Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: SAS 115 requires communication, in writing, to management and those charged with governance, of material weaknesses identified in an audit.
Condition and context: A material audit adjustment was proposed that was not identified by the Center’s internal control system.
Cause: Management did not identify an adjustment necessary to present the financial statements in accordance with U.S. GAAP. A material audit adjustment was proposed to correct an account balance.
Effect or Potential Effect: The control deficiency is a material weakness that results in a material misstatement of the financial statements that was not prevented, or detected and corrected, on a timely basis.
Identification of a Repeat Finding: New finding.
Recommendation: Management should review the financial statements to ensure all necessary adjustments are made and balances are reflected accurately.
Responsible Official’s Response: In order to gain some comfort on the detailed processes, the Director of CFP, with the support from the Executive Committee of the Board, has appointed a certified CPA to review the last 2 years of monthly financial statements to build a routine for the existing staff so they may continue to conduct these reviews.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: The segregation of duties and responsibilities between different individuals for custody of assets, recordkeeping for those assets, and reconciliation of those asset accounts is an important control activity needed to adequately protect the entity’s assets and ensure accurate financial reporting.
Condition and context: The Center does not have appropriate segregation of duties. Presently, the same individual has asset access, record-keeping, and reconciliation responsibilities.
Cause: The Center does not have enough available accounting staff to fully segregate incompatible duties in a cost-effective manner.
Effect or Potential Effect: The significant deficiency adversely affects the Center’s ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the Center’s financial statements that is more than inconsequential will not be prevented or detected by the Center’s internal control.
Identification of a Repeat Finding: New finding.
Recommendation: The Center’s management and Board of Directors must rely on its review and oversight authority to mitigate this inherent weakness in its internal control system.
Responsible Official’s Response: The Director of CFP, with support from the Executive Committee of the Board, has appointed a certified CPA to review all financial reconciliation statements and grant reports. The Director will continue and now document the periodic review of all financial statements, audits, and grant reports. The Executive Committee and Board of Directors will continue their monthly review of financial statements, audit, and tax returns and they will be accepted by the board. Additionally, we have reallocated the position of Grant Specialist to Accounting and Data Management Specialist to better distribute the duties and responsibilities of the Director of Finance.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: SAS 115 requires communication, in writing, to management and those charged with governance, of material weaknesses identified in an audit.
Condition and context: The Health Center does not have an internal control system designed to provide for the preparation of the financial statements being audited, including the schedule of expenditures of federal awards and note disclosures.
Cause: The Center’s accounting personnel do not have the expertise to prepare the financial statements, including note disclosures and the schedule of expenditures of federal awards in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP).
Effect or Potential Effect: The control deficiency is a material weakness that results in a reasonable possibility that a material misstatement of the financial statements will not be prevented, or detected and corrected on a timely basis.
Identification of a Repeat Finding: New finding.
Recommendation: The Center should continue to rely on the board for review of the financial statements, including note disclosures and the schedule of expenditures of federal awards. The Center may consider searching for a qualified volunteer to review the Center’s financial statements.
Responsible Official’s Response: The Director of CFP, with support from the Executive Committee of the Board, has appointed a certified CPA to create financial statement preparation procedures for the existing financial staff. The certified CPA will review the financial workpapers and statements monthly.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: SAS 115 requires communication, in writing, to management and those charged with governance, of material weaknesses identified in an audit.
Condition and context: A material audit adjustment was proposed that was not identified by the Center’s internal control system.
Cause: Management did not identify an adjustment necessary to present the financial statements in accordance with U.S. GAAP. A material audit adjustment was proposed to correct an account balance.
Effect or Potential Effect: The control deficiency is a material weakness that results in a material misstatement of the financial statements that was not prevented, or detected and corrected, on a timely basis.
Identification of a Repeat Finding: New finding.
Recommendation: Management should review the financial statements to ensure all necessary adjustments are made and balances are reflected accurately.
Responsible Official’s Response: In order to gain some comfort on the detailed processes, the Director of CFP, with the support from the Executive Committee of the Board, has appointed a certified CPA to review the last 2 years of monthly financial statements to build a routine for the existing staff so they may continue to conduct these reviews.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: The segregation of duties and responsibilities between different individuals for custody of assets, recordkeeping for those assets, and reconciliation of those asset accounts is an important control activity needed to adequately protect the entity’s assets and ensure accurate financial reporting.
