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GAO reviewed the audit reports covering the financial statements of the National Woman's Relief Corps, Auxiliary to the Grand Army of the Republic, Incorporated, for fiscal years 2003 and 2002. GAO found no reportable instances of noncompliance. The audit report included the auditor's opinion that the financial statements of the corporation were presented fairly on a modified cash basis of accounting. [ABSTRACT FROM AUTHOR]

Pursuant to a legislative requirement, GAO audited the expenditures of one office of independent counsel and one office of special counsel for the 6 months ended March 31, 2005. In our audits covering the 6 months ended March 31, 2005, we found (1) the statements of expenditures, for the office of the Independent Counsel David M. Barrett and for the office of Special Counsel Patrick J. Fitzgerald, respectively, are presented fairly, in all material respects, in conformity with the basis of accounting described in note 1 of each counsel's statement, which is principally the cash basis, a comprehensive basis of accounting other than U.S. generally accepted accounting principles; (2) each of the counsels had effective internal control over financial reporting (including safeguarding assets) and compliance with laws and regulations as of March 31, 2005; and (3) no reportable noncompliance with laws and regulations we tested. [ABSTRACT FROM AUTHOR]

The Debt Collection Improvement Act of 1996 (DCIA) allows the federal government to collect state debts from federal payments to contractors. However, before a state can participate in this program, DCIA requires that the state enter into a reciprocal agreement with the Department of the Treasury that would require the state to collect unpaid federal debt from state payments if Treasury collects unpaid state debt from federal payments. In February 2004, we reported that Department of Defense (DOD) and Internal Revenue Service (IRS) records showed that over 27,000 DOD contractors had nearly $3 billion in unpaid federal taxes as of September 30, 2002. In a hearing before the Senate Permanent Subcommittee on Investigations on February 12, 2004, we noted that many of those contractors also had unpaid state taxes. Based on the issues raised in that hearing, Congress requested that we determine (1) the extent to which Financial Management Service (FMS) and the states have entered into reciprocal agreements to collect unpaid state and federal debt from their payments to contractors and (2) whether additional opportunities may exist for the Department of the Treasury's FMS to collect unpaid state taxes from federal contractors. This report responds to that request by providing information on (1) the extent of states' participation in FMS's debt collection levy and offset programs, (2) the potential benefits to states of participation in those programs, and (3) the level of state participation in, and the benefits states derive from, the collection of state tax debt from federal income tax refunds. Neither the federal government nor the states have as yet pursued potentially beneficial reciprocal agreements authorizing the collection of debt from nontax payments, including payments to contractors. According to FMS officials, no state has expressed interest in such agreements, and FMS has not actively pursued avenues to encourage state participation. None of the officials in the 17 states we contacted said they were aware of the reciprocal agreement provision in DCIA, and all expressed interest in pursuing this debt collection opportunity. Our comparison of FMS disbursements with the database of state income tax debt that FMS maintains found that thousands of federal contractors paid through FMS have unpaid state tax debt. In fiscal year 2004, FMS disbursed a total of about $1.8 billion to over 4,600 federal contractors that had approximately $17 million in state tax debt owed primarily by individuals. According to our analysis, if states had participated in FMS's program that collects debt from nontax payments to contractors, they could have collected over half of the outstanding state tax debt from these federal contractors in fiscal year 2004. On the other hand, the experiences of the federal government and the states in working together to collect unpaid tax debt from state and federal tax refunds demonstrate that reciprocal agreements to collect tax debt from nontax payments, including contractor payments, have had a significant impact. The federal government and most of the states with income taxes collect tax debt on behalf of one another through the offset of income tax refunds, which has resulted in millions of dollars in collections. In fiscal year 2004, although most states submit only personal income tax debt and not business income tax debt to FMS for collection, FMS still collected over $217 million on behalf of various states through offsets of federal income tax refunds to pay state income tax debt. Conversely, IRS received over $77 million from states' levy of state income tax refunds to pay delinquent federal taxes. [ABSTRACT FROM AUTHOR]

Tax abuses by contractors working for the Department of Defense, which GAO previously reported on, have led to concerns about similar abuses by those hired by civilian agencies. GAO was asked to determine if similar problems exist at civilian agencies and, if so, to (1) quantify the amount of unpaid federal taxes owed by civilian agency contractors paid through the Financial Management Service (FMS), (2) determine whether there are indications of abusive or potential criminal activity by contractors with unpaid tax debts, and (3) identify any statutory or policy impediments and control weaknesses that impede tax collections under the Federal Payment Levy Program (FPLP). FMS and IRS records showed that about 33,000 civilian agency contractors owed over $3 billion in unpaid federal taxes as of September 30, 2004. GAO investigated 50 civilian agency contractors with abusive and potentially criminal activity. For example, businesses did not forward payroll taxes withheld from their employees to IRS. Willful failure to remit payroll taxes is a felony under U.S. law. Furthermore, several individuals owed multiple businesses with unpaid federal taxes--one owned about 20 businesses that did not fully pay taxes on over 300 returns. Some diverted payroll taxes for personal gain or to fund their businesses, such as building a house, purchasing other real property, and increasing the salary of the company's officer/owner. These contractors worked for a number of federal agencies including the Departments of Justice and Homeland Security, and the National Aeronautics and Space Administration. If all tax debts owed by, and all payments made to, the 33,000 contractors were included in the FPLP, FMS could have collected hundreds of millions of dollars in fiscal year 2004. However, because only a fraction of all unpaid taxes and a portion of FMS payments were included in the levy program, FMS collected only $16 million. For example, about $171 billion of unpaid federal taxes was not sent to the levy program to be offset against payments because of statutory requirements or IRS policy exclusions such as claims of financial hardship or bankruptcy. Tens of billions of dollars in federal payments were not matched against tax debts for potential levy because FMS did not proactively manage and oversee the levy program. Until GAO brought it to FMS's attention, FMS was unaware that $40 billion of contractor payments had not been submitted for potential levy. FMS also did not identify payment files that lacked contractor taxpayer identification numbers, names, or both, resulting in another $21 billion that could not be levied. FMS also excluded billions of dollars from levy because of what it considered limitations in its automated systems without taking steps to overcome those limitations. Furthermore, civilian agency purchase card payments to contractors totaling nearly $10 billion could not be levied. [ABSTRACT FROM AUTHOR]

GAO reviewed the audit report covering the financial statements of the American War Mothers for fiscal year 2003. GAO found no reportable instances of noncompliance. The audit reports included the auditors' opinions that the financial statements of the corporation were presented fairly in accordance with generally accepted accounting principles. [ABSTRACT FROM AUTHOR]

