Independent Auditor's Report – Summary of Results
In our opinion, USAID's consolidated balance sheets, consolidated statements of
changes in net position, consolidated statements of net cost, combined statements of
budgetary resources, and consolidated statements of financing present fairly, in all
material respects, the financial position of USAID as of September 30, 2005 and 2004;
and its net cost, net position, and budgetary resources for the years then ended are in
conformity with generally accepted accounting principles.
As described in Note 22, USAID corrected an error it had made in calculating accruals
during fiscal year 2004, and made related adjustments and disclosures to restate its
2004 financial statements.
Our audit identified one material internal control weakness and three reportable internal
control conditions. The material internal control weakness relate to USAID's need to
improve its Accruals Reporting System.
The reportable conditions relate to USAID's need to improve its:
- Process for reconciling its Fund Balance with the U.S. Treasury,
- Intragovernmental transaction reconciliation process,
- Process for recognizing and reporting its overseas accounts receivable.
In addition, our audit identified reportable noncompliance related to requirements of the
Federal Financial Management Improvement Act, as follows:
- Phoenix was not fully deployed, but progress has been made,
- Legacy financial systems at overseas missions did not comply with the U.S.
Government Standard General Ledger at the transaction level, and
- Financial reporting capabilities need improvement.
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