Finding 2022-001: Material Weakness - Financial Reporting Criteria: Management is responsible for controls over the year-end financial reporting process, including controls over procedures used to enter transaction totals in the general ledger, initiate, authorize, record and process journal entries into the general ledger, and record recurring and nonrecurring adjustments to the consolidated financial statements. Condition: There is a lack of controls over the year-end financial reporting process. During the course of the audit, material adjustments were made to the year-end financial statements and disclosures to ensure they met generally accepted accounting principles (GAAP) reporting requirements. It is important that management and the outsourced accounting team understand transactions recorded in the general ledger, necessity for the timely reconciliation of accounts, review journal entries to ensure there is proper documentation to support the transaction and ensure that transactions are recorded in the correct year. Cause: The Organization did not have a system of internal controls in place that would ensure all nonrecurring adjustments were properly recorded in the general ledger and that the financial statements and related notes to the financial statements contained all necessary disclosures. Effect: Material misstatements and errors in the financial statements were not identified by management. Recommendation: The Organization should make the necessary internal control changes to ensure all necessary adjustments are identified internally and recorded in the general ledger in a timely manner. In addition, transactions should be reviewed by someone other than the preparer. Management's Response: The Organization agrees with the recommendation and implement processes to carefully reconcile all data and properly record all regular and nonrecurring adjustments to the general ledger as part of the financial closing process.
Finding 2022-002: Significant Deficiency - Separation of Duties Criteria: The origination and completion of single transactions should not be under the control of the same individual. Each transaction should pass through two or more individuals with the result that the work of one is under the review of another. Condition: While the Organization has a control structure designed to optimize segregation of duties where possible, it was noted there lacks complete and appropriate segregation of duties within the accounting and financial reporting functions. It is important for those charged with governance to be aware of this condition and realize that the concentration of duties and responsibilities in a limited number of individuals is not desirable from a control point of view. Cause: The size of the Organization does not have an adequate control structure to properly separate the various accounting functions, including recording journal entries, reconciling accounts, and preparing financial statement reports. Effect: Errors in the accounting records could occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Recommendation: The Organization should continue to perform certain review procedures which help mitigate risk associated with the lack of separation of duties. We suggest that management review the current control structure and implement controls to ensure manual journal entries are reviewed and approved by an appropriate individual. Management's Response: The Organization agrees with the recommendation and will implement additional formal review processes for manual journal entries.
Finding 2022-001: Material Weakness - Financial Reporting Criteria: Management is responsible for controls over the year-end financial reporting process, including controls over procedures used to enter transaction totals in the general ledger, initiate, authorize, record and process journal entries into the general ledger, and record recurring and nonrecurring adjustments to the consolidated financial statements. Condition: There is a lack of controls over the year-end financial reporting process. During the course of the audit, material adjustments were made to the year-end financial statements and disclosures to ensure they met generally accepted accounting principles (GAAP) reporting requirements. It is important that management and the outsourced accounting team understand transactions recorded in the general ledger, necessity for the timely reconciliation of accounts, review journal entries to ensure there is proper documentation to support the transaction and ensure that transactions are recorded in the correct year. Cause: The Organization did not have a system of internal controls in place that would ensure all nonrecurring adjustments were properly recorded in the general ledger and that the financial statements and related notes to the financial statements contained all necessary disclosures. Effect: Material misstatements and errors in the financial statements were not identified by management. Recommendation: The Organization should make the necessary internal control changes to ensure all necessary adjustments are identified internally and recorded in the general ledger in a timely manner. In addition, transactions should be reviewed by someone other than the preparer. Management's Response: The Organization agrees with the recommendation and implement processes to carefully reconcile all data and properly record all regular and nonrecurring adjustments to the general ledger as part of the financial closing process.