Condition and context: The Center does not have appropriate segregation of duties. Presently, the same individual has asset access, record-keeping, and reconciliation responsibilities.
Cause: The Center does not have enough available accounting staff to fully segregate incompatible duties in a cost-effective manner.
Effect or Potential Effect: The significant deficiency adversely affects the Center’s ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the Center’s financial statements that is more than inconsequential will not be prevented or detected by the Center’s internal control.
Identification of a Repeat Finding: New finding.
Recommendation: The Center’s management and Board of Directors must rely on its review and oversight authority to mitigate this inherent weakness in its internal control system.
Responsible Official’s Response: The Director of CFP, with support from the Executive Committee of the Board, has appointed a certified CPA to review all financial reconciliation statements and grant reports. The Director will continue and now document the periodic review of all financial statements, audits, and grant reports. The Executive Committee and Board of Directors will continue their monthly review of financial statements, audit, and tax returns and they will be accepted by the board. Additionally, we have reallocated the position of Grant Specialist to Accounting and Data Management Specialist to better distribute the duties and responsibilities of the Director of Finance.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: SAS 115 requires communication, in writing, to management and those charged with governance, of material weaknesses identified in an audit.
Condition and context: The Health Center does not have an internal control system designed to provide for the preparation of the financial statements being audited, including the schedule of expenditures of federal awards and note disclosures.
Cause: The Center’s accounting personnel do not have the expertise to prepare the financial statements, including note disclosures and the schedule of expenditures of federal awards in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP).
Effect or Potential Effect: The control deficiency is a material weakness that results in a reasonable possibility that a material misstatement of the financial statements will not be prevented, or detected and corrected on a timely basis.
Identification of a Repeat Finding: New finding.
Recommendation: The Center should continue to rely on the board for review of the financial statements, including note disclosures and the schedule of expenditures of federal awards. The Center may consider searching for a qualified volunteer to review the Center’s financial statements.
Responsible Official’s Response: The Director of CFP, with support from the Executive Committee of the Board, has appointed a certified CPA to create financial statement preparation procedures for the existing financial staff. The certified CPA will review the financial workpapers and statements monthly.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: SAS 115 requires communication, in writing, to management and those charged with governance, of material weaknesses identified in an audit.
Condition and context: A material audit adjustment was proposed that was not identified by the Center’s internal control system.
Cause: Management did not identify an adjustment necessary to present the financial statements in accordance with U.S. GAAP. A material audit adjustment was proposed to correct an account balance.
Effect or Potential Effect: The control deficiency is a material weakness that results in a material misstatement of the financial statements that was not prevented, or detected and corrected, on a timely basis.
Identification of a Repeat Finding: New finding.
Recommendation: Management should review the financial statements to ensure all necessary adjustments are made and balances are reflected accurately.
Responsible Official’s Response: In order to gain some comfort on the detailed processes, the Director of CFP, with the support from the Executive Committee of the Board, has appointed a certified CPA to review the last 2 years of monthly financial statements to build a routine for the existing staff so they may continue to conduct these reviews.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: The segregation of duties and responsibilities between different individuals for custody of assets, recordkeeping for those assets, and reconciliation of those asset accounts is an important control activity needed to adequately protect the entity’s assets and ensure accurate financial reporting.
Condition and context: The Center does not have appropriate segregation of duties. Presently, the same individual has asset access, record-keeping, and reconciliation responsibilities.
Cause: The Center does not have enough available accounting staff to fully segregate incompatible duties in a cost-effective manner.
Effect or Potential Effect: The significant deficiency adversely affects the Center’s ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the Center’s financial statements that is more than inconsequential will not be prevented or detected by the Center’s internal control.
Identification of a Repeat Finding: New finding.
Recommendation: The Center’s management and Board of Directors must rely on its review and oversight authority to mitigate this inherent weakness in its internal control system.
Responsible Official’s Response: The Director of CFP, with support from the Executive Committee of the Board, has appointed a certified CPA to review all financial reconciliation statements and grant reports. The Director will continue and now document the periodic review of all financial statements, audits, and grant reports. The Executive Committee and Board of Directors will continue their monthly review of financial statements, audit, and tax returns and they will be accepted by the board. Additionally, we have reallocated the position of Grant Specialist to Accounting and Data Management Specialist to better distribute the duties and responsibilities of the Director of Finance.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: SAS 115 requires communication, in writing, to management and those charged with governance, of material weaknesses identified in an audit.
