Finding Text
Condition - The Organization had a lack of segregation of duties during the year ended December 31, 2023.
Criteria - Internal control procedures require that accounting functions should be segregated so that one person does not control more than one aspect of an accounting transaction. And when there are duties that are not segregated, compensating controls should be in place to overcome the risks related to a lack of segregation of duties.
Cause - During 2023, the Organization had an employee in the accounting department retire and was not replaced. The Organization has a limited number of staff in the accounting department to be able to keep proper segregation of duties after the employee’s retirement.
Effect - After the employee’s retirement, the Organization could not maintain segregation of duties.
Recommendation - When a lack of segregation of duties exists, management’s close supervision and review of accounting information are the best means of preventing or detecting errors and irregularities.