Finding 1093676 (2024-002)

Significant Deficiency
Requirement
P
Questioned Costs
-
Year
2024
Accepted
2024-12-31
Audit: 335234
Organization: Columbia Village (MN)

AI Summary

  • Core Issue: Management failed to provide supporting documentation for a journal entry, indicating a significant deficiency in internal controls over financial reporting.
  • Impacted Requirements: Internal controls must ensure that all journal entries are backed by proper documentation to prevent misstatements or fraud.
  • Recommended Follow-Up: Management should review and improve policies for retaining supporting documentation to ensure all journal entries are accurately supported.

Finding Text

Type of Finding: Significant Deficiency in Internal Control over Financial Reporting Condition: Management is responsible for reviewing and retaining all support of journal entries made to the general ledger detail to ensure no fictitious or incorrect entries are made. Criteria or Specific Requirement: Internal controls should be in place to ensure the support for all journal entries are retained to support the amount and purpose of the entries made to the general ledger detail. Context: While performing audit procedures, it was noted that management was unable to provide supporting documentation for one of the journal entries selected during the testing and review of the general ledger. Effect: The lack of supporting documentation for the journal entry selected for testing increases the risk of misstatements, fraud, or errors occurring and not being detected and corrected during the journal entry preparation process. Cause: Management was unable to provide the supporting documentation for the prepaid journal entry selected during the testing process to support the accuracy and purpose of the entry made. Repeat Finding: N/A Recommendation: The Corporation should evaluate their policies and procedures relating to the retainment of supporting documentation during the journal entry preparation and close process to ensure all supporting documentation for any journal entries made are accessible to support both the accuracy and purpose of the entries made. Views of Responsible Officials and Planned Corrective Actions: There is no disagreement with the audit finding. Management will review the policies and procedures currently in place relating to the retainment of journal entry support to ensure that all supporting documentation for entries made to the general ledger are kept validating the accuracy and purpose of journal entries.

Categories

Reporting Significant Deficiency Internal Control / Segregation of Duties

Other Findings in this Audit

  • 517233 2024-001
    Material Weakness Repeat
  • 517234 2024-002
    Significant Deficiency
  • 517235 2024-003
    Significant Deficiency
  • 1093675 2024-001
    Material Weakness Repeat
  • 1093677 2024-003
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
14.157 Supportive Housing for the Elderly $3.00M
14.182 Section 8 New Construction and Substantial Rehabilitation $86,197