This report is intended for use by the management of the Variable Annuity Life Insurance Company ("VALIC") and its subsidiaries.
VALIC Retirement Services Company ("VRSCO") and VALIC Financial Advisors, Inc. ("VFA"), its user entities, and the independent
auditors of its user entities, and is not intended and should not be used by anyone other than these specified parties.
Back to TOCIV. VALIC control objectives and controls, and PricewaterhouseCoopers LLP's tests of operating
effectiveness and results of tests
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Purpose and objectives of the independent auditor’s examination
The control objectives and related control activities to achieve such objectives are specified by VALIC. The nature,
timing and extent of testing performed to determine whether the VALIC control activities were suitably designed and
operating to achieve the control objectives are determined by PricewaterhouseCoopers LLP. The control objectives,
control activities, description of the tests performed and test results are included in this section of the report.
Tests of the operating effectiveness of the VALIC controls included those considered necessary to evaluate
whether internal controls were in place and the extent of compliance with those controls. Tests provide
reasonable, but not absolute, assurance that the specified control objectives were achieved during the period
fromOctober 1, 2015 through September 30, 2016. In selecting particular tests of the operating effectiveness of
controls, the following were considered: (a) the nature of the items being tested; (b) the types and competence
of available evidential matter; (c) the nature of the control objectives to be achieved; (d) the assessed level of
control risk and (e) the expected efficiency and effectiveness of the test.
Tests performed on the operational effectiveness of controls are described below. Additionally, observation,
inspection, and independent query procedures were performed as it relates to system generated reports, queries,
and listings to assess the completeness and accuracy (reliability) of the information utilized in the performance of
our testing of the control activities.
References in the Control Objectives and Control Activities to Plan Administrator or Group can also be referred to
as the plan sponsor; client as participant.
Tests of operating effectiveness
This section presents the following information provided by VALIC:
(1) The control objectives specified by the management of VALIC.
(2) The controls established and specified by VALIC to achieve the specified control objectives.
Also, included in this section are the “Tests of Operating Effectiveness” and “Results of Tests” provided by the
service auditor, PricewaterhouseCoopers LLP.
Following are control objectives for which PricewaterhouseCoopers LLP used the work of the Financial
Controls Unit (FCU) team.
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Control Objective 3
— Controls provide reasonable assurance that remittances are credited to
participant accounts accurately, completely, and in accordance with instructions received from plan
sponsors or participants.
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Control Objective 4
— Controls provide reasonable assurance that loans are properly authorized and
processed accurately, completely, and in accordance with instructions received from plan sponsors or
participants and in compliance with plan provisions.
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Control Objective 6
— Controls provide reasonable assurance that benefit payments are properly
authorized and processed accurately, completely, and in accordance with instructions received from
plan sponsors or participants and in compliance with plan provisions.
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Control Objective 7
— Controls provide reasonable assurance that the processing of payments are
properly authorized and processed accurately.
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Control Objective 8
— Controls provide reasonable assurance that transaction confirmations,
participant account statements, and plan reports are accurate, complete, and are delivered to
participants without intervention.
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Control Objective 10
— Controls provide reasonable assurance that transactions and participant
account balances are valued, based on market prices obtained from authorized pricing sources.