Office of Inspector General

 Independent Auditor’s Report of the

 FMC’s FY 2021 Financial Statements

A22-03

 November 2021

 FEDERAL MARITIME COMMISSION
 FEDERAL MARITIME COMMISSION

Washington, DC 20573

November 15, 2021 

Office of Inspector General

Dear Chairman Maffei and Commissioners Dye, Khouri, Sola, and Bentzel: 

I am pleased to provide the attached audit report required by the Accountability for Tax 

Dollars Act of 2002 (ATDA), which presents an unmodified (clean) opinion on the Federal 

Maritime Commission’s (FMC) fiscal year (FY) 2021 and 2020 financial statements. The audit 

results indicate that the FMC has established an internal control structure that facilitates the 

preparation of reliable financial and performance information. The Office of Inspector General 

(OIG) commends the FMC for the noteworthy accomplishment of attaining an unmodified 

opinion. 

The OIG contracted with the independent certified public accounting firm Dembo Jones, 

P.C. to: perform the audit of the FMC’s financial statements for the fiscal years ending September 

30, 2021 and 2020; consider internal control over financial reporting; and test the agency’s 

compliance with certain provisions of applicable laws, regulations, and contracts that could have 

a direct and material effect on the financial statements. The OIG contract required that the audit 

be performed in accordance with U.S. Generally Accepted Government Auditing Standards and 

Office of Management and Budget (OMB) audit guidance. 

In its audit of the FMC, Dembo Jones found: the financial statements were fairly 

presented, in all material respects, in conformity with U.S. Generally Accepted Accounting 

Principles; there were no material weaknesses or significant deficiencies in internal control 

over financial reporting; and no reportable noncompliance issues with the laws and regulations 

tested. 

In connection with the OIG’s contract, the OIG reviewed Dembo Jones’ report and related 

documentation and inquired of its representatives. Our review, as differentiated from an audit in 

accordance with U.S. Generally Accepted Government Auditing Standards, was not intended to 

enable the OIG to express, and we do not express, opinions on FMC's financial statements or 

internal control; or conclusions on compliance with laws and regulations. Dembo Jones is 

responsible for the attached auditors' report dated November 15, 2021 and the conclusions 

expressed in the report. However, our review disclosed no instances where Dembo Jones did not 

comply, in all material respects, with Generally Accepted Government Auditing Standards. 
The OIG would like to thank FMC staff; especially the Office of Budget and Finance, for 

their assistance in helping Dembo Jones and the OIG meet the audit objectives.

 

Respectfully submitted, 

/s/

Jon Hatfield

Inspector General

Attachment

cc: Office of the Managing Director 

Office of the General Counsel

Office of Budget and Finance 
 6116 Executive Blvd • Suite 500 Dembo Jones, P.C. 8850 Stanford Blvd • Suite 2000

North Bethesda, MD 20852 A Member of Allinial Global Columbia, MD 21045

P 301.770.5100 • F 301.770.5202 www.dembojones.com P 410.290.0770 • F 410.290.0774

Independent Auditor’s Report

To Chairman Daniel B. Maffei

Federal Maritime Commission

In our audits of the fiscal years 2021 and 2020 financial statements of Federal Maritime 

Commission (FMC) we found: 

a) FMC’s financial statements as of and for the fiscal years ended September 30, 2021 and 

2020, are presented fairly, in all material respects, in accordance with U.S. generally 

accepted accounting principles;

b) no material weaknesses in internal control over financial reporting based on the limited 

procedures we performed; and 

c) no reportable noncompliance for fiscal year 2021 with provisions of applicable laws, 

regulations and contracts we tested. 

The following sections discuss in more detail (1) our report on the financial statements, which 

includes required supplementary information (RSI), such as “Management’s Discussion and 

Analysis”; (2) our report on internal control over financial reporting; (3) our report on compliance 

with laws, regulations and contracts; and (4) agency comments. 

Report on the Financial Statements 

In accordance with Generally Accepted Government Auditing Standards (GAGAS) and Office of 

Management and Budget (OMB) Bulletin No. 21-04, Audit Requirements for Federal Financial 

Statements, we have audited FMC’s financial statements. FMC’s financial statements comprise 

the balance sheets as of September 30, 2021, and 2020; the related statements of net cost, changes 

in net position, budgetary resources and custodial activity for the fiscal years then ended; and the 

related notes to the financial statements. 

