FAC Explorer

Audit 350381

FY End
2024-06-30
Total Expended
$5.04M
Findings
6
Programs
1
Organization: Spencer Mountain Road Volunteer Fire Department (NC)
Year: 2024 Accepted: 2025-03-30
Auditor: Foard and Company PA

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
540604 2024-001 Material Weakness - ABHN
540605 2024-002 Material Weakness - ABHN
540606 2024-003 Significant Deficiency - ABHN
1117046 2024-001 Material Weakness - ABHN
1117047 2024-002 Material Weakness - ABHN
1117048 2024-003 Significant Deficiency - ABHN

Programs

ALN Program Spent Major Findings
10.766 Community Facilities Loans and Grants $5.04M Yes 3

Contacts

Name Title Type
Z5N4AGBZCMA3 Amber Beatty Auditee
9805227182 Josh Kleveland Auditor
No contacts on file

Notes to SEFA

Title: Note 1 - Basis of Presentation and Summary of Significant Accounting Policies Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal grant activity of Spencer Mountain Road Volunteer Fire Department (the “Organization”) for the year ended June 30, 2024. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Organization, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Organization. De Minimis Rate Used: N Rate Explanation: Not applicable to Federal Program The accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal grant activity of Spencer Mountain Road Volunteer Fire Department (the “Organization”) for the year ended June 30, 2024. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Organization, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Organization. Expenditures reported on the Schedule are reported on the modified cash basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. The Organization has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance.
Title: Note 2 - Subrecipents Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal grant activity of Spencer Mountain Road Volunteer Fire Department (the “Organization”) for the year ended June 30, 2024. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Organization, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Organization. De Minimis Rate Used: N Rate Explanation: Not applicable to Federal Program Of the federal awards presented in the Schedule, the Organization did not provide federal awards to any sub-recipients.

Finding Details

Finding 2024-001
Bank Reconciliations Criteria: Bank reconciliations are important to the Organization’s internal control and are used to ensure all cash transactions are recorded and to help identify errors. Condition: Bank reconciliations were not performed for any of the Organization’s bank accounts during the year ended June 30, 2024. Cause: The Organization did not allocate adequate resources of qualified accounting personnel to the task of completing and reconciling bank accounts of the Organization to its QuickBooks financial records. Effect: The auditors identified several misstatements in the initial financial records, which necessitated multiple adjusting journal entries to ensure the accuracy of the financial statements. Recommendation: Additional resources should be allocated to accounting so that the bank reconciliations are completed for all accounts every month in a timely manner. Management Response: The Organization will begin performing bank reconciliations for all accounts held by the Organization ensure accuracy between bank statement balances and amounts recorded in QuickBooks. The Organization will also look into hiring an independent accountant to assist with financial statement preparation.
Finding 2024-002
Lack of Oversight/Segregation of Duties Criteria: An organization’s accounting duties should be adequately segregated among personnel. Condition: The Organization’s relies on a volunteer Treasurer who is solely responsible for many functions within the financial system. Cause: The Organization had multiple volunteer Treasurers during the year which led to inconsistencies in the financial reporting and presentation, and no additional documented oversight or review from the Board of Directors was performed. Effect: The auditors identified several material misstatements in the initial financial records, which necessitated multiple adjusting journal entries to ensure the accuracy of the financial statements. Recommendation: The Organization should implement proper monitoring and oversight regarding the review of bank statements, reconciliations, cancelled check images, and other direct charges to bank accounts, review of payroll registers, review of monthly financial statements, and review of monthly general ledger activity. Management Response: The Organization’s Board of Directors will ensure its review of the monthly bank statements, reconciliations and cancelled check images, payroll registers, financial statements and general ledger activity is documented through physical signatures, sign off with initials or email approval. The Organization will
Finding 2024-003
Accuracy of Financial Records - Material Misstatements Criteria: An organization’s financial statements should be fairly stated in all material respects. Condition: The Organization’s initial financial statements had various material errors. Cause: The Organization did not allocate adequate resources of qualified accounting personnel to the task of maintaining the accounting records of the Organization. Effect: The auditors identified several material misstatements in the initial financial records, which necessitated multiple adjusting journal entries to ensure the accuracy of the financial statements. Recommendation: Additional resources should be allocated to accounting so that the financial statements are materially correct and help ensure financial accuracy. These steps should include but not be limited to hiring staff or engaging independent accountants with sufficient financial expertise to maintain financial records, and also ensure monthly statements of loan activity are received from South State Bank to ensure proper reporting of the loan payable. Management Response: The Organization will also look into hiring an independent accountant to assist with financial statement preparations to ensure accuracy. The Organization will also take steps to ensure the loan liability balance held at South State Bank is reported accurately.
Finding 2024-001
Bank Reconciliations Criteria: Bank reconciliations are important to the Organization’s internal control and are used to ensure all cash transactions are recorded and to help identify errors. Condition: Bank reconciliations were not performed for any of the Organization’s bank accounts during the year ended June 30, 2024. Cause: The Organization did not allocate adequate resources of qualified accounting personnel to the task of completing and reconciling bank accounts of the Organization to its QuickBooks financial records. Effect: The auditors identified several misstatements in the initial financial records, which necessitated multiple adjusting journal entries to ensure the accuracy of the financial statements. Recommendation: Additional resources should be allocated to accounting so that the bank reconciliations are completed for all accounts every month in a timely manner. Management Response: The Organization will begin performing bank reconciliations for all accounts held by the Organization ensure accuracy between bank statement balances and amounts recorded in QuickBooks. The Organization will also look into hiring an independent accountant to assist with financial statement preparation.
Finding 2024-002
Lack of Oversight/Segregation of Duties Criteria: An organization’s accounting duties should be adequately segregated among personnel. Condition: The Organization’s relies on a volunteer Treasurer who is solely responsible for many functions within the financial system. Cause: The Organization had multiple volunteer Treasurers during the year which led to inconsistencies in the financial reporting and presentation, and no additional documented oversight or review from the Board of Directors was performed. Effect: The auditors identified several material misstatements in the initial financial records, which necessitated multiple adjusting journal entries to ensure the accuracy of the financial statements. Recommendation: The Organization should implement proper monitoring and oversight regarding the review of bank statements, reconciliations, cancelled check images, and other direct charges to bank accounts, review of payroll registers, review of monthly financial statements, and review of monthly general ledger activity. Management Response: The Organization’s Board of Directors will ensure its review of the monthly bank statements, reconciliations and cancelled check images, payroll registers, financial statements and general ledger activity is documented through physical signatures, sign off with initials or email approval. The Organization will
Finding 2024-003
Accuracy of Financial Records - Material Misstatements Criteria: An organization’s financial statements should be fairly stated in all material respects. Condition: The Organization’s initial financial statements had various material errors. Cause: The Organization did not allocate adequate resources of qualified accounting personnel to the task of maintaining the accounting records of the Organization. Effect: The auditors identified several material misstatements in the initial financial records, which necessitated multiple adjusting journal entries to ensure the accuracy of the financial statements. Recommendation: Additional resources should be allocated to accounting so that the financial statements are materially correct and help ensure financial accuracy. These steps should include but not be limited to hiring staff or engaging independent accountants with sufficient financial expertise to maintain financial records, and also ensure monthly statements of loan activity are received from South State Bank to ensure proper reporting of the loan payable. Management Response: The Organization will also look into hiring an independent accountant to assist with financial statement preparations to ensure accuracy. The Organization will also take steps to ensure the loan liability balance held at South State Bank is reported accurately.