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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. Click VALIC.com 67
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
7.8 Accounting performs daily
reconciliation of EFT annuity
disbursement totals processed
in SAP to the transmission file
received from the bank. Any
discrepancies are investigated
and resolved.
Inspected a sample of SAP ledgers
and transmission files received from
BoNY to determine whether they
were reconciled by a member of the
Accounting Department and that any
discrepancies were followed up and
resolved.
Exception Noted.
The daily manual EFT reconciliation
was not performed for the period
11/21/2015 - 7/24/2016.
Refer to Section V for
management's response.
7.9 Death claim disbursements are
approved based on limits defined
in business policies. Evidence of
approval is retained.
Test performed by the FCU team:
Inspected a sample of death claim
disbursements to determine whether
appropriate approval was obtained
per business policy and documented
in AWD.
No exceptions noted.
7.10 All surrenders and withdrawals
are approved based on limits
defined in business policies.
Evidence of approval is retained.
Test performed by the FCU team:
Inspected a sample of surrenders and
withdrawals greater than $200,000
to determine whether appropriate
approval was obtained per business
policy and documented in AWD.
No exceptions noted.
7.11 Monthly reconciliations are
performed and approved by
management to ensure the bank’s
EFT transactions are tracked and
recorded in the SAP ledger. Any
discrepancies are investigated
and resolved.
Inspected a sample of BoNY EFT
transactions and the SAP ledger
to determine whether they were
reconciled by a member of the
Accounting Department and that
any discrepancies were investigated
and resolved.
No exceptions noted.
IV. VALIC control objectives and controls, and PricewaterhouseCoopers LLP's tests of operating
effectiveness and results of tests