Finding 2022-001 ? Materially Misstated Financial Statements and Schedule of Expenditure of Federal Awards, Assistance Listing 10.601, Market Access Program and Assistance Listing 10.309, Specialty Crop Research Initiative Criteria: Part 200. Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards Subpart F. Audit Requirements subgroup 47. Auditees Section 200.510, Financial statements: The auditee must prepare a schedule of expenditures of Federal awards for the period covered by the auditee's financial statements which must include the total Federal awards expended as determined in accordance with ? 200.502 Basis for determining Federal awards expended. Condition: Audit adjustments of over $134,000 were required to correct the Schedule of Expenditure of Federal Awards (SEFA) and eight audit adjustments were required to correct financial statement account balances due the lack of proper accrual accounting. Cause of Condition: Accrual accounting was not performed and there was a lack of oversight by management over the preparation of the schedule of expenditures of federal awards to ensure proper reporting. Potential Effect: As a result of the condition above, the financial reports and the SEFA required significant adjustments at year end. These conditions may provide opportunities for errors or fraud to occur and cause material misstatements of the financial statements. Questioned Costs: None Context: There was a lack of oversight and lack of grant accounting knowledge to ensure complete and accurate financial statements and SEFA preparation. Recommendation: Recommend procedures be put into place to ensure the financial statements and the schedule of expenditures of federal awards are being prepared and presented in accordance with Generally Accepted Accounting Principles. We further recommend the accountant receive training in the purpose and use of accrual accounting and its application in the QuickBooks accounting system. Due to the material adjustments required to 2021 and 2022 expenditures, we recommend re-submission of both years? Federal Financial Reports to accurately reflect adjusted expenditures and matching requirements.
Finding 2022-001 ? Materially Misstated Financial Statements and Schedule of Expenditure of Federal Awards, Assistance Listing 10.601, Market Access Program and Assistance Listing 10.309, Specialty Crop Research Initiative Criteria: Part 200. Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards Subpart F. Audit Requirements subgroup 47. Auditees Section 200.510, Financial statements: The auditee must prepare a schedule of expenditures of Federal awards for the period covered by the auditee's financial statements which must include the total Federal awards expended as determined in accordance with ? 200.502 Basis for determining Federal awards expended. Condition: Audit adjustments of over $134,000 were required to correct the Schedule of Expenditure of Federal Awards (SEFA) and eight audit adjustments were required to correct financial statement account balances due the lack of proper accrual accounting. Cause of Condition: Accrual accounting was not performed and there was a lack of oversight by management over the preparation of the schedule of expenditures of federal awards to ensure proper reporting. Potential Effect: As a result of the condition above, the financial reports and the SEFA required significant adjustments at year end. These conditions may provide opportunities for errors or fraud to occur and cause material misstatements of the financial statements. Questioned Costs: None Context: There was a lack of oversight and lack of grant accounting knowledge to ensure complete and accurate financial statements and SEFA preparation. Recommendation: Recommend procedures be put into place to ensure the financial statements and the schedule of expenditures of federal awards are being prepared and presented in accordance with Generally Accepted Accounting Principles. We further recommend the accountant receive training in the purpose and use of accrual accounting and its application in the QuickBooks accounting system. Due to the material adjustments required to 2021 and 2022 expenditures, we recommend re-submission of both years? Federal Financial Reports to accurately reflect adjusted expenditures and matching requirements.
Finding 2022-001 ? Materially Misstated Financial Statements and Schedule of Expenditure of Federal Awards, Assistance Listing 10.601, Market Access Program and Assistance Listing 10.309, Specialty Crop Research Initiative Criteria: Part 200. Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards Subpart F. Audit Requirements subgroup 47. Auditees Section 200.510, Financial statements: The auditee must prepare a schedule of expenditures of Federal awards for the period covered by the auditee's financial statements which must include the total Federal awards expended as determined in accordance with ? 200.502 Basis for determining Federal awards expended. Condition: Audit adjustments of over $134,000 were required to correct the Schedule of Expenditure of Federal Awards (SEFA) and eight audit adjustments were required to correct financial statement account balances due the lack of proper accrual accounting. Cause of Condition: Accrual accounting was not performed and there was a lack of oversight by management over the preparation of the schedule of expenditures of federal awards to ensure proper reporting. Potential Effect: As a result of the condition above, the financial reports and the SEFA required significant adjustments at year end. These conditions may provide opportunities for errors or fraud to occur and cause material misstatements of the financial statements. Questioned Costs: None Context: There was a lack of oversight and lack of grant accounting knowledge to ensure complete and accurate financial statements and SEFA preparation. Recommendation: Recommend procedures be put into place to ensure the financial statements and the schedule of expenditures of federal awards are being prepared and presented in accordance with Generally Accepted Accounting Principles. We further recommend the accountant receive training in the purpose and use of accrual accounting and its application in the QuickBooks accounting system. Due to the material adjustments required to 2021 and 2022 expenditures, we recommend re-submission of both years? Federal Financial Reports to accurately reflect adjusted expenditures and matching requirements.
