[Final Audit for the Department of the Interior on Applying Agreed-Upon Procedures for FACTS I Data Verification]
[From the U.S. Government Printing Office, www.gpo.gov]

Report No. 2003-I-0016

Title: Final Audit for the Department of the Interior on Applying
       Agreed-Upon Procedures for FACTS I Data Verification

  

Date:  February 6, 2003


**********DISCLAIMER********** 
This file contains an ASCII representation of an OIG report. No attempt has been made to display graphic images or illustrations. Some tables may be included, but may not resemble those in the printed version. A printed copy of this report may be obtained by referring to the PDF file or by calling the Office of Inspector General, Division of Acquisition and Management Operations at (202) 219-3841. 
******************************


Subject: Final Audit for the Department of the Interior on Applying Agreed-Upon Procedures for FACTS I Data Verification (No. 2003-I-0016)

U.S. General Accounting Office
Attn: Mr. John Fretwell
441 G. Street, NW Room 5970
Washington, DC 20548

Department of Treasury
Attn: Director, Financial Reports Division
Financial Management Services
Room 509B
3700 East-West Highway
Hyattsville, MD 20782


Dear Sir or Madam:

Enclosed is the report for the Department of the Interior on ï¿½Applying Agreed-Upon Procedures for FACTS I Data Verification.ï¿½  The report was prepared by KPMG LLP (KPMG) under contract with the Department of the Interior, Office of Inspector General.

KPMG is responsible for the report, dated February 6, 2003.  We monitored the progress of the engagement at key points, reviewed KPMGï¿½s report and selected related working papers, and inquired of its representatives.  We continue to review KPMGï¿½s work as the final information is provided to us.  Our review to date has disclosed no instances where KPMG did not comply, in all material respects, with the Government Auditing Standards.

If you have any questions concerning this matter, please contact me at (202) 208-5512 or Mr. Curtis Crider, Director of Financial Audits, at (202) 208-5724. 


Sincerely,

Signed by Andrew Fedak for

Roger La Rouche, Assistant Inspector General for Audits

Enclosure



ENCLOSURE

February 6, 2003

FY2002 Independent Accountantsï¿½ Report on Applying Agreed-Upon Procedures For FACTS I Data Verification 

Office of Inspector General,
U.S. Department of the Interior 

We have performed the procedures enumerated in Exhibit A (attached), which were stated in the U.S. Department of Treasuryï¿½s (Treasury) Federal Agenciesï¿½ Centralized Trial Balance System (FACTS) guidance dated August 16, 2002, to assist the Treasury Financial Management Service (FMS) in the preparation of, and the U.S. General Accounting Office (GAO) in the audit of, the consolidated financial statements of the U.S. Government, and to assist the U.S. Department of the Interiorï¿½s (Interior) Office of Inspector General (OIG) in evaluating Interiorï¿½s assertion that it compared the summarized FACTS I data to the related information in the Departmentï¿½s consolidated audited financial statements as of and for the year ended September 30, 2002. Interiorï¿½s management is responsible for the proper accounting, presentation, and reporting of its consolidated financial statements and reporting of information to Treasury. 

This agreed-upon procedures engagement was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants.  These procedures were agreed to by the Office of Management and Budget (OMB), FMS, GAO, Interior, and OIG.  The sufficiency of these procedures is solely the responsibility of OMB, FMS, and GAO.  Consequently, we make no representations regarding the sufficiency of the procedures described in Exhibit A either for the purpose for which this report has been requested or for any other purpose.  The procedures we performed and our associated findings are presented in Exhibit A. 

We were not engaged to, and did not, conduct an examination of the FACTS I data submission, the objective of which would be the expression of an opinion on such information.  Accordingly, we do not express such an opinion.  Had we performed additional procedures, other matters might have come to our attention that would have been reported to you. 

This report is intended solely for the information and use of OMB, FMS, GAO, Interior, and OIG, and should not be used by those who have not agreed to the procedures and taken responsibility for the sufficiency of the procedures for their purposes. 

