Finding Text
Finding 2025-001 Controls over Revenue Recognition and Review / Preparation of the SEFA Finding Type Significant deficiency in internal control over financial reporting, other matters compliance finding, and significant deficiency in internal control over compliance. Criteria Organizations should maintain internal control to provide for the recognition of revenue in accordance with the provisions of U.S. Generally Accepted Accounting Principles (GAAP). In addition, Section 200.510(b) of 2 CFR Part 200 (the Uniform Guidance) requires recipients of federal awards to prepare a complete and accurate schedule of expenditures of federal awards (SEFA). Condition and Context During the audit, upon management’s completion of the final SEFA reconciliations, it was determined that an adjusting entry was required in order to reduce recognized federal awards revenue in the financial statements and expenditures on the SEFA for the year ended September 30, 2025 by $407,237. Cause ASTHO did not timely complete its final reconciliation of total federal award revenue to total federal award expenses. Effect Had the error not been corrected, Federal award revenue and the SEFA expenditures would have been overstated by $407,237. Repeat Finding No. Recommendation We recommend that ASTHO implement a procedure to provide for the reconciliation of total federal award revenue to the total federal award expenses on a monthly basis. This should reduce the likelihood of similar future errors. Views of Responsible Officials and Planned Corrective Action See attached corrective action plan. Questioned Costs None.