Condition and context: The Health Center does not have an internal control system designed to provide for the preparation of the financial statements being audited, including the schedule of expenditures of federal awards and note disclosures.
Cause: The Center’s accounting personnel do not have the expertise to prepare the financial statements, including note disclosures and the schedule of expenditures of federal awards in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP).
Effect or Potential Effect: The control deficiency is a material weakness that results in a reasonable possibility that a material misstatement of the financial statements will not be prevented, or detected and corrected on a timely basis.
Identification of a Repeat Finding: New finding.
Recommendation: The Center should continue to rely on the board for review of the financial statements, including note disclosures and the schedule of expenditures of federal awards. The Center may consider searching for a qualified volunteer to review the Center’s financial statements.
Responsible Official’s Response: The Director of CFP, with support from the Executive Committee of the Board, has appointed a certified CPA to create financial statement preparation procedures for the existing financial staff. The certified CPA will review the financial workpapers and statements monthly.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: SAS 115 requires communication, in writing, to management and those charged with governance, of material weaknesses identified in an audit.
Condition and context: A material audit adjustment was proposed that was not identified by the Center’s internal control system.
Cause: Management did not identify an adjustment necessary to present the financial statements in accordance with U.S. GAAP. A material audit adjustment was proposed to correct an account balance.
Effect or Potential Effect: The control deficiency is a material weakness that results in a material misstatement of the financial statements that was not prevented, or detected and corrected, on a timely basis.
Identification of a Repeat Finding: New finding.
Recommendation: Management should review the financial statements to ensure all necessary adjustments are made and balances are reflected accurately.
Responsible Official’s Response: In order to gain some comfort on the detailed processes, the Director of CFP, with the support from the Executive Committee of the Board, has appointed a certified CPA to review the last 2 years of monthly financial statements to build a routine for the existing staff so they may continue to conduct these reviews.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: The segregation of duties and responsibilities between different individuals for custody of assets, recordkeeping for those assets, and reconciliation of those asset accounts is an important control activity needed to adequately protect the entity’s assets and ensure accurate financial reporting.
Condition and context: The Center does not have appropriate segregation of duties. Presently, the same individual has asset access, record-keeping, and reconciliation responsibilities.
Cause: The Center does not have enough available accounting staff to fully segregate incompatible duties in a cost-effective manner.
Effect or Potential Effect: The significant deficiency adversely affects the Center’s ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the Center’s financial statements that is more than inconsequential will not be prevented or detected by the Center’s internal control.
Identification of a Repeat Finding: New finding.
Recommendation: The Center’s management and Board of Directors must rely on its review and oversight authority to mitigate this inherent weakness in its internal control system.
Responsible Official’s Response: The Director of CFP, with support from the Executive Committee of the Board, has appointed a certified CPA to review all financial reconciliation statements and grant reports. The Director will continue and now document the periodic review of all financial statements, audits, and grant reports. The Executive Committee and Board of Directors will continue their monthly review of financial statements, audit, and tax returns and they will be accepted by the board. Additionally, we have reallocated the position of Grant Specialist to Accounting and Data Management Specialist to better distribute the duties and responsibilities of the Director of Finance.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: SAS 115 requires communication, in writing, to management and those charged with governance, of material weaknesses identified in an audit.
Condition and context: The Health Center does not have an internal control system designed to provide for the preparation of the financial statements being audited, including the schedule of expenditures of federal awards and note disclosures.
Cause: The Center’s accounting personnel do not have the expertise to prepare the financial statements, including note disclosures and the schedule of expenditures of federal awards in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP).
Effect or Potential Effect: The control deficiency is a material weakness that results in a reasonable possibility that a material misstatement of the financial statements will not be prevented, or detected and corrected on a timely basis.
Identification of a Repeat Finding: New finding.
Recommendation: The Center should continue to rely on the board for review of the financial statements, including note disclosures and the schedule of expenditures of federal awards. The Center may consider searching for a qualified volunteer to review the Center’s financial statements.
Responsible Official’s Response: The Director of CFP, with support from the Executive Committee of the Board, has appointed a certified CPA to create financial statement preparation procedures for the existing financial staff. The certified CPA will review the financial workpapers and statements monthly.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: SAS 115 requires communication, in writing, to management and those charged with governance, of material weaknesses identified in an audit.
