Summary
On March 13, 2007, we issued our report on our audit of the Capitol Preservation Fund's (CPF) fiscal years 2005 and 2004 financial statements, including the results of our tests of related internal control and selected provisions of laws. In that report, we noted the need to improve certain CPF-related internal controls established by the Library of Congress (Library) in conjunction with financial management services it provides to the Capitol Preservation Commission (Commission). The purpose of this report is to discuss further those internal control deficiencies and to make four recommendations to the Library for improving its CPF-related internal controls and related procedures.
In our audit of the CPF's fiscal years 2005 and 2004 financial statements, we found that the Library's CPF-related internal controls associated with CPF payments and financial reporting needed to be improved. Specifically, we found that Library controls were ineffective in ensuring that the CPF had sufficient cash in its account with the U.S. Treasury to cover payments from the account. We also found that the Library's internal controls associated with the preparation and review of the CPF's financial statements for fiscal years 2005 and 2004 were not operating effectively. While not considered material weaknesses, these deficiencies represent reportable conditions4 with respect to the Library's CPF-related internal controls.
Recommendations
Our recommendations from this work are listed below with a Contact for more information. Status will change
from "In process" to "Implemented" or "Not implemented" based on our follow up work.
Director:
Team:
Phone:
Jeanette M. Franzel
Government Accountability Office: Financial Management and Assurance
(202) 512-9471
Recommendations for Executive Action
Recommendation: To help strengthen internal controls over CPF-related payments for vendor invoices and investments in Treasury securities, the Librarian of Congress should direct the Library's Chief Financial Officer to revise applicable processes and procedures to require that all CPF-related payment recommendations be based on available cash balance data that have been reconciled with the CPF general ledger and other reliable source information to confirm that the CPF will have sufficient cash to fund the planned payments at the time they will be made.
Agency Affected: Library of Congress
Status: In process
Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
Recommendation: To help strengthen internal controls over CPF-related payments for vendor invoices and investments in Treasury the Librarian of Congress should direct the Library's Chief Financial Officer to revise applicable processes and procedures to require that all CPF-related payment recommendations receive supervisory review and approval that includes reviewing evidence confirming that sufficient funds will be available to fund the recommended payment.
Agency Affected: Library of Congress
Status: In process
Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
Recommendation: To improve the reliability of CPF financial statements provided to potential users, the Librarian of Congress should direct the Library's Chief Financial Officer to strengthen the Library's CPF-related financial statement preparation and review process by establishing procedures that specify the nature and source of financial information needed to prepare and support accurate CPF financial statement balances and classifications and facilitate their review.
Agency Affected: Library of Congress
Status: In process
Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
Recommendation: To improve the reliability of CPF financial statements provided to potential users, the Librarian of Congress should direct the Library's Chief Financial Officer to strengthen the Library's CPF-related financial statement preparation and review process by establishing procedures that require review of the CPF's financial statements and the related supporting financial information used in their preparation.
Agency Affected: Library of Congress
Status: In process
Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
