Audit 383328

Criteria: Proper internal controls over accounting transactions would include the ability to segregate certain accounting functions in order to protect assets. Statement of Condition: Significant Deficiency - The District does not have sufficient staff base to properly segregate accounting functions. Cause: The Treasurer records all financial transactions. Effect: The results of our tests revealed no questioned costs or material misstatements. Recommendation: Both Tara Volesky, Treasurer and Joeseph Wood, Superintendent should be involved in the daily financial affairs of the District to include monthly ledgers, financial statements, bank statements and bank reconciliations. Views of Responsible Officials and Corrective Action: The District will strive to segregate as many accounting functions as practical with the limited staff available.

Criteria: Proper internal controls over financial reporting would include the ability to prepare financial statements including footnote disclosures. Statement of Condition: Significant Deficiency - The District does not have an internal control system designed to provide for the preparation of the financial statements and related financial statement disclosures. As auditors, we were requested to draft the financial statements and accompanying notes to the financial statements. Cause: The personnel of the District do not possess the knowledge or tools to prepare financial statement footnotes and required schedules. Effect: Although this circumstance is not unusual for a District of this size, the preparation of financial statements as a part of the audit engagement may result in financial statements and related information included in financial statements disclosures not being available for management purposes as timely as it would be if prepared by District personnel. Recommendation: The District should appoint a competent individual, such as Joeseph Wood, Superintendent who possesses the skill knowledge and experience to review and approve the draft reports and assume all relevant management responsibilities. Views of Responsible Officials and Corrective Action: The District will strive to gain necessary knowledge needed to prepare a full set of financial statements. The District will appoint a competent individual who possesses the skill knowledge and experience to review and approve the draft reports and assume all relevant management responsibilities.

Criteria: Proper internal controls over accounts receivable would include reconciling the accounts receivable balance between the general ledger and billing software. Statement of Condition: Significant Deficiency - The District’s accounts receivable general ledger was not reconciled with the accounts receivable aging report that is maintain in a separate billing software. Cause: The Treasurer was correctly recording the monthly activity from the billing software but was not reconciling the accounts receivable balance in the general ledger to the aging report from the billing software. Effect: The results of our tests revealed no questioned costs or material misstatements. Recommendation: Tara Volesky, Treasurer should reconcile the accounts receivable balance from the billing software with the accounts receivable general ledger balance monthly to insure an accurate accounts receivable balance on the general ledger. Views of Responsible Officials and Corrective Action: The District has added reconciling the accounts receivable balance from the billing software to the general ledger accounts receivable balance, to their monthly closing process.