Finding 2108 (2021-003)

FINDING #2021-003 – Lack of Expenditure Support and Evidence of Approval for Federal Expenditures Condition During our current year testing of federal expenditures, we noted 8 instances from a sample of 40 expenditures that lacked management approval. In addition, there were 4 expenditures that did not have adequate supporting detail. Criteria Management is responsible for establishing and maintaining an effective system of internal control over financial reporting. Proper approval of expenditures and availability of adequate supporting documentation for expenditures is a key aspect of an effective system of internal control over financial reporting. Cause Management oversight. Effect of Condition Unallowable expenditures may be charged to federal grants. Recommendation We recommend that the board and management establish sufficient controls surrounding federal expenditures.