Senate Health Promotion Revolving Fund's Fiscal Year 2002 Financial Statements
GAO-04-389: Published: Mar 31, 2004. Publicly Released: Mar 31, 2004.
This report presents the results of our audit of the financial statements of the Senate Health Promotion Revolving Fund (the Fund) as of and for the fiscal year ending September 30, 2002. This report also contains our opinion on the effectiveness of the Fund's related internal control as of September 30, 2002, and our evaluation of its compliance with selected provisions of laws and regulations we tested. We performed this audit at the request of the former Senate Sergeant at Arms.
We have audited the accompanying statement of financial position of the Fund as of September 30, 2002, and the related statement of revenue and expenses and changes in fund balance and statement of cash flows for the fiscal year then ended. In our audit, we found the financial statements are presented fairly, in all material respects, in conformity with U.S. generally accepted accounting principles; although certain internal controls should be improved, the Fund had effective internal control over financial reporting (including safeguarding of assets); and compliance with laws and regulations; and no reportable noncompliance with selected provisions of laws and regulations we tested.
Matter for Congressional Consideration
Status: Closed - Implemented
Comments: In 2004, the Office of Financial Management of SAA evaluated which basis of accounting was most useful to the management of the Health Promotions Revolving Fund and adopted the accrual basis of accounting for transactions throughout the year and to prepare year-end financial statements.
Matter: In light of the internal control weaknesses identified during our audit, the Sergeant at Arms should strengthen controls over financial reporting and recording of transactions for the Senate Health Promotion Revolving Fund. Specifically, the Sergeant at Arms should direct Fund management to evaluate whether the accrual basis is the basis of accounting most useful to the Fund's management or whether the modified cash basis, which is essentially what is in place during the year, is most effective and adopt the most appropriate basis for presentation of the financial statements.
Recommendation for Executive Action
Status: Closed - Implemented
Comments: The Office of Financial Management required in 2004, that the preparation and review of journal entries be documented. Specifically, the preparers were required to document and sign each journal entry. In addition, the reviewer was required to sign the applicable period-ending closing package which includes the journal entries, supporting schedules and other closing documentation, and the draft financial statements. Further, Office of Financial Management stated in September 2008, that enhancements to the journal entry review process are under consideration and are expected to be implemented during next year.
Recommendation: In light of the internal control weaknesses identified during our audit, the Sergeant at Arms should strengthen controls over financial reporting and recording of transactions for the Senate Health Promotion Revolving Fund. Specifically, the Sergeant at Arms should direct Fund management to improve policies and procedures for reviewing journal entries, in particular key entries such as year-end accruals and adjustments, so that such entries are properly calculated and recorded in accordance with the basis of accounting selected.
Agency Affected: Senate Sergeant at Arms