Finding 2022-002: Significant Deficiency - Separation of Duties Criteria: The origination and completion of single transactions should not be under the control of the same individual. Each transaction should pass through two or more individuals with the result that the work of one is under the review of another. Condition: While the Organization has a control structure designed to optimize segregation of duties where possible, it was noted there lacks complete and appropriate segregation of duties within the accounting and financial reporting functions. It is important for those charged with governance to be aware of this condition and realize that the concentration of duties and responsibilities in a limited number of individuals is not desirable from a control point of view. Cause: The size of the Organization does not have an adequate control structure to properly separate the various accounting functions, including recording journal entries, reconciling accounts, and preparing financial statement reports. Effect: Errors in the accounting records could occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Recommendation: The Organization should continue to perform certain review procedures which help mitigate risk associated with the lack of separation of duties. We suggest that management review the current control structure and implement controls to ensure manual journal entries are reviewed and approved by an appropriate individual. Management's Response: The Organization agrees with the recommendation and will implement additional formal review processes for manual journal entries.
Finding 2022-001: Material Weakness - Financial Reporting Criteria: Management is responsible for controls over the year-end financial reporting process, including controls over procedures used to enter transaction totals in the general ledger, initiate, authorize, record and process journal entries into the general ledger, and record recurring and nonrecurring adjustments to the consolidated financial statements. Condition: There is a lack of controls over the year-end financial reporting process. During the course of the audit, material adjustments were made to the year-end financial statements and disclosures to ensure they met generally accepted accounting principles (GAAP) reporting requirements. It is important that management and the outsourced accounting team understand transactions recorded in the general ledger, necessity for the timely reconciliation of accounts, review journal entries to ensure there is proper documentation to support the transaction and ensure that transactions are recorded in the correct year. Cause: The Organization did not have a system of internal controls in place that would ensure all nonrecurring adjustments were properly recorded in the general ledger and that the financial statements and related notes to the financial statements contained all necessary disclosures. Effect: Material misstatements and errors in the financial statements were not identified by management. Recommendation: The Organization should make the necessary internal control changes to ensure all necessary adjustments are identified internally and recorded in the general ledger in a timely manner. In addition, transactions should be reviewed by someone other than the preparer. Management's Response: The Organization agrees with the recommendation and implement processes to carefully reconcile all data and properly record all regular and nonrecurring adjustments to the general ledger as part of the financial closing process.
Finding 2022-002: Significant Deficiency - Separation of Duties Criteria: The origination and completion of single transactions should not be under the control of the same individual. Each transaction should pass through two or more individuals with the result that the work of one is under the review of another. Condition: While the Organization has a control structure designed to optimize segregation of duties where possible, it was noted there lacks complete and appropriate segregation of duties within the accounting and financial reporting functions. It is important for those charged with governance to be aware of this condition and realize that the concentration of duties and responsibilities in a limited number of individuals is not desirable from a control point of view. Cause: The size of the Organization does not have an adequate control structure to properly separate the various accounting functions, including recording journal entries, reconciling accounts, and preparing financial statement reports. Effect: Errors in the accounting records could occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Recommendation: The Organization should continue to perform certain review procedures which help mitigate risk associated with the lack of separation of duties. We suggest that management review the current control structure and implement controls to ensure manual journal entries are reviewed and approved by an appropriate individual. Management's Response: The Organization agrees with the recommendation and will implement additional formal review processes for manual journal entries.
Finding 2022-001: Material Weakness - Financial Reporting Criteria: Management is responsible for controls over the year-end financial reporting process, including controls over procedures used to enter transaction totals in the general ledger, initiate, authorize, record and process journal entries into the general ledger, and record recurring and nonrecurring adjustments to the consolidated financial statements. Condition: There is a lack of controls over the year-end financial reporting process. During the course of the audit, material adjustments were made to the year-end financial statements and disclosures to ensure they met generally accepted accounting principles (GAAP) reporting requirements. It is important that management and the outsourced accounting team understand transactions recorded in the general ledger, necessity for the timely reconciliation of accounts, review journal entries to ensure there is proper documentation to support the transaction and ensure that transactions are recorded in the correct year. Cause: The Organization did not have a system of internal controls in place that would ensure all nonrecurring adjustments were properly recorded in the general ledger and that the financial statements and related notes to the financial statements contained all necessary disclosures. Effect: Material misstatements and errors in the financial statements were not identified by management. Recommendation: The Organization should make the necessary internal control changes to ensure all necessary adjustments are identified internally and recorded in the general ledger in a timely manner. In addition, transactions should be reviewed by someone other than the preparer. Management's Response: The Organization agrees with the recommendation and implement processes to carefully reconcile all data and properly record all regular and nonrecurring adjustments to the general ledger as part of the financial closing process.