We conducted our audits in accordance with U.S. generally accepted government auditing 

standards. We believe that the audit evidence we obtained is sufficient and appropriate to provide 

a basis for our audit opinions. 
Dembo Jones, P.C. 

Management’s Responsibility for the Financial Statements

FMC’s management is responsible for (1) the preparation and fair presentation of these financial 

statements in accordance with U.S. generally accepted accounting principles; (2) preparing, 

measuring, and presenting the RSI in accordance with U.S. generally accepted accounting 

principles; (3) preparing and presenting other information included in documents containing the 

audited financial statements and auditor’s report, and ensuring the consistency of that information 

with the audited financial statements and the RSI; and (4) maintaining effective internal control 

over financial reporting, including the design, implementation, and maintenance of internal control 

relevant to the preparation and fair presentation of financial statements that are free from material 

misstatement, whether due to fraud or error. 

Auditor’s Responsibility 

Our responsibility is to express an opinion on these financial statements based on our audits. U.S. 

generally accepted government auditing standards require that we plan and perform the audit to 

obtain reasonable assurance about whether the financial statements are free from material 

misstatement. We are also responsible for applying certain limited procedures to RSI and other 

information included with the financial statements. 

An audit of financial statements involves performing procedures to obtain audit evidence about 

the amounts and disclosures in the financial statements. The procedures selected depend on the 

auditor’s judgment, including the auditor’s assessment of the risks of material misstatement of the 

financial statements, whether due to fraud or error. In making those risk assessments, the auditor 

considers internal control relevant to the entity’s preparation and fair presentation of the financial 

statements in order to design audit procedures that are appropriate in the circumstances, but not 

for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. 

Accordingly, we express no such opinion. An audit of financial statements also involves evaluating 

the appropriateness of the accounting policies used and the reasonableness of significant 

accounting estimates made by management, as well as evaluating the overall presentation of the 

financial statements. Our audits also included performing such other procedures as we considered 

necessary in the circumstances. 

Opinion on Financial Statements 

In our opinion, FMC’s financial statements present fairly, in all material respects, FMC’s financial 

position as of September 30, 2021 and 2020, and its net costs of operations, changes in net position, 

budgetary resources and custodial activity for the fiscal years then ended in accordance with U.S. 

generally accepted accounting principles. 

Other Matters

Required Supplementary Information 

U.S. generally accepted accounting principles issued by the Federal Accounting Standards 

Advisory Board (FASAB) require that the RSI be presented to supplement the financial 

statements. Although the RSI is not a part of the financial statements, FASAB considers 

this information to be an essential part of financial reporting for placing the financial 

statements in appropriate operational, economic, or historical context. We have applied 

certain limited procedures to the RSI in accordance with U.S. generally accepted 
Dembo Jones, P.C. 

government auditing standards, which consisted of inquiries of management about the 

methods of preparing the RSI and comparing the information for consistency with 

management’s responses to the auditor’s inquiries, the financial statements, and other 

knowledge we obtained during the audit of the financial statements, in order to report 

omissions or material departures from FASAB guidelines, if any, identified by these 

limited procedures. We did not audit and we do not express an opinion or provide any 

assurance on the RSI because the limited procedures we applied do not provide sufficient 

evidence to express an opinion or provide any assurance. 

Other Information 

FMC’s other information contains a wide range of information, some of which is not 

directly related to the financial statements. This information is presented for purposes of 

additional analysis and is not a required part of the financial statements or the RSI. We read 

the other information included with the financial statements in order to identify material 

inconsistencies, if any, with the audited financial statements. Our audit was conducted for 

the purpose of forming an opinion on FMC’s financial statements. We did not audit and do 

not express an opinion or provide any assurance on the other information.

Report on Internal Control over Financial Reporting 

In connection with our audits of the FMC’s financial statements, we considered the FMC’s internal 

control over financial reporting, consistent with our auditor’s responsibility discussed below. We 

performed our procedures related to the FMC’s internal control over financial reporting in 

accordance with U.S. generally accepted government auditing standards. 

