Criteria: A properly designed and effective system of internal control includes components of internal control at the overall entity level of an organization. These entity-level controls include the control environment, risk assessment, information and communication controls and monitoring controls. It is crucial that entity-level internal control components be designed properly and be operating effectively in order for the entire system of internal control, including activity-level internal control components, to properly prevent and detect financial reporting errors, including material weaknesses and significant deficiencies. Condition: Arizona Immigrant and Refugee Services, Inc. (‘AIRS”) has not properly designed an adequate internal control environment, does not appear to be conducting internal risk assessment, has inadequate board and senior management monitoring controls and does not appear to have appropriate communication with those charged with governance. During the year ended September 30, 2022, the Organization did not hold regular board meetings or have minutes or other documentation of formal communication with board members during the year ended September 30, 2022. The Organization also appears to lack written policies and procedures related to certain significant aspects of financial reporting, and does not appear to have a written purchasing or procurement manual. The Organization is also not periodically preparing comparative financial statements (budget to actual or prior period actual to current period actual) that are subject to review and approval by senior management or the board. Cause: AIRS has not properly designed or implemented adequate entity-level internal controls related to control environment risk assessment, information and communication with those charged with governance, or monitoring activities of those charged with governance or with senior management. In large part this is due to the fact that AIRS did not hold any board meetings during the year ended September 30, 2022. Effect: Since AIRS did not hold regular board meetings or have minutes or other documentation of formal communication with board members, and did not provide the board with periodic comparative financial statements, the board was unable to properly exercise its required fiduciary responsibilities or to provide for adequate risk assessment, and created a lack of sufficient monitoring and oversight of financial reporting, budgeting or the operations of AIRS. In addition, due to this condition, formal documented communication between senior management and board, in the form of board meeting minutes, are non-existent. AIRS management also does not appear to have created other written communications that are key to the operation of the Organization, such as a written procurement/purchasing manual or written accounting policies for certain significant aspects of the financial reporting system. Questioned Costs: None reported Repeat Finding from Prior Year: Yes Recommendation: In response to finding 2021-001 during the audit for the year ended September 30, 2021, AIRS created a schedule of board meetings for the year ended September 30, 2024. During the year ended September 30, 2024, the AIRS board did hold a meeting in January 2024, but due to extenuating circumstances AIRS board did not meet during the second or third quarter of 2024. Operational information and comparative financial information was provided to board members at the January 2024 meeting. I would strongly recommend that the boars schedule and hold regular meetings on a go-forward basis. In addition, during the year ended September 30, 2024, AIRS began the process of creating and revising its policies and procedures manual. I commend the Organization for its efforts to comply with finding 2021-001. However, during the years ended September 30, 2022 and September 30, 2023, the conditions originally noted in finding 2021-001 still existed. Views of Responsible Officials: Management concurs with this audit finding.
Criteria: Uniform Guidance, federal cost principles and many of the Organization’s grant agreements require that AIRS financial reporting be completed on an accounting basis in accordance with U.S. generally accepted accounting principles (GAAP). Condition: During the year ended September 30, 2022, AIRS internal financial reporting was initially completed by internal accounting personnel on a cash basis rather than on a GAAP accrual basis. In preparation for the audit, AIRS engaged a third-party accountant to assist management with converting the cash basis financial statements to a GAAP accrual basis. Many of the accounts were properly adjusted and reported in accordance with GAAP prior to the start of the audit. However, the following audit adjustments were still required to properly state certain amounts in accordance with GAAP:
• Government grants receivable, in the amount of $30,673, were not properly recorded as receivable and revenue.
• Certain small equipment. in the combined amount of $9,688, that was below the capitalization threshold was improperly capitalized as property and equipment.