Finding 2022-002: Significant Deficiency - Separation of Duties Criteria: The origination and completion of single transactions should not be under the control of the same individual. Each transaction should pass through two or more individuals with the result that the work of one is under the review of another. Condition: While the Organization has a control structure designed to optimize segregation of duties where possible, it was noted there lacks complete and appropriate segregation of duties within the accounting and financial reporting functions. It is important for those charged with governance to be aware of this condition and realize that the concentration of duties and responsibilities in a limited number of individuals is not desirable from a control point of view. Cause: The size of the Organization does not have an adequate control structure to properly separate the various accounting functions, including recording journal entries, reconciling accounts, and preparing financial statement reports. Effect: Errors in the accounting records could occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Recommendation: The Organization should continue to perform certain review procedures which help mitigate risk associated with the lack of separation of duties. We suggest that management review the current control structure and implement controls to ensure manual journal entries are reviewed and approved by an appropriate individual. Management's Response: The Organization agrees with the recommendation and will implement additional formal review processes for manual journal entries.
Finding 2022-001: Material Weakness - Financial Reporting Criteria: Management is responsible for controls over the year-end financial reporting process, including controls over procedures used to enter transaction totals in the general ledger, initiate, authorize, record and process journal entries into the general ledger, and record recurring and nonrecurring adjustments to the consolidated financial statements. Condition: There is a lack of controls over the year-end financial reporting process. During the course of the audit, material adjustments were made to the year-end financial statements and disclosures to ensure they met generally accepted accounting principles (GAAP) reporting requirements. It is important that management and the outsourced accounting team understand transactions recorded in the general ledger, necessity for the timely reconciliation of accounts, review journal entries to ensure there is proper documentation to support the transaction and ensure that transactions are recorded in the correct year. Cause: The Organization did not have a system of internal controls in place that would ensure all nonrecurring adjustments were properly recorded in the general ledger and that the financial statements and related notes to the financial statements contained all necessary disclosures. Effect: Material misstatements and errors in the financial statements were not identified by management. Recommendation: The Organization should make the necessary internal control changes to ensure all necessary adjustments are identified internally and recorded in the general ledger in a timely manner. In addition, transactions should be reviewed by someone other than the preparer. Management's Response: The Organization agrees with the recommendation and implement processes to carefully reconcile all data and properly record all regular and nonrecurring adjustments to the general ledger as part of the financial closing process.
Finding 2022-002: Significant Deficiency - Separation of Duties Criteria: The origination and completion of single transactions should not be under the control of the same individual. Each transaction should pass through two or more individuals with the result that the work of one is under the review of another. Condition: While the Organization has a control structure designed to optimize segregation of duties where possible, it was noted there lacks complete and appropriate segregation of duties within the accounting and financial reporting functions. It is important for those charged with governance to be aware of this condition and realize that the concentration of duties and responsibilities in a limited number of individuals is not desirable from a control point of view. Cause: The size of the Organization does not have an adequate control structure to properly separate the various accounting functions, including recording journal entries, reconciling accounts, and preparing financial statement reports. Effect: Errors in the accounting records could occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Recommendation: The Organization should continue to perform certain review procedures which help mitigate risk associated with the lack of separation of duties. We suggest that management review the current control structure and implement controls to ensure manual journal entries are reviewed and approved by an appropriate individual. Management's Response: The Organization agrees with the recommendation and will implement additional formal review processes for manual journal entries.
