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093874 1 (1973-03-14)

handle is hein.gao/gaobacxhk0001 and id is 1 raw text is: WASHINGTON REGIONAL OFFICE U.S GENERAL ACOOUNTINQ OFFICE 803 WEST BROAD STPEET, FiF rq iLOO FALLS CHURCH, VIRGINIA 22046 -MAR 1 4 1973 The Honorable Frank Wille Chairman, Board of Directors Federal Deposit Insurance Corporation De'ar Mr. Wille: We appreciate your thoughtful comments of February 9, 1973, on our draft report. You can be assured they will be given full consideration in completing our work. As mentioned in your letter, our staff rade some suggestions which you intend to pursue. Your associates thought it would be useful for us to summarize for your consIderation our thoughts on the benefits of an accounting manual and rounding of amounts on financial statments. As you know, a ranual of accounting policies and procedures, a chart of accounts, and a written organization plan are an important part of a sound internal control system. These documents contribute to accurate and reliable accounting and operating data in accordance with corporate policies. Furthermore, a clear definition of individual responsibilities and the pro- cedures by vhich these responsibilities should be fulfilled can result in a more efficient operation. The Corporation has no accounting manual or written organization plan and the chart of accounts currently in use needs updating. Certain errors found during this year's audit demonstrate the need for these documents. For example, interest on capital notes was recorded on the cash basis. As a result, $100,000 of accrued interest which the Corporation had earned as of June 30, 1972, was not recorded. Officials in the Office of the Controller stated that the accrued interest should have been recorded and accounts have been established to record the interest from the capital notes on an accrual basis. We believe an accounting manual and a complete chart of accounts would minimize inconsistencies such as the above. Officials in the Office of the Controller have recognized the need for these documents, and preliminary planning is under way toward developing an accounting manual. Also, a partial revision of the chart of accounts is in process. Milestones for completion of these tasks are pending. BEST DOCUMENT AVAILABLE

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