Financial Audit: Congressional Award Foundation's Fiscal Year	 
2000 and 1999 Financial Statements (15-MAY-01, GAO-01-680).	 
								 
GAO audited the financial statements of the Congressional Award  
Foundation as of September 30, 2000 and 1999, and the related	 
statements of activities and cash flows for the fiscal years	 
there ended. GAO found that (1) the financial statements were	 
presented fairly in conformity with U.S. generally accepted	 
accounting principles, (2) the Foundation had effective internal 
control over financial reporting and compliance with laws and	 
regulations as of September 30, 2000, and (3)there were no	 
reportable noncompliance with laws and regulations GAO tested.	 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-01-680 					        
    ACCNO:   A01013						        
  TITLE:     Financial Audit: Congressional Award Foundation's Fiscal 
             Year 2000 and 1999 Financial Statements                          
     DATE:   05/15/2001 
  SUBJECT:   Financial statement audits 			 
	     Internal controls					 
	     Reporting requirements				 

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GAO-01-680
     
A

Report to the Congress

May 2001 FINANCIAL AUDIT Congressional Award Foundation?s Fiscal Year 2000
and 1999 Financial Statements

GAO- 01- 680

Letter 3 Auditor?s Report 5 Financial Statements 10

Statements of Financial Position 10 Statements of Activities 11 Statements
of Cash Flows 12 Notes to Financial Statements 13

Lett er

May 15, 2001 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
Congressional Award Foundation for the fiscal years ended September 30, 2000
and 1999. These financial statements are the responsibility of the
Congressional Award Foundation. This report also presents (1) our opinion on
the effectiveness of the Foundation's related internal control as of
September 30, 2000, and (2) our conclusion on the Foundation's compliance in
fiscal year 2000 with selected provisions of laws and

regulations we tested. We conducted our audit pursuant to section 8 of the
Congressional Award Act, as amended (2 U. S. C. 807), and in accordance with
U. S. generally accepted government auditing standards. We are sending
copies of this report to Senator Fred Thompson, Chairman, and Senator Joseph
I. Lieberman, Ranking Member, Senate Committee on Governmental Affairs;
Representative Dan Burton, Chairman, and

Representative Henry A. Waxman, Ranking Minority Member, House Committee on
Government Reform; Representative John Boehner, Chairman, and Representative
George Miller, Ranking Minority Member, House Committee on Education and the
Workforce; Thomas D. Campbell,

Chairman, National Board of Directors, Congressional Award Program; James F.
Manning, National Director, Congressional Award Foundation; and other
interested parties. Should you or your staffs have any questions concerning
our review of the audits, please contact me on (202) 512- 2600 or

Jeanette M. Franzel, Acting Director, on (202) 512- 9471. Jeffrey C.
Steinhoff Managing Director Financial Management and Assurance

Opi ni on Let ter

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

We have audited the statements of financial position of the Congressional
Award Foundation as of September 30, 2000 and 1999, and the related
statements of activities and cash flows for the fiscal years then ended. We
found

 the financial statements are presented fairly in conformity with U. S.
generally accepted accounting principles,

 the Foundation had effective internal control over financial reporting
(including safeguarding of assets) and compliance with laws and regulations
as of September 30, 2000, and

 no reportable noncompliance with laws and regulations we tested. The
following sections discuss, in more detail, our conclusions and the scope of
our audit.

Opinion on Financial The financial statements and accompanying notes present
fairly, in all Statements

material respects, in conformity with U. S. generally accepted accounting
principles, the Foundation's financial position as of September 30, 2000 and
1999, and the results of its activities and cash flows for the fiscal years
then ended.

Opinion on Internal The Foundation maintained, in all material respects,
effective internal Control

control over financial reporting and compliance as of September 30, 2000,
that provided reasonable assurance that misstatements, losses, or
noncompliance, material in relation to the financial statements, would be

prevented or detected promptly. Management asserted that its internal
control was effective based on criteria we established in our Standards for
Internal Control in the Federal Government. 1 1 Standards for Internal
Control in the Federal Government (GAO/ AIMD- 00- 21.3.1, November

1999).

Compliance With Laws Our tests for compliance with selected provisions of
laws and regulations

and Regulations disclosed no instances of noncompliance that would be
reportable under

U. S. 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 The Foundation's management is responsible for

Methodology

 preparing the annual financial statements in conformity with U. S.
generally accepted accounting principles;

 establishing, maintaining, and assessing the Foundation's internal control
(as described in Standards for Internal Control in the Federal Government)
to provide reasonable assurance that the Foundation's control objectives are
met; and

 complying with applicable laws and regulations. We are responsible for
obtaining reasonable assurance about whether (1) the financial statements
are presented fairly, in all material respects, in conformity with U. S.
generally accepted accounting principles and

(2) management maintained effective related internal control, the objectives
of which are the following:

 financial reporting transactions are properly recorded, processed, and
summarized to permit the preparation of financial statements, in conformity
with U. S. generally accepted accounting principles, and assets are
safeguarded against loss from unauthorized acquisition, use, or disposition
and

 compliance with laws and regulations transactions are executed in
accordance with laws and regulations that could have a direct and material
effect on the financial statements. We are also responsible for testing
compliance with selected provisions of laws and regulations that have a
direct and material effect on the financial statements.

