Summary: GAO reviewed the Pension Benefit Guaranty Corporation's (PBGC) accounting procedures and internal controls that warranted management's attention as of September 30, 1994. GAO noted that PBGC: (1) used evidence about significant transactions that occurred after year-end in assessing its year-end contingent liabilities; (2) misclassified several pension plans based on their prior year classifications; (3) placed greater emphasis on bond ratings and debt-equity ratios in classifying pension plans; (4) financial statements did not disclose factors that represented high contingent liability risks; (5) did not adequately disclose the monetary effects that actuarial assumptions had on the amounts disclosed; (6) did not provide all available information about its efforts to recover amounts from sponsors of terminated plans in its financial statements; (7) incorrectly recorded its estimated losses; (8) did not provide adequate documentation in its Single Employer Program's Statement of Cash Flows; (9) inconsistently reviewed its financial assistance to multiemployer plans; (10) had yet to evaluate the effectiveness of its ratio screens in identifying troubled plans; (11) incorrectly listed 16 multiemployer plans as inactive in its Premium Processing System; (12) incorrectly allocated some of its losses to the Multiemployer Program; and (13) had not fully implemented its new computerized premium accounting system, disaster recovery plan, and software changes.