In February 2005, we issued our opinions on the calendar year 2004 financial statements of the Bank Insurance Fund (BIF), the Savings Association Insurance Fund (SAIF), and the FSLIC Resolution Fund (FRF). We also issued our opinion on the effectiveness of the Federal Deposit Insurance Corporation's (FDIC) internal controls as of December 31, 2004, and our evaluation of FDIC's compliance with significant provisions of selected laws and regulations for the three funds for the year ended December 31, 2004. The purpose of this report is to discuss issues identified during our audits of the 2004 financial statements regarding accounting procedures and internal controls that could be improved, and to recommend improvements to address these issues. Although these issues were not material in relation to the financial statements, we believe they warrant management's attention. During 2004, we identified several internal control issues that affected FDIC's accounting for the funds it administers. Although the amounts would not have been material to the financial statements taken as a whole, these issues would have resulted in reporting errors had they not been detected by our audit and corrected by FDIC. Specifically, we found that FDIC made errors in calculations supporting its allowance for losses on receivables from thrift resolutions. These errors would have led to misstatements in SAIF's and FRF's financial statements. Further, FDIC did not have effective compensating controls in place to ensure the accuracy of pay computations related to the National Finance Center's (NFC) Thrift Savings Plan (TSP). Other payroll expenses could have been misstated in the funds' financial statements. Finally, FDIC did not detect billing errors made by a contractor, resulting in overpayments to the contractor. The lack of effective invoice review procedures increases the risk of overcharges for goods and services and that they may not be detected and recovered. [ABSTRACT FROM AUTHOR]

GAO reviewed the audit reports covering the financial statements of the Air Force Sergeants Association for fiscal years 2004 and 2003. GAO found no reportable instances of noncompliance. The audit reports included the auditors' opinion that the financial statements of the corporation were presented fairly in accordance with generally accepted accounting principles. [ABSTRACT FROM AUTHOR]

GAO reviewed the audit reports covering the financial statements of the 82nd Airborne Division Association, Incorporated, for fiscal years 2003 and 2002. GAO found no reportable instances of noncompliance. The audit reports included the auditors' opinions that the financial statements of the corporation were presented fairly in accordance with generally accepted accounting principles. [ABSTRACT FROM AUTHOR]

GAO reviewed the audit reports covering the financial statements of the Former Members of Congress, Incorporated, for fiscal year 2003. GAO found no reportable instances of noncompliance. The audit reports included the auditors' opinion that the financial statements of the corporation were presented fairly in accordance with generally accepted accounting principles. [ABSTRACT FROM AUTHOR]

GAO reviewed the audit reports covering the financial statements of the General Federation of Women's Clubs for Fiscal Year 2003. GAO found no reportable instances of noncompliance. The audit reports included the auditors' opinions that the financial statements of the corporation were presented fairly in accordance with generally accepted accounting principles. [ABSTRACT FROM AUTHOR]

GAO reviewed the audit reports covering the financial statements of the Military Order of the World Wars for fiscal year 2003. GAO found no reportable instances of noncompliance. The audit reports included the auditors' opinion that the financial statements of the corporation were presented fairly on a modified cash basis of accounting. [ABSTRACT FROM AUTHOR]

GAO reviewed the audit reports covering the financial statements of the Fleet Reserve Association for fiscal years 2003 and 2002. GAO found no reportable instances of noncompliance. The audit reports included the auditors' opinion that the financial statements of the corporation were presented fairly in accordance with generally accepted accounting principles. [ABSTRACT FROM AUTHOR]

GAO reviewed the audit reports covering the financial statements of the Gold Star Wives of America, Incorporated, for fiscal years 2004 and 2003. GAO found no reportable instances of noncompliance. The audit reports included the auditors' opinions that the financial statements of the corporation were presented fairly in accordance with generally accepted accounting principles. [ABSTRACT FROM AUTHOR]

GAO reviewed the audit reports covering the financial statements of the Congressional Medal of Honor Society of the United States of America, for fiscal year 2003. GAO found no reportable instances of noncompliance. The audit reports included the auditors' opinions that the financial statements of the corporation were presented fairly in accordance with generally accepted accounting principles. [ABSTRACT FROM AUTHOR]

GAO reviewed the audit reports covering the financial statements of the Marine Corps League for Fiscal Years 2003 and 2002. GAO found no reportable instances of noncompliance. The audit reports included the auditors' opinions that the financial statements of the corporation were presented fairly in accordance with generally accepted accounting principles. [ABSTRACT FROM AUTHOR]

GAO reviewed the audit reports covering the financial statements of the Jewish War Veterans, U.S.A., National Memorial, Incorporated, for fiscal years 2004 and 2003. GAO found no reportable instances of noncompliance. The audit reports included the auditors' opinion that the financial statements of the corporation were presented fairly in accordance with generally accepted accounting principles. [ABSTRACT FROM AUTHOR]

GAO reviewed the audit reports covering the financial statements of the Catholic War Veterans of the United States of America, Incorporated, for fiscal year 2003. GAO found no reportable instances of noncompliance. The audit reports included the auditors' opinion that the financial statements of the corporation were presented fairly in accordance with generally accepted accounting principles. [ABSTRACT FROM AUTHOR]

GAO reviewed the audit reports covering the financial statements of the Military Chaplains Association of the United States of America for Fiscal Years 2003 and 2002. GAO found no reportable instances of noncompliance. The audit reports included the auditors' opinions that the financial statements of the corporation were presented fairly in accordance with generally accepted accounting principles. [ABSTRACT FROM AUTHOR]