Finding 2022-001: Material Weakness - Financial Reporting Criteria: Management is responsible for controls over the year-end financial reporting process, including controls over procedures used to enter transaction totals in the general ledger, initiate, authorize, record and process journal entries into the general ledger, and record recurring and nonrecurring adjustments to the consolidated financial statements. Condition: There is a lack of controls over the year-end financial reporting process. During the course of the audit, material adjustments were made to the year-end financial statements and disclosures to ensure they met generally accepted accounting principles (GAAP) reporting requirements. It is important that management and the outsourced accounting team understand transactions recorded in the general ledger, necessity for the timely reconciliation of accounts, review journal entries to ensure there is proper documentation to support the transaction and ensure that transactions are recorded in the correct year. Cause: The Organization did not have a system of internal controls in place that would ensure all nonrecurring adjustments were properly recorded in the general ledger and that the financial statements and related notes to the financial statements contained all necessary disclosures. Effect: Material misstatements and errors in the financial statements were not identified by management. Recommendation: The Organization should make the necessary internal control changes to ensure all necessary adjustments are identified internally and recorded in the general ledger in a timely manner. In addition, transactions should be reviewed by someone other than the preparer. Management's Response: The Organization agrees with the recommendation and implement processes to carefully reconcile all data and properly record all regular and nonrecurring adjustments to the general ledger as part of the financial closing process.
Finding 2022-002: Significant Deficiency - Separation of Duties Criteria: The origination and completion of single transactions should not be under the control of the same individual. Each transaction should pass through two or more individuals with the result that the work of one is under the review of another. Condition: While the Organization has a control structure designed to optimize segregation of duties where possible, it was noted there lacks complete and appropriate segregation of duties within the accounting and financial reporting functions. It is important for those charged with governance to be aware of this condition and realize that the concentration of duties and responsibilities in a limited number of individuals is not desirable from a control point of view. Cause: The size of the Organization does not have an adequate control structure to properly separate the various accounting functions, including recording journal entries, reconciling accounts, and preparing financial statement reports. Effect: Errors in the accounting records could occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Recommendation: The Organization should continue to perform certain review procedures which help mitigate risk associated with the lack of separation of duties. We suggest that management review the current control structure and implement controls to ensure manual journal entries are reviewed and approved by an appropriate individual. Management's Response: The Organization agrees with the recommendation and will implement additional formal review processes for manual journal entries.
Finding 2022-001: Material Weakness - Financial Reporting Criteria: Management is responsible for controls over the year-end financial reporting process, including controls over procedures used to enter transaction totals in the general ledger, initiate, authorize, record and process journal entries into the general ledger, and record recurring and nonrecurring adjustments to the consolidated financial statements. Condition: There is a lack of controls over the year-end financial reporting process. During the course of the audit, material adjustments were made to the year-end financial statements and disclosures to ensure they met generally accepted accounting principles (GAAP) reporting requirements. It is important that management and the outsourced accounting team understand transactions recorded in the general ledger, necessity for the timely reconciliation of accounts, review journal entries to ensure there is proper documentation to support the transaction and ensure that transactions are recorded in the correct year. Cause: The Organization did not have a system of internal controls in place that would ensure all nonrecurring adjustments were properly recorded in the general ledger and that the financial statements and related notes to the financial statements contained all necessary disclosures. Effect: Material misstatements and errors in the financial statements were not identified by management. Recommendation: The Organization should make the necessary internal control changes to ensure all necessary adjustments are identified internally and recorded in the general ledger in a timely manner. In addition, transactions should be reviewed by someone other than the preparer. Management's Response: The Organization agrees with the recommendation and implement processes to carefully reconcile all data and properly record all regular and nonrecurring adjustments to the general ledger as part of the financial closing process.
Finding 2022-002: Significant Deficiency - Separation of Duties Criteria: The origination and completion of single transactions should not be under the control of the same individual. Each transaction should pass through two or more individuals with the result that the work of one is under the review of another. Condition: While the Organization has a control structure designed to optimize segregation of duties where possible, it was noted there lacks complete and appropriate segregation of duties within the accounting and financial reporting functions. It is important for those charged with governance to be aware of this condition and realize that the concentration of duties and responsibilities in a limited number of individuals is not desirable from a control point of view. Cause: The size of the Organization does not have an adequate control structure to properly separate the various accounting functions, including recording journal entries, reconciling accounts, and preparing financial statement reports. Effect: Errors in the accounting records could occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Recommendation: The Organization should continue to perform certain review procedures which help mitigate risk associated with the lack of separation of duties. We suggest that management review the current control structure and implement controls to ensure manual journal entries are reviewed and approved by an appropriate individual. Management's Response: The Organization agrees with the recommendation and will implement additional formal review processes for manual journal entries.
