AUDITOR’S REPORT
A. UNQUALIFIED OPINION ON FINANCIAL STATEMENTS 
In our opinion, the consolidated financial statements, including the accompanying notes, present fairly, in all material respects, in conformity with U.S. generally accepted accounting principles, the DOT assets, liabilities, and net position; net costs; changes in net position; budgetary resources; and reconciliation of net costs to budgetary obligations as of September 30, 2004, and September 30, 2003 and for the years then ended. 
Under contract with OIG and under our supervision, KPMG LLP audited the financial statements of FAA as of and for the years ended September 30, 2004, and September 30, 2003. KPMG rendered an unqualified opinion on the FAA financial statements. Also under contract with OIG and under our supervision, Clifton Gunderson LLP audited the financial statements of the Highway Trust Fund (HTF) as of and for the years ended September 30, 2004, and September 30, 2003. Clifton Gunderson rendered an unqualified opinion on the HTF financial statements. We performed a quality control review of the work performed by KPMG and Clifton Gunderson and relied on their results in performing our work on the FYs 2004 and 2003 DOT Consolidated Financial Statements. 
As discussed in Note 17, the accompanying financial statements reflect actual excise tax revenues deposited in the HTF and the Airport and Airways Trust Fund through March 31, 2004, and excise tax receipts estimated by the Department of the Treasury Office of Tax Analysis for the two quarters ended June 30, 2004, and September 30, 2004. 
As discussed in Note 17, DOT restated the FY 2003 Balance Sheet, Statement of Net Costs, Statement of Changes in Net Position, and Statement of Financing to properly report transactions with the Department of Agriculture related to MARAD’s administration of the Cargo Preference Program. As discussed in Note 18, DOT also restated the FY 2003 Statement of Budgetary Resources to properly report its FY 2003 budget authority and unobligated balances. We audited these adjustments and concluded that they were appropriate and properly applied.