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 Foundation?s management;

 evaluated the overall presentation of the financial statements;

 obtained an understanding of the Foundation's internal control related to
financial reporting (including safeguarding assets) and compliance with laws
and regulations;  tested relevant internal control over financial reporting
(including

safeguarding of assets) and compliance and evaluated the design and
operating effectiveness of internal control; and

 tested compliance with selected provisions of the Congressional Award Act,
as amended.

We did not evaluate internal controls relevant to operating objectives, such
as controls relevant to ensuring efficient operations. We limited our
internal control testing to controls over financial reporting and
compliance.

Because of inherent limitations in internal control, misstatements due to
error or fraud, losses, or noncompliance may nevertheless occur and not be
detected. We also caution that projecting the results of our tests of
internal control 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 did not test compliance with all laws and regulations applicable to the
Foundation. We limited our tests of compliance to those provisions of laws
and regulations that we deemed to have a direct and material effect on the

financial statements for the fiscal year ended September 30, 2000. We
caution that noncompliance may occur and not be detected by our tests and
that such testing may not be sufficient for other purposes. We conducted our
work in accordance with U. S. generally accepted government auditing
standards.

Foundation?s We provided a draft of our report to Congressional Award
Foundation

Comments officials for their review and comment. Foundation officials agreed
with the contents of our report. Jeffrey C. Steinhoff

Managing Director Financial Management and Assurance

April 13, 2001

Financial Statements

Statements of Financial Position

The Congressional Award Foundation Statements of Financial Position As of
September 30, 2000 and 1999

2000 1999 Assets

Cash and cash equivalents (note 3) $288,177 $343,784 Contributions
receivable, net (note 4) - 77,800 Accounts receivable, net - 2,423 Prepaid
expense 4,392 4,349 Congressional Award Fellowship Trust (note 5) 662,864
427,885 Equipment, furniture, and fixtures, net (note 2) 69,509 78,468
Escrowed funds from councils, net (note 6) 5,145 5,145 Other Assets 170
Total

Assets $1,030,257 $939,854 Liabilities and Net Assets

Accounts payable - 47,560 Accrued payroll, related taxes, and leave 25,176
14,479 Obligation under capital lease 9,136 11,885 Escrowed funds due
councils, net (note 6) 5,145 5,145

Total Liabilities 39,457 79,069 Net Assets

Unrestricted 650,121 491,742 Temporarily restricted 76,222 104,936
Permanently restricted 264,457 264,107

Total Net Assets 990,800 860,785 Total Liabilities and Net Assets $1,030,257
$939,854

The accompanying notes are an integral part of these financial statements.

Statements of Activities

The Congressional Award Foundation Statements of Activities For the Fiscal
Years Ended September 30, 2000 and 1999

2000 1999 Changes in Unrestricted Net Assets:

Operating revenue and other support

Contributions $834,828 $1,043,125 Contributions - In- kind (note 7) 82,794
106,002 Program and other revenues 43,381 33,682 Interest and dividends
applied to current operations 17,678 18,417 Net assets released from
restrictions (note 8) 33,714 24,774

Total Operating Revenue and Other Support 1,012,395 1,226,000 Operating
expenses (note 13)

Salaries, benefits, and payroll taxes 446,512 409,113 Program, promotion,
and travel 152,515 119,076 Fund- raising expense 147,428 331,018 Gold Award
ceremony 41,706 34,460 Professional fees 127,139 91,950 Depreciation 15,049
7,200 Board of Directors expense 11,467 399 Administrative and other expense
45,695 12,320 Bad debt expense 2,052 520 Loss on sale of assets - 5,498

Total Operating Expenses 989,563 1,011,554 Other changes

Investment earnings (losses) not applied to current operations 135,547
75,723

Increase (Decrease) in Unrestricted Net Assets 158,379 290,169 Changes in
Temporarily Restricted Net Assets:

Contributions (note 9) 5,000 81,500 Net assets released from restrictions
(note 8) (33,714) (24,774)

Increase (Decrease) in Temporarily Restricted Net Assets (28,714) 56,726
Changes in Permanently Restricted Net Assets:

Contributions 350 1,050

Increase in Permanently Restricted Net Assets 350 1,050 Increase (Decrease)
in Net Assets 130,015 347,945

Net Assets at Beginning of Year 860,785 512,840

Net Assets at End of Year $990,800 $860,785

The accompanying notes are an integral part of these financial statements.

Statements of Cash Flows

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