OIG Audit Report 05-11

Federal Bureau of Prisons Annual Financial Statement
Fiscal Year 2004

Audit Report No. 05-11
March 2005
Office of the Inspector General

Commentary and Summary

This audit report contains the financial statements of the Federal Bureau of Prisons (BOP) for the fiscal years ended September 30, 2004 and September 30, 2003. Under the direction of the Office of the Inspector General (OIG), PricewaterhouseCoopers LLP (PwC) performed the audit, which resulted in an unqualified opinion on the FY 2004 financial statements. An unqualified opinion means that the financial statements present fairly, in all material respects, the financial position and results of operations of the entity. The FY 2003 audit also resulted in an unqualified opinion (OIG Report No. 04 24).
PwC also issued reports on internal control, and compliance with applicable laws and regulations. The Auditors’ Report on Internal Control identified one reportable condition, which was reported in the FY 2002 and FY 2003 annual financial statements audits. The reportable condition noted that improvements were needed in the BOP’s information security program management and controls and the FMIS-2 accounting system maintained by the Department of Justice’s (DOJ) Management Division. The auditors also identified weaknesses in application software development and change control activity. The Report on Compliance and Other Matters identified no findings.
The OIG reviewed PwC’s report and related documentation and inquired of its representatives. Our review, as differentiated from an audit in accordance with U.S. generally accepted government auditing standards, was not intended to enable us to express, and we do not express, an opinion on the Bureau of Prisons’ financial statements, conclusions about the effectiveness of internal control, or conclusions on compliance with laws and regulations. PwC is responsible for the attached auditor’s reports dated October 26, 2004 and the conclusions expressed in the reports. However, our review disclosed no instances where PwC did not comply, in all material respects, with generally accepted government auditing standards.