Since the passage of the IRS Restructuring and Reform Act of 1998 (RRA 98), the Internal Revenue Service (IRS) has faced the challenge of managing its resources to simultaneously improve service to taxpayers, assure taxpayers' compliance with the tax laws, and modernize its antiquated information systems. As requested, this statement provides our assessment of IRS's current performance in the areas of taxpayer service, tax law enforcement, and systems modernization. Looking ahead, this statement also describes the challenges that IRS faces in addressing resource constraints as well as realizing efficiency and information systems improvements. IRS's most noticeable progress has been in IRS's taxpayer service, which has been of special concern to the Congress. Since the passage of RRA 98, improvements in access to IRS by telephone, the accuracy of answers given to taxpayer inquiries, and the growth of IRS's Web site, which now provides a variety of services, have been noteworthy accomplishments. IRS experienced declines in enforcement staffing after 1998, but recently stopped the declines and begun to show increases. Despite this, enforcement remains a high risk area because of the continued need to improve enforcement and make progress towards reducing the tax gap. IRS has made significant progress in establishing management controls and acquiring infrastructure as part of the BSM program, as well as significant progress in addressing financial management issues. However, BSM remains at risk because of the scope and complexity of modernization activities and the need for better management capacity to avoid repeating the program's history of schedule delays and cost overruns. Looking ahead, continuing the progress described above depends on IRS addressing resource constraints and realizing efficiency and systems improvements. We highlight several such opportunities: (1) developing long-term goals would help IRS and Congress assess agency performance and make budget decisions, (2) considering additional funding enhancements such as user fees and private debt collection which may help mitigate budget constraints, (3) leveraging nonfederal partners such as states to assist with tax law enforcement and volunteers to help provide taxpayer service, (4) prioritizing taxpayer service activities could help IRS minimize the impact of budget cuts, (5) targeting enforcement resources could help IRS make more efficient use of available resources and help the agency make progress towards reducing the tax gap, (6) creating the necessary systems to enable IRS to develop accurate cost accounting information would help IRS make resource allocation decisions, (7) developing and using better productivity data would help IRS make productivity improvements and thereby make better use of available resources, (8) making needed management improvements would help IRS bring planned new information systems on-line in a timely and cost-effective manner, and (9) making needed improvements to assure information systems security would reduce vulnerabilities. [ABSTRACT FROM AUTHOR]

In its role as the nation's tax collector, the Internal Revenue Service (IRS) has a demanding responsibility for collecting taxes, processing tax returns, and enforcing the nation's tax laws. Since GAO's first audit of IRS's financial statements in fiscal year 1992, a number of weaknesses in IRS's financial management operations have been identified. In related reports, GAO has recommended corrective action to address those weaknesses. Each year, as part of the annual audit of IRS's financial statements, GAO not only makes recommendations to address any new weaknesses identified, but also follows up on the status of weaknesses GAO identified in previous years' audits. The purpose of this report is to assist IRS management in tracking the status of audit recommendations and actions needed to fully address them. As in past years, IRS has continued to make improvements to address a number of financial management weaknesses. At the same time, a number of the open audit recommendations have been outstanding for an extended period of time. IRS has continued to experience delays in the implementation of the new systems intended to correct some of these long-standing deficiencies. Others, however, could be resolved with additional management attention. The continued existence of these financial management weaknesses exposes IRS to loss due to errors or theft and impairs the availability of current, accurate financial information that management needs to make decisions on a day-to-day basis. Of 118 recommendations related to financial management (consisting of 76 recommendations open as of April 2004, 9 recommendations included in GAO's January 2005 report on the timeliness of IRS lien releases, 3 recommendations included in GAO's March 2005 report on the Brookhaven Service Center Campus rampdown, and 30 new recommendations included in GAO's management report for fiscal year 2004), GAO is closing 34 due to effective actions IRS has taken to address the issues that gave rise to them. These actions were verified by GAO in the course of conducting the audit of IRS's fiscal year 2004 financial statements. Of the remaining 84 financial management recommendations GAO considers open as of the date of this report, 75 are short term (capable of being addressed within 2 years) and 9 are long term (expected to require more than 2 years to implement). IRS considers 40 (48 percent) of the 84 recommendations to be closed. GAO considers 21 of these 40 to be still open because it has not yet had an opportunity to verify the actions taken by IRS. The actions cited by IRS for these 21 recommendations are recent and were taken after GAO's financial statement audit work for the year was completed. For 18 of the 40 recommendations that IRS considers closed, GAO found that action taken by IRS has not yet been fully effective in addressing the conditions that gave rise to the recommendations. IRS disagrees with the remaining recommendation. IRS continues to exhibit a strong commitment to addressing its ongoing financial management problems and has made improvements in recent years that have resulted in the closing of many recommendations. At the same time, the continued existence of the serious financial management weaknesses that gave rise to the remaining open recommendations represents a serious obstacle that IRS needs to overcome to achieve effective financial management. IRS stated that it has begun to address the 42 new recommendations included in the report. GAO will review these corrective actions and the status of IRS's progress in implementing all open recommendations as part of the fiscal year 2005 audit. [ABSTRACT FROM AUTHOR]

In November 2004, we issued our report on the results of our audit of the Internal Revenue Service's (IRS) financial statements as of, and for the fiscal years ending, September 30, 2004 and 2003, and on the effectiveness of its internal controls as of September 30, 2004. We also reported our conclusions on IRS's compliance with significant provisions of selected laws and regulations and on whether IRS's financial management systems substantially comply with requirements of the Federal Financial Management Improvement Act of 1996. A separate report on the implementation status of recommendations from our prior IRS financial audits and related financial management reports, including this one, will be issued shortly. The purpose of this report is to discuss issues identified during our fiscal year 2004 audit regarding internal controls that could be improved for which we do not currently have any recommendations outstanding. Although not all of these issues were discussed in our fiscal year 2004 audit report, they all warrant management's consideration. During our fiscal year 2004 audit, we identified a number of internal control issues that adversely affected safeguarding of tax receipts and information, refunds to taxpayers, and lien resolutions. These issues concern (1) enforcement of IRS contractor background investigation policies, (2) omission of certain provisions related to contingency plans and taxpayer privacy in lockbox bank service contracts, (3) verification of lockbox bank deposits, (4) procedures for handling taxpayer receipts and information by couriers, (5) safeguarding sensitive systems and equipment in lockbox banks, (6) candling procedures, (7) monitoring and verifying recording and transmittal of taxpayer receipts and information, (8) controls over automated refund disbursements, (9) controls over authorization of manual refunds, and (10) resolution of liens with manually calculated interest or penalties. These issues increase the risk that (1) taxpayer receipts and information could be lost, stolen, misused, or destroyed; (2) improper refunds to taxpayers could be disbursed; and (3) liens could be released before taxpayers have paid the full amount of interest or penalties due. [ABSTRACT FROM AUTHOR]

Pursuant to a legislative requirement, GAO audited the expenditures of two offices of independent counsel and one office of special counsel for the 6 months ended September 30, 2004. In our audits covering the 6 months ended September 30, 2004, we found (1) the statements of expenditures presented for the offices of Independent Counsel David M. Barrett and Independent Counsel Julie F. Thomas and for the office of Special Counsel Patrick J. Fitzgerald, respectively, are presented fairly, in all material respects, in conformity with the basis of accounting described in note 1 of each counsel's statement, which is principally the cash basis, a comprehensive basis of accounting other than U.S. generally accepted accounting principles; (2) the counsels had effective internal control over financial reporting (including safeguarding assets) and compliance with laws and regulations; and (3) no reportable noncompliance with laws and regulations we tested. [ABSTRACT FROM AUTHOR]

