State of Texas Financial Portion of the Statewide Single Audit Report for the Year Ended August 31, 2003
March 2004
Report Number 04-555 and KPMG's report
Overall Conclusion
The State's basic financial statements for the year ended August 31, 2003, are materially correct in accordance with accounting principles generally accepted in the United States of America. These financial statements provide a comprehensive picture of how the State used its resources during the year, as well as the State's remaining assets and obligations at the end of the year.
Auditing financial statements is not limited to reviewing the accuracy of the numbers in those statements. Conducting this audit also requires us to audit the underlying systems and processes that agencies and institutions of higher education use to record their financial activities. Through that review, we identified specific weaknesses that certain agencies and institutions of higher education need to address to ensure the accuracy of their financial information.
The ability to prepare materially correct financial statements represents a significant accomplishment for the State; however, the budget issues that have arisen during the past few years remain among the State's most significant financial challenges. In addition, preparing materially correct financial statements is only one aspect of financial accountability. As our prior audit reports have demonstrated, the State continues to face significant risks in areas such as contracting, revenue management, and information technology systems. Our office continues to monitor these significant risks and incorporate them into the risk assessment we use to identify additional audit work we will conduct.
Federal portion - The State Auditor's Office contracted with KPMG, LLP, to perform the federal portion of the 2003 Statewide Single Audit. The federal portion included a review of compliance and controls over the State's federal awards and an audit of the Schedule of Expenditures of Federal Awards. See KPMG's report including findings, recommendations, and management responses.
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