The Federal Deposit Insurance Corporation insures more than $8 trillion in deposits and protects your money if your FDIC-insured bank fails—up to $250,000 per individual depositor.
We audit the financial statements of FDIC's insurance funds each year. We issue an opinion on them, as well as on the effectiveness of the agency's internal controls (e.g., its ability to reasonably assure that transactions are properly authorized and recorded).
We found that the statements were reliable and that FDIC's controls over financial reporting were effective, although FDIC could improve its controls over contract payment reviews.
What GAO Found
GAO found (1) the financial statements of the Deposit Insurance Fund (DIF) and of the Federal Savings and Loan Insurance Corporation (FSLIC) Resolution Fund (FRF) as of and for the years ended December 31, 2020, and 2019, are presented fairly, in all material respects, in accordance with U.S. generally accepted accounting principles; (2) although internal controls could be improved, the Federal Deposit Insurance Corporation (FDIC) maintained, in all material respects, effective internal control over financial reporting relevant to the DIF and to the FRF as of December 31, 2020; and (3) with respect to the DIF and to the FRF, no reportable instances of noncompliance for 2020 with provisions of applicable laws, regulations, contracts, and grant agreements GAO tested.
In commenting on a draft of this report, FDIC stated that it was pleased to receive unmodified opinions on the DIF's and the FRF's financial statements. In regard to the significant deficiency in internal control over contract payment review processes, FDIC stated that it began taking steps to address this issue and will work to enhance control activities and expand monitoring capabilities in this area. Further, FDIC stated that it recognizes the essential role a strong internal control program plays in an agency achieving its mission. FDIC added that its commitment to sound financial management has been and will remain a top priority.
Why GAO Did This Study
Section 17 of the Federal Deposit Insurance Act, as amended, requires GAO to audit the financial statements of the DIF and of the FRF annually. In addition, the Government Corporation Control Act requires that FDIC annually prepare and submit audited financial statements to Congress and authorizes GAO to audit the statements. This report responds to these requirements.
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