Finding 2022-002 ? Lack of Subrecipient Monitoring, Assistance Listing 10.309, Specialty Crop Research Initiative - Cash Management Criteria: 2 CFR Section 200.305(b)(1) Pass through entities must monitor cash drawdowns by their subrecipients to ensure that the time elapsing between the transfer of federal funds to the subrecipient and their disbursement for program purposes is minimized as required by the applicable cash management requirements in the federal award to the recipient. Pass through entities are also required to monitor the activities of the subrecipients as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves the performance goals. Condition: Subrecipients were advanced funds according to an approved budget with semi-annual reporting requirements per their subaward agreements. Of the about $359,700 at December 31, 2022 in outstanding advances made to sub-recipients during the year, a significant amount of approximately $223,500 remains unspent as of July 2023. Cause of Condition: Sub-award agreements only require semi-annual reporting which does not provide the Organization the ability to adequately monitor and determine if funds have been expended timely on allowable costs and activities by the sub-recipients. Due to the impact of COVID-19 on the labor force, and difficulties of hiring qualified persons, funds advanced for salary expenses remain unspent. Potential Effect: As a result of the condition above, use of funds passed to subrecipients cannot be monitored timely which could result in unallowable costs, waste and abuse. These conditions may provide opportunities for errors, fraud or waste and abuse to occur and cause material misstatements of the financial statements and SEFA. Questioned Costs: None Context: Management lacks a full understanding of all federal compliance requirements. Recommendation: Recommend Management include in subaward agreements and conduct regular monitoring of subrecipients for timely spending of federal awards and adherence with federal cost principles and compliance requirements. We further recommend one of the reporting periods coincide with the Organization?s fiscal year end to ensure a complete and accurate schedule of expenditures of federal awards.
Finding 2022-001 ? Materially Misstated Financial Statements and Schedule of Expenditure of Federal Awards, Assistance Listing 10.601, Market Access Program and Assistance Listing 10.309, Specialty Crop Research Initiative Criteria: Part 200. Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards Subpart F. Audit Requirements subgroup 47. Auditees Section 200.510, Financial statements: The auditee must prepare a schedule of expenditures of Federal awards for the period covered by the auditee's financial statements which must include the total Federal awards expended as determined in accordance with ? 200.502 Basis for determining Federal awards expended. Condition: Audit adjustments of over $134,000 were required to correct the Schedule of Expenditure of Federal Awards (SEFA) and eight audit adjustments were required to correct financial statement account balances due the lack of proper accrual accounting. Cause of Condition: Accrual accounting was not performed and there was a lack of oversight by management over the preparation of the schedule of expenditures of federal awards to ensure proper reporting. Potential Effect: As a result of the condition above, the financial reports and the SEFA required significant adjustments at year end. These conditions may provide opportunities for errors or fraud to occur and cause material misstatements of the financial statements. Questioned Costs: None Context: There was a lack of oversight and lack of grant accounting knowledge to ensure complete and accurate financial statements and SEFA preparation. Recommendation: Recommend procedures be put into place to ensure the financial statements and the schedule of expenditures of federal awards are being prepared and presented in accordance with Generally Accepted Accounting Principles. We further recommend the accountant receive training in the purpose and use of accrual accounting and its application in the QuickBooks accounting system. Due to the material adjustments required to 2021 and 2022 expenditures, we recommend re-submission of both years? Federal Financial Reports to accurately reflect adjusted expenditures and matching requirements.
