Financial Audit: Federal Deposit Insurance Corporation's 1997 and 1996 Financial Statements
AIMD-98-204
Published: Jun 29, 1998. Publicly Released: Jun 29, 1998.
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Highlights
Pursuant to a legislative requirement, GAO audited the financial statements of the Bank Insurance Fund, the Savings Association Insurance Fund, and the Federal Savings and Loan Insurance Corporation Resolution Fund for the years ended December 31, 1997, and 1996. GAO also reviewed: (1) the Federal Deposit Insurance Corporation (FDIC) management's assertions regarding the effectiveness of its internal controls as of December 31, 1997; (2) FDIC's compliance with laws and regulations during 1997; and (3) FDIC's progress in correcting internal controls.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Federal Deposit Insurance Corporation | The Chairman, FDIC, should direct the heads of the Division of Resolutions and Receiverships and the Division of Finance to implement an improved process for estimating recoveries for securities and other assets currently being valued outside its Standard Asset Valuation Estimation process. The process should have the objectives of producing valid and defensible estimates for financial statement purposes. |
Closed – Implemented
In 1998, FDIC implemented standard, consistent valuation methodologies for assets previously valued outside of its Standard Asset Valuation Estimation process. FDIC also clearly designated responsibility for valuing those assets and for reviewing completed valuations. During GAO's 1998 audits, it found these new methodologies helped ensure that these value estimates were accurate and reliable.
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| Federal Deposit Insurance Corporation | FDIC should reemphasize the importance of the review and certification procedures for the estimated recoveries on assets valued outside of its standard asset valuation process. |
Closed – Implemented
FDIC's actions on the previous recommendation also satisfy this recommendation. See previous recommendation for action taken.
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Topics
Accounting proceduresAuditing standardsBank failuresFederal corporationsFinancial statement auditsFund auditsInternal controlsReporting requirementsFinancial statementsFederal deposit insurance