This report responds to a Congressional request that, in conjunction with our audit of the Internal Revenue Service's (IRS) fiscal year 2004 financial statements, we review the agency's procedures for handling and processing receipts and taxpayer information at the Brookhaven service center campus. As a result of the increased percentage of taxpayers filing returns electronically, IRS designed a detailed business plan to reduce the number of service center campuses that process paper returns. In fiscal year 2004, Brookhaven became the first service center campus to downsize its submission processing function, leading to changes in its operations and a significant reduction in the volume of taxpayer receipts and information processed. Congress requested this review in light of these significant changes in operations and IRS's desire to benefit from the Brookhaven experience in planning for future submission processing rampdowns. Specifically, we were asked to (1) review the policies and procedures IRS developed to safeguard and process taxpayer receipts and information at the modified Brookhaven operation and (2) offer recommendations, if any, for improving internal controls at Brookhaven and at other submission processing centers that will undergo future rampdowns. To accommodate the request, we agreed to add a review of the mail control function at the Brookhaven service center campus to our tests of internal controls conducted as part of our audit of IRS's fiscal year 2004 financial statements. We have performed extensive work in reviewing internal controls designed to safeguard taxpayer receipts and information as part of our annual financial audits of IRS. In performing this work, we have come to recognize the significance and importance of the submission processing function to IRS and the potential for loss, theft, or misuse of taxpayer receipts and information if controls are not properly designed and effectively implemented. Our audits have identified weaknesses in internal controls over the safeguarding of taxpayer receipts and information related to submission processing activities at IRS's service center campuses, lockbox banks, and field offices. In reviewing the Brookhaven rampdown procedures, we considered the internal control weaknesses previously found at other service center campuses. We found that IRS completed the rampdown at Brookhaven without any significant disruptions in service. However, we did identify several areas where improvements could be made to internal controls at the Brookhaven service center campus residual mail processing unit, as well as to the process for estimating mail volumes. These issues are also relevant to IRS as it proceeds in ramping down future submission processing functions. Specifically, we found that IRS developed standard operating procedures for employees processing incoming mail at Brookhaven during the rampdown. However, we found that these procedures did not include detailed instructions for (1) tracking taxpayer receipts and information forwarded to other service center campuses for further processing and (2) handling cash receipts found during the extraction process. The absence of these instructions increases the risk that employees with significant internal control responsibilities over high-risk and vulnerable assets are not aware of the correct procedures to be followed in safeguarding and processing taxpayer receipts and information, thereby increasing the risk of their theft, loss, or misuse. Staff at the Brookhaven location did not always follow the required procedures to safeguard taxpayer receipts and information in its facilities. We found that (1) access rights allowed to visitors were not always appropriately restricted; (2) trash, which included taxpayer information, was not always sufficiently secured; and (3) candling was not always properly performed. The lack of adherence to IRS's procedures increases the risk of theft, loss, or misuse of taxpayer receipts and information. IRS did not have a documented methodology for estimating post-rampdown mail volumes at service center campuses selected for rampdowns. The lack of a documented methodology increases the risk that adequate mail volume information will not be gathered, maintained, and appropriately considered as estimates are prepared to assist IRS management in making decisions related to sites selected for future rampdowns and assessing their ultimate success. [ABSTRACT FROM AUTHOR]

GAO contracted with Clifton Gunderson LLP to audit the financial statements of the Senate Restaurants Revolving Fund for fiscal years 2004 and 2003. Clifton Gunderson LLP found that (1) the financial statements were presented fairly, in all material respects, in conformity with U.S. generally accepted accounting principles; (2) the Fund maintained effective internal control over financial reporting (including safeguarding assets) and compliance with laws and regulations; and (3) there was no reportable noncompliance with selected provisions of laws and regulations it tested. [ABSTRACT FROM AUTHOR]

In accordance with 36 U.S.C. 2103, GAO is responsible for conducting audits of the agencywide financial statements of the American Battle Monuments Commission (the Commission). GAO audited the financial statements of the Commission for the fiscal years ended September 30, 2004, and 2003. The audits were done to determine whether, in all material respects, (1) the Commission's financial statements were reliable, and (2) Commission management maintained effective internal control over financial reporting and compliance with laws and regulations. Also, we tested Commission management's compliance with selected laws and regulations. The American Battle Monuments Commission was created in 1923 to commemorate the sacrifices and achievements of U.S. Armed Forces where they have served overseas since April 6, 1917, and locations within the United States as directed by Congress. The Commission designs, administers, operates, and maintains 24 American military cemeteries on foreign soil and 25 federal memorials, monuments, and markers, 22 of which are on foreign soil. The Commission was also responsible for designing and constructing the national World War II Memorial on the Capitol Mall in Washington, D.C., and for maintaining 4 nonfederal memorials with funds provided by those memorials' sponsors. In our opinion, the financial statements of the American Battle Monuments Commission as of September 30, 2004, and 2003, and for the fiscal years then ended, are presented fairly, in all material respects, in conformity with U.S. generally accepted accounting principles. Also in our opinion, the Commission maintained effective internal control over financial reporting (including safeguarding of assets) and compliance with laws and regulations as of September 30, 2004. In addition, we found no instances of Commission noncompliance in fiscal year 2004 with selected provisions of laws and regulations we tested. However, our work identified inadequate controls over information technology in two areas and improper recognition of property additions and accrued liabilities as of September 30, 2004, that we considered to be reportable conditions. The Commission recorded accounting adjustments to correct its property and accrued liabilities at year-end and is working to improve internal controls in all these areas during fiscal year 2005. For fiscal year 2004, the Commission spent $40.4 million of appropriated funds to maintain its 24 cemeteries and 25 federal memorials. It also spent $47.5 million of private contributions and investment earnings, primarily for construction-in-progress of the World War II Memorial that was dedicated on Memorial Day weekend in May 2004. On November 1, 2004, the Commission formally transferred the World War II Memorial to the National Park Service, which assumed responsibility for its perpetual care. [ABSTRACT FROM AUTHOR]

GAO agreed to assist Congress in evaluating the extent to which the Schedules of Receipts, Disbursements, and Fund Balance for five Interparliamentary Groups appropriately reflect the actual cash receipts and disbursements and related fund balances for the years ended December 31, 2002, and 2001. These five groups were the Mexico-United States Interparliamentary Group, Canada-United States Interparliamentary Group, Transatlantic Legislators' Dialogue, United States Group of the NATO Parliamentary Assembly, and British-American Parliamentary Group. Congress asked us to (1) compare recorded receipts to appropriation requests, bank statements, and other supporting documentation; (2) compare recorded disbursements to vouchers, canceled checks, and other supporting documentation; and (3) recalculate and compare fund balance with amounts recorded in the general journal and Schedule of Receipts, Disbursements, and Fund Balance for 2002 and 2001. We were not engaged to perform, and did not perform, an examination, the objective of which would have been to express an opinion on the amounts reported on the schedules. Accordingly, we do not express such an opinion. Had we performed additional procedures, other matters might have come to our attention that we would have reported them. [ABSTRACT FROM AUTHOR]

