Finding Text
Finding Number: 2025-003 Repeat Finding: No Type of Finding: Significant Deficiency in Internal Control and Nonmaterial Noncompliance Description: Late Submission of the Data Collection Form Major Programs: Aging Cluster Questioned Costs: None How the questioned costs were computed: N/A Compliance Requirement: Reporting Condition: The auditee did not submit the required Data Collection Form (SF-SAC) and reporting package to the Federal Audit Clearinghouse within the timeframe required by Uniform Guidance. The filing was delayed because the annual audit could not be completed as scheduled due to unresolved accounts receivable balances that required additional reconciliation and audit procedures before the financial statements could be finalized. Criteria: Pursuant to 2 CFR § 200.512(b), an auditee must submit the Data Collection Form and reporting package to the Federal Audit Clearinghouse no later than the earlier of: Thirty (30) calendar days after receipt of the auditor's reports, or Nine (9) months after the end of the audit period. In addition, management is responsible for maintaining effective internal controls to ensure the timely preparation of accurate financial records and compliance with federal reporting requirements. Cause: The auditee did not maintain adequate controls over the reconciliation and monitoring of accounts receivable balances throughout the fiscal year. As a result, significant accounts receivable discrepancies remained unresolved at year-end and required extensive analysis and correction during the audit process. The delay in resolving these matters postponed completion of the financial statement audit and, consequently, the submission of the Data Collection Form and reporting package. Effect: Failure to timely reconcile accounts receivable records contributed to delays in the completion of the audit and resulted in noncompliance with Uniform Guidance reporting requirements. Untimely submission of the Data Collection Form may hinder the timely availability of audit information to federal agencies and pass-through entities and may subject the auditee to increased monitoring or scrutiny by federal oversight agencies. Recommendation: We recommend management strengthen internal controls over financial reporting and federal compliance by: Implementing formal monthly reconciliations of accounts receivable balances and subsidiary ledgers to the general ledger. Establishing supervisory review procedures to ensure reconciliations are completed timely and discrepancies are investigated promptly. Developing a year-end closing schedule that includes deadlines for resolving significant accounting issues before the audit begins. Maintaining a compliance calendar to monitor Single Audit milestones and federal reporting deadlines. Periodically reviewing the status of audit preparation activities to identify and address issues that could delay completion of the audit and subsequent federal filings. View of Responsible Officials: Management agrees with the finding and has developed a written corrective action plan.