CORRECTIVE ACTION PLAN (CAP) Agency: White Bird Clinic Audit Period: Fiscal year ending June 30th, 2022 Identification of control weakness: 1) Audit adjustments for the prior year were not posted to the accounting records, resulting in a $116,141 overstatement of beginning net assets, as well as d...
CORRECTIVE ACTION PLAN (CAP) Agency: White Bird Clinic Audit Period: Fiscal year ending June 30th, 2022 Identification of control weakness: 1) Audit adjustments for the prior year were not posted to the accounting records, resulting in a $116,141 overstatement of beginning net assets, as well as differences in long-term debt balances and overstatement of current year salaries and revenue. 2) The board designated endowment fund at the Oregon Community Foundation was not adjusted to record the activity for the last nine months of the year, and an entry to record donations to the fund was posted backwards. 3) FQHC WRAP receivable and revenue were not adjusted to actual for the last six months of the year. Although the State of Oregon is six months in arrears in making the payments, the Clinic has the information to record the correct amounts much sooner. The difference was $637,034. Effect of control weakness: The general ledger required significant adjustments during the audit in order to fairly present the financial statements. Interim reports prepared for Board and management use during the year contained some inaccurate information. Agency response to deficiency finding: Management acknowledges some periodic reconciliations of significant balance sheet accounts were not performed in a timely manner due to ongoing staffing shortages and gaps in training within the fiscal department. White Bird's former CFO departed the agency in March of 2022. For this reason, the agency leaned more heavily on its auditors to ensure proper reporting balances of its financial accounts as of year-end. Management agrees with and has made all adjusted entries to its ledgers as of June 30, 2022. Management has reviewed its closing policies and procedures and made improvements to its closing processes, including training staff to perform appropriate reconciliations of pertinent general ledger balances. Corrective Actions Steps to Directly Address deficiency: 1) All audit adjustments stemming from the prior fiscal year audit (FY20-21) were entered and posted to the ledgers upon notification by the auditor. The adjustments were entered and posted by the accounting controller (Max Fery) in the 2022 Adjustment Period. 2) The OCF endowment fund will be reconciled following the receipt of the quarterly endowment statement which is provided for the quarters ending 3/31, 6/30, 9/30, and 12/31 of each year. Entries to book activity from the fund activities will be entered by the Staff Accountant (Pam Price) and reviewed by the Controller (Max Fery) prior to posting. For current FY22-23, OCF endowment statements have been received and activity has been posted up until 12/31/22 as of this writing. The Staff Accountant has been trained in how to enter the quarterly activity to respective gain/loss accounts, and how to book interest income received. 3) FQHC WRAP receivable will be reconciled each month by the Controller (Max Fery) during the monthly close process. The receivable balance will be reconciled to the actual amounts expected to be received as dictated by the actuals of each submission that which can be reasonably known. White Bird will have some uncertainty as to what the receivable will be in the trailing 1-2 months, and therefore will use its best judgment to book a forecast for those months. For example, on June 30th 2023, White Bird will not have submitted the FQHC WRAP invoice for June encounters until 2 ? 3 months subsequent to the end of the month, therefore our receivable balance at June 30th will be the sum of all previous submissions that are unpaid, and some amount of forecasted submissions for the most recent un-submitted months that services were provided. Anticipated Completion Date & responsible persons: 1) Completed in April 2023 by Max Fery 2) Each quarter (9/30, 12/31, 3/31, and 6/30/23) by Pam Price and Max Fery 3) Each month during fiscal close by Max Fery CAP Outcomes: Significant balance sheet accounts will be adjusted in a timely manner to provide accurate financial reporting.