are sending copies of this report to all members of the Capitol
Preservation Commission, the Architect of the Capitol, and other
interested parties.  Copies will be made available to others upon
request.  This report was prepared under the direction of Robert W. 
Gramling, Director, Corporate Audits and Standards, who may be
reached at (202) 512-9406 if you or your staffs have any questions. 

James F.  Hinchman
Acting Comptroller General
of the United States


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


B-277057

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

We have audited the statements of financial position of the Capitol
Preservation Fund as of September 30, 1996 and 1995 (as restated for
fiscal year 1995--see note 4), and the related statements of
activities and statements of cash flows for the fiscal years then
ended (as restated for fiscal year 1995).  We found

  the financial statements were reliable in all material respects,

  no material weaknesses in the internal controls we tested, and

  no reportable noncompliance with selected provisions of 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. 


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

The financial statements and accompanying notes present fairly, in
all material respects, in conformity with generally accepted
accounting principles, the Capitol Preservation Fund's financial
position as of September 30, 1996 and 1995 (as restated for fiscal
year 1995), and the results of its activities and its cash flows for
the fiscal years then ended (as restated for fiscal year 1995). 


   CONSIDERATION OF INTERNAL
   CONTROLS
------------------------------------------------------------ Letter :2

We gained an understanding of internal controls designed to

  safeguard assets against loss from unauthorized acquisition, use,
     or disposition;

  assure the execution of transactions in accordance with
     management's authority and with laws and regulations that could
     have a direct and material effect on the financial statements;
     and

  properly record, process, and summarize transactions to permit the
     preparation of reliable financial statements and to maintain
     accountability over assets. 

The objective of our internal control work was to determine
procedures for auditing the financial statements, not to express an
opinion on internal controls.  Accordingly, we do not express such an
opinion.  However, for the controls we tested, we found no material
weaknesses in internal control and its operations for the fiscal year
ended September 30, 1996.  A material weakness is a reportable
condition\1 in which the design or operation of the internal controls
does not reduce to a relatively low level the risk that losses,
noncompliance, or misstatements in amounts that would be material in
relation to the financial statements may occur and not be detected
promptly by employees in the normal course of their assigned duties. 
Our internal control work would not necessarily disclose all material
weaknesses. 


--------------------
\1 Reportable conditions involve matters coming to the auditor's
attention relating to significant deficiencies in the design or
operation of internal controls that, in the auditor's judgment, could
adversely affect an entity's ability to (1) safeguard assets against
loss from unauthorized acquisition, use, or disposition, (2) ensure
the execution of transactions in accordance with management's
authority and with laws and regulations, and (3) properly record,
process, and summarize transactions to permit the preparation of
financial statements and to maintain accountability for assets. 


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

Our tests for compliance with selected provisions of laws and
regulations disclosed no instances of noncompliance that would be
reportable under 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. 


   OBJECTIVES, SCOPE, AND
   METHODOLOGY
------------------------------------------------------------ Letter :4

The Fund's management is responsible for

  preparing the Fund's annual financial statements in conformity with
     generally accepted accounting principles;

  establishing and maintaining the Fund'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
the financial statements are free of material misstatements and
presented fairly, in all material respects, in conformity with
generally accepted accounting principles.  Also, we are responsible
for obtaining a sufficient understanding of internal controls to plan
the audit and for testing compliance with selected provisions of laws
and regulations. 

In order to fulfill these responsibilities, we

  examined evidence supporting the amounts and disclosures in the
     financial statements and notes;

  assessed the accounting principles used by management;

  evaluated the overall presentation of the financial statements;

  obtained an understanding of the internal control related to
     safeguarding assets, compliance with laws and regulations, and
     financial reporting; and

  tested compliance with selected provisions of laws and regulations. 

We conducted our audit from January 15, 1997, to May 19, 1997, in
accordance with generally accepted government auditing standards. 


   LIBRARY OF CONGRESS COMMENTS
------------------------------------------------------------ Letter :5

We provided a draft of our report to the Director, Financial
Services, Library of Congress for review and comment.  The Library of
Congress provides financial management services for the Capitol
Preservation Fund including preparing the Fund's financial
statements.  The Director agreed with the contents of our report. 

Jeffrey C.  Steinhoff
Director of Planning and
 Reporting

May 19, 1997


FINANCIAL STATEMENTS
=========================================================== Appendix 0

   Statements of Financial
   Position

   (See figure in printed
   edition.)

   Statements of Activities

   (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.)


*** End of document. ***