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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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Asset Valuation
Control Objective 10
- Controls provide reasonable assurance that transactions and participant account balances
are valued based on market prices obtained from authorized pricing sources.
VALIC Control Activities
Tests of Operating Effectiveness
Results of Tests
10.1 VPA personnel validate asset
valuation by reconciling the
calculated change in reported
NAV to the actual reported
change in NAV and the
percentage change in unit value
from the net asset values of the
underlying investment vehicles to
help prevent or detect errors in
the unit value calculations.
Inspected a sample of the Unit
Value Change to NAV Change
Reasonableness Check Report
to determine whether they were
completed and reviewed by separate
members of the VPA group.
For any variances identified in
reconciliations, inspected evidence
to determine whether they were
researched and resolved.
No exceptions noted.
No exceptions noted.
10.2 VPA personnel validate asset
valuation for group mutual
funds by comparing the share
values received from the NSCC
to share values received by the
vendor VMS.
Inspected a sample of the Final NAV
Comparison Report to determine
whether the comparison was
completed and reviewed by VPA.
For any variances identified in
reconciliations, inspected evidence
to determine whether they were
researched and resolved.
No exceptions noted.
No exceptions noted.
10.3 The completion of daily
reconciliation for annuities is
recorded on the Unit Value
Report Review Checklist and on
the Unit Value Reasonableness
Test. The completion of the daily
reconciliation for group mutual
funds is recorded on the Share
Value Pricing Review Checklist.
The reconciliations are prepared
and reviewed by separate
individuals.
Inspected a sample of the Unit Value
Report Review Checklist and the
Share Value Pricing Review Checklist
to determine whether the daily
reconciliations were performed for
annuities and mutual funds.
Inspected the Unit Value Report
Review Checklist and the Share Value
Pricing Review Checklist to determine
whether they were reviewed and
approved by a separate member of the
VPA team.
No exceptions noted.
No exceptions noted.
10.4 Dividend payment schedules are
monitored to confirm recording of
distributions by fund managers.
Inspected a sample of the Dividend
Verification Reports to determine
whether it was prepared to ensure the
dividend rates from UVT agree to the
dividend rates from VMS.
No exceptions noted.
IV. VALIC control objectives and controls, and PricewaterhouseCoopers LLP's tests of operating
effectiveness and results of tests