Finding 2022-001 ? Materially Misstated Financial Statements and Schedule of Expenditure of Federal Awards, Assistance Listing 10.601, Market Access Program and Assistance Listing 10.309, Specialty Crop Research Initiative Criteria: Part 200. Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards Subpart F. Audit Requirements subgroup 47. Auditees Section 200.510, Financial statements: The auditee must prepare a schedule of expenditures of Federal awards for the period covered by the auditee's financial statements which must include the total Federal awards expended as determined in accordance with ? 200.502 Basis for determining Federal awards expended. Condition: Audit adjustments of over $134,000 were required to correct the Schedule of Expenditure of Federal Awards (SEFA) and eight audit adjustments were required to correct financial statement account balances due the lack of proper accrual accounting. Cause of Condition: Accrual accounting was not performed and there was a lack of oversight by management over the preparation of the schedule of expenditures of federal awards to ensure proper reporting. Potential Effect: As a result of the condition above, the financial reports and the SEFA required significant adjustments at year end. These conditions may provide opportunities for errors or fraud to occur and cause material misstatements of the financial statements. Questioned Costs: None Context: There was a lack of oversight and lack of grant accounting knowledge to ensure complete and accurate financial statements and SEFA preparation. Recommendation: Recommend procedures be put into place to ensure the financial statements and the schedule of expenditures of federal awards are being prepared and presented in accordance with Generally Accepted Accounting Principles. We further recommend the accountant receive training in the purpose and use of accrual accounting and its application in the QuickBooks accounting system. Due to the material adjustments required to 2021 and 2022 expenditures, we recommend re-submission of both years? Federal Financial Reports to accurately reflect adjusted expenditures and matching requirements.
Finding 2022-001 ? Materially Misstated Financial Statements and Schedule of Expenditure of Federal Awards, Assistance Listing 10.601, Market Access Program and Assistance Listing 10.309, Specialty Crop Research Initiative Criteria: Part 200. Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards Subpart F. Audit Requirements subgroup 47. Auditees Section 200.510, Financial statements: The auditee must prepare a schedule of expenditures of Federal awards for the period covered by the auditee's financial statements which must include the total Federal awards expended as determined in accordance with ? 200.502 Basis for determining Federal awards expended. Condition: Audit adjustments of over $134,000 were required to correct the Schedule of Expenditure of Federal Awards (SEFA) and eight audit adjustments were required to correct financial statement account balances due the lack of proper accrual accounting. Cause of Condition: Accrual accounting was not performed and there was a lack of oversight by management over the preparation of the schedule of expenditures of federal awards to ensure proper reporting. Potential Effect: As a result of the condition above, the financial reports and the SEFA required significant adjustments at year end. These conditions may provide opportunities for errors or fraud to occur and cause material misstatements of the financial statements. Questioned Costs: None Context: There was a lack of oversight and lack of grant accounting knowledge to ensure complete and accurate financial statements and SEFA preparation. Recommendation: Recommend procedures be put into place to ensure the financial statements and the schedule of expenditures of federal awards are being prepared and presented in accordance with Generally Accepted Accounting Principles. We further recommend the accountant receive training in the purpose and use of accrual accounting and its application in the QuickBooks accounting system. Due to the material adjustments required to 2021 and 2022 expenditures, we recommend re-submission of both years? Federal Financial Reports to accurately reflect adjusted expenditures and matching requirements.
Finding 2022-001 ? Materially Misstated Financial Statements and Schedule of Expenditure of Federal Awards, Assistance Listing 10.601, Market Access Program and Assistance Listing 10.309, Specialty Crop Research Initiative Criteria: Part 200. Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards Subpart F. Audit Requirements subgroup 47. Auditees Section 200.510, Financial statements: The auditee must prepare a schedule of expenditures of Federal awards for the period covered by the auditee's financial statements which must include the total Federal awards expended as determined in accordance with ? 200.502 Basis for determining Federal awards expended. Condition: Audit adjustments of over $134,000 were required to correct the Schedule of Expenditure of Federal Awards (SEFA) and eight audit adjustments were required to correct financial statement account balances due the lack of proper accrual accounting. Cause of Condition: Accrual accounting was not performed and there was a lack of oversight by management over the preparation of the schedule of expenditures of federal awards to ensure proper reporting. Potential Effect: As a result of the condition above, the financial reports and the SEFA required significant adjustments at year end. These conditions may provide opportunities for errors or fraud to occur and cause material misstatements of the financial statements. Questioned Costs: None Context: There was a lack of oversight and lack of grant accounting knowledge to ensure complete and accurate financial statements and SEFA preparation. Recommendation: Recommend procedures be put into place to ensure the financial statements and the schedule of expenditures of federal awards are being prepared and presented in accordance with Generally Accepted Accounting Principles. We further recommend the accountant receive training in the purpose and use of accrual accounting and its application in the QuickBooks accounting system. Due to the material adjustments required to 2021 and 2022 expenditures, we recommend re-submission of both years? Federal Financial Reports to accurately reflect adjusted expenditures and matching requirements.
