Deloitte &
Touche

2 Hopkins Plaza	Facsimile: (301) 837-0510
Baltimore, Maryland 21201-2983	ITT Telex: 4995614
Telephone: (301) 576-6700

Independent Auditors' Report

The Honorable Louis L. Goldstein
Comptroller of the Treasury of Maryland

We have audited the accompanying general purpose financial statements of the State of Maryland as of June 30,
1990, and for the year then ended, as listed in the table of contents. These general purpose financial statements
are the responsibility of the State of Maryland's management. Our responsibility is to express an opinion on these
general purpose financial statements based on our audit. We did not audit the financial statements of the loan
insurance programs and four loan programs of the Maryland Departments of Housing and Community
Development and Economic and Employment Development, Maryland Food Center Authority, Maryland State
Lottery Agency, Maryland Stadium Authority and Maryland Higher Education Loan Corporation, which
represent total assets, revenues and expenses constituting 53 percent, 83 percent and 88 percent, respectively, of
the related combined totals for Enterprise Funds. Those financial statements were audited by other auditors
whose reports thereon have been furnished to us, and our opinion, insofar as it relates to the amounts included for
the above mentioned component units, is based solely on the reports of other auditors.

We conducted our audit in accordance with generally accepted auditing standards. Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the general purpose financial
statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the general purpose financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well as evaluating the overall
general purpose financial statement presentation. We believe that our audit provides a reasonable basis for our
opinion.

In our opinion, based upon our audit and the reports of other auditors, the general purpose financial statements
referred to above present fairly, in all material respects, the financial position of the State of Maryland as of
June 30,1990, and the results of its operations and the cash flows of its Enterprise Funds for the year then ended
in conformity with generally accepted accounting principles.

As discussed more fully in Note 15 to the financial statements, the State of Maryland Deposit Insurance Fund
Corporation (MDIFC), an agency of the State, insured the insured accounts of six member savings and loan
associations that are in receivership. The financial statements of MDIFC are included in the combined Proprietary
Fund Type financial statements. At June 30,1990, the balance sheet of MDIFC reflects an accrual of $350,000,000
for estimated losses on insured savings deposits. In addition, MDIFC is a party to numerous lawsuits, the outcome
of which cannot presently be determined. As a result, the ultimate outcome of the savings and loan situation is
uncertain at this time.

Our audit was made for the purpose of forming an opinion on the general purpose financial statements taken as a
whole. The combining financial statements and schedules listed in the table of contents, which are also the
responsibility of the State of Maryland's management, are presented for purposes of additional analysis and to
meet legal reporting requirements and are not a required part of the general purpose financial statements of the
State of Maryland. Except for the Schedules of Estimated Revenues and General, Special, Federal, Current
Unrestricted and Current Restricted Fund Appropriations-Budgetary Basis for the year ending June 30, 1991
(pages 75 and 76), such information has been subjected to the auditing procedures applied in the audit of the
general purpose financial statements and, in our opinion, is fairly stated in all material respects when considered
in relation to the general purpose financial statements taken as a whole.

The other data included in this report have not been audited by us and, accordingly, we express no opinion on such
data.

November 20,1990

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