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November 18, 2019

Quality Control Review of the Independent Auditor’s Report on the Department of Transportation’s Audited Consolidated Financial Statements for Fiscal Years 2019 and 2018

Required by the Chief Financial Officers Act of 1990
Project ID: 
QC2020011
View PDF Document
What We Looked At
We contracted with the independent public accounting firm KPMG LLP to audit the Department of Transportation’s (DOT) financial statements as of and for the fiscal years ended September 30, 2019, and September 30, 2018, and to report on internal control over financial reporting and compliance with laws and other matters. The contract requires the audit to be performed in accordance with U.S. generally accepted Government auditing standards, Office of Management and Budget audit guidance, and the Governmental Accountability Office’s and Council of the Inspectors General on Integrity and Efficiency’s Financial Audit Manual. In connection with the contract, we performed a quality control review of KPMG’s report dated November 13, 2019, and related documentation, and inquired of its representatives.
 
What We Found
Our quality control review disclosed no instances in which KPMG did not comply, in all material respects, with U.S. generally accepted Government auditing standards.
 
Recommendations
DOT concurred with KPMG’s eight recommendations. We agree with KPMG’s recommendations and are not making any additional recommendations.

Recommendations

Open

Closed

Closed on 12.17.2020
No. 1 to FAA

KPMG recommends that FAA management design and implement procedures to consistently perform and document application log reviews as required by existing internal policies.

No. 2 to FAA

KPMG recommends that FAA management design and implement procedures to consistently perform and document database layer audit log reviews as required by existing internal policies.

No. 3 to FAA

KPMG recommends that FAA management design and implement procedures to consistently perform and document operation system layer log reviews as required by existing internal policies.

Closed on 03.30.2021
No. 4 to FAA

KPMG recommends that FAA management design and implement procedures to consistently perform and document application level user account access reviews as required by existing internal policies.

No. 5 to FAA

KPMG recommends that FAA management design and implement procedures to consistently perform and document operating system administrative account access reviews as required by existing internal policies.

Closed on 12.17.2020
No. 6 to OST

KPMG recommends that Office of the Secretary management design controls which are sufficiently precise to ensure that each of the data inputs which are key to the cash flow projections are defined (including for loans expected to reach the substantial disbursement threshold); control procedures are sufficiently designed and documented to ensure that the inputs are validated against source documents; and the inputs are accurate prior to the annual subsidy re-estimation in September.

Closed on 12.16.2020
No. 7 to FRA

KPMG recommends that FRA management develop an accrual methodology for incurred but not submitted grantee expenses at year-end.

Closed on 12.16.2020
No. 8 to FRA

KPMG recommends that FRA management develop a process to improve communications between the Grant Office and Office of Financial Services to ensure all available expense information is recorded in the proper reporting period.