GAO Report Finds That SEC Needs to Improve Internal Controls and Accounting Procedures

The United States Government Accountability Office ("GAO") released a report regarding the financial statements of the SEC from fiscal year 2013. In the report, the GAO found several deficiencies in the internal controls of the SEC over financial reporting. While the GAO did not consider the deficiencies to be material weaknesses either individually or collectively, the GAO concluded that the deficiencies warrant the SEC management's attention. The deficiencies relate to:

• procedures for transferring disgorgement and penalty-related funds to the United States Department of the Treasury;
• the monitoring of disgorgement and penalty-related cases filed in courts;
• the segregation of duties for recording disgorgement and penalty-related financial data;
• the safeguarding of SEC cash receipts received at its service provider;
• the recording of property and equipment transactions; and
• management's review of legal contingencies and significant events.

See: GAO Report.Related news: GAO Report: SEC Needs to Improve Controls over Financial Systems and Data (April 17, 2014).