Among the Internal Revenue Service's (IRS) many tools to collect outstanding taxes is its ability to use the property of a taxpayer as security for an outstanding tax debt. IRS exercises this power when it files a federal tax lien against the property of a taxpayer. As part of its tax collection activities, IRS reported filing more than 548,000 tax liens against taxpayer property in fiscal year 2003. Since a lien encumbers taxpayer property, IRS's ability to file a lien is a powerful tool in enforcing the tax laws. With this power, however, comes the responsibility to ensure that liens are released timely once taxpayers satisfy their tax debt. The Internal Revenue Code (IRC) addresses timeliness by requiring IRS to release liens within 30 days of the tax debt's satisfaction. If IRS fails to timely release federal tax liens, taxpayers can suffer undue hardship and burden. Because federal tax liens appear on commercial credit reports, (1) businesses may be unable to obtain necessary credit because lenders may assume they are bad credit risks, (2) individuals may miss an opportunity to buy a home or an automobile because they are unable to obtain financing, and (3) individuals may be unable to sell their home because of the presence of a tax lien on their property. Failure to timely release liens this conflicts with IRS's mission of providing top-quality service to the nation's taxpayers. This report discusses deficiencies we identified in IRS?s use of exception reports. We found problems with IRS's use of three types of exception reports. First, IRS produces a weekly exception report for lien filings that fail to post to taxpayer accounts. The key is to timely resolve any items on the exception report so that the lien can be released. As of May 21, 2004, IRS had more than 8,500 liens that could not post to taxpayer accounts, 74 percent of which predated 2004. IRS produces a second exception report weekly when taxpayer accounts with liens have been fully satisfied and identified for lien release but the taxpayer accounts do not match accounts in IRS's lien system. We found that IRS was also not timely resolving these "unmatched exception reports" and, as a result, the number of unresolved lien cases from these reports had increased, from almost 1,800 at the end of 2003 to 3,180 by mid-June 2004. A third weekly exception report lists all taxpayer accounts identified for lien release that have manually calculated interest or penalties. We found that IRS was also not timely resolving items on this exception report. In addition to untimely resolution of lien cases on these exception reports, all of which ultimately affect the timely release of tax liens, we found that one report had a serious design flaw in that it was not cumulative, meaning that accounts from one week's report that were not resolved did not carry over to the following week's report. This flaw in the design of the unmatched exception report contributed significantly to the fact that 99 percent of the taxpayer accounts listed on the report at the end of 2003 were still unresolved as of the end of June 2004. We were unable to definitively quantify the extent to which IRS's failure to resolve cases showing up on these exception reports contributed to the overall number of liens IRS failed to timely release. Based on the nature of IRS's delays in releasing liens that we found in our fiscal year 2004 sample, however, we estimate that about 30 percent of the delayed releases likely resulted from IRS's failure to effectively resolve exception reports. IRS's inability to promptly resolve the lien exception reports has contributed to its inability to ensure that tax liens are timely released. This condition can negatively affect taxpayers, adversely affect IRS's mission of providing top-quality customer service, and result in noncompliance with the legal requirement that liens be released within 30 days after satisfaction of the related tax debt. Although IRS has begun to take steps to address untimely resolution of lien exception reports, critical steps remain to be taken and backlogs of unresolved exception reports remain to be resolved. [ABSTRACT FROM AUTHOR]

We assisted the Department of Transportation (DOT) in ascertaining whether the net excise tax revenue distributed to the Highway Trust Fund (HTF) for the fiscal year ended September 30, 2004, is supported by the underlying records. As agreed with DOT, we evaluated fiscal year 2004 activity affecting distributions to the HTF. In performing the agreed-upon procedures, we conducted our work in accordance with U.S. generally accepted government auditing standards, which incorporate financial audit and attestation standards established by the American Institute of Certified Public Accountants. These standards also provide guidance for performing and reporting the results of agreed-upon procedures. The adequacy of the procedures to meet objectives is the Department of Transportation's responsibility, and we make no representation in that respect. The procedures we agreed to perform were (1) detailed tests of transactions that represent the underlying basis of amounts distributed to the HTF, (2) review of the Internal Revenue Service's (IRS) quarterly HTF certifications, (3) review of the Department of the Treasury's Financial Management Service adjustments to the HTF for fiscal year 2004, (4) review of IRS's precertification of receipts for the second and third quarters of fiscal year 2004, (5) review of certain procedures of the Department of the Treasury's Office of Tax Analysis' (OTA) process for estimating amounts to be distributed to the HTF for the fourth quarter of fiscal year 2004, and other procedures including (6) compiling and reporting the net amount of fiscal year 2004 excise taxes distributed to the HTF, (7) detailed tests of transactions that represent total IRS tax revenue receipts and refunds, and (8) review of key reconciliations of IRS records to Treasury records. [ABSTRACT FROM AUTHOR]

We assisted the Department of Labor in ascertaining whether the net federal unemployment tax (FUTA) revenue distributed to the Unemployment Trust Fund (UTF) for the fiscal year ended September 30, 2004, is supported by the underlying records. We evaluated fiscal year 2004 activity affecting distributions to the UTF. In performing the agreed-upon procedures, we conducted our work in accordance with U.S. generally accepted government auditing standards, which incorporate financial audit and attestation standards established by the American Institute of Certified Public Accountants. These standards also provide guidance for performing and reporting the results of agreed-upon procedures. The procedures we agreed to perform include (1) detailed tests of transactions that represent the underlying basis of amounts distributed to the UTF and (2) review of key reconciliations of the Internal Revenue Service records to the Department of the Treasury records. [ABSTRACT FROM AUTHOR]

