Finding 1173227 (2024-001)

Material Weakness Repeat Finding
Requirement
P
Questioned Costs
-
Year
2024
Accepted
2026-02-11
Audit: 386706
Organization: Anewentry, Inc. (TX)

AI Summary

  • Core Issue: Lack of separation of duties in management and accounting roles increases risk of fraud.
  • Impacted Requirements: Internal controls over financial reporting and compliance with grant agreements are compromised.
  • Recommended Follow-Up: Implement clear separation of duties and enhance oversight to mitigate risks.

Finding Text

Criteria: Management is responsible for establishing and maintaining internal controls over financial reporting and compliance with requirements of its grant agreements. Condition: There was a lack of separation of duties during the audit period. Perspective Information: All accounting and management functions were subject to this lack of separation of duties. Cause and effect: Family-related persons were in charge of management and accounting functions. This could result in management override and potential collusion. Recommendation: Management should establish adequate separation of duties and oversight. Views of responsible officials: See attached.

Corrective Action Plan

Views of Responsible Officials: We agree with the auditor’s comments, and the following actions have been implemented. Corrective Action Plan: With respect to the identified nepotism concern, the Board of Directors formally adopted the Chamber of Commerce Board Standards to strengthen governance, independence, and conflict-of-interest oversight. Upon notification of the adoption of these standards, the prior administration, including Executive Director Soleece Watson, tendered their resignations in full. This resulted in a complete transition of executive leadership and administrative staff. As a result of these corrective actions, including revised governance standards, leadership transitions, and strengthened internal controls, management does not anticipate recurrence of the previously identified issues. The current Board and administration are committed to ongoing compliance, transparency, and adherence to best practices, and believe these measures will prevent similar discrepancies in future audit periods. Implementation date: 01 January 2026 Responsible Official: Drew Denett and A New Entry, Inc. Management and Board Members

Categories

Internal Control / Segregation of Duties Reporting

Other Findings in this Audit

  • 1173225 2024-001
    Material Weakness Repeat
  • 1173226 2024-002
    Material Weakness Repeat
  • 1173228 2024-002
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
21.027 CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS $144,154