The FRBNY released its 2009 audited financial results today. The biggest bank of the Federal Reserve Board did not report anything unknown, and as for the things that should be reported, well those of course will never be known until there is something akin to a peasant revolt. Instead we paid particular attention to the language from the auditors (no, not E&Y this time), Deloitte, who signed off on the report. Some memorable phrases uncovered: "FRBNY's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the FRBNY; (2) provide reasonable assurance that transactions are recorded as necessary... and that receipts and expenditures of FRBNY are being made only in accordance with authorizations of management and directors of FRBNY; and 3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of FRBNY's assets that could have a material effect on the consolidated financial statements." And here is the boilerplate understatement of the millennium: "Because of inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may not be prevented or detected on a timely basis." Now we know when the lawsuits are flying in a year or two, just what line will be Deloitte's saving loophole phrase.