Exhibit A 

U.S. Department of the Interior Agreed-Upon Procedures for FACTS I Data Verification 
Procedures and Findings.  (NOTE: Where applicable, the procedures performed took into consideration that the consolidated financial statements and footnotes are rounded to the nearest thousand, and Required Supplementary Information and Required Supplementary Stewardship Information are rounded to the nearest million.) 

1. The amounts for split U.S. Government Standard General Ledger (USSGL) accounts in the Interiorï¿½s accounting records must agree to the corresponding amounts on the Account Grouping Worksheet (AGW) Split Account Schedule ï¿½ FY2002, presented in Attachment 1, prepared by the U.S. Department of the Interior (Interior) Chief Financial Officer (CFO).  We compared the amounts in Interiorï¿½s accounting records to the corresponding amounts for each line item on the AGW Split Account Schedule ï¿½ FY2002. 

Findings: We found such amounts to be in agreement. 

2. The amounts for each line item in Interiorï¿½s audited consolidated balance sheet and audited consolidated statement of changes in net position must agree to the corresponding amounts in the AGW columns titled ï¿½Amount from Agency Financial Statementsï¿½ presented in Attachment 2, and ï¿½Agency Financial Statements Cumulative Results of Operationsï¿½ and ï¿½Agency Financial Statements Unexpended Appropriationsï¿½ presented in Attachment 3, provided by the CFO.  We compared the amounts for each line item in the audited consolidated balance sheet and the audited consolidated statement of changes in net position to the corresponding amounts in the AGW balance sheet column titled ï¿½Amount from Agency Financial Statementsï¿½ and the AGW statement of changes in net position columns titled ï¿½Agency Financial Statements Cumulative Results of Operationsï¿½ and ï¿½Agency Financial Statements Unexpended Appropriations.ï¿½ 

Findings: We found such amounts to be in agreement. 

3. The amounts for each line item on the AGW balance sheet for the column titled ï¿½Amount from Agency Financial Statementsï¿½ presented in Attachment 2, and the AGW statement of changes in net position for the columns titled ï¿½Agency Financial Statements Cumulative Results of Operationsï¿½ and ï¿½Agency Financial Statements Unexpended Appropriationsï¿½ presented in Attachment 3, prepared by the CFO, must agree to the corresponding amounts in Interiorï¿½s audited consolidated balance sheet and audited consolidated statement of changes in net position. We compared the amounts for each line item on the AGW balance sheet for the column titled ï¿½Amount from Agency Financial Statementsï¿½ and the AGW statement of changes in net position for the columns titled ï¿½Agency Financial Statements Cumulative Results of Operationsï¿½ and ï¿½Agency Financial Statements Unexpended Appropriationsï¿½ to the corresponding amounts in the Departmentï¿½s audited consolidated balance sheet and audited consolidated statement of changes in net position. 

Findings: We found such amounts to be in agreement. 

4. The column on the AGW balance sheet titled ï¿½Amount from Agency Financial Statements,ï¿½ presented in Attachment 2, and the columns on the AGW statement of changes in net position columns titled ï¿½Agency Financial Statements Cumulative Results of Operationsï¿½ and ï¿½Agency Financial Statements Unexpended Appropriationsï¿½ presented in Attachment 3, must be arithmetically correct.  The columns titled ï¿½Differencesï¿½ on the AGW balance sheet, presented in Attachment 2, and the AGW statement of changes in net position, presented in Attachment 3, must be arithmetically correct.  We totaled the AGW balance sheet column titled ï¿½Amount from Agency Financial Statementsï¿½ and AGW statement of changes in net position columns titled ï¿½Agency Financial Statements Cumulative Results of Operationsï¿½ and ï¿½Agency Financial Statements Unexpended Appropriations.ï¿½  We also totaled and cross-totaled the AGW balance sheet and AGW statement of changes in net position columns titled ï¿½Differences.ï¿½ 

Findings: The calculated amounts agreed to the totals of the ï¿½Amount From Agency Financial Statementsï¿½ and to the ï¿½Differencesï¿½ columns presented on the AGW balance sheet, and to the ï¿½Amount from Agency Financial Statements Cumulative Results of Operations,ï¿½ ï¿½Agency Financial Statements Unexpended Appropriationsï¿½ and the ï¿½Differencesï¿½ columns on the AGW statement of changes in net position. 

