Finding Text
inding Number 2019-002: Represents a material weakness in internal control over compliance with Community and Family Services, Inc.'s major federal programs.
Repeat Finding: No
Questioned Costs: None
Funding Agency: Department of Housing and Urban Development & Department of Health and Human Services Title: Section 8 and Head Start
AL Numbers: 14.871 & 93.600
Award Year: Section 8: 01/01/19 - 12/31/19 Head Start: 11/1/2018 - 10/31/2019 Head Start: 11/1/2019 - 10/31/2020 Condition - Throughout the early stages of audit fieldwork management struggled to provide proper documentation to substantiate account balances. In order to substantiate balances, the audit team guided management in gathering and completing various schedules which ultimately was used as audit evidence. As a consequence the audit process lasted significantly longer than considered normal.
Criteria - Management is responsible for establishing and maintaining a system of internal controls that includes keeping accurate records to support account balances.
Effect or Potential Effects - As a result of improper documentation being stored and shared, the Organization has a material weakness in internal controls and compliance over financial reporting.
Cause - The Organization has had turnover and has limited staff working in the accounting office.
Auditor's Recommendation - We recommend that the Organization create systems to store required accurate records as part of their system of internal control. Management should continue to review and approve the annual financial statements and the related footnote disclosures.
View of Responsible Official - The Organization agrees with the finding and will investigate if this can be addressed internally by management.