USPTO Performance and Accountability Report - U.S. Patent and ...

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INDEPENDENT AUDITORS’ REPORT
United States Patent and Trademark Office
Independent Auditors’ Report
November 7, 2012
Page 3 of 7
and are not a required part of the basic consolidated financial statements. Such information has not been
subjected to the auditing procedures applied in the audits of the basic consolidated financial statements, and
accordingly, we do not express an opinion or provide any assurance on them.
Internal Control Over Financial Reporting
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.
Our consideration of internal control over financial reporting was for the limited purpose described in the
Responsibilities section of this report and was not designed to identify all deficiencies in internal control
over financial reporting that might be deficiencies, significant deficiencies, or material weaknesses. In our
fiscal year 2012 audit, we did not identify any deficiencies in internal control over financial reporting that
we consider to be material weaknesses, as defined above. However, we identified certain deficiencies in
internal control over financial reporting described in Exhibit I that we consider to be a significant
deficiency in internal control over financial reporting. 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.
General information technology controls. We found that although the USPTO has taken partial
corrective actions to address certain information technology (IT) control weaknesses, general IT
weaknesses still exist. Despite the positive efforts made by the USPTO, the USPTO needs to make
continued improvement in its IT general control environment to fully ensure that financial data
processed on the USPTO’s systems is complete, reliable, and has integrity.
We noted certain additional matters that we have reported to management of USPTO in a separate letter
dated November 7, 2012.
Compliance and Other Matters
The results of certain of our tests of compliance as described in the Responsibilities section of this report
disclosed no instances of noncompliance or other matters that are required to be reported herein under
Government Auditing Standards or OMB Bulletin No. 07-04.
* * * * * * *
Responsibilities
Management’s Responsibilities. Management is responsible for the consolidated financial statements;
establishing and maintaining effective internal control over financial reporting; and complying with laws,
regulations, and contracts applicable to the USPTO.
Auditors’ Responsibilities. Our responsibility is to express an opinion on the fiscal year 2012 and 2011
consolidated financial statements of the USPTO based on our audits. We conducted our audits in
PERFORMANCE AND ACCOUNTABILITY REPORT: FISCAL YEAR 2012