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- COMPTROLLER GENERAL OF THE UNITED STATES
, , ,WASHINGTON. D.C. 2054B
B-148513 OEC llS9
The Honorable Harrison A. Williams
Chairman, Committee on Labor and
Human Resources
14 United States Senate J/
Dear Mr. Chairman:
This letter provides our Lcomments on S. 1840] 96th Congress,
a bill cited as the Education Amendments of 1979, and S. 1841,
96th Congress, a bill, cited as the Education Amendments of
1980. We are concerned with the provisions contained in section
432(b)(2) and section 451(e)(2). of S. 1840, which would require
us to make annual audits of financial accounts maintained by the
proposed Government Student Loan Association. Also, our views
concerning the definition of a developing institution, as con-
tained in section 301(b) of S. 1840 and in section 301(b)(1)
of S. 1841, are provided.
The Government Corporation Control Act (31 U.S.C. 850)
provides that each wholly owned Government corporation shall
be audited at least once in every 3 years by the Comptroller
General. We believe that this provision gives us the flexi-
bility to meet our audit responsibilities consistent with the
most effective use of our resources. If we find that account-
ing controls are weak and ineffective, we could decide that an
annual audit is warranted. On the other hand, if we find that
accounting controls are effective and there is adequate coverage
by internal audits, it would not be an effective use of our
resources to routinely make audits more often than our judgment
dictates. Moreover, as you are probably aware, we are required
by the Legislative Reorganization Act of 1970 (31 U.S.C. 1154)
to make reviews and evaluations of Government programs and activ-
ities when required by either House of Congress or its committees.
We therefore recommend that the requirement for an annual
audit by the General Accounting Office be deleted and that
section 432(b)(2) on page 112 of S. 1840 be revised to read as
folows:
(2) maintain with respect to insurance under this part
an integral set of accounts, which shall be audited at
least once in every 3 years by the General Accounting
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