Finding 1073426 (2023-002)

Finding Number: 2023-002 - Preparation of the Schedule of Expenditures of Federal Awards Criteria: The District should be reporting federal grant expenditures on an accrual basis of accounting in order to be consistent with the District's financial statements. Condition Found: The District is currently reporting grant expenditures on a cash basis which is not consistent with the financial statements prepared using the accrual basis of accounting as a result grant expenditures could be reported in improper periods. Cause and Effect: Having to adjust for accrual account balances resulted in errors that an ongoing accrual accounting process would have helped prevent or detect and correct timely. As a result of this condition, the District reported grant expenditures that had been accrued and reported in the prior year's Schedule of Expenditures of Federal Awards. Recommendation: It was recommended that the District implement policies and procedures to report grant expenditures on the accrual basis of accounting throughout the year. Identification as a Repeat Finding, if applicable: Not applicable Management response: Management agrees with the findings and recommendations.