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January 31, 2022

Quality Control Review of the Management Letter for the Department of Transportation’s Audited Consolidated Financial Statements for Fiscal Years 2021 and 2020

Required by Chief Financial Officers Act of 1990
Project ID: 
QC2022017
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What We Looked At
This report presents the results of our quality control review (QCR) of KPMG LLP’s management letter for its audit, conducted under contract with us, of the Department of Transportation’s (DOT) consolidated financial statements for fiscal years 2021 and 2020. The management letter discusses four internal control matters that KPMG was not required to include in its audit report.
 
What We Found
Our QCR of the management letter disclosed no instances in which KPMG did not comply, in all material respects, with U.S. generally accepted Government auditing standards.
 
Our Recommendations
KPMG made seven recommendations in its management letter. DOT concurred with all seven recommendations.

Recommendations

Open

Closed

Closed on 01.05.2023
No. 1 to OST

KPMG recommends that ESC management correct the ESC server inventory list to ensure that all production servers are correctly categorized

Closed on 01.05.2023
No. 2 to OST

KPMG recommends that ESC management implement a quality assurance process to confirm that all servers and systems are included during the semiannual review process.

Closed on 10.19.2022
No. 3 to MARAD

KPMG recommends that MARAD management develop and implement policies and procedures to timely evaluate and respond to changes in MARAD’s programs or activities prompted by public law or DOT directives that could impact financial reporting objectives and cause revision to its accounting treatment.

Closed on 10.20.2022
No. 4 to MARAD

KPMG recommends that MARAD management should design and implement processes to timely correct identified errors or account for changes in accounting policies.

Closed on 02.13.2023
No. 5 to OST

KPMG recommends that ESC management update procedures surrounding management’s review of journal entries to ensure journal entries are reviewed at an appropriate level of precision to determine that all manually posted entries are complete, accurate, and adequately supported by documentation.

No. 6 to OST

KPMG recommends that OST management obtain documentation from external borrowers to support the input assumption that the remaining loan value will not be disbursed.

No. 7 to OST

KPMG recommends that OST management maintain a documentation trail that includes support for each current year input in accordance with the TIFIA Loan Subsidy Re- estimates Standard Operating Procedures.