We have performed the procedures contained in this report, which we agreed to perform and with which the Inspector General (IG) of the Department of Transportation concurred, solely to assist that office in ascertaining whether the net excise tax revenue distributed to the Airport and Airway Trust Fund (AATF) for the fiscal year ended September 30, 2004, is supported by the underlying records. We evaluated fiscal year 2004 activity affecting distributions to the AATF. The adequacy of the procedures to meet the IG's objectives is the IG's responsibility, and we make no representation in that respect. The procedures we agreed to perform were (1) detailed tests of transactions that represent the underlying basis of amounts distributed to the AATF, (2) review of the Internal Revenue Service's (IRS) quarterly AATF certifications, (3) review of the Department of the Treasury's Financial Management Service adjustments to the AATF for fiscal year 2004, (4) review of IRS's precertification1 of receipts for the second and third quarters of fiscal year 2004, (5) review of certain procedures of the Department of the Treasury's Office of Tax Analysis' (OTA) estimation procedures affecting excise tax distributions to the AATF for the fourth quarter of fiscal year 2004, and other procedures including (6) compiling and reporting the net amount of fiscal year 2004 excise taxes distributed to the AATF, (7) detailed tests of transactions that represent total IRS tax revenue receipts and refunds, and (8) review of key reconciliations of IRS records to Treasury records. [ABSTRACT FROM AUTHOR]

In February 2004, we issued our opinions on the calendar year 2003 financial statements of the Bank Insurance Fund (BIF), the Savings Association Insurance Fund (SAIF), and the FSLIC Resolution Fund (FRF). We also issued our opinion on the effectiveness of the Federal Deposit Insurance Corporation's (FDIC) internal controls as of December 31, 2003, and our evaluation of FDIC's compliance with significant provisions of selected laws and regulations for the three funds for the year ended December 31, 2003. The purpose of this report is to discuss issues identified during our audits of the 2003 financial statements regarding accounting procedures and internal controls that could be improved and to recommend improvements to address these issues. Although these issues were not material in relation to the financial statements, we believe they warrant management's attention. We conducted our audits in accordance with U.S. generally accepted government auditing standards. During 2003, we identified several internal control issues that affected FDIC's accounting for the funds it administers. These weaknesses would have resulted in reporting errors had they not been detected and corrected. Specifically, we found the following: (1) FDIC erroneously accounted for funds it received related to securitizations that terminated in prior years, which would have caused the related FRF account balances to be misstated, (2) FDIC did not always follow its procedures relating to time and attendance reporting, which would have resulted in an improper allocation of operating expenses among the funds, and (3) FDIC made errors in calculations supporting its allowance for losses on receivables from thrift resolutions. These errors would have led to misstatements in FRF's financial statements. At the end of our discussion of each of these issues in the following sections, we make recommendations for strengthening FDIC's internal controls. Implementation of these recommendations is intended to bring FDIC into conformance with the internal control standards that federal agencies are required to follow. [ABSTRACT FROM AUTHOR]

In its role as the nation's tax collector, the Internal Revenue Service (IRS) has a demanding responsibility in collecting taxes, processing tax returns, and enforcing the nation's tax laws. Since GAO's first audit of IRS's financial statements in fiscal year 1992, a number of weaknesses in IRS's financial management operations have been identified. In related reports, GAO has recommended corrective action to address those weaknesses. Each year as part of the annual audit of IRS's financial statements, GAO not only makes recommendations to address any new weaknesses identified but also follows up on the open weaknesses GAO identified in previous years' audits. The purpose of this report is to assist IRS management in tracking the status of audit recommendations and actions needed to address them. Although IRS has made improvements to address a number of financial management weaknesses, some of the open audit recommendations have been outstanding for an extended period of time. IRS has continued to experience delays in the implementation of the new systems intended to correct some of these long-standing deficiencies. Others, however, could be resolved with additional management attention. The continued existence of these financial management weaknesses exposes IRS to loss due to errors or theft and impairs the availability of current, accurate financial information that management needs to make decisions on a day-to-day basis. Of 100 recommendations related to financial management (consisting of 78 recommendations open as of May 2003, 7 recommendations included in GAO's July 2003 report on IRS's excise tax certification process, and 15 new recommendations included in GAO's management report for fiscal year 2003), GAO is closing 24 because of actions IRS has taken to address the issues that gave rise to them. These actions were verified by GAO in the course of conducting the audit of IRS's fiscal year 2003 financial statements. Of the remaining 76 financial management recommendations GAO considers open as of the date of this report, 66 are short term (capable of being addressed within 2 years) and 10 are long term (expected to require more than 2 years to implement). IRS considers 37 (49 percent) of the 76 recommendations to be closed. GAO considers 12 of these 37 still open because it has not yet had an opportunity to verify the actions taken by IRS. The actions cited by IRS for these 12 recommendations are recent and were taken after GAO's financial statement audit work for the year was completed. For 24 of the 37 recommendations that IRS considers closed, GAO found that action taken by IRS has not yet been fully effective in addressing the conditions that gave rise to the recommendations. IRS disagrees with the remaining recommendation. IRS continues to exhibit a strong commitment to addressing its ongoing financial management problems and has made improvements in recent years that have resulted in the closing of many recommendations. At the same time, the continued existence of the serious financial management weaknesses that gave rise to the remaining open recommendations represents a serious obstacle that IRS needs to overcome to achieve effective financial management. GAO will continue to monitor IRS's progress in implementing the 76 recommendations that remain open during the fiscal year 2004 audit. IRS said it expects GAO to find in its fiscal year 2004 financial audit that IRS has taken corrective actions to allow closure of another 37 recommendations. In addition, IRS stated that it is actively working to implement corrective actions to address all remaining open recommendations. [ABSTRACT FROM AUTHOR]

In November 2003, we issued our report on the results of our audit of the Internal Revenue Service's (IRS) financial statements as of and for the fiscal years ending September 30, 2003 and 2002, and on the effectiveness of its internal controls as of September 30, 2003. We also reported our conclusions on IRS's compliance with significant provisions of selected laws and regulations and on whether IRS's financial management systems substantially comply with requirements of the Federal Financial Management Improvement Act of 1996. A separate report on the implementation status of recommendations from our prior IRS financial audits and related financial management reports including this one will be issued shortly. The purpose of this report is to discuss issues identified during our fiscal year 2003 audit regarding internal controls and accounting procedures that could be improved for which we do not presently have any recommendations outstanding. Although not all of these issues were discussed in our fiscal year 2003 audit report, they all warrant management's consideration. During fiscal year 2003, we identified a number of internal control issues that adversely affected safeguarding of tax receipts, budgeting, operating costs, and financial reporting. These issues concern (1) enforcement of lockbox bank contractor policies, (2) courier service requirements, (3) lockbox bank management reviews, (4) candling, (5) safeguarding of taxpayer receipts and information at IRS field offices and service center campuses, (6) physical security, (7) deobligation of funds, (8) overpayments to employees' Thrift Savings Plan (TSP) accounts, (9) financial statement disclosures, and (10) interim performance measures. [ABSTRACT FROM AUTHOR]

