subpart ii—accounting policies and audits

§3721. Accounting policies

(a) Establishment and maintenance of accounts; specifications

The Commission shall establish and maintain its accounts pursuant to chapter 91 of title 31 and the provisions of this part. Such accounts shall specify all revenues received by the Commission, including tolls for the use of the Panama Canal, expenditures for capital replacement, expansion, and improvement, and all costs of maintenance and operation of the Panama Canal and of its complementary works, installations, and equipment, including depreciation, payments to the Republic of Panama under the Panama Canal Treaty of 1977, and interest on the investment of the United States calculated in accordance with section 3793 of this title.

(b) Regulations establishing the basis of accounting for assets

The Commission may issue regulations establishing the basis of accounting for the assets which are made available for the use of the Commission. Such regulations may provide for depreciation of the net replacement value of the assets which will ultimately require replacement to maintain the service capacity of the Panama Canal. Such regulations may also provide that depreciation of such assets be recorded ratably over their service lives.

(Pub. L. 96–70, title I, §1311, Sept. 27, 1979, 93 Stat. 479; Pub. L. 104–201, div. C, title XXXV, §3541(a), Sept. 23, 1996, 110 Stat. 2866.)

Amendments

1996—Subsec. (a). Pub. L. 104–201 substituted "chapter 91 of title 31" for "the Accounting and Auditing Act of 1950 (31 U.S.C. 65 et seq.)".

Section Referred to in Other Sections

This section is referred to in sections 3751, 3793 of this title.

§3722. Repealed. Pub. L. 104–66, title II, §2201(a), Dec. 21, 1995, 109 Stat. 732

Section, Pub. L. 96–70, title I, §1312, Sept. 27, 1979, 93 Stat. 479, related to annual reports to President and Congress.

§3723. Audits

(a) Financial transactions of Commission; access to books, accounts, etc.

Notwithstanding any other provision of law, and subject to subsection (c) of this section, financial transactions of the Commission shall be audited by the Comptroller General of the United States (hereinafter in this chapter referred to as the "Comptroller General"). In conducting any such audit, the appropriate representatives of the Comptroller General shall have access to all books, accounts, financial records, reports, files, and other papers, items, or property in use by the Commission and necessary to facilitate such audit, and such representatives shall be afforded full facilities for verifying transactions with the balances or securities held by depositories, fiscal agents, and custodians. Any such audit shall first be conducted with respect to the fiscal year in which this chapter becomes effective. An audit performed under this section is subject to the requirements of paragraphs (2), (3), and (5) of section 9105(a) of title 31.

(b) Annual report to Congress; contents

Subject to subsection (c) of this section, the Comptroller General shall, not later than six months after the end of each fiscal year, submit to the Congress a report of the audit conducted pursuant to subsection (a) of this section with respect to such fiscal year. Such report shall set forth the scope of the audit and shall include—

(1) a statement of assets and liabilities, capital, and surplus or deficit, based on the accounts of the Commission established pursuant to this part,

(2) a statement of income and expenses,

(3) a statement of sources and application of funds,

(4) a statement listing all direct and indirect costs incurred by the United States in implementing the Panama Canal Treaty of 1977, including the cost of property transferred to the Republic of Panama during each fiscal year, and

(5) such comments and information as the Comptroller General considers necessary to keep the Congress informed of the operations and financial transactions of the Commission, together with such recommendations with respect to such operations and transactions as the Comptroller General considers advisable.

The report shall identify specifically any program, expenditure, or other financial transaction or undertaking observed in the course of the audit which, in the opinion of the Comptroller General, has been carried out or made and has not been authorized by law. The Comptroller General shall submit a copy of each such report to the President, the Secretary of the Treasury, and the Commission.

(c) Independent auditors

At the discretion of the Board provided for in section 3612 of this title, the Commission may hire independent auditors to perform, in lieu of the Comptroller General, the audit and reporting functions prescribed in subsections (a) and (b) of this section.

