To a much lesser degree than the FFEL Program, there are other financial statement amounts for which unreconciled differences existed, or where potential errors identified by the single audit act process were not quantified. Education's account with the U.S. Treasury was out of balance with its accounting records by a net difference of $183 million. In the absence of information to explain what comprises this difference, we are unable to determine the effect, if any, on Education's financial statements if the $183 million difference contains errors. With respect to grant expenses, audits conducted on Education's behalf revealed, from time to time, that amounts were improperly granted, in which case Education could be entitled to recoup the funds. However, the results of these audits have not been summarized by Education, and we are unable to determine the effect on the financial statements, if any, that might result from potential misuse of grant funds.
As described above, certain amounts reported in Education's consolidated financial statements could not be supported by sufficient and reliable accounting information and certain differences between financial statement amounts and underlying accounting records could not be adequately explained. Because obtaining missing information or locating evidence to explain differences in the accounting records would have entailed reconstruction of a substantial amount of supporting data, it was not practicable for us to extend our auditing procedures to satisfy ourselves regarding the effect these matters might have on Education's consolidated financial statements. Accordingly, the scope of our work was not sufficient to enable us to express, and we do not express, an opinion on the accompanying consolidated financial statements.
The consolidating information is presented for purposes of additional analysis of the consolidated financial statements rather than to present financial position, results of operations and cash flows of Education's major programs and activities. For the reasons described in the preceding paragraph, we are unable to, and do not, express an opinion on whether such consolidating information is fairly stated, in all material respects, in relation to the consolidated statements taken as a whole.
The overview of Education contains a wide range of data, some of which are not directly related to the consolidated financial statements. We do not express an overall opinion on this information. However, we compared this information for consistency with the consolidated financial statements and discussed the methods of measurement and presentation with Education officials. Based on this limited work, we found no material inconsistencies with the consolidated financial statements.
Price Waterhouse LLP
June 4, 1996