We have performed the procedures contained in the enclosure to this report, which we agreed to perform and with which the Inspector General (IG) concurred, solely to assist it in ascertaining whether the net excise tax revenue distributed to the Airport and Airway Trust Fund (AATF) for the fiscal year ended September 30, 2003, is supported by the underlying records. As agreed, we evaluated fiscal year 2003 activity affecting distributions to the AATF. The adequacy of the procedures to meet the Inspector General's objectives is his responsibility, and we make no representation in that respect. The procedures we agreed to perform include (1) detailed tests of transactions that represent the underlying basis of amounts distributed to the AATF, (2) review of the Internal Revenue Service's (IRS) quarterly AATF certifications, (3) review of the Department of the Treasury Financial Management Service (FMS) adjustments to the AATF for fiscal year 2003, (4) review of IRS's precertification1 of receipts for the third quarter of fiscal year 2003 (5) review of certain procedures of the Department of the Treasury Office of Tax Analysis' (OTA) estimation procedures affecting excise tax distributions to the AATF for the fourth quarter of fiscal year 2003, and other procedures including (6) the comparison of net excise tax distributions to the AATF during fiscal year 2003 and amounts reported in the draft financial statements prepared by the Bureau of the Public Debt (BPD) for the AATF and the Federal Aviation Administration's (FAA) draft consolidated financial statements, (7) detailed tests of transactions that represent total IRS tax revenue receipts and refunds, and (8) review of key reconciliations of IRS records to Treasury records. The enclosure contains the agreed-upon procedures and our findings from performing each of the procedures. We were not engaged to perform, and did not perform, an audit, the objective of which would have been the expression of an opinion on the amount of net excise taxes distributed to the AATF. [ABSTRACT FROM AUTHOR]

The Inspector General (IG) of the Department of Transportation requested that GAO perform procedures to assist the IG's office in ascertaining whether the net excise tax revenue distributed to the Highway Trust Fund (HTF) for the fiscal year ended September 30, 2003, is supported by the underlying records. GAO evaluated fiscal year 2003 activity affecting distributions to the HTF. GAO noted that the adequacy of the procedures to meet IG's objectives is the IG's responsibility, and GAO makes no representation in that respect. The procedures GAO agreed to perform include (1) detailed tests of transactions that represent the underlying basis of amounts distributed to the HTF, (2) review of the Internal Revenue Service's (IRS) quarterly HTF certifications, (3) review of the Department of the Treasury Financial Management Service (FMS) adjustments to the HTF for fiscal year 2003, (4) review of IRS's precertification1 of receipts for the third quarter of fiscal year 2003, (5) review of certain procedures of the Department of the Treasury Office of Tax Analysis' (OTA) process for estimating amounts to be distributed to the HTF for the fourth quarter of fiscal year 2003, and other procedures including (6) comparison of net excise tax distributions to the HTF during fiscal year 2003 and amounts reported in the draft financial statements prepared by the Bureau of the Public Debt (BPD) for the HTF and the HTF's draft financial statements, (7) detailed tests of transactions that represent total IRS tax revenue receipts and refunds, and (8) review of key reconciliations of IRS records to Treasury records. GAO was not engaged to perform, and did not perform, an audit, the objective of which would have been the expression of an opinion on the amount of net excise taxes distributed to the HTF. [ABSTRACT FROM AUTHOR]

In November 2002, we issued our report on the results of our audit of the Internal Revenue Service's (IRS) financial statements as of and for the fiscal years ending September 30, 2002 and 2001, and on the effectiveness of its internal controls as of September 30, 2002. We also reported our conclusions on IRS's compliance with significant provisions of selected laws and regulations and on whether IRS's financial management systems substantially comply with requirements of the Federal Financial Management Improvement Act of 1996 (FFMIA). A separate report on the implementation status of recommendations from our prior IRS financial audits and related financial management reports will be issued shortly. The purpose of this report is to discuss issues identified during our fiscal year 2002 audit regarding accounting procedures and internal controls that could be improved for which we do not presently have any recommendations outstanding. During fiscal year 2002, IRS had a number of internal control issues that affected financial reporting, which includes safeguarding of assets. These issues concern policies and procedures related to (1) employee fingerprint records, (2) enforcement of courier service standards, (3) taxpayer receipt processing areas, (4) candling, (5) acceptance of tax payments in cash, and (6) structuring of installment agreements. Each of these control weaknesses posed added risks of losses, nonpayment of taxes, or potential burden to taxpayers. [ABSTRACT FROM AUTHOR]

Congress passed the IRS Restructuring and Reform Act of 1998 in response to frustration with the Internal Revenue Service's (IRS) inability to effectively carry out its mission. IRS's inability to deliver new computer systems that worked, allegations of abuse of taxpayers by IRS employees, and taxpayers greeted by busy signals when calling IRS for assistance all fed the frustration. The act set two goals for IRS--improve service to taxpayers while continuing to enforce compliance with the tax laws. The act also mandated annual joint congressional oversight hearings, of which this is the fifth and final. IRS's accomplishments in the 5 years since the act was passed are significant. IRS has increased its capacity to manage with, for example, more effective controls over information system acquisition and better performance measures. In addition, the improvements have had a noticeable impact on service to taxpayers. Taxpayers have an easier time reaching IRS by telephone and are increasingly using IRS's Web site to download tax forms and publications and check the status of their refunds. Nevertheless, IRS is only part of the way to where taxpayers and Congress expect it to be. Compliance is perhaps IRS's greatest challenge looking forward. Although IRS lacks current data about the level of voluntary compliance, what is known is that there have been significant and pervasive declines in many of IRS's key compliance and collections programs. As a result of these declines, taxpayers have less incentive to voluntarily comply, thereby potentially undermining the integrity of the tax system and risking revenue collections. Reversing this decline will be a challenge. Another challenge will be closing the gap between the level and quality of taxpayer services that IRS provides and what Congress and taxpayers want and expect. Despite improvements, almost one-third of callers receive busy signals or hang up without receiving service, and almost 20 percent get incorrect answers to tax law questions. The means for realizing IRS's goals is continued progress modernizing, but this will be a challenge. The scope and complexity of the business systems modernization is growing, but management capacity is still maturing. Long-standing computer security weaknesses continue to threaten the confidentiality, integrity, and availability of sensitive systems and taxpayer data. Performance, financial, and human capital management all need further improvement. IRS is also challenged to realize the increased staffing levels for service and compliance called for in recent IRS budget requests. [ABSTRACT FROM AUTHOR]

