FAC Explorer

Audit 10676

FY End
2023-10-31
Total Expended
$7.30M
Findings
2
Programs
1
Organization: Realife Cooperative of Coon Rapids (MN)
Year: 2023 Accepted: 2024-01-10
Auditor: Westberg Eischens Pllp

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
8102 2023-001 Significant Deficiency Yes P
584544 2023-001 Significant Deficiency Yes P

Programs

ALN Program Spent Major Findings
14.126 Mortgage Insurance_cooperative Projects $7.30M Yes 1

Contacts

Name Title Type
JF1PABLDC714 Dick Wenker Auditee
7634272739 Michael A Gramm Auditor
No contacts on file

Notes to SEFA

Accounting Policies: BASIS OF PRESENTATION: The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of Realife Cooperative of Coon Rapids, FHA Project No. 092-23206 and is presented on the accrual basis of accounting. The information in the Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). The Schedule presents only a selected portion of the operations of Realife Cooperative of Coon Rapids because it is not intended to and does not present the financial position, changes in net assets, or cash flows of Realife Cooperative of Coon Rapids. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Realife Cooperative of Coon Rapids has elected not to use the 10 percent de minimus indirect cost rate as allowed under the Uniform Guidance. U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT LOAN PROGRAM: Realife Cooperative of Coon Rapids has received a U.S. Department of Housing and Urban Development insured loan under Section 213 of the National Housing Act. The loan balance outstanding at the beginning of the year is included in the federal expenditures presented in the Schedule. Realife Cooperative of Coon Rapids received no additional loans during the year. The balance of the loan outstanding at October 31, 2023 consists of: $7,092,469 De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate.

Finding Details

Finding 2023-001
Finding 2023-001 Criteria: Generally, a system of internal control includes the ability to understand and prepare the Cooperative’s financial statements and related disclosures in accordance with accounting principles generally accepted in the United States of America (GAAP). Condition: Due to the limited size of the Cooperative’s business staff and related resources available, the Cooperative has utilized the auditor to post adjusting journal entries and prepare the financial statements and related disclosures in accordance with accounting principles generally accepted in the United States of America. Questioned Costs: None. Context: The Cooperative has informed us that the small size and qualifications of its business office staff precludes the Cooperative from posting adjusting journal entries and preparing its own financial statements. Effect: The Cooperative utilizes the auditor to prepare GAAP based financial statements. Cause: Limited number of staff and hours available preclude the Cooperative from preparing GAAP based financial statements. Repeat Finding: This finding was reported in the prior year as finding 2022-002. Recommendation: We recommend that the Cooperative continue to review the auditor prepared adjusting journal entries and financial statements with the intention of understanding and acceptance of responsibility for reporting under generally accepted accounting principles. Current Status: Unresolved, the number of staff and qualifications of staff have not changed. The Cooperative is continuing to review the auditor prepared adjusting journal entries and financial statements. Action Taken: The Cooperative will continue to review the auditor prepared adjusting journal entries and financial statements with the intention of understanding and acceptance of responsibility for reporting under generally accepted accounting principles. Views of Responsible Officials and Planned Corrective Actions: The Cooperative agrees with this finding and will adhere to the corrective action plan on page 26 in this audit report.
Finding 2023-001
Finding 2023-001 Criteria: Generally, a system of internal control includes the ability to understand and prepare the Cooperative’s financial statements and related disclosures in accordance with accounting principles generally accepted in the United States of America (GAAP). Condition: Due to the limited size of the Cooperative’s business staff and related resources available, the Cooperative has utilized the auditor to post adjusting journal entries and prepare the financial statements and related disclosures in accordance with accounting principles generally accepted in the United States of America. Questioned Costs: None. Context: The Cooperative has informed us that the small size and qualifications of its business office staff precludes the Cooperative from posting adjusting journal entries and preparing its own financial statements. Effect: The Cooperative utilizes the auditor to prepare GAAP based financial statements. Cause: Limited number of staff and hours available preclude the Cooperative from preparing GAAP based financial statements. Repeat Finding: This finding was reported in the prior year as finding 2022-002. Recommendation: We recommend that the Cooperative continue to review the auditor prepared adjusting journal entries and financial statements with the intention of understanding and acceptance of responsibility for reporting under generally accepted accounting principles. Current Status: Unresolved, the number of staff and qualifications of staff have not changed. The Cooperative is continuing to review the auditor prepared adjusting journal entries and financial statements. Action Taken: The Cooperative will continue to review the auditor prepared adjusting journal entries and financial statements with the intention of understanding and acceptance of responsibility for reporting under generally accepted accounting principles. Views of Responsible Officials and Planned Corrective Actions: The Cooperative agrees with this finding and will adhere to the corrective action plan on page 26 in this audit report.