5. Any differences identified for the AGW balance sheet, presented in Attachment 2, and AGW statement of changes in net position, presented in Attachment 3, must be explained by the CFO.  We read Attachments 2 and 3 to identify any differences for the AGW balance sheet and AGW statement of changes in net position and requested explanations and supporting documentation for those differences from the CFO.  We compared the explanations for the differences to supporting documentation for consistency. 

Findings: We determined that the amounts labeled as ï¿½Differencesï¿½ on the AGW balance sheet and AGW statement of changes in net position were explained by the CFO.  We compared the explanations for the differences to the supporting documentation for consistency.  However, we noted the following exceptions: 

ï¿½ We did not receive supporting documentation for $71,138,816 of the $1,898,928,612 difference on ï¿½total - cumulative results of operationsï¿½ line on the AGW balance sheet. 
ï¿½ The CFO did not provide an explanation for the $878,512 difference in ï¿½other budgetary financing sources and adjustmentsï¿½ on the AGW statement of changes in net position. 
ï¿½ The CFO did not provide an explanation for the $706,087 difference in the ï¿½beginning balances of cumulative results of operationsï¿½ on both the AGW balance sheet and the AGW statement of changes in net position. 

No additional procedures were performed with respect to managementï¿½s representation as to the explanations for the ï¿½Differences.ï¿½ 

6. If there is an amount labeled as ï¿½Differencesï¿½ on the ending balances line at the bottom of the AGW statement of changes in net position, presented in Attachment 3, the explanation for the difference must be identified by the CFO and supported by appropriate documentation.  We obtained the AGW statement of changes in net position and determined if there was an amount labeled as ï¿½Differencesï¿½ on the ending balances line, and if so, we requested explanations and supporting documentation for those differences from the CFO. 

Findings: We determined that the amount labeled as ï¿½Differencesï¿½ on the AGW statement of changes in net position ï¿½ end of period line was explained by the CFO.  We compared the explanation for the differences to the supporting documentation for consistency, except that we did not receive an explanation for the $878,512 difference in ï¿½other budgetary financing sources and adjustmentsï¿½ on the AGW statement of changes in net position.  No additional procedures were performed with respect to managementï¿½s representation as to the reasons for the ï¿½Differences.ï¿½ 

7. The amounts for each line item for agency gross cost, agency exchange revenue, and agency net cost by Budget Subfunction Classification (BFS), from Interiorï¿½s audited consolidated financial statement footnotes must agree to the corresponding amounts in the AGW statement of net cost column titled ï¿½Agency Statement Footnotesï¿½ provided by the CFO, presented in Attachment 4.  We compared amounts for each line item for agency gross cost, agency exchange revenue, and agency net cost by BFS from Interiorï¿½s audited consolidated financial statement footnotes to the corresponding amounts in the AGW statement of net cost column titled ï¿½Agency Statement Footnotes.ï¿½ 

Findings: Agency net cost by BFS is not included in the AGW statement of net cost; therefore, we were unable to compare these amounts from the audited consolidated financial statements to the AGW statement of net cost.  We found such amounts for agency gross cost and agency exchange revenue by BFS to be in agreement. 

8. The amounts for each line item for agency gross cost, agency exchange revenue, and agency net cost, by BFS on the AGW statement of net cost for the column titled ï¿½Agency Statement Footnotesï¿½ provided by the CFO, presented in Attachment 4, must agree to the corresponding amounts in Interiorï¿½s audited consolidated financial statement footnotes.  We compared the amounts for each line item for agency gross cost, agency exchange revenue, and agency net cost by BFS on the AGW statement of net cost for the column titled ï¿½Agency Statement Footnotesï¿½ to the corresponding amounts in Interiorï¿½s audited consolidated financial statement footnotes. 

Findings: Agency net cost by BFS is not included in the AGW statement of net cost; therefore, we were unable to compare these amounts from the audited consolidated financial statements to the AGW statement of net cost.  We found such amounts for agency gross cost and agency exchange revenue by BFS to be in agreement. 

