Resolution Trust Corporation: Recommendations Addressed to Oversee and Account for Cash Flow Mortgages
GGD-94-179
Published: Jul 26, 1994. Publicly Released: Aug 26, 1994.
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Highlights
Pursuant to a congressional request, GAO reviewed the Resolution Trust Corporation's (RTC) efforts to implement previous recommendations and oversee the Patriot and Centrust cash flow mortgages to ensure that these mortgages comply with their terms and conditions.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Resolution Trust Corporation | The RTC Deputy and Acting Chief Executive Officer should direct RTC servicing oversight personnel to require the RTC cash flow mortgage servicer to implement procedures requiring that the annual audits of cash flow mortgages include verification of the charges to the properties' operating accounts throughout the life of the mortgages. |
Closed – Implemented
On June 13, 1994, RTC servicing oversight personnel were directed to ensure that RTC's servicer continues to implement audit procedures to effectively monitor and verify the appropriateness of expenses charged against the cash flow mortgages' collateral properties' operating accounts. The servicer has developed additional audit procedures, engaged a third-party accountant for the 1994 audit cycle, and is conducting audits to verify, among other things, that unrelated charges are not being passed on as expenses to the properties for the Patriot and Centrust transactions.
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Topics
Accounting proceduresInternal controlsLoan accounting systemsLoan repaymentsMortgage loansMortgage programsSavings and loan associationsMortgagesContract termsAudits