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INDEPENDENT AUDITORS’ REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE


To the Architect of the Capitol and the Inspector General


We have audited the financial statements and related notes to the financial statements of the Architect of the Capitol (AOC) as of and for the years ended September 30, 2014 and 2013, and have issued our reports thereon dated December 3, 2014. Those reports contained our unmodified opinion on the financial statements. We conducted our audits in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and Office of Management and Budget (OMB) Bulletin No. 14-02, Audit Requirements for Federal Financial Statements.


INTERNAL CONTROL OVER FINANCIAL REPORTING AND COMPLIANCE


In planning and performing our audit of the financial statements, we considered AOC's internal control over financial reporting to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of AOC’s internal control. Accordingly, we do not express an opinion on the effectiveness of AOC’s internal control.


A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected, on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.


Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses or significant deficiencies may exist that have not been identified.


Significant Deficiencies


We identified three deficiencies in AOC’s internal control that we consider to be significant deficiencies, as follows:


1. Ineffective control over accounting for the Fairchild Building lease renewal.


2. Untimely contract closeouts and liquidation of obligations.


3. Improperly recorded costs associated with the O’Neill Building leasehold improvements.


These significant deficiencies are described in more detail in the Appendix.


Limitations of Internal Control


Because of inherent limitations in internal control, misstatements due to error or fraud, losses, or noncompliance may nevertheless occur and not be detected. We also caution that projecting our evaluation to future periods is


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