Finding Text
Condition Found: During our audit, we noted the following: The right-of-use asset and lease liability was not recorded. Repair and maintenance expenses were incorrectly capitalized. Grants given to students using HEERF funds was not correctly recorded. Allowance for uncollectible accounts receivable should have been adjusted. Criteria: The design and implementation of policies and procedures should be sufficient enough for the reconciliation of significant financial accounts and transaction classes to prevent and detect material misstatements in the financial statements. Cause: The end of year closing process was lacking the procedures necessary to identify the adjustments needed. Possible Asserted Effect: In fiscal year 2023, we proposed several adjustments to general ledger accounts. The potential effect could be significant to the financial statements since without these adjustments, the financial statements of the University would have been materially misleading. Repeat Finding :A similar finding was reported in the prior year’s audit as Finding 2022-001.Recommendation:We recommend that the University put in place necessary controls and procedures to ensure that all transactions, especially at year-end, are properly classified. Management Response: We will continue to increase the review of general ledger entries and strive to record all necessary adjustments prior to the beginning of the audit. The accountant will review the prior year adjusting journal entries made to ensure that if similar adjustments are needed that they are made before the audit begins. In addition, the CFO will review the end of year trial balance to make sure the general ledger accounts are correct.