Finding Text
Finding No. 2023-001: Financial Reporting – Material Weakness
Criteria
An accounting system and effective internal control environment should support the preparation of the
financial statements in accordance with Generally Accepted Accounting Principles (“GAAP”) and
grant reports in accordance with Federal and State compliance requirements, including a robust
financial close process at year end.
Condition
In fiscal year 2023, the Organization’s accounting processes and internal controls over financial
reporting were not functioning timely to support generating complete and accurate financial
information. The books and records were not closed and finalized timely. Numerous adjustments to the
trial balances were made, necessitating revisions to account reconciliations, and grant schedules.
Cause
The Organization experienced staffing shortages and related difficulties during the fiscal year.
Effect
The books and records were not closed and finalized until many months after year end.
Context
The Organization’s accounting processes and internal controls over financial reporting were not
functioning properly.
Recommendation
We recommend that the Organization maintain an adequate level of appropriately trained and
experienced personnel. This will help ensure that the accounting processes and internal controls over
financial reporting will function properly, and that the financial close process will be complete,
accurate, and timely.
Management’s Response/View of Responsible Officials
Management agrees with this finding, see the Corrective Action Plan.
III. Federal Awards Findings and Questioned Costs:
Finding No. 2023-001: Financial Reporting – Material Weakness, is also considered a finding under
Federal Award Findings and Questioned Costs. This finding is applicable to all federal programs.