Condition and context: A material audit adjustment was proposed that was not identified by the Center’s internal control system.
Cause: Management did not identify an adjustment necessary to present the financial statements in accordance with U.S. GAAP. A material audit adjustment was proposed to correct an account balance.
Effect or Potential Effect: The control deficiency is a material weakness that results in a material misstatement of the financial statements that was not prevented, or detected and corrected, on a timely basis.
Identification of a Repeat Finding: New finding.
Recommendation: Management should review the financial statements to ensure all necessary adjustments are made and balances are reflected accurately.
Responsible Official’s Response: In order to gain some comfort on the detailed processes, the Director of CFP, with the support from the Executive Committee of the Board, has appointed a certified CPA to review the last 2 years of monthly financial statements to build a routine for the existing staff so they may continue to conduct these reviews.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: The segregation of duties and responsibilities between different individuals for custody of assets, recordkeeping for those assets, and reconciliation of those asset accounts is an important control activity needed to adequately protect the entity’s assets and ensure accurate financial reporting.
Condition and context: The Center does not have appropriate segregation of duties. Presently, the same individual has asset access, record-keeping, and reconciliation responsibilities.
Cause: The Center does not have enough available accounting staff to fully segregate incompatible duties in a cost-effective manner.
Effect or Potential Effect: The significant deficiency adversely affects the Center’s ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the Center’s financial statements that is more than inconsequential will not be prevented or detected by the Center’s internal control.
Identification of a Repeat Finding: New finding.
Recommendation: The Center’s management and Board of Directors must rely on its review and oversight authority to mitigate this inherent weakness in its internal control system.
Responsible Official’s Response: The Director of CFP, with support from the Executive Committee of the Board, has appointed a certified CPA to review all financial reconciliation statements and grant reports. The Director will continue and now document the periodic review of all financial statements, audits, and grant reports. The Executive Committee and Board of Directors will continue their monthly review of financial statements, audit, and tax returns and they will be accepted by the board. Additionally, we have reallocated the position of Grant Specialist to Accounting and Data Management Specialist to better distribute the duties and responsibilities of the Director of Finance.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: SAS 115 requires communication, in writing, to management and those charged with governance, of material weaknesses identified in an audit.
Condition and context: The Health Center does not have an internal control system designed to provide for the preparation of the financial statements being audited, including the schedule of expenditures of federal awards and note disclosures.
Cause: The Center’s accounting personnel do not have the expertise to prepare the financial statements, including note disclosures and the schedule of expenditures of federal awards in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP).
Effect or Potential Effect: The control deficiency is a material weakness that results in a reasonable possibility that a material misstatement of the financial statements will not be prevented, or detected and corrected on a timely basis.
Identification of a Repeat Finding: New finding.
Recommendation: The Center should continue to rely on the board for review of the financial statements, including note disclosures and the schedule of expenditures of federal awards. The Center may consider searching for a qualified volunteer to review the Center’s financial statements.
Responsible Official’s Response: The Director of CFP, with support from the Executive Committee of the Board, has appointed a certified CPA to create financial statement preparation procedures for the existing financial staff. The certified CPA will review the financial workpapers and statements monthly.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: SAS 115 requires communication, in writing, to management and those charged with governance, of material weaknesses identified in an audit.
Condition and context: A material audit adjustment was proposed that was not identified by the Center’s internal control system.
Cause: Management did not identify an adjustment necessary to present the financial statements in accordance with U.S. GAAP. A material audit adjustment was proposed to correct an account balance.
Effect or Potential Effect: The control deficiency is a material weakness that results in a material misstatement of the financial statements that was not prevented, or detected and corrected, on a timely basis.
Identification of a Repeat Finding: New finding.
Recommendation: Management should review the financial statements to ensure all necessary adjustments are made and balances are reflected accurately.
Responsible Official’s Response: In order to gain some comfort on the detailed processes, the Director of CFP, with the support from the Executive Committee of the Board, has appointed a certified CPA to review the last 2 years of monthly financial statements to build a routine for the existing staff so they may continue to conduct these reviews.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: The segregation of duties and responsibilities between different individuals for custody of assets, recordkeeping for those assets, and reconciliation of those asset accounts is an important control activity needed to adequately protect the entity’s assets and ensure accurate financial reporting.
Condition and context: The Center does not have appropriate segregation of duties. Presently, the same individual has asset access, record-keeping, and reconciliation responsibilities.
