Finding Text
Condition: A potential exists that a material misstatement of the financial statements could occur
and not be prevented or detected by management’s internal controls.
Criteria: Management is responsible for the accuracy and completeness of financial records and
related information.
Effect: The adjustments proposed impacted various financial statement line items. In total 7 adjusting
journal entries were proposed with an aggregate impact to decrease total assets of approximately
$217,000, decrease liabilities of approximately $64,000, and decrease in change in net assets of
approximately $153,000.
Cause: Management oversight.
Recommendation: Management should evaluate monthly and year-end closing procedures to
ensure appropriate recognition of accruals, revenue, and expenses.
Management’s Response: Management has reviewed, agreed to, and posted the proposed adjusting
journal entries to the Foundation’s general ledger.