During fiscal year 2001, the Internal Revenue Service (IRS) had a number of internal control issues that affected financial reporting, including safeguarding of assets. These concern policies and procedures over (1) receipt of taxpayer payments, (2) courier services that transport taxpayer data, (3) employee fingerprint records, (4) issuance of manual refunds, (5) release of tax liens, (6) recording of property and equipment transactions, (7) linking of property and accounting records, (8) software licenses, (9) reimbursable receivables, and (10) recording changes in administrative account balances. [ABSTRACT FROM AUTHOR]

In light of the fourth anniversary of the Internal Revenue Service (IRS) Restructuring and Reform Act of 1998, which established Congress' expectation that IRS modernize to better meet taxpayer needs, GAO gave an overview of IRS's current performance and resources and then assessed the progress that IRS has made modernizing and the risks to continued progress. Overall, IRS has seen increased workload, decreased staffing, and significant changes in the allocation of resources between taxpayer assistance programs and its compliance and collection programs. Between 1995 and 2001, IRS's workload, measured by returns filed, increased by 10 percent while aggregate staffing declined by 14 percent. Over the same time, there was a significant internal reallocation of resources with a disproportionate decline in compliance and collection program staffing to accommodate more emphasis on taxpayer service, such as telephone assistance, and to information systems operation and investment. Electronic filing of returns increased but not enough to reduce paper returns sufficiently to free significant processing resources for use elsewhere. The reallocation of resources shows signs of beginning to produce more accurate service for taxpayers, but the compliance and collection programs have seen large and pervasive declines in performance indicators such as audit rates, collection cases closed, enforcement actions such as liens and levies, and raw productivity. [ABSTRACT FROM AUTHOR]

The Internal Revenue Service (IRS) was, for the second consecutive year, able to prepare financial statements that received an unqualified opinion. However, this achievement once again came through the use of substantial, costly, and time-consuming processes to compensate for serious systems and control deficiencies. IRS continues to make progress in its performance management system by using a strategic planning and budgeting process to reconcile competing priorities and initiatives with available resources. In the area of computer security, IRS corrected or mitigated many of the previously reported weaknesses, including those affecting its electronic filing systems. It also is implementing a computer security program that should help manage its risks in this area. Business Systems Modernization is IRS' ongoing program to leverage information technology and is integral to IRS achieving its customer-focused vision. To date, IRS has made progress in establishing the systems infrastructure, delivering system applications, and developing the management controls and capabilities necessary to effectively acquire and deploy modernized systems. [ABSTRACT FROM AUTHOR]

GAO performed detailed tests of transactions that represent the underlying basis of amounts distributed to the Unemployment Trust Fund (UTF) and reviewed key reconciliations of the Internal Revenue Service records to the Department of the Treasury records. GAO found that the net federal unemployment tax revenue distributed to UTF for fiscal year 2001 is supported by the underlying records. [ABSTRACT FROM AUTHOR]

GAO examined the underlying records for the net excise tax revenue distributed to the Airport and Airway Trust Fund (AATF) for fiscal year 2001. GAO (1) did a detailed test of transactions that represent the underlying basis of amounts distributed to AATF, (2) reviewed the Internal Revenue Service's (IRS) quarterly AATF certifications, (3) reviewed the Department of the Treasury Financial Management Service adjustments to AATF for fiscal year 2001, (4) reviewed procedures in the Office of Tax Analysis' process for estimating amounts to be distributed to AATF for the fourth quarter of fiscal year 2001, (5) compared net excise tax distributions to AATF during fiscal year 2001 and amounts reported in the financial statements prepared by the Bureau of the Public Debt for AATF and the Federal Aviation Administration's consolidated financial statements, and (6) reviewed key reconciliations of IRS records to Treasury records. [ABSTRACT FROM AUTHOR]

This testimony discusses (1) how well the Internal Revenue Service (IRS) is providing service to taxpayers and ensuring compliance with tax laws, and (2) IRS' progress in its long-term effort to modernize. GAO found that IRS posted mixed results in 2001 in collecting revenues, providing taxpayer service, and enforcing tax laws. On the plus side, IRS processed millions of tax returns and issued refunds without significant problems, taxpayers had an easier time getting through to telephone assistors, and IRS said that it made progress in correcting weaknesses that threatened the security of electronically filed tax information. On the down side, the quality of service provided to taxpayers who visited taxpayer assistance centers, trends in audit rates and enforcement programs, and productivity all experienced troubling declines. With respect to modernization, IRS is making incremental progress in overhauling its organization, performance management system, business processes, and information technology. IRS is also making important progress in implementing its new organizational structure, developing a blueprint for modernizing its business processes and information systems, and more fully defining its strategic direction. However, IRS progress has fallen short of expectations. For example, IRS is not where it should be in implementing management controls over business systems modernization, which has contributed to project delays. [ABSTRACT FROM AUTHOR]

A letter from Steven J. Sebastian, director for financial management and assurance at the U.S. Government Accountability Office, to Calvin L. Scovel, inspector general at the U.S. Department of Transportation, for procedures for excise tax distribution for highways in fiscal year 2011 is presented.

Provides information on the audit reports covering the financial statements of the National Conference of State Societies in the U.S. Aim to promote cooperative relations between the various state and territorial societies; Determination of the annual financial audit by an independent public accountant; Presentation of the corporation's assets and liabilities and reasonable detail on the corporation's income.

GAO reviewed the audit reports covering the financial statements of the National Conference on Citizenship for Fiscal Years 2003 and 2002. GAO found no reportable instances of noncompliance. The audit reports included the auditors' opinions that the financial statements of the corporation were presented fairly in accordance with generally accepted accounting principles. [ABSTRACT FROM AUTHOR]

Provides information on the audit report covering the financial statements of the National Federation of Music Clubs, a federally chartered corporation in the U.S. Presentation of the corporation's assets and liabilities; Detail on the corporation's income and expenses in annual financial statements; Determination of the financial audit by an independent public accountant.

GAO reviewed the audit reports covering the financial statements of the Future Farmers of America for Fiscal Years 2003 and 2002. GAO found no reportable instances of noncompliance. The audit reports included the auditors' opinions that the financial statements of the corporation were presented fairly in accordance with generally accepted accounting principles. [ABSTRACT FROM AUTHOR]

GAO reviewed the audit reports covering the financial statements of the National Academy of Public Administration, for fiscal year 2003. GAO found no reportable instances of noncompliance. The audit reports included the auditors' opinions that the financial statements of the corporation were presented fairly in accordance with generally accepted accounting principles. [ABSTRACT FROM AUTHOR]

GAO reviewed the audit reports covering the financial statements of the Italian American War Veterans of the United States, for fiscal year 2001. GAO found no reportable instances of noncompliance. The audit reports included the auditors' opinions that the financial statements of the corporation were presented fairly on a modified cash basis of accounting. [ABSTRACT FROM AUTHOR]