Cause: The Center does not have enough available accounting staff to fully segregate incompatible duties in a cost-effective manner.
Effect or Potential Effect: The significant deficiency adversely affects the Center’s ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the Center’s financial statements that is more than inconsequential will not be prevented or detected by the Center’s internal control.
Identification of a Repeat Finding: New finding.
Recommendation: The Center’s management and Board of Directors must rely on its review and oversight authority to mitigate this inherent weakness in its internal control system.
Responsible Official’s Response: The Director of CFP, with support from the Executive Committee of the Board, has appointed a certified CPA to review all financial reconciliation statements and grant reports. The Director will continue and now document the periodic review of all financial statements, audits, and grant reports. The Executive Committee and Board of Directors will continue their monthly review of financial statements, audit, and tax returns and they will be accepted by the board. Additionally, we have reallocated the position of Grant Specialist to Accounting and Data Management Specialist to better distribute the duties and responsibilities of the Director of Finance.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: SAS 115 requires communication, in writing, to management and those charged with governance, of material weaknesses identified in an audit.
Condition and context: The Health Center does not have an internal control system designed to provide for the preparation of the financial statements being audited, including the schedule of expenditures of federal awards and note disclosures.
Cause: The Center’s accounting personnel do not have the expertise to prepare the financial statements, including note disclosures and the schedule of expenditures of federal awards in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP).
Effect or Potential Effect: The control deficiency is a material weakness that results in a reasonable possibility that a material misstatement of the financial statements will not be prevented, or detected and corrected on a timely basis.
Identification of a Repeat Finding: New finding.
Recommendation: The Center should continue to rely on the board for review of the financial statements, including note disclosures and the schedule of expenditures of federal awards. The Center may consider searching for a qualified volunteer to review the Center’s financial statements.
Responsible Official’s Response: The Director of CFP, with support from the Executive Committee of the Board, has appointed a certified CPA to create financial statement preparation procedures for the existing financial staff. The certified CPA will review the financial workpapers and statements monthly.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: SAS 115 requires communication, in writing, to management and those charged with governance, of material weaknesses identified in an audit.
Condition and context: A material audit adjustment was proposed that was not identified by the Center’s internal control system.
Cause: Management did not identify an adjustment necessary to present the financial statements in accordance with U.S. GAAP. A material audit adjustment was proposed to correct an account balance.
Effect or Potential Effect: The control deficiency is a material weakness that results in a material misstatement of the financial statements that was not prevented, or detected and corrected, on a timely basis.
Identification of a Repeat Finding: New finding.
Recommendation: Management should review the financial statements to ensure all necessary adjustments are made and balances are reflected accurately.
Responsible Official’s Response: In order to gain some comfort on the detailed processes, the Director of CFP, with the support from the Executive Committee of the Board, has appointed a certified CPA to review the last 2 years of monthly financial statements to build a routine for the existing staff so they may continue to conduct these reviews.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: The segregation of duties and responsibilities between different individuals for custody of assets, recordkeeping for those assets, and reconciliation of those asset accounts is an important control activity needed to adequately protect the entity’s assets and ensure accurate financial reporting.
Condition and context: The Center does not have appropriate segregation of duties. Presently, the same individual has asset access, record-keeping, and reconciliation responsibilities.
Cause: The Center does not have enough available accounting staff to fully segregate incompatible duties in a cost-effective manner.
Effect or Potential Effect: The significant deficiency adversely affects the Center’s ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the Center’s financial statements that is more than inconsequential will not be prevented or detected by the Center’s internal control.
Identification of a Repeat Finding: New finding.
Recommendation: The Center’s management and Board of Directors must rely on its review and oversight authority to mitigate this inherent weakness in its internal control system.
Responsible Official’s Response: The Director of CFP, with support from the Executive Committee of the Board, has appointed a certified CPA to review all financial reconciliation statements and grant reports. The Director will continue and now document the periodic review of all financial statements, audits, and grant reports. The Executive Committee and Board of Directors will continue their monthly review of financial statements, audit, and tax returns and they will be accepted by the board. Additionally, we have reallocated the position of Grant Specialist to Accounting and Data Management Specialist to better distribute the duties and responsibilities of the Director of Finance.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: SAS 115 requires communication, in writing, to management and those charged with governance, of material weaknesses identified in an audit.