Finding 2022-002 ? Lack of Subrecipient Monitoring, Assistance Listing 10.309, Specialty Crop Research Initiative - Cash Management Criteria: 2 CFR Section 200.305(b)(1) Pass through entities must monitor cash drawdowns by their subrecipients to ensure that the time elapsing between the transfer of federal funds to the subrecipient and their disbursement for program purposes is minimized as required by the applicable cash management requirements in the federal award to the recipient. Pass through entities are also required to monitor the activities of the subrecipients as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves the performance goals. Condition: Subrecipients were advanced funds according to an approved budget with semi-annual reporting requirements per their subaward agreements. Of the about $359,700 at December 31, 2022 in outstanding advances made to sub-recipients during the year, a significant amount of approximately $223,500 remains unspent as of July 2023. Cause of Condition: Sub-award agreements only require semi-annual reporting which does not provide the Organization the ability to adequately monitor and determine if funds have been expended timely on allowable costs and activities by the sub-recipients. Due to the impact of COVID-19 on the labor force, and difficulties of hiring qualified persons, funds advanced for salary expenses remain unspent. Potential Effect: As a result of the condition above, use of funds passed to subrecipients cannot be monitored timely which could result in unallowable costs, waste and abuse. These conditions may provide opportunities for errors, fraud or waste and abuse to occur and cause material misstatements of the financial statements and SEFA. Questioned Costs: None Context: Management lacks a full understanding of all federal compliance requirements. Recommendation: Recommend Management include in subaward agreements and conduct regular monitoring of subrecipients for timely spending of federal awards and adherence with federal cost principles and compliance requirements. We further recommend one of the reporting periods coincide with the Organization?s fiscal year end to ensure a complete and accurate schedule of expenditures of federal awards.
Finding 2022-001 ? Materially Misstated Financial Statements and Schedule of Expenditure of Federal Awards, Assistance Listing 10.601, Market Access Program and Assistance Listing 10.309, Specialty Crop Research Initiative Criteria: Part 200. Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards Subpart F. Audit Requirements subgroup 47. Auditees Section 200.510, Financial statements: The auditee must prepare a schedule of expenditures of Federal awards for the period covered by the auditee's financial statements which must include the total Federal awards expended as determined in accordance with ? 200.502 Basis for determining Federal awards expended. Condition: Audit adjustments of over $134,000 were required to correct the Schedule of Expenditure of Federal Awards (SEFA) and eight audit adjustments were required to correct financial statement account balances due the lack of proper accrual accounting. Cause of Condition: Accrual accounting was not performed and there was a lack of oversight by management over the preparation of the schedule of expenditures of federal awards to ensure proper reporting. Potential Effect: As a result of the condition above, the financial reports and the SEFA required significant adjustments at year end. These conditions may provide opportunities for errors or fraud to occur and cause material misstatements of the financial statements. Questioned Costs: None Context: There was a lack of oversight and lack of grant accounting knowledge to ensure complete and accurate financial statements and SEFA preparation. Recommendation: Recommend procedures be put into place to ensure the financial statements and the schedule of expenditures of federal awards are being prepared and presented in accordance with Generally Accepted Accounting Principles. We further recommend the accountant receive training in the purpose and use of accrual accounting and its application in the QuickBooks accounting system. Due to the material adjustments required to 2021 and 2022 expenditures, we recommend re-submission of both years? Federal Financial Reports to accurately reflect adjusted expenditures and matching requirements.