FAC Explorer

Finding 13035 (2022-001)

Significant Deficiency Repeat Finding
Requirement
P
Questioned Costs
-
Year
2022
Accepted
2023-05-03
Audit: 17164
Organization: Breezy Hill Water and Sewer Company, Inc. (SC)
Auditor: Phillips CPAS and Advisors

AI Summary

  • Core Issue: There's a lack of segregation in accounting duties, allowing individuals access to both physical assets and accounting records.
  • Impacted Requirements: Proper segregation of duties is necessary to ensure transactions are handled correctly and to prevent mishandling.
  • Recommended Follow-Up: Increase duty segregation where possible and ensure the Board of Directors is actively involved in financial oversight.

Finding Text

SIGNIFICANT DEFICIENCY 2022-001. CONDITION: THERE IS A LACK OF SEGREGATION OF ACCOUNTING DUTIES THAT ENABLES THE SAME INDIVIDUALS TO HAVE ACCESS TO BOTH PHYSICAL ASSETS AND THE RELATED ACCOUNTING RECORDS OR TO ALL PHASES OF A TRANSACTION. EFFECT: TRANSACTIONS COULD BE MISHANDLED. CRITERIA: DUTIES SHOULD BE SEGREGATED TO PROVIDE REASONABLE ASSURANCE THAT TRANSACTIONS ARE BEING HANDLED APPROPRIATELY. CAUSE: THERE ARE A LIMITED NUMBER OF PERSONNEL FOR CERTAIN FUNCTIONS. IDENTIFICATION OF A REPORT FINDING: THIS IS A REPEAT FINDING. RECOMMENDATION: DUTIES SHOULD BE SEGREGATED TO THE EXTEND POSSIBLE. THE BOARD OF DIRECTORS MUST REMAIN INVOLVED IN THE FINANCIAL AFFAIRS OF THE COMPANY TO PROVIDE OVERSIGHT AND INDEPENDEDNT REVIEW FUNCTIONS.

Corrective Action Plan

SIGNIFICANT DEFICIENCY 2022-001 SEGREGATION OF DUTIES. NAME OF CONTACT PERSON: JEFF LOWE, GENERAL MANAGER. CORRECTIVE ACTION: THE DUTIES WILL BE SEGREGATED AS MUCH AS POSSIBLE AND THE BOARD OF DIRECTORS WILL REMAIN INVOLVED IN THE FINANCIAL AFFAIRS OF THE COMPANY TO PROVIDE OVERSIGHT AND INDEPENDENT REVIEW FUNCTIONS. PROPOSEZD COMPLETION DATE: MANAGEMENT WILL IMPLEMENT THE ABOVE ACTION IMMEDIATELY.

Categories

HUD Housing Programs Significant Deficiency Internal Control / Segregation of Duties

Other Findings in this Audit

  • 589477 2022-001
    Significant Deficiency Repeat

Programs in Audit

ALN Program Name Expenditures
10.760 Water and Waste Disposal Systems for Rural Communities $829,652