October 31, 2016

Management Letter on the Southwestern Federal Power System’s Fiscal Year 2015 Financial Statement Audit

KPMG LLP (KPMG), our contract auditors, planned and performed an audit of the combined financial statements of the Southwestern Federal Power System (the System) as of and for the year ended September 30, 2015, in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards.  As part of the audit of the combined financial statements, KPMG considered the System’s internal control over financial reporting (internal control) as a basis for designing auditing procedures for the purpose of expressing an opinion on the combined financial statements but not for the purpose of expressing an opinion on the effectiveness of the System’s internal control.  

The Office of Inspector General monitored audit progress and reviewed the audit report and related documentation.  This review disclosed no instances where KPMG did not comply, in all material respects, with generally accepted Government auditing standards.  During the audit, KPMG noted certain matters involving internal control and other operational matters that are presented in the management letter prepared by KPMG.  The letter contains three findings that were issued during the course of the System’s Fiscal Year 2015 Financial Statement Audit.

Topic: Management & Administration