9. The amounts for each line item in Interiorï¿½s audited consolidated financial statement footnotes for agency gross cost, agency exchange revenue, and agency net cost, for interdepartmental amounts by BFS must agree to the corresponding amounts in the AGW statement of net cost column titled ï¿½Agency Statement Footnotesï¿½ provided by the CFO, presented in Attachment 4.  We compared the amounts for each line item in Interiorï¿½s audited consolidated financial statement footnotes for agency gross cost, agency exchange revenue, and agency net cost, for interdepartmental amounts by BFS, to the corresponding amounts in the AGW statement of net cost column titled ï¿½Agency Statement Footnotes.ï¿½ 

Findings: Agency net cost, for interdepartmental amounts by BFS is not included on the AGW statement of net cost; therefore, we were unable to compare these amounts from the audited consolidated financial statements to the AGW statement of net cost.  We found such amounts for agency gross cost and agency exchange revenue, for interdepartmental amounts by BFS to be in agreement. 

10. The amounts for each line item for agency gross cost, agency exchange revenue, and agency net cost, for interdepartmental amounts by BFS, from the AGW statement of net cost column titled ï¿½Agency Statement Footnotesï¿½ provided by the CFO, presented in Attachment 4, must agree to the corresponding amounts in Interiorï¿½s audited consolidated financial statement footnotes.  We compared the amounts for each line item for agency gross cost, agency exchange revenue, and agency net cost, for interdepartmental amounts by BFS, from the AGW statement of net cost column titled ï¿½Agency Statement Footnotesï¿½ to the corresponding amounts in Interiorï¿½s audited consolidated financial statement footnotes. 

Findings: Agency net cost, for interdepartmental amounts by BFS is not included on the AGW statement of net cost; therefore, we were unable to compare these amounts from the audited consolidated financial statements to the AGW statement of net cost.  We found such amounts for agency gross cost and agency exchange revenue, for interdepartmental amounts by BFS to be in agreement. 

11. The amounts for total agency gross cost, total agency exchange revenue, and total agency net costs from the AGW statement of net cost column titled ï¿½Agency Statement Footnotesï¿½ provided by the CFO, presented in Attachment 4, must agree to the corresponding amounts in Interiorï¿½s audited consolidated financial statement footnotes.  We compared the amounts for total agency gross cost, total agency exchange revenue, and total agency net costs from the AGW statement of net cost column titled ï¿½Agency Statement Footnotesï¿½ to the corresponding amounts in Interiorï¿½s audited consolidated financial statement footnotes. 

Findings: We found such amounts to be in agreement. 

12. The amounts for total agency gross cost, total agency exchange revenue, and total agency net cost from the Departmentï¿½s audited consolidated financial statement footnotes must agree to the corresponding amounts on the AGW statement of net cost column titled ï¿½Agency Statement Footnotesï¿½ provided by the CFO, presented in Attachment 4.  We compared the amounts for total agency gross cost, total agency exchange revenue, and total agency net cost from Interiorï¿½s audited consolidated financial statement footnotes to the corresponding amounts in the AGW statement of net cost column titled ï¿½Agency Statement Footnotes.ï¿½ 

Findings: We found such amounts to be in agreement. 

13. The AGW statement of net cost column titled ï¿½Agency Statement Footnotes,ï¿½ presented in Attachment 4, must be arithmetically correct.  The AGW statement of net cost columns titled ï¿½Difference,ï¿½ presented in Attachment 4, must be arithmetically correct.  We totaled the AGW statement of net cost column titled ï¿½Agency Statement Footnotes.ï¿½  We totaled and cross-totaled the AGW statement of net cost columns titled ï¿½Difference.ï¿½ 

Findings: The calculated amounts agreed to the totals of the ï¿½Agency Statement Footnotesï¿½ column and to the ï¿½Differenceï¿½ columns presented on the AGW statement of net cost. 

14. Any differences identified on the AGW statement of net cost must be explained by the CFO.  We inspected the AGW for any differences between each line item for total agency gross cost, total agency exchange revenue, and total agency net cost from Interiorï¿½s audited consolidated financial statement footnotes and the corresponding amounts in the AGW statement of net cost column titled ï¿½Agency Statement Footnotes,ï¿½ and requested explanations and supporting documentation for those differences from the CFO.  We compared the explanations for the differences to supporting documentation for consistency. 

