Audit 387835

Criteria: Management is responsible for establishing and maintaining an effective system of internal control over financial reporting. One of the components of an effective system of internal control over financial grant reports is the subsequent review and reconciliation of grant reporting to the general ledger. Condition: The Federal Grants Fund grants receivable balances and grant revenues need to be adjusted in order to reconcile the grant activity for the year. Grants are based on a reimbursement basis whereas expenditures are first incurred and claims for reimbursement are subsequently collected. Effect of Condition: It is possible that errors in financial grant reporting could result in claims not being processed or claimed. Cause: The District accounting system has some system bugs that need to be investigated and refined. Recommendation: We recommend that a final true-up request for reimbursement be based on fiscal year end cutoff that includes June account payable transactions. This process would allow for the elimination of timing differences lapsing between fiscal years. In addition, grant requests should be reviewed and approved by a second individual before submission