Finding 1237687 (2024-004)

Department of Agriculture Federal Financial Assistance Listing #10.766 Community Facilities Loans and Grants Preparation of the Schedule of Expenditures of Federal Awards Material Weakness in Internal Control Over Compliance - Other Criteria Proper controls over financial reporting include the ability to prepare the Consolidated Schedule of Expenditures of Federal Awards (Schedule) and accompanying notes to the Schedule. Condition The Medical Center does not have an internal control system designed to provide for a complete and accurate schedule of expenditures of federal awards being audited. We were requested to draft the Schedule. Cause Auditor assistance with preparation of the Schedule is not unusual, as the Schedule has unique and specialized requirements and preparation is only required when the Medical Center meets a specified threshold of federal expenditures. Effect There is a reasonable possibility that the Medical Center would not be able to draft a Schedule that is correct without assistance of the auditors. Questioned Costs None reported. Context Sampling was not used. Repeat Finding from Prior Years Yes Recommendation While we recognize that this condition is not unusual for an organization with limited staffing, we recommend management be aware of the financial reporting requirements relating to the Medical Center’s Consolidated Schedule of Expenditures of Federal Awards and internal controls that impact financial reporting. Views of Responsible Officials Management agrees with the finding.