Finding Text
Criteria: Internal controls over financial reporting include the ability to timely reconcile general ledger accounts and produce accurate and timely financial statements in accordance with generally accepted accounting principles (GAAP) to ensure that useful information is available to management and those charged with governance.
Condition: The internally generated trial balance provided for the audit did not include certain adjusting entries. Material audit adjustments were required to correct the balances in net assets with and without donor
restrictions, grants receivable, deferred revenue, and revenues Effect: Without fully analyzing and accurately recording transactions, information provided to management or
the board of directors may not be accurate.
Recommendation: The Organization should evaluate its revenue recognition policy and update them to be in line with GAAP.
Views of responsible officials and planned corrective actions: Management acknowledges that adjustments to deferred revenue, receivables, and revenue were required.