Condition and context: The Health Center does not have an internal control system designed to provide for the preparation of the financial statements being audited, including the schedule of expenditures of federal awards and note disclosures.
Cause: The Center’s accounting personnel do not have the expertise to prepare the financial statements, including note disclosures and the schedule of expenditures of federal awards in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP).
Effect or Potential Effect: The control deficiency is a material weakness that results in a reasonable possibility that a material misstatement of the financial statements will not be prevented, or detected and corrected on a timely basis.
Identification of a Repeat Finding: New finding.
Recommendation: The Center should continue to rely on the board for review of the financial statements, including note disclosures and the schedule of expenditures of federal awards. The Center may consider searching for a qualified volunteer to review the Center’s financial statements.
Responsible Official’s Response: The Director of CFP, with support from the Executive Committee of the Board, has appointed a certified CPA to create financial statement preparation procedures for the existing financial staff. The certified CPA will review the financial workpapers and statements monthly.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: SAS 115 requires communication, in writing, to management and those charged with governance, of material weaknesses identified in an audit.
Condition and context: A material audit adjustment was proposed that was not identified by the Center’s internal control system.
Cause: Management did not identify an adjustment necessary to present the financial statements in accordance with U.S. GAAP. A material audit adjustment was proposed to correct an account balance.
Effect or Potential Effect: The control deficiency is a material weakness that results in a material misstatement of the financial statements that was not prevented, or detected and corrected, on a timely basis.
Identification of a Repeat Finding: New finding.
Recommendation: Management should review the financial statements to ensure all necessary adjustments are made and balances are reflected accurately.
Responsible Official’s Response: In order to gain some comfort on the detailed processes, the Director of CFP, with the support from the Executive Committee of the Board, has appointed a certified CPA to review the last 2 years of monthly financial statements to build a routine for the existing staff so they may continue to conduct these reviews.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: The segregation of duties and responsibilities between different individuals for custody of assets, recordkeeping for those assets, and reconciliation of those asset accounts is an important control activity needed to adequately protect the entity’s assets and ensure accurate financial reporting.
Condition and context: The Center does not have appropriate segregation of duties. Presently, the same individual has asset access, record-keeping, and reconciliation responsibilities.
Cause: The Center does not have enough available accounting staff to fully segregate incompatible duties in a cost-effective manner.
Effect or Potential Effect: The significant deficiency adversely affects the Center’s ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the Center’s financial statements that is more than inconsequential will not be prevented or detected by the Center’s internal control.
Identification of a Repeat Finding: New finding.
Recommendation: The Center’s management and Board of Directors must rely on its review and oversight authority to mitigate this inherent weakness in its internal control system.
Responsible Official’s Response: The Director of CFP, with support from the Executive Committee of the Board, has appointed a certified CPA to review all financial reconciliation statements and grant reports. The Director will continue and now document the periodic review of all financial statements, audits, and grant reports. The Executive Committee and Board of Directors will continue their monthly review of financial statements, audit, and tax returns and they will be accepted by the board. Additionally, we have reallocated the position of Grant Specialist to Accounting and Data Management Specialist to better distribute the duties and responsibilities of the Director of Finance.
Information on the Federal Program: U.S. Department of the Treasury, Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027, Grant Agreement Nos. SLFPR1965, 23-11-0264, and 23-11-304.
Criteria: SAS 115 requires communication, in writing, to management and those charged with governance, of material weaknesses identified in an audit.
Condition and context: The Health Center does not have an internal control system designed to provide for the preparation of the financial statements being audited, including the schedule of expenditures of federal awards and note disclosures.
Cause: The Center’s accounting personnel do not have the expertise to prepare the financial statements, including note disclosures and the schedule of expenditures of federal awards in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP).
Effect or Potential Effect: The control deficiency is a material weakness that results in a reasonable possibility that a material misstatement of the financial statements will not be prevented, or detected and corrected on a timely basis.
Identification of a Repeat Finding: New finding.
Recommendation: The Center should continue to rely on the board for review of the financial statements, including note disclosures and the schedule of expenditures of federal awards. The Center may consider searching for a qualified volunteer to review the Center’s financial statements.
Responsible Official’s Response: The Director of CFP, with support from the Executive Committee of the Board, has appointed a certified CPA to create financial statement preparation procedures for the existing financial staff. The certified CPA will review the financial workpapers and statements monthly.