Finding 2025-001: Material Weakness in Internal Control over Financial Reporting ● Condition: The Abbey did not consolidate subsidiaries in its financial statements. ● Criteria: Generally Accepted Accounting Principles (GAAP) require that all subsidiaries be consolidated into the parent Abbey's financial statements. ● Cause: The Abbey lacked adequate internal controls to ensure all subsidiaries were identified and consolidated. ● Effect: The financial statements were materially misstated, as they did not include the financial position and results of operations of the subsidiary. Corrective Action Plan: ● Responsible Person: Right Reverend Gregory Boquet, O.S.B. ● Planned Action: We agree with the auditor’s finding that there is a material weakness in internal control over financial reporting due to the non-consolidation of subsidiaries. However, after careful consideration, management has decided not to implement the recommended procedures to consolidate the subsidiaries. ● Justification: Management believes that the current procedures are adequate, and that the non-consolidation of the subsidiaries does not materially affect the financial statements. The costs and resources required to implement the recommended procedures outweigh the benefits, given the subsidiaries’ minimal impact on the overall financial position and results of operations. We will continue to monitor the situation and reassess it if necessary. ● Anticipated Completion Date: Not applicable, as no changes will be made. Views of Responsible Officials: The Abbey disagrees with the finding. Management believes that the current procedures are adequate, and that the non-consolidation of the subsidiaries does not materially affect the financial statements. The Abbey will not implement the recommended procedures but will continue to monitor the situation and reassess if necessary.