Finding Text
Criteria:
Internal control that supports the District's ability to initiate, record, process, and report financial
data consistent with the assertions of management in the financial statements requires adequate
segregation of accounting duties.
Condition:
During the year ended June 30, 2023, the District had a lack of segregation of accounting duties due
to a limited number of office employees. This lack of segregation of accounting duties can be
demonstrated in the following areas, which is not intended to be an all-inclusive list:
The Program Director is responsible for reporting without review.
The Program Director is responsible for preparing reimbursement requests without review
Management is aware of this condition and will take certain steps to compensate for the lack of
segregation. However, due to the small accounting staff needed to handle all of the accounting
duties, the cost of obtaining desirable segregation of accounting duties can often exceed benefits
which could be derived. Due to this reason, management has determined a complete segregation of
accounting duties is impractical to correct.
Context:
This finding impacts the internal control over financial reporting.Effect or Potential Effect:
The lack of adequate segregation of accounting duties could adversely affect the District's ability to
record, process, summarize, and report financial data consistent with the assertions of management
in the financial statements.
Cause:
There are a limited number of office employees.
Recommendation:
Continue to review the accounting system, including changes that may occur. Implement segregation
whenever practical.