• A vehicle held under capital lease and related capital lease liability, in the amount of $5,000, was not properly recorded. Cause: Although AIRS did engage a third-party accountant to assist with preparation for the audit, it does not appear that processes, procedures and internal control over financial reporting were fully implemented to completely ensure that, on a material basis, the year-end financial reporting is completed on the appropriate GAAP accrual basis of accounting. Effect: Audit adjustments, that are material on a combined basis, were required to properly state the year-end financial statements in accordance with a GAAP accrual basis of accounting. Repeat Finding from Prior Year: Yes Recommendation: In response to finding 2021-002 during the audit for the year ended September 30, 2021, AIRS engaged a third-party accountant to assist with converting the financial statements from a cash basis of accounting to a GAAP accrual basis of accounting. I commend management for engaging this accountant and for its efforts to convert its books and records to GAAP. Since Uniform Guidance and federal cost accounting principles require that AIRS report on a GAAP basis, AIRS management strongly consider fully converting the books and records to a GAAP accrual basis during the year and not just at year end in preparation for the audit. Senior management and board may also want to consider providing accounting staff with additional training and education related to nonprofit GAAP, and training and education related to federal cost principles and allowable costs accounting for federal award programs. Finally, senior management and the board may want to consider engaging the third-party accountant to assist with converting its books and records to a GAAP accrual basis of accounting. Views of Responsible Officials: Management concurs with this audit finding.
Criteria: Segregation of duties is one the most important elements of internal control. It contemplates that no one individual handles a transaction from beginning to end. It also contemplates that a single individual does not perform incompatible duties such as both maintaining the custody of assets and also perform the recording and recordkeeping functions for these assets. In connection with segregation of duties, certain reconciliation and review controls should be designed and implemented to help further reduce the risk of undetected and unprevented errors in financial reporting. Condition: Lack of proper segregation of duties were noted as follows:
• Cash receipts, revenue and receivables - A single individual has custody of checks and other cash receipts, is responsible for preparing bank deposits, creates invoices and reimbursement reports, submits invoices and reimbursement reports to customers, posts cash receipts to the accounting system, has the ability to edit the accounts receivable and customer master file, maintains the chart of accounts and has review responsibilities for the bank reconciliation.
• Cash disbursements, expenses and accrued liabilities - A single individual approves check requests, has custody of checks after signature, has the ability to edit the vendor master file, maintains the chart of accounts and has review responsibilities for the bank reconciliation.
• Cash disbursements, expenses and accrued liabilities - A separate individual (different from the individual above) prepares checks for disbursement, enters invoices and cash disbursements into the accounting software, and reconciles the bank accounts.
• Payroll expenses and payroll liabilities - A single individual enters employees, payroll deductions and bi-monthly payroll information into the third-party payroll system, prepares payroll checks, resolves employee payroll inquiries, has the ability to edit the payroll master file, and has review and reconciliation responsibilities for payroll. Lack of proper reconciliation and review controls were noted as follows:
• The review of the monthly bank reconciliations is not clearly documented in writing or otherwise.
• Bank reconciliations for two different bank accounts were not initially prepared properly and did not agree to the general ledger account balances by significant amounts. When the auditor brought this to the attention of management and the third-party accountant, the bank reconciliations were revised and completed by hand.
• In connection with the above bank reconciliations, it was noted that check stock is not being used in numerical sequence. Using check stock in numerical order helps to provide internal control over the cutoff and completeness of cash and is also a useful fraud deterrent.
• Although it appears that a pre-processing and post-processing review of payroll is conducted, there is not a process in place to periodically review the payroll master file change log to ensure that all changes made to payroll information are approved and appropriate.
• The review of journal entries is not clearly documented in writing or otherwise.
• Certain significant account coding and keying errors were noted. The fact that these items were not prevented or detected prior to the start of the audit is indicative of a significant weakness in the review and reconciliation procedures and internal controls. These account coding and keying errors were likely inadvertent, however, certain reclassification adjustments were required related to the following:
o Depreciation expense in the amount of $1,200 was improperly entered at $12,000 and this error was not identified by the or corrected by the financial statement review or by the property and equipment reconciliation process prior to the start of the audit.
o Removal of accumulated depreciation for a disposed asset was improperly recorded to depreciation expense rather than as a debit to accumulated depreciation. Again, this error was not identified by the or corrected by the financial statement review or by the property and equipment reconciliation process prior to the start of the audit.
o Payroll paid for bonuses and payroll service fees were improperly recorded and comingled in the same account and employer payroll taxes. This error was not identified or corrected by the financial statement review or the payroll and payroll tax review and reconciliation processes prior to the start of the audit. Cause: AIRS has not properly designed or implemented adequate segregation of duties or appropriate reconciliation and review controls in certain circumstances.
