Summary: Pursuant to a legislative requirement, GAO reviewed an independent accounting firm's audits of the 1987 financial statements of each of the 12 Federal Home Loan Banks and the combined financial statements of the 12 banks.
GAO found that: (1) in the auditor's opinion, each bank's financial statements presented fairly its financial position as of December 31, 1987, the results of its operations, and the changes in its financial position for 1987; (2) in the auditor's opinion, the combined financial statements of the 12 banks presented fairly the combined financial position of the banks as of December 31, 1987, the results of their combined operations, and the changes in their combined financial position for 1987; (3) the auditor's reports on internal controls and compliance with laws and regulations did not disclose any material weaknesses or noncompliance; (4) the auditor disclosed a significant uncertainty in the Dallas bank's financial statements, regarding about $510 million of undercollateralized or uncollateralized advances to member savings and loan institutions guaranteed by the Federal Savings and Loan Insurance Corporation; and (5) the financial statements, together with the auditor's opinions and the GAO review of that work, provide Congress with a dependable basis for overseeing the banks' financial position.
