Pension Benefit Guaranty Corporation's Accounting Procedures
AIMD-94-168ML: Published: Aug 29, 1994. Publicly Released: Aug 29, 1994.
- Full Report:
GAO provided information on the nonmaterial accounting and internal control weaknesses it detected during its audits of the Pension Benefit Guaranty Corporation's (PBGC) fiscal year 1993 financial statements. GAO noted that: (1) PBGC failed to include all underfunded plans in its database and accounting system and had inadequate classification procedures and documentation for its contingent liability assessment process; (2) PBGC failed to use the most current and reliable data and did not adequately document recovery estimations and contribution agreements with plan sponsors; (3) weaknesses in the Multiemployer Program included inadequate supporting documentation, inconsistent processes, inadequate document safeguards and reviews, and PBGC failure to use available information on terminated plans; (4) additional weaknesses included poor controls over premium refunds and inadequate accounting policies for measuring losses, inconsistent methods for calculating interfund allocations, PBGC failure to offset accounts to net zero, unaudited custodian bank reporting, inadequate computer security and access restrictions to the wire transfer and tape management systems, and PBGC failure to establish separate test and production environments; and (5) PBGC has corrected some weaknesses and is taking steps to correct others.