Effect: Certain significant, but not material, audit adjustments were required during the financial statement audit. These adjustments appear to be a direct result of the lack of appropriate segregation of duties and lack of certain reconciliation and review controls. Questioned Costs: None reported Repeat Finding from Prior Year: Yes Recommendation: Given the limited number of staff currently available, adequate segregation of duties may be difficult, if not impossible, to achieve at present. However, senior management and the board should review and analyze the current duties assigned and segregate duties, to the extent possible and to further segregate duties, to the extent possible, when and if conditions change. Management and the board should also assess weaknesses related to segregation of duties and assess the related risks and benefits associated with improving segregation of duties and other related internal controls. Management might also want to consider instituting additional preventative and automated controls that could help to mitigate the internal control deficiencies caused by the lack of adequate segregation of duties. Views of Responsible Officials: Management concurs with this audit finding.
Criteria: As required under the Uniform Guidance, the single audit and data collection reporting package are required to be submitted to the Federal Audit Clearinghouse within 9 months after the end of the audit period. Condition: For the years ended September 30, 2022 and September 30, 2023, the financial statement audit and single audit were not scheduled or completed in a timely manner. As a result, the single audit and data collection reporting package were not completed or submitted to Federal Audit Clearinghouse in accordance with the requirements for Reporting under the Uniform Guidance. Cause: The commencement of the 2022 audit of the Organization was delayed primarily due to budgetary constraints, difficulty in identifying and engaging an audit firm capable of completing the single audit and due to the fact that the 2021 audit was required to be completed before the 2022 audit could commence. The audit for 2022 was not completed and issued until January 27, 2024, As a result, the audit firm was not engaged until February 5, 2024 to complete the financial statement and single audit for the year ended September 30, 2022. The Organization was not fully prepared for the audit until mid-October 2024, and due to other previously scheduled client engagements, the audit firm was unable to fully complete work on the 2022 audit until November 2024. Effect: The financial statements and single audit were not completed in a timely manner and AIRS is not in compliance with the required timing of submission of the single audit and data collection package to the Federal Audit Clearinghouse as required under the Uniform Guidance for years ended September 30, 2022 and September 30, 2023. Questioned Costs: None reported Repeat Finding from Prior Year: Yes Recommendation: AIRS should improve its financial reporting process and procedures to ensure that it completes financial statement and single audits in a timely and efficient manner and ensure that its financial statements, single audit and data collection package are completed and properly submitted to the Federal Audit Clearinghouse within the required 9 months after fiscal year end as required by the Uniform Guidance. Views of Responsible Officials: Management concurs with this audit finding.
Criteria: A non-federal entity is required to have certain written policies and procedure in compliance with Uniform Guidance and must comply with the procurement standards as described in 2 CFR 200.318 through 2 CFR 200.327. Specifically, the non-federal entity must comply with the following:
• The non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward. The non-Federal entity's documented procurement procedures must conform to the procurement standards identified in §§ 200.317 through 200.327.
• If the non-Federal entity has a parent, affiliate, or subsidiary organization that is not a State, local government, or Indian tribe, the non-Federal entity must also maintain written standards of conduct covering organizational conflicts of interest. Organizational conflicts of interest means that because of relationships with a parent company, affiliate, or subsidiary organization, the non-Federal entity is unable or appears to be unable to be impartial in conducting a procurement action involving a related organization. Condition: AIRS does not appear to have created written purchasing or procurement policies and procedures as required by 2 CFR 200.318(a). Since AIRS is an affiliate organization of the Ethiopian Community Development Council (ECDC), it appears that the relationship between AIRS and ECDC meets the “affiliate” requirement under 2 CFR 200.318 (c) (2). It does appear that AIRS has created written standards of conduct covering organizational conflicts of interest. Cause: Management has not created or maintained certain written policies and procedures as required under 2 CFR 200.318. Effect: AIRS is not in compliance with certain written policies and procedures as required under 2 CFR 200.318. Questioned Costs: None reported Repeat Finding from Prior Year: Yes Recommendation: In response to Finding 2021-006 during the audit for the year ended September 30, 2021, management has started the process of creating, updating and revising its written policies and procedures. I commend management for their efforts. However, I strongly recommend that management and board complete the written procurement policies and procedures and written standards of conduct covering organizational conflicts of interest prior to start of the 2023 audit. Views of Responsible Officials: Management concurs with this audit finding.
