Finding Text
FINDING 2024-002: Controls Over Accounting of Real Estate Subsidiaries - Criteria – Organizations should have controls in place to ensure accounting activity is recorded timely and accurate. Condition – For the audit of NeDA’s real estate subsidiaries, the property management agent was not able to provide an accurate tenants receivable aging report that agreed to the accounting records, escrows held with the mortgager where not properly recorded or reconciled, and other balance sheet accounts were inaccurate and not reconciled. Cause – There was a breakdown in controls over the accounting of NeDA’s real estate subsidiaries. Effect – The accounting records of the real estate subsidiaries were inaccurate. Repeat Finding – No. Recommendation – We recommend that the property management agent enhance its internal controls, policies and procedures to ensure that all accounting activity is accurately and timely recorded. Auditee's comments and response – Management agrees with the finding. Effective October 1, 2024, NeDA moved the management of its real estate subsidiaries to a new property management agent. Responsible party for the corrective action – Maria Steffel, Executive Director