Finding 1168814 (2024-001)

Management acknowledges the condition noted regarding the maintenance of accounting records on a cash basis rather than an accrual basis in 2024, as well as the absence of a formal budget for the year under audit. We recognize that these factors contributed to errors in the financial records and resulted in the need for several audit adjustments. To address the underlying causes identified, management is implementing the following corrective actions: • Transition to Accrual Basis Accounting: We have revised our accounting processes to ensure that all financial activity is recorded in accordance with generally accepted accounting principles (GAAP). This includes recording expenses in the period in which they are incurred and ensuring that all reconciliations reflect accrual basis adjustments. • Grant Reconciliation Oversight: We have strengthened our review of grant reconciliations and indirect cost calculations to ensure accuracy and compliance with grant requirements. The Treasurer reviews all reconciliations and submits same to the Board for review and approval on a monthly basis. • Timely Period End Close: Management is implementing a structured month end and year end close process to ensure that all reconciliations and supporting schedules are completed and reviewed promptly after period close. • Budget Preparation: Approximately 90% of all revenue and appropriations are driven by grant programs with specific spending requirements. As such, there are limited funds subject to the development of an operating budget outside of grant funding. However, the Board of Director's has initiated the development of an annual budget related to the discretionary funding.