Criteria: A properly designed and effective system of internal control includes components of internal control at the overall entity level of an organization. These entity-level controls include the control environment, risk assessment, information and communication controls and monitoring controls. It is crucial that entity-level internal control components be designed properly and be operating effectively in order for the entire system of internal control, including activity-level internal control components, to properly prevent and detect financial reporting errors, including material weaknesses and significant deficiencies. Condition: Arizona Immigrant and Refugee Services, Inc. (‘AIRS”) has not properly designed an adequate internal control environment, does not appear to be conducting internal risk assessment, has inadequate board and senior management monitoring controls and does not appear to have appropriate communication with those charged with governance. During the year ended September 30, 2022, the Organization did not hold regular board meetings or have minutes or other documentation of formal communication with board members during the year ended September 30, 2022. The Organization also appears to lack written policies and procedures related to certain significant aspects of financial reporting, and does not appear to have a written purchasing or procurement manual. The Organization is also not periodically preparing comparative financial statements (budget to actual or prior period actual to current period actual) that are subject to review and approval by senior management or the board. Cause: AIRS has not properly designed or implemented adequate entity-level internal controls related to control environment risk assessment, information and communication with those charged with governance, or monitoring activities of those charged with governance or with senior management. In large part this is due to the fact that AIRS did not hold any board meetings during the year ended September 30, 2022. Effect: Since AIRS did not hold regular board meetings or have minutes or other documentation of formal communication with board members, and did not provide the board with periodic comparative financial statements, the board was unable to properly exercise its required fiduciary responsibilities or to provide for adequate risk assessment, and created a lack of sufficient monitoring and oversight of financial reporting, budgeting or the operations of AIRS. In addition, due to this condition, formal documented communication between senior management and board, in the form of board meeting minutes, are non-existent. AIRS management also does not appear to have created other written communications that are key to the operation of the Organization, such as a written procurement/purchasing manual or written accounting policies for certain significant aspects of the financial reporting system. Questioned Costs: None reported Repeat Finding from Prior Year: Yes Recommendation: In response to finding 2021-001 during the audit for the year ended September 30, 2021, AIRS created a schedule of board meetings for the year ended September 30, 2024. During the year ended September 30, 2024, the AIRS board did hold a meeting in January 2024, but due to extenuating circumstances AIRS board did not meet during the second or third quarter of 2024. Operational information and comparative financial information was provided to board members at the January 2024 meeting. I would strongly recommend that the boars schedule and hold regular meetings on a go-forward basis. In addition, during the year ended September 30, 2024, AIRS began the process of creating and revising its policies and procedures manual. I commend the Organization for its efforts to comply with finding 2021-001. However, during the years ended September 30, 2022 and September 30, 2023, the conditions originally noted in finding 2021-001 still existed. Views of Responsible Officials: Management concurs with this audit finding.
Criteria: Uniform Guidance, federal cost principles and many of the Organization’s grant agreements require that AIRS financial reporting be completed on an accounting basis in accordance with U.S. generally accepted accounting principles (GAAP). Condition: During the year ended September 30, 2022, AIRS internal financial reporting was initially completed by internal accounting personnel on a cash basis rather than on a GAAP accrual basis. In preparation for the audit, AIRS engaged a third-party accountant to assist management with converting the cash basis financial statements to a GAAP accrual basis. Many of the accounts were properly adjusted and reported in accordance with GAAP prior to the start of the audit. However, the following audit adjustments were still required to properly state certain amounts in accordance with GAAP:
• Government grants receivable, in the amount of $30,673, were not properly recorded as receivable and revenue.
• Certain small equipment. in the combined amount of $9,688, that was below the capitalization threshold was improperly capitalized as property and equipment.
