Summary of Financial Statement Audit and Management Assurances
Office of management and budget (OMB) guidance requires all agencies to prepare Table 1 (Summary of Financial Statement Audit) to show auditor-reported material weaknesses identified in the Independent Auditor’s Report. This table relates to the Summary of Independent Auditor’s Report Findings FY 2007 table located in the Management’s Discussion and Analysis (MD&A) section under Other Management Information, Initiatives, and Issues. In addition, OMB guidance requires all agencies to prepare Table 2 (Summary of Management Assurances) for a global overview of management-identified internal control material weaknesses, conformance with financial management requirements, and compliance with the Federal Financial Management Improvement Act (FFMIA). This table corresponds with the information presented in the Management Assurances section under Analysis of Systems, Controls, and Legal Compliance located in the MD&A.
Summary of Financial Statement Audit
Table 1. Summary Of Financial Statement Audit
| Audit Opinion: |
Unqualified |
| Restatement: |
No |
| Material Weaknesses |
Beginning Balance |
New |
Resolved |
Consolidated |
Ending Balance |
| Accounting and Reporting of Accruals |
1 |
0 |
1 |
0 |
0 |
| Total Material Weaknesses |
1 |
0 |
1 |
0 |
0 |
Summary Of Management Assurances
Table 2. Summary Of Management Assurances
Effectiveness of Internal Control over Financial Reporting (FMFIA ยง 2) (App A, OMB Cir A-123)
Statement of Assurance:
 |
Qualified (Due to Scope Limitations)
|
| Material Weaknesses |
Beginning
Balance |
New |
Resolved |
Consolidated |
Reassessed |
Ending
Balance |
| Personnel preparing quarterly accruals have not received adequate training on how to document and calculate quarterly accruals. |
1 |
0 |
1 |
0 |
0 |
0 |
| The reconciliation between the Accruals Reporting System (ARS) and Phoenix was not performed when data were initially transferred from one database to the other. |
1 |
0 |
1 |
0 |
0 |
0 |
| Total Material Weaknesses |
2 |
0 |
2 |
0 |
0 |
0 |
Effectiveness of Internal Control over Operations (FMFIA § 2)
Statement of Assurance:
|
Qualified
|
| Material Weaknesses |
Beginning
Balance |
New |
Resolved |
Consolidated |
Reassessed |
Ending
Balance |
| Inadequate physical security in overseas buildings and operations |
1 |
0 |
1 |
0 |
0 |
0 |
| Implementation and activity monitoring in the ANE regions |
1 |
0 |
0 |
0 |
0 |
1 |
| Total Material Weaknesses |
2 |
0 |
1 |
0 |
0 |
1 |
Conformance with Financial Management System Requirements (FMFIA § 4)
Statement of Assurance:
|
Systems conform to financial management system requirements
|
| Non-Conformances |
Beginning
Balance |
New |
Resolved |
Consolidated |
Reassessed |
Ending
Balance |
| None |
0 |
0 |
0 |
0 |
0 |
0 |
| Total Material Weaknesses |
0 |
0 |
0 |
0 |
0 |
0 |
Compliance with Federal Financial Management Improvement Act (FFMIA)
| |
Agency |
Auditor |
| Overall Substantial Compliance |
Yes |
Yes |
| 1. System Requirements |
Yes |
Yes |
| 2. Accounting Standards |
Yes |
Yes |
| 3. USSGL at Transaction Level |
Yes |
Yes |
|
Definition of Terms
Beginning Balance: The ending balance of material weaknesses from the prior year.
New: The total number of material weaknesses that have been identified during the current year.
Resolved: The total number of material weaknesses that have dropped below the level of materiality in the current year.
Consolidated: The combining of two or more findings.
Reassessed: The removal of any finding not attributable to corrective actions (e.g., management has re-evaluated and determined a material weakness does not meet the criteria for materiality or is redefined as more correctly classified under another heading (e.g., FMFIA Section 2 to a FMFIA Section 4 and vice versa)).
Ending Balance: The agency’s year-end balance.
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