Finding 22382 (2022-001)

Finding 2022-001 Financial Close Process Type of Finding: Material Weakness in Internal Control over Financial Reporting Condition and Context: The financial statements provided by management did not include all of the activity of the Organization. There was another bank account and loan that was not recorded on the financial statements that were provided to the auditor. Criteria: Management is responsible for establishing internal controls to properly record, track, and approve the financial statements. Cause: Management did not provide the outside bookkeeper with all of the bank statements and information for the Organization. Effect: The financial statements were materially misstated until the bank account and its activity were included in the financial statements. Recommendation: Management should ensure all activity and accounts of the Organization are provided to the outside bookkeeper on a monthly basis. Views of Responsible Officials: Little Buns, Inc. was awarded a SBA Disaster Loan that was intended for investment purposes to generate income to provide additional resources for expenses not available through USDA CACFP Grant funding. I was not aware that these funds were audited in the Federal Audit for USDA CACFP Grant funding as they were not co-mingled in the grant funding