Management’s Responsibility 

FMC management is responsible for maintaining effective internal control over financial 

reporting, including the design, implementation, and maintenance of internal control relevant to 

the preparation and fair presentation of financial statements that are free from material 

misstatement, whether due to fraud or error. 

Auditor’s Responsibility 

In planning and performing our audit of FMC’s financial statements as of and for the year ended 

September 30, 2021, in accordance with U.S. generally accepted government auditing standards, 

we considered the FMC’s internal control over financial reporting as a basis for designing 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 

the FMC’s internal control over financial reporting. Accordingly, we do not express an opinion on 

the FMC’s internal control over financial reporting. We are required to report all deficiencies that 

are considered significant deficiencies or material weaknesses. We did not consider all internal 

controls relevant to operating objectives, such as those controls relevant to preparing performance 

information and ensuring efficient operations. 
Dembo Jones, P.C. 

Definition and Inherent Limitations of Internal Control over Financial Reporting 

An entity’s internal control over financial reporting is a process effected by those charged with 

governance, management, and other personnel, the objectives of which are to provide reasonable 

assurance that (1) transactions are properly recorded, processed, and summarized to permit the 

preparation of financial statements in accordance with U.S. generally accepted accounting 

principles, and assets are safeguarded against loss from unauthorized acquisition, use, or 

disposition, and (2) transactions are executed in accordance with provisions of applicable laws, 

including those governing the use of budget authority, regulations and contracts, noncompliance 

with which could have a material effect on the financial statements. 

Because of its inherent limitations, internal control over financial reporting may not prevent, or 

detect and correct, misstatements due to fraud or error. 

Results of Our Consideration of Internal Control over Financial Reporting 

Our consideration of internal control was for the limited purpose described above, and was not 

designed to identify all deficiencies in internal control that might be material weaknesses and 

significant deficiencies or to express an opinion on the effectiveness of the FMC’s internal control 

over financial reporting. Given these limitations, during our audit, we did not identify any 

deficiencies in internal control over financial reporting that we consider to be material weaknesses. 

However, material weaknesses may exist that have not been identified. 

Intended Purpose of Report on Internal Control over Financial Reporting 

The purpose of this report is solely to describe the scope of our consideration of the FMC’s internal 

control over financial reporting and the results of our procedures, and not to provide an opinion on 

the effectiveness of the FMC’s internal control over financial reporting. This report is an integral 

part of an audit performed in accordance with U.S. generally accepted government auditing 

standards in considering internal control over financial reporting. Accordingly, this report on 

internal control over financial reporting is not suitable for any other purpose. 

Report on Compliance with Laws, Regulations and Contracts

In connection with our audits of FMC’s financial statements, we tested compliance with selected 

provisions of applicable laws, regulations and contracts, consistent with our auditor’s 

responsibility discussed below. We caution that noncompliance may occur and not be detected by 

these tests. We performed our tests of compliance in accordance with U.S. generally accepted 

government auditing standards. 
Dembo Jones, P.C. 

Management’s Responsibility 

FMC management is responsible for complying with laws, regulations and contracts applicable to 

FMC. 

Auditor’s Responsibility 

Our responsibility is to test compliance with selected provisions of applicable laws, regulations 

and contracts applicable to FMC that have a direct effect on the determination of material amounts 

and disclosures in FMC’s financial statements, and perform certain other limited procedures. 

Accordingly, we did not test compliance with all laws, regulations and contracts applicable to 

FMC. 

Results of Our Tests for Compliance with Laws, Regulations and Contracts 

Our tests for compliance with selected provisions of applicable laws, regulations and contracts 

disclosed no instances of noncompliance for fiscal year 2021 that would be reportable under U.S. 

generally accepted government auditing standards. However, the objective of our tests was not to 

provide an opinion on compliance with laws, regulations and contracts applicable to FMC. 

Accordingly, we do not express such an opinion. 

Intended Purpose of Report on Compliance with Laws, Regulations and Contracts 

The purpose of this report is solely to describe the scope of our testing of compliance with selected 

provisions of applicable laws, regulations and contracts, and the results of that testing, and not to 

provide an opinion on compliance. This report is an integral part of an audit performed in 

accordance with U.S. generally accepted government auditing standards in considering 

compliance. Accordingly, this report on compliance with laws, regulations and contracts is not 

suitable for any other purpose.

Rockville, Maryland

November 15, 2021