• A vehicle held under capital lease and related capital lease liability, in the amount of $5,000, was not properly recorded. Cause: Although AIRS did engage a third-party accountant to assist with preparation for the audit, it does not appear that processes, procedures and internal control over financial reporting were fully implemented to completely ensure that, on a material basis, the year-end financial reporting is completed on the appropriate GAAP accrual basis of accounting. Effect: Audit adjustments, that are material on a combined basis, were required to properly state the year-end financial statements in accordance with a GAAP accrual basis of accounting. Repeat Finding from Prior Year: Yes Recommendation: In response to finding 2021-002 during the audit for the year ended September 30, 2021, AIRS engaged a third-party accountant to assist with converting the financial statements from a cash basis of accounting to a GAAP accrual basis of accounting. I commend management for engaging this accountant and for its efforts to convert its books and records to GAAP. Since Uniform Guidance and federal cost accounting principles require that AIRS report on a GAAP basis, AIRS management strongly consider fully converting the books and records to a GAAP accrual basis during the year and not just at year end in preparation for the audit. Senior management and board may also want to consider providing accounting staff with additional training and education related to nonprofit GAAP, and training and education related to federal cost principles and allowable costs accounting for federal award programs. Finally, senior management and the board may want to consider engaging the third-party accountant to assist with converting its books and records to a GAAP accrual basis of accounting. Views of Responsible Officials: Management concurs with this audit finding.
Criteria: Segregation of duties is one the most important elements of internal control. It contemplates that no one individual handles a transaction from beginning to end. It also contemplates that a single individual does not perform incompatible duties such as both maintaining the custody of assets and also perform the recording and recordkeeping functions for these assets. In connection with segregation of duties, certain reconciliation and review controls should be designed and implemented to help further reduce the risk of undetected and unprevented errors in financial reporting. Condition: Lack of proper segregation of duties were noted as follows:
• Cash receipts, revenue and receivables - A single individual has custody of checks and other cash receipts, is responsible for preparing bank deposits, creates invoices and reimbursement reports, submits invoices and reimbursement reports to customers, posts cash receipts to the accounting system, has the ability to edit the accounts receivable and customer master file, maintains the chart of accounts and has review responsibilities for the bank reconciliation.
• Cash disbursements, expenses and accrued liabilities - A single individual approves check requests, has custody of checks after signature, has the ability to edit the vendor master file, maintains the chart of accounts and has review responsibilities for the bank reconciliation.
• Cash disbursements, expenses and accrued liabilities - A separate individual (different from the individual above) prepares checks for disbursement, enters invoices and cash disbursements into the accounting software, and reconciles the bank accounts.
• Payroll expenses and payroll liabilities - A single individual enters employees, payroll deductions and bi-monthly payroll information into the third-party payroll system, prepares payroll checks, resolves employee payroll inquiries, has the ability to edit the payroll master file, and has review and reconciliation responsibilities for payroll. Lack of proper reconciliation and review controls were noted as follows:
• The review of the monthly bank reconciliations is not clearly documented in writing or otherwise.
• Bank reconciliations for two different bank accounts were not initially prepared properly and did not agree to the general ledger account balances by significant amounts. When the auditor brought this to the attention of management and the third-party accountant, the bank reconciliations were revised and completed by hand.
• In connection with the above bank reconciliations, it was noted that check stock is not being used in numerical sequence. Using check stock in numerical order helps to provide internal control over the cutoff and completeness of cash and is also a useful fraud deterrent.
• Although it appears that a pre-processing and post-processing review of payroll is conducted, there is not a process in place to periodically review the payroll master file change log to ensure that all changes made to payroll information are approved and appropriate.
• The review of journal entries is not clearly documented in writing or otherwise.
• Certain significant account coding and keying errors were noted. The fact that these items were not prevented or detected prior to the start of the audit is indicative of a significant weakness in the review and reconciliation procedures and internal controls. These account coding and keying errors were likely inadvertent, however, certain reclassification adjustments were required related to the following:
o Depreciation expense in the amount of $1,200 was improperly entered at $12,000 and this error was not identified by the or corrected by the financial statement review or by the property and equipment reconciliation process prior to the start of the audit.
o Removal of accumulated depreciation for a disposed asset was improperly recorded to depreciation expense rather than as a debit to accumulated depreciation. Again, this error was not identified by the or corrected by the financial statement review or by the property and equipment reconciliation process prior to the start of the audit.
o Payroll paid for bonuses and payroll service fees were improperly recorded and comingled in the same account and employer payroll taxes. This error was not identified or corrected by the financial statement review or the payroll and payroll tax review and reconciliation processes prior to the start of the audit. Cause: AIRS has not properly designed or implemented adequate segregation of duties or appropriate reconciliation and review controls in certain circumstances.
