Financial Audit

Pursuant to a legislative requirement, GAO examined the Environmental Protection Agency's (EPA) consolidated financial statements for the years ended September 30, 1988 and 1987, focusing on: (1) EPA internal accounting controls; (2) EPA compliance with laws and regulations; and (3) the Superfund program's financial condition.

GAO found that: (1) EPA estimated a $30-billion cleanup cost for about 1,200 hazardous waste sites, but it may have underestimated the cost; (2) as of September 30, 1988, EPA had identified over 30,000 waste sites and had completed preliminary assessments at over 26,000 sites and inspections at over 9,000 sites; (3) at the end of 1988, EPA had started cleanup work at 201 of the 1,200 sites, and had completed work at 27 sites; (4) the new EPA reporting system did not provide satisfactory accounting information; and (5) EPA did not timely reconcile its general ledger and external reports. GAO also found that: (1) EPA did not correct previously reported property management internal control problems; (2) the EPA subsidiary accounting system for property and related internal controls did not adequately account for or maintain control over those assets; and (3) the property management system did not reasonably safeguard EPA assets or provide the appropriate information in financial statements. GAO also found that EPA complied with the provisions of laws and regulations that could have a material effect on its consolidated financial statements.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

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