Finding 2022-001: Material Weakness - Financial Reporting Criteria: Management is responsible for controls over the year-end financial reporting process, including controls over procedures used to enter transaction totals in the general ledger, initiate, authorize, record and process journal entries into the general ledger, and record recurring and nonrecurring adjustments to the consolidated financial statements. Condition: There is a lack of controls over the year-end financial reporting process. During the course of the audit, material adjustments were made to the year-end financial statements and disclosures to ensure they met generally accepted accounting principles (GAAP) reporting requirements. It is important that management and the outsourced accounting team understand transactions recorded in the general ledger, necessity for the timely reconciliation of accounts, review journal entries to ensure there is proper documentation to support the transaction and ensure that transactions are recorded in the correct year. Cause: The Organization did not have a system of internal controls in place that would ensure all nonrecurring adjustments were properly recorded in the general ledger and that the financial statements and related notes to the financial statements contained all necessary disclosures. Effect: Material misstatements and errors in the financial statements were not identified by management. Recommendation: The Organization should make the necessary internal control changes to ensure all necessary adjustments are identified internally and recorded in the general ledger in a timely manner. In addition, transactions should be reviewed by someone other than the preparer. Management's Response: The Organization agrees with the recommendation and implement processes to carefully reconcile all data and properly record all regular and nonrecurring adjustments to the general ledger as part of the financial closing process.
Finding 2022-002: Significant Deficiency - Separation of Duties Criteria: The origination and completion of single transactions should not be under the control of the same individual. Each transaction should pass through two or more individuals with the result that the work of one is under the review of another. Condition: While the Organization has a control structure designed to optimize segregation of duties where possible, it was noted there lacks complete and appropriate segregation of duties within the accounting and financial reporting functions. It is important for those charged with governance to be aware of this condition and realize that the concentration of duties and responsibilities in a limited number of individuals is not desirable from a control point of view. Cause: The size of the Organization does not have an adequate control structure to properly separate the various accounting functions, including recording journal entries, reconciling accounts, and preparing financial statement reports. Effect: Errors in the accounting records could occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Recommendation: The Organization should continue to perform certain review procedures which help mitigate risk associated with the lack of separation of duties. We suggest that management review the current control structure and implement controls to ensure manual journal entries are reviewed and approved by an appropriate individual. Management's Response: The Organization agrees with the recommendation and will implement additional formal review processes for manual journal entries.
Finding 2022-001: Material Weakness - Financial Reporting Criteria: Management is responsible for controls over the year-end financial reporting process, including controls over procedures used to enter transaction totals in the general ledger, initiate, authorize, record and process journal entries into the general ledger, and record recurring and nonrecurring adjustments to the consolidated financial statements. Condition: There is a lack of controls over the year-end financial reporting process. During the course of the audit, material adjustments were made to the year-end financial statements and disclosures to ensure they met generally accepted accounting principles (GAAP) reporting requirements. It is important that management and the outsourced accounting team understand transactions recorded in the general ledger, necessity for the timely reconciliation of accounts, review journal entries to ensure there is proper documentation to support the transaction and ensure that transactions are recorded in the correct year. Cause: The Organization did not have a system of internal controls in place that would ensure all nonrecurring adjustments were properly recorded in the general ledger and that the financial statements and related notes to the financial statements contained all necessary disclosures. Effect: Material misstatements and errors in the financial statements were not identified by management. Recommendation: The Organization should make the necessary internal control changes to ensure all necessary adjustments are identified internally and recorded in the general ledger in a timely manner. In addition, transactions should be reviewed by someone other than the preparer. Management's Response: The Organization agrees with the recommendation and implement processes to carefully reconcile all data and properly record all regular and nonrecurring adjustments to the general ledger as part of the financial closing process.