Findings: We determined that the amounts labeled as ï¿½Differencesï¿½ on the AGW statement of net cost were explained by the CFO.  We compared the explanation for the differences to the supporting documentation for consistency.  However, we noted the following exceptions: 

ï¿½ The CFO explained that the difference of $10,750,871 for BFS 300 in the AGW statement of net cost, agency gross cost amount, represents an elimination entry made after the FACTS submission.  We found that the $10,750,871 consists of (1) a $67,157,705 debit for eliminations made after the FACTS submission to Treasury that we compared to supporting documentation, and (2) a $56,406,834 credit for which we did not receive supporting documentation. 
ï¿½ We did not receive supporting documentation for $222,106,116 of the differences totaling $4,360,808,116 on the AGW statement of net cost, agency exchange revenue. 
ï¿½ We did not receive supporting documentation for $72,608,120 of the differences totaling $3,917,835,879 on the AGW statement of net cost, interdepartmental agency exchange revenue. 

No additional procedures were performed with respect to managementï¿½s representation as to the explanations for the amounts identified in the ï¿½Differenceï¿½ column. 

15. The amounts for each respective line item in the AGW FACTS I NOTES Review Schedule for Interiorï¿½s consolidated financial statement footnotes, or other supporting data, must agree to the corresponding amounts on the AGW FACTS I NOTES Review Schedule columns titled ï¿½Agency Source Dataï¿½ and ï¿½Amount from Agency Source Data,ï¿½ presented in Attachment 5.  We compared the amounts for each respective line item on the AGW FACTS I NOTES Review Schedule from Interiorï¿½s consolidated financial statement footnotes, or other supporting data, to the corresponding amounts on the AGW FACTS I NOTES Review Schedule columns titled ï¿½Agency Source Dataï¿½ and ï¿½Amount from Agency Source Data.ï¿½ 

Findings: We found such amounts to be in agreement. 

16. The AGW FACTS I NOTES Review Schedule column titled ï¿½Amount from Agency Source Data,ï¿½ presented in Attachment 5, must be arithmetically correct.  The AGW FACTS I NOTES Review Schedule column titled ï¿½Variance,ï¿½ presented in Attachment 5, must be arithmetically correct.  We totaled the AGW FACTS I NOTES Review Schedule column titled ï¿½Amount from Agency Source Data.ï¿½  We totaled and cross-totaled the AGW FACTS I NOTES Review Schedule column titled ï¿½Variance.ï¿½ 

Findings: The calculated amounts agreed to the totals for the ï¿½Amount from Agency Source Dataï¿½ column and to the ï¿½Varianceï¿½ column on the AGW FACTS I NOTES Review Schedule. 

17. Any differences between the amounts for each respective line item on the AGW FACTS I NOTES Review Schedule for Interiorï¿½s consolidated financial statement footnotes, or other supporting data, and the corresponding amounts on the AGW FACTS I NOTES Review Schedule columns titled ï¿½Agency Source Dataï¿½ and ï¿½Amount from Agency Source Data,ï¿½ presented in Attachment 5, must be identified and explained by the CFO.  We reviewed Attachment 5 for any differences between the amounts for each respective line item on the AGW FACTS I NOTES Review Schedule for Interiorï¿½s consolidated financial statement footnotes, or other supporting data, and the corresponding amounts on the AGW FACTS I NOTES Review Schedule columns titled ï¿½Agency Source Dataï¿½ and ï¿½Amount from Agency Source Data,ï¿½ and requested explanations and supporting documentation for those variances from the CFO.  We compared the explanations for the differences to supporting documentation for consistency. 

Findings: We determined that the amounts labeled as ï¿½Varianceï¿½ on the AGW FACTS I NOTES Review Schedule were explained by the CFO.  We compared the explanations for the variances to the supporting documentation for consistency.  No additional procedures were performed with respect to managementï¿½s representation as to the reasons for the ï¿½Variance.ï¿½