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entitled 'Financial Audit: Capitol Preservation Fund's Fiscal Years 
2002 and 2001 Financial Statements' which was released on June 13, 
2003.

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Report to the Congress:

June 2003:

Financial Audit:

Capitol Preservation Fund's Fiscal Years 2002 and 2001 Financial 
Statements:

GAO-03-822:

Letter:

Auditor's Report:

Opinion on Financial Statements:

Consideration of Internal Control:

Compliance with Laws and Regulations:

Objectives, Scope, and Methodology:

Commission Comments:

Financial Statements:

Statements of Financial Position:

Statements of Activities:

Statements of Cash Flows:

Notes to Financial Statements:

Letter June 13, 2003:

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 (the Fund) for the fiscal years ended 
September 30, 2002, and 2001. It also discusses our consideration of 
the Fund's internal control and our tests of compliance with laws and 
regulations during fiscal year 2002. We conducted our audit pursuant to 
2 U.S.C. 2084 and in accordance with U.S. generally accepted government 
auditing standards. We appreciate the cooperation and assistance of the 
Office of the Secretary of the Senate, the Office of the Clerk of the 
House of Representatives, and the staffs of the Architect of the 
Capitol and the Library of Congress during our audit.

We are sending copies of this report to the members of the Capitol 
Preservation Commission; the Honorable Emily J. Reynolds, Secretary of 
the Senate; the Honorable Jeffrey T. Trandahl, Clerk of the House of 
Representatives; the Honorable Alan M. Hantman, Architect of the 
Capitol; the Honorable James H. Billington, Librarian of Congress; and 
other interested parties. This report will also be available at no 
charge on the GAO Web site at http://www.gao.gov.

If you or your staff have any questions concerning this report, please 
contact me at (202) 512-9406 or Shirley Abel, Assistant Director, at 
(202) 512-9516. You can also reach us by e-mail at franzelj@gao.gov or 
abels@gao.gov. Key contributors to this report were David Merrill and 
Joel Rodriguez.

Jeanette M. Franzel 

Director 

Financial Management and Assurance:

Signed by Jeanette M. Franzel:

Auditor's Report To the Members of the Capitol Preservation Commission:

We have audited the statements of financial position of the Capitol 
Preservation Fund (the Fund) as of September 30, 2002, and 2001, and 
the related statements of activities and statements of cash flows for 
the fiscal years then ended. We found:

* the financial statements are presented fairly, in all material 
respects, in conformity with U.S. generally accepted accounting 
principles;

* no material weaknesses in internal control over financial reporting 
(including safeguarding assets) and compliance with laws and 
regulations; and:

* no reportable noncompliance with the provisions of laws and 
regulations we tested.

The following sections provide additional detail about our conclusions 
and the scope of our audit.

Opinion on Financial Statements:

The financial statements and accompanying notes present fairly, in all 
material respects, in conformity with U.S. generally accepted 
accounting principles, the Capitol Preservation Fund's financial 
position as of September 30, 2002, and 2001, and the results of its 
activities and its cash flows for the fiscal years then ended.

Consideration of Internal Control:

In planning and performing our audit of the Fund's fiscal year 2002 
financial statements, we considered the Fund's internal control over 
financial reporting and compliance.[Footnote 1] We did this to 
determine our procedures for auditing the financial statements, not to 
express an opinion on internal control over financial reporting and 
compliance. Accordingly, we do not express an opinion on internal 
control. However, for the controls we tested, we found no material 
weaknesses in internal controls over financial reporting (including 
safeguarding assets) and compliance. A material weakness is a condition 
in which the design or operation of internal control does not reduce to 
a relatively low level the risk that errors, fraud, or noncompliance 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 performing their duties. Our consideration of internal 
control would not necessarily disclose all material weaknesses.

Compliance with Laws and Regulations:

Our tests for compliance with selected provisions of laws 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 Methodology:

The management of the Capitol Preservation Commission is responsible 
for:

* preparing the Fund's financial statements in conformity with U.S. 
generally accepted accounting principles;

* establishing, maintaining, and assessing internal control to provide 
reasonable assurance that the objectives of internal control are met; 
and:

* complying with applicable laws and regulations.

We are responsible for:

* obtaining reasonable assurance about whether the financial statements 
are presented fairly, in all material respects, in conformity with U.S. 
generally accepted accounting principles;

* obtaining a sufficient understanding of internal control over 
financial reporting and compliance with laws and regulations to plan 
the audit; and:

* 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 (1) examined, on a test 
basis, evidence supporting the amounts and disclosures in the financial 
statements and notes, (2) assessed the accounting principles used and 
significant estimates made by management, (3) evaluated the overall 
presentation of the financial statements and notes, (4) obtained an 
understanding of the design and operation of internal control related 
to financial reporting (including safeguarding assets) and compliance 
with laws and regulations and tested selected internal controls, and 
(5) tested compliance with selected provisions of the following laws:

* Capitol Preservation Commission and Capitol Preservation Fund 
enabling legislation, 2 U.S.C. 2081-2086, and:

* United States Capitol Visitor Center Commemorative Coin Act of 1999, 
Title II, Public Law 106-126.

We did not test all internal controls relevant to the operations of the 
Capitol Preservation Fund. We limited our consideration to internal 
control over financial reporting and compliance with laws and 
regulations for the purpose of planning our audit. 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 our consideration 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. In addition, we caution that 
our internal control testing may not be sufficient for other purposes.

We did not test compliance with all laws and regulations applicable to 
the Capitol Preservation Fund. We limited our tests of compliance to 
selected provisions of laws and regulations that we deemed applicable 
to the Fund's financial statements for the fiscal year ended September 
30, 2002. 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 performed our work in accordance with U.S. generally accepted 
government auditing standards.

Commission Comments:

We provided a draft of our report to representatives of the Capitol 
Preservation Commission for their review and comment. The Commission's 
representatives agreed with the contents of our report.

Jeanette M. Franzel 
Director 
Financial Management and Assurance:

Signed by Jeanette M. Franzel:

May 2, 2003:

[End of section]

Financial Statements:

[See PDF for image]

[End of figure]

[End of section]

Statements of Financial Position:

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[End of figure]

Statements of Activities:

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[End of figure]

Statements of Cash Flows:

[See PDF for image]

[End of figure]

Notes to Financial Statements:

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[End of figure]

(194177):

FOOTNOTES

[1] The objectives of financial reporting control are to provide 
reasonable assurance that transactions are properly recorded, 
processed, and summarized to permit the preparation of the financial 
statements in conformity with U.S. generally accepted accounting 
principles, and assets are safeguarded against loss from unauthorized 
acquisition, use, or disposition. The objective of compliance control 
is to provide reasonable assurance that transactions are executed in 
accordance with laws governing the use of budget authority and other 
laws and regulations that could have a direct and material effect on 
the financial statements.

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