Finding 1152498 (2024-001)

Significant Deficiency
Requirement
L
Questioned Costs
-
Year
2024
Accepted
2025-09-09
Audit: 365948
Organization: Public Defender Association (WA)
Auditor: Clark Nuber Ps

AI Summary

  • Core Issue: There is a significant deficiency in internal controls over financial reporting related to donor restrictions.
  • Impacted Requirements: Internal controls must ensure proper reconciliations and compliance with U.S. GAAP.
  • Recommended Follow-Up: Implement controls to review donor restricted balances during year-end close to release amounts when restrictions are met.

Finding Text

Finding 2024-001 Significant deficiency in internal controls over financial reporting in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). Criteria Internal controls over financial reporting should be in place to ensure proper reconciliations are being performed to ensure transactions are recorded in accordance with U.S. GAAP. Condition/Context During our audit, we noted that a significant amount of donor restrictions had been met in prior years but not released in those years. Effect/Potential Effect As a result, a prior period adjustment had to be booked to reclass $655,000 from net assets with donor restrictions to net assets without donor restrictions. Cause In the prior year, a year end review of restricted net assets was not performed to assess termed awards or to compare year end restricted net asset balances against expectations based on expenditures to date. Repeat Finding No Recommendation We recommend that PDA implement necessary internal controls to ensure that donor restricted balances are reviewed as part of year end close processes to determine if restrictions have been met and amounts should be released from restriction. Views of Responsible Officials Management agrees with the finding and has provided the corrective action plan following the Single Audit Report.

Categories

Reporting Significant Deficiency Internal Control / Segregation of Duties

Other Findings in this Audit

  • 576053 2024-001
    Significant Deficiency
  • 576054 2024-002
    Significant Deficiency
  • 576055 2024-003
    Material Weakness Repeat
  • 576056 2024-001
    Significant Deficiency
  • 576057 2024-002
    Significant Deficiency
  • 576058 2024-003
    Material Weakness Repeat
  • 1152495 2024-001
    Significant Deficiency
  • 1152496 2024-002
    Significant Deficiency
  • 1152497 2024-003
    Material Weakness Repeat
  • 1152499 2024-002
    Significant Deficiency
  • 1152500 2024-003
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
93.493 Congressional Directives $1.50M