Finding Text
Criteria - The internal control structure should be designed to contain the following:
1. Segregation of duties to provide reasonable assurance that all transactions are
being properly approved.
2. All accounts are reconciled in a timely manner, and account reconciliations
are reviewed.
3. Timely preparation of internal financial statements and other financial
information to ensure those in charge of governance can make financial
decisions based upon current financial data.in certain phases including, the summary of checks received is not being compared
to the bank deposit slip, reconciliations of accounts receivable balances to the
general ledger total are not performed in all instances, the monthly accounts
receivable balances are not reviewed and approved by a member of management,
reconciliations are not presently reviewed by a member of management, credit card
statements of the key employees are not reviewed by another member of
management, and in several instances, transactions on credit card statements were
not supported by receipts.
Cause - Due to the size of the accounting staff and implementation of procedures
related to reconciliations, approval and posting of transactions.
Effect - The lack of adequate internal controls relating to approval of transactions
and account reconciliations could result in the financial statements being misstated.
Context - Systematic.
Recommendation - We recommend BCHS implement adequate internal controls
relating to transaction approval and account reconciliation which provide for
approval of all transactions and reconciliation of all accounts on a monthly basis.