Finding Text
Schedule of Expenditures of Federal Awards - Material Weakness Criteria An accounting system and effective internal control environment should support the preparation of the grant reports in accordance with Federal compliance requirements. Condition In fiscal year 2023, the Organization accounting processes and internal controls over Federal reporting were not functioning timely to support generating complete and accurate Schedule of Expenditures of Federal Awards. Cause The Organization experienced staffing shortages and was under the impression that Federal report was guided by the revenue from grants. Effect The lack of controls and understanding over reporting requirements resulted in failure to report the Schedule of Expenditures of Federal Awards. Context The Organization’s accounting processes and internal controls over Federal reporting were not functioning properly. Recommendation We recommend that the Organization maintain appropriately trained and experienced personnel. This will ensure that the accounting processes and internal controls over Federal Reporting will be functioning properly. Management’s Response/View of Responsible Officials Management agrees with this finding and has employed a new Director of Finance.