Effect: Certain significant, but not material, audit adjustments were required during the financial statement audit. These adjustments appear to be a direct result of the lack of appropriate segregation of duties and lack of certain reconciliation and review controls. Questioned Costs: None reported Repeat Finding from Prior Year: Yes Recommendation: Given the limited number of staff currently available, adequate segregation of duties may be difficult, if not impossible, to achieve at present. However, senior management and the board should review and analyze the current duties assigned and segregate duties, to the extent possible and to further segregate duties, to the extent possible, when and if conditions change. Management and the board should also assess weaknesses related to segregation of duties and assess the related risks and benefits associated with improving segregation of duties and other related internal controls. Management might also want to consider instituting additional preventative and automated controls that could help to mitigate the internal control deficiencies caused by the lack of adequate segregation of duties. Views of Responsible Officials: Management concurs with this audit finding.
Criteria: As required under the Uniform Guidance, the single audit and data collection reporting package are required to be submitted to the Federal Audit Clearinghouse within 9 months after the end of the audit period. Condition: For the years ended September 30, 2022 and September 30, 2023, the financial statement audit and single audit were not scheduled or completed in a timely manner. As a result, the single audit and data collection reporting package were not completed or submitted to Federal Audit Clearinghouse in accordance with the requirements for Reporting under the Uniform Guidance. Cause: The commencement of the 2022 audit of the Organization was delayed primarily due to budgetary constraints, difficulty in identifying and engaging an audit firm capable of completing the single audit and due to the fact that the 2021 audit was required to be completed before the 2022 audit could commence. The audit for 2022 was not completed and issued until January 27, 2024, As a result, the audit firm was not engaged until February 5, 2024 to complete the financial statement and single audit for the year ended September 30, 2022. The Organization was not fully prepared for the audit until mid-October 2024, and due to other previously scheduled client engagements, the audit firm was unable to fully complete work on the 2022 audit until November 2024. Effect: The financial statements and single audit were not completed in a timely manner and AIRS is not in compliance with the required timing of submission of the single audit and data collection package to the Federal Audit Clearinghouse as required under the Uniform Guidance for years ended September 30, 2022 and September 30, 2023. Questioned Costs: None reported Repeat Finding from Prior Year: Yes Recommendation: AIRS should improve its financial reporting process and procedures to ensure that it completes financial statement and single audits in a timely and efficient manner and ensure that its financial statements, single audit and data collection package are completed and properly submitted to the Federal Audit Clearinghouse within the required 9 months after fiscal year end as required by the Uniform Guidance. Views of Responsible Officials: Management concurs with this audit finding.
Criteria: A non-federal entity is required to have certain written policies and procedure in compliance with Uniform Guidance and must comply with the procurement standards as described in 2 CFR 200.318 through 2 CFR 200.327. Specifically, the non-federal entity must comply with the following:
• The non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward. The non-Federal entity's documented procurement procedures must conform to the procurement standards identified in §§ 200.317 through 200.327.
• If the non-Federal entity has a parent, affiliate, or subsidiary organization that is not a State, local government, or Indian tribe, the non-Federal entity must also maintain written standards of conduct covering organizational conflicts of interest. Organizational conflicts of interest means that because of relationships with a parent company, affiliate, or subsidiary organization, the non-Federal entity is unable or appears to be unable to be impartial in conducting a procurement action involving a related organization. Condition: AIRS does not appear to have created written purchasing or procurement policies and procedures as required by 2 CFR 200.318(a). Since AIRS is an affiliate organization of the Ethiopian Community Development Council (ECDC), it appears that the relationship between AIRS and ECDC meets the “affiliate” requirement under 2 CFR 200.318 (c) (2). It does appear that AIRS has created written standards of conduct covering organizational conflicts of interest. Cause: Management has not created or maintained certain written policies and procedures as required under 2 CFR 200.318. Effect: AIRS is not in compliance with certain written policies and procedures as required under 2 CFR 200.318. Questioned Costs: None reported Repeat Finding from Prior Year: Yes Recommendation: In response to Finding 2021-006 during the audit for the year ended September 30, 2021, management has started the process of creating, updating and revising its written policies and procedures. I commend management for their efforts. However, I strongly recommend that management and board complete the written procurement policies and procedures and written standards of conduct covering organizational conflicts of interest prior to start of the 2023 audit. Views of Responsible Officials: Management concurs with this audit finding.