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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.
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VALIC
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Control Objective 7
- Controls provide reasonable assurance that the processing of check and EFT payments are
properly authorized and processed accurately.
VALIC Control Activities
Tests of Operating Effectiveness
Results of Tests
7.4 Finance performs a daily
balancing of administrative
system general ledger entries
in SAP. Any unbalanced general
ledger entries are corrected.
Test performed by the FCU team:
Inspected a sample of SAP daily
and monthly balancing reports to
determine whether reports were
reviewed for out of balance entries,
and any out of balance entries
identified were resolved.
No exceptions noted.
7.5 Finance compares the record
keeping system balance totals to
the general ledger balances on a
monthly basis.
Inspected a sample of reconciliations
to determine whether monthly
reconciliations were performed by
Financial Reporting and any significant
variances were investigated and resolved.
Reperformed a sample of
reconciliations to determine whether
V-System balanced with SAP.
No exceptions noted.
No exceptions noted.
7.6 Automated manual checks have
appropriate approvals based on
appropriate business policies. The
requests are automatically sent
to SAP for processing subsequent
to the Transaction Account
Processing System (TAPS)
request from the requestor. The
request in the TAPS database
is noted as SAP Export with
respective batch number.
Test performed by the FCU team:
Inspected a sample of requests in the
TAPS database to determine whether
each request had a respective SAP
Export batch number.
Inspected a sample of automated on-
demand check requests to determine
whether checks had appropriate
approvals based on appropriate
business policies.
No exceptions noted.
No exceptions noted.
7.7 Non-automated on-demand
checks and wire transfer
requests are approved and
quality reviewed through TAPS
prior to issue.
Test performed by the FCU team:
Inspected a sample of manual check
requests to determine whether return
of premium was approved in the
Transaction Accounting Processing
System (TAPS) prior to payment and
in accordance with business policy.
Inspected a sample of the SAP
report of all return premium checks
over $500 to determine whether
management reviewed the report the
following business day in accordance
with business policy.
Inspected a sample of the report
monitoring returns of premiums
issued to OPT payees for amounts
over $200 to determine whether
management reviewed the following
business day in accordance with
business policy.
No exceptions noted.
No exceptions noted.
No exceptions noted.
IV. VALIC control objectives and controls, and PricewaterhouseCoopers LLP's tests of operating
effectiveness and results of tests