Audit 56744

The School lacks an effective internal control structure over financial close and reporting to allow for timely and accurate financial reporting. During our audit, the following issues were noted related to the School?s financial close and reporting process: Accrued liabilities: The School could not provide all the necessary information to substantiate the balances for various accrued liabilities accounts as of June 30, 2022. Fund Balance The School has restated the beginning fund balance to correct and reclass the balances of various accounts. Additionally, the School has recorded adjustments in unearned grant revenue, incomes and expenses to correct the ending balances of these accounts. Cash Balance The School?s cash reconciliations have unknown variances, and no current review of the reconciliation process. Criteria: The School is responsible for maintaining adequate internal controls over its accounting records, account balances, and financial statement disclosures. Accounting records should include a complete, balanced general ledger that records all transactions that is supported by appropriate subsidiary records so that accurate financial statements can be prepared. Procedures should be in place to ensure that balance sheet accounts are independently reviewed and reconciled to the subsidiary records, at the very least, on a monthly basis. Cause: There was a lack of established internal controls and processes over the financial reporting process to ensure timely and accurate financial reporting. Effect: Without established and adequate internal controls and year-end reconciliation procedures, the School?s balances lack certainty about the accuracy of the balances. We recommend management evaluate all aspects of the financial close and reporting process, and establish adequate internal controls and procedures to ensure timely and accurate financial statements and supporting schedules and to ensure timely compliance requirements are met. Management Response: The School did not have a Business Manager or Principal for the full fiscal year and has experienced turnover in other positions as well. The school has hired two (2) Business Managers on a short-term contract and full time contract. During the interim period, the Business Manager position was vacant until December 19, 2022. The administration agrees with the finding and with the newly hired Business Manager will devote time to evaluate adequate internal controls and procedures to ensure timely and accurate financial statements and supporting schedules and to ensure timely financial compliance requirements are met. ? All liability accounts will be reconciled at year end. ? Cash deposits will be made into the correct cash accounts and accounts reconciled. ? The School?s financial policy, updated in December of 2021, will be revised annually to ensure internal controls are identified and procedures are in place for timely and accurate recording of revenue and expenditures. ? The Organizational Structure will be revised to ensure the internal controls are met within the Business Office. ? The Principal and key staff will establish ad team to review and update the School's financial policies. Anticipated Completion Date: June 2023 Responsible Party: School Principal, Leon Oosahwe; Business Manager, Ernest Sakeva

The School lacks an effective internal control structure over financial close and reporting to allow for timely and accurate financial reporting. During our audit, the following issues were noted related to the School?s financial close and reporting process: Accrued liabilities: The School could not provide all the necessary information to substantiate the balances for various accrued liabilities accounts as of June 30, 2022. Fund Balance The School has restated the beginning fund balance to correct and reclass the balances of various accounts. Additionally, the School has recorded adjustments in unearned grant revenue, incomes and expenses to correct the ending balances of these accounts. Cash Balance The School?s cash reconciliations have unknown variances, and no current review of the reconciliation process. Criteria: The School is responsible for maintaining adequate internal controls over its accounting records, account balances, and financial statement disclosures. Accounting records should include a complete, balanced general ledger that records all transactions that is supported by appropriate subsidiary records so that accurate financial statements can be prepared. Procedures should be in place to ensure that balance sheet accounts are independently reviewed and reconciled to the subsidiary records, at the very least, on a monthly basis. Cause: There was a lack of established internal controls and processes over the financial reporting process to ensure timely and accurate financial reporting. Effect: Without established and adequate internal controls and year-end reconciliation procedures, the School?s balances lack certainty about the accuracy of the balances. We recommend management evaluate all aspects of the financial close and reporting process, and establish adequate internal controls and procedures to ensure timely and accurate financial statements and supporting schedules and to ensure timely compliance requirements are met. Management Response: The School did not have a Business Manager or Principal for the full fiscal year and has experienced turnover in other positions as well. The school has hired two (2) Business Managers on a short-term contract and full time contract. During the interim period, the Business Manager position was vacant until December 19, 2022. The administration agrees with the finding and with the newly hired Business Manager will devote time to evaluate adequate internal controls and procedures to ensure timely and accurate financial statements and supporting schedules and to ensure timely financial compliance requirements are met. ? All liability accounts will be reconciled at year end. ? Cash deposits will be made into the correct cash accounts and accounts reconciled. ? The School?s financial policy, updated in December of 2021, will be revised annually to ensure internal controls are identified and procedures are in place for timely and accurate recording of revenue and expenditures. ? The Organizational Structure will be revised to ensure the internal controls are met within the Business Office. ? The Principal and key staff will establish ad team to review and update the School's financial policies. Anticipated Completion Date: June 2023 Responsible Party: School Principal, Leon Oosahwe; Business Manager, Ernest Sakeva