Finding 2022-002: Significant Deficiency - Separation of Duties Criteria: The origination and completion of single transactions should not be under the control of the same individual. Each transaction should pass through two or more individuals with the result that the work of one is under the review of another. Condition: While the Organization has a control structure designed to optimize segregation of duties where possible, it was noted there lacks complete and appropriate segregation of duties within the accounting and financial reporting functions. It is important for those charged with governance to be aware of this condition and realize that the concentration of duties and responsibilities in a limited number of individuals is not desirable from a control point of view. Cause: The size of the Organization does not have an adequate control structure to properly separate the various accounting functions, including recording journal entries, reconciling accounts, and preparing financial statement reports. Effect: Errors in the accounting records could occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Recommendation: The Organization should continue to perform certain review procedures which help mitigate risk associated with the lack of separation of duties. We suggest that management review the current control structure and implement controls to ensure manual journal entries are reviewed and approved by an appropriate individual. Management's Response: The Organization agrees with the recommendation and will implement additional formal review processes for manual journal entries.
Finding 2022-001: Material Weakness - Financial Reporting Criteria: Management is responsible for controls over the year-end financial reporting process, including controls over procedures used to enter transaction totals in the general ledger, initiate, authorize, record and process journal entries into the general ledger, and record recurring and nonrecurring adjustments to the consolidated financial statements. Condition: There is a lack of controls over the year-end financial reporting process. During the course of the audit, material adjustments were made to the year-end financial statements and disclosures to ensure they met generally accepted accounting principles (GAAP) reporting requirements. It is important that management and the outsourced accounting team understand transactions recorded in the general ledger, necessity for the timely reconciliation of accounts, review journal entries to ensure there is proper documentation to support the transaction and ensure that transactions are recorded in the correct year. Cause: The Organization did not have a system of internal controls in place that would ensure all nonrecurring adjustments were properly recorded in the general ledger and that the financial statements and related notes to the financial statements contained all necessary disclosures. Effect: Material misstatements and errors in the financial statements were not identified by management. Recommendation: The Organization should make the necessary internal control changes to ensure all necessary adjustments are identified internally and recorded in the general ledger in a timely manner. In addition, transactions should be reviewed by someone other than the preparer. Management's Response: The Organization agrees with the recommendation and implement processes to carefully reconcile all data and properly record all regular and nonrecurring adjustments to the general ledger as part of the financial closing process.
Finding 2022-002: Significant Deficiency - Separation of Duties Criteria: The origination and completion of single transactions should not be under the control of the same individual. Each transaction should pass through two or more individuals with the result that the work of one is under the review of another. Condition: While the Organization has a control structure designed to optimize segregation of duties where possible, it was noted there lacks complete and appropriate segregation of duties within the accounting and financial reporting functions. It is important for those charged with governance to be aware of this condition and realize that the concentration of duties and responsibilities in a limited number of individuals is not desirable from a control point of view. Cause: The size of the Organization does not have an adequate control structure to properly separate the various accounting functions, including recording journal entries, reconciling accounts, and preparing financial statement reports. Effect: Errors in the accounting records could occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Recommendation: The Organization should continue to perform certain review procedures which help mitigate risk associated with the lack of separation of duties. We suggest that management review the current control structure and implement controls to ensure manual journal entries are reviewed and approved by an appropriate individual. Management's Response: The Organization agrees with the recommendation and will implement additional formal review processes for manual journal entries.
Finding 2022-001: Material Weakness - Financial Reporting Criteria: Management is responsible for controls over the year-end financial reporting process, including controls over procedures used to enter transaction totals in the general ledger, initiate, authorize, record and process journal entries into the general ledger, and record recurring and nonrecurring adjustments to the consolidated financial statements. Condition: There is a lack of controls over the year-end financial reporting process. During the course of the audit, material adjustments were made to the year-end financial statements and disclosures to ensure they met generally accepted accounting principles (GAAP) reporting requirements. It is important that management and the outsourced accounting team understand transactions recorded in the general ledger, necessity for the timely reconciliation of accounts, review journal entries to ensure there is proper documentation to support the transaction and ensure that transactions are recorded in the correct year. Cause: The Organization did not have a system of internal controls in place that would ensure all nonrecurring adjustments were properly recorded in the general ledger and that the financial statements and related notes to the financial statements contained all necessary disclosures. Effect: Material misstatements and errors in the financial statements were not identified by management. Recommendation: The Organization should make the necessary internal control changes to ensure all necessary adjustments are identified internally and recorded in the general ledger in a timely manner. In addition, transactions should be reviewed by someone other than the preparer. Management's Response: The Organization agrees with the recommendation and implement processes to carefully reconcile all data and properly record all regular and nonrecurring adjustments to the general ledger as part of the financial closing process.