(d) Examination and report on Commission's financial forecast

In addition to auditing the financial statements of the Commission, the Comptroller General (or the independent auditor if one is employed pursuant to subsection (c) of this section) shall, in accordance with standards for an examination of a financial forecast established by the American Institute of Certified Public Accountants, examine and report on the Commission's financial forecast that it will be in a position to meet its financial liabilities on December 31, 1999.

(Pub. L. 96–70, title I, §1313, Sept. 27, 1979, 93 Stat. 479; Pub. L. 104–106, div. C, title XXXV, §3526(a), Feb. 10, 1996, 110 Stat. 640; Pub. L. 104–201, div. C, title XXXV, §§3541(b), 3546(a)(9), (b), Sept. 23, 1996, 110 Stat. 2867, 2868; Pub. L. 105–261, div. C, title XXXV, §3512(a)(3), Oct. 17, 1998, 112 Stat. 2271.)

References in Text

This chapter, referred to in subsec. (a), was in the original "this Act", meaning Pub. L. 96–70, Sept. 27, 1979, 93 Stat. 452, known as the Panama Canal Act of 1979, which is classified principally to this chapter. For complete classification of this Act to the Code, see Short Title note set out under section 3601 of this title and Tables.

Amendments

1998—Subsecs. (a), (b), (d). Pub. L. 105–261 substituted "subsection (c)" for "subsection (d)".

1996—Pub. L. 104–106, §3526(a)(1), substituted "Audits" for "Audit by the Comptroller General of the United States" as section catchline.

Subsec. (a). Pub. L. 104–201, §3541(b), which directed substitution of "chapter 91 of title 31" for "the Accounting and Auditing Act of 1950 (31 U.S.C. 65 et seq.)", could not be executed because that phrase did not appear subsequent to amendment by Pub. L. 104–106, §3526(a)(2)(B). See below.

Pub. L. 104–106, §3526(a)(2), substituted "Notwithstanding any other provision of law, and subject to subsection (d) of this section, financial transactions" for "Financial transactions", struck out "pursuant to the Accounting and Auditing Act of 1950 (31 U.S.C. 65 et seq.)" after "as the 'Comptroller General')", substituted "conducting any such audit" for "conducting any audit pursuant to such Act" and "Any such audit shall first" for "An audit pursuant to such Act shall first", and inserted at end "An audit performed under this section is subject to the requirements of paragraphs (2), (3), and (5) of section 9105(a) of title 31."

Subsec. (b). Pub. L. 104–106, §3526(a)(3), substituted "Subject to subsection (d) of this section, the Comptroller General" for "The Comptroller General" in introductory provisions.

Subsec. (c). Pub. L. 104–201, §3546(b), redesignated subsec. (d) as (c).

Pub. L. 104–201, §3546(a)(9), struck out subsec. (c) which read as follows: "In conducting the audits and preparing the reports provided for in this section and in carrying out his other responsibilities pursuant to law, the Comptroller General shall, with respect to fiscal year 1980, take into account the problems inherent in converting the existing accounting system of the Panama Canal Company to conform to the requirements established in section 3721 of this title. Accordingly, the Comptroller General shall take no adverse action with respect to the Commission, nor shall any violation of sections 1341, 1342, and 1349–1351 and subchapter II of chapter 15 of title 31 be considered to have taken place, so long as the Commission is in substantial compliance with the requirements of this chapter. The Comptroller General shall make such recommendations to the Commission and to the Congress as he may consider appropriate to insure that full compliance with the financial controls provided for in chapter 91 of title 31 is achieved promptly."

Pub. L. 104–201, §3541(b), substituted "chapter 91 of title 31" for "the Accounting and Auditing Act of 1950 (31 U.S.C. 65 et seq.)".

Subsec. (d). Pub. L. 104–201, §3546(b), redesignated subsec. (e) as (d). Former subsec. (d) redesignated (c).

Pub. L. 104–106, §3526(a)(4), added subsec. (d).

Subsec. (e). Pub. L. 104–201, §3546(b), redesignated subsec. (e) as (d).

Pub. L. 104–106, §3526(a)(4), added subsec. (e).