Finding Text
#2024-002 Finding: Financial Statement and Schedule of Expenditures of Federal Awards (SEFA) Preparation Federal Program Affected: Coronavirus State and Local Fiscal Recovery Funds (ALN 21.027) Compliance Requirement: Reporting Questioned Costs: None Condition and Cause: We were requested to draft the audited financial statements, SEFA, and related footnote disclosures as part of our regular audit services. Ultimately, it is management’s responsibility to provide for the preparation of the District’s statements, schedules and footnotes, and the responsibility of the auditor to determine the fairness of presentation of those statements. From a practical standpoint, we do both for the District at the same time in connection with our audit. This is not unusual for districts of your size. Criteria and Effect: It is our responsibility to inform the Board that this deficiency could result in a material misstatement to the financial statements that would have not been prevented or detected by the District’s management. Recommendation: We have instructed management to review a draft of the auditor prepared financials and adjusted SEFA in detail for their accuracy, we have answered any questions they might have, and we have encouraged research of any accounting guidance in connection with the adequacy and appropriateness of classification and disclosure in your statements. We are satisfied the appropriate steps have been taken to provide the District with complete financial statements and SEFA. It is the responsibility of management and the Commission to make the decision whether to accept the degree of risk associated with this condition because of cost or other considerations. Response/Corrective Action Plan: See District’s Corrective Action Plan.