Finding 1238607 (2024-002)

Material Weakness Repeat Finding

Requirement

Questioned Costs

Year

2024

Accepted

2026-09-30

Audit: 413484

Organization: CITY OF FARRAGUT (IA)

Auditor: IOWA AUDITOR OF STATE

AI Summary

Core Issue: One person has too much control over critical financial areas, increasing the risk of errors or fraud.
Impacted Requirements: This situation violates key internal control principles that require separation of duties.
Recommended Follow-Up: Implement checks and balances by assigning different individuals to handle cash, debt, receipts, disbursements, and financial reporting.

Finding Text

One individual in the City has control over each of the following areas for the City: • Cash – handling, reconciling and recording. • Long-term debt – recordkeeping, compliance and debt payment processing. • Receipts – opening mail, collecting, depositing, recording, reconciling and posting. • Disbursements – purchasing, invoice processing, check writing, mailing, reconciling and recording. • Financial Reporting – report preparation, performance of all accounting functions, controlling all data input and output and having custody of assets.

Corrective Action Plan

The City will review procedures and attempt to make the necessary changes to improve internal control.

Other Findings in this Audit

1238606 2024-001

Material Weakness Repeat

Programs in Audit

ALN	Program Name	Expenditures
10.760	WATER AND WASTE DISPOSAL SYSTEMS FOR RURAL COMMUNITIES	$1.76M