Finding 2022-002: Significant Deficiency - Separation of Duties Criteria: The origination and completion of single transactions should not be under the control of the same individual. Each transaction should pass through two or more individuals with the result that the work of one is under the review of another. Condition: While the Organization has a control structure designed to optimize segregation of duties where possible, it was noted there lacks complete and appropriate segregation of duties within the accounting and financial reporting functions. It is important for those charged with governance to be aware of this condition and realize that the concentration of duties and responsibilities in a limited number of individuals is not desirable from a control point of view. Cause: The size of the Organization does not have an adequate control structure to properly separate the various accounting functions, including recording journal entries, reconciling accounts, and preparing financial statement reports. Effect: Errors in the accounting records could occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Recommendation: The Organization should continue to perform certain review procedures which help mitigate risk associated with the lack of separation of duties. We suggest that management review the current control structure and implement controls to ensure manual journal entries are reviewed and approved by an appropriate individual. Management's Response: The Organization agrees with the recommendation and will implement additional formal review processes for manual journal entries.
Finding 2022-001: Material Weakness - Financial Reporting Criteria: Management is responsible for controls over the year-end financial reporting process, including controls over procedures used to enter transaction totals in the general ledger, initiate, authorize, record and process journal entries into the general ledger, and record recurring and nonrecurring adjustments to the consolidated financial statements. Condition: There is a lack of controls over the year-end financial reporting process. During the course of the audit, material adjustments were made to the year-end financial statements and disclosures to ensure they met generally accepted accounting principles (GAAP) reporting requirements. It is important that management and the outsourced accounting team understand transactions recorded in the general ledger, necessity for the timely reconciliation of accounts, review journal entries to ensure there is proper documentation to support the transaction and ensure that transactions are recorded in the correct year. Cause: The Organization did not have a system of internal controls in place that would ensure all nonrecurring adjustments were properly recorded in the general ledger and that the financial statements and related notes to the financial statements contained all necessary disclosures. Effect: Material misstatements and errors in the financial statements were not identified by management. Recommendation: The Organization should make the necessary internal control changes to ensure all necessary adjustments are identified internally and recorded in the general ledger in a timely manner. In addition, transactions should be reviewed by someone other than the preparer. Management's Response: The Organization agrees with the recommendation and implement processes to carefully reconcile all data and properly record all regular and nonrecurring adjustments to the general ledger as part of the financial closing process.
Finding 2022-002: Significant Deficiency - Separation of Duties Criteria: The origination and completion of single transactions should not be under the control of the same individual. Each transaction should pass through two or more individuals with the result that the work of one is under the review of another. Condition: While the Organization has a control structure designed to optimize segregation of duties where possible, it was noted there lacks complete and appropriate segregation of duties within the accounting and financial reporting functions. It is important for those charged with governance to be aware of this condition and realize that the concentration of duties and responsibilities in a limited number of individuals is not desirable from a control point of view. Cause: The size of the Organization does not have an adequate control structure to properly separate the various accounting functions, including recording journal entries, reconciling accounts, and preparing financial statement reports. Effect: Errors in the accounting records could occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. Recommendation: The Organization should continue to perform certain review procedures which help mitigate risk associated with the lack of separation of duties. We suggest that management review the current control structure and implement controls to ensure manual journal entries are reviewed and approved by an appropriate individual. Management's Response: The Organization agrees with the recommendation and will implement additional formal review processes for manual journal entries.