Financial Audit

GAO is required to review the annual audits of the financial statements of SEMATECH, a consortium of U.S. semiconductor manufacturers and the Defense Department. In the opinion of Price Waterhouse, an independent public accounting firm, SEMATECH's financial statements for 1996 were fairly presented in all material respects in conformity with generally accepted accounting principles. Likewise, Price Waterhouse found no internal control weaknesses or noncompliance with laws and regulations. GAO found no instances in which Price Waterhouse's opinion on SEMATECH's 1996 financial statements, its internal controls, or its compliance with laws and regulations did not comply with generally accepted government auditing standards.

GAO found that: (1) Price Waterhouse's opinion, dated January 31, 1997, stated that SEMATECH's financial statements for the year ended December 31, 1996, are fairly presented in all material respects in conformity with generally accepted accounting principles; (2) also, as required by generally accepted government auditing standards, Price Waterhouse issued reports on SEMATECH's internal control structure and its compliance with laws and regulations; (3) these reports disclosed no material internal control weaknesses or noncompliance with laws and regulations; and (4) the results of GAO's review disclosed no instances where Price Waterhouse's opinion on SEMATECH's 1996 financial statements, its report on internal control structure, or its report on compliance with laws and regulations did not comply, in all material respects, with generally accepted government auditing standards.