Finding 33444 (2022-002)

Material Weakness
Requirement
A
Questioned Costs
-
Year
2022
Accepted
2023-06-05
Audit: 28952
Organization: Bethesda University (CA)
Auditor: Ckp

AI Summary

  • Answer: The University failed to maintain effective internal controls over federal awards, leading to material noncompliance.
  • Trend: This issue highlights a recurring problem with compliance management in federal award processes.
  • List: Recommended follow-up includes strengthening internal controls and conducting regular compliance training for staff.

Finding Text

Criteria: 2 CFR 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Condition: The University did not detect several material noncompliance due to the ineffective internal control over compliance. Questioned Costs: Not applicable

Corrective Action Plan

The University evaluated and updated its internal control monitoring procedures so that the procedures will be properly followed and documented. The University have two basic categories of internal control ? preventive and detective. An effective internal control system will have both types as each serves a different purpose. Preventive controls aim to decrease the chance of errors and fraud before they occur. Preventive controls are essential because they are proactive and focused on quality. Preventive controls include pre-approval of actions and transactions, access controls, employee screening and training etc. To protect those who handle finances from mistakes, false accusations or temptations, the following procedures have been enacted. Bethesda University checks require at least one signature. Money received from students is recorded in two places on the computer: QuickBooks (accounting software program), and Populi (school management system). In each transaction, money is received and recorded by the accountants. Bank deposits are conducted by the accountants, and all deposit records are kept in a binder with copies of all deposit slips and canceled checks. Once a month, the accountant does bank reconciliation by comparing QuickBooks records with bank stubs, bank statements, cleared checks, and monthly payment records. The expenditures are categorized in the appropriate budget category. Detective controls are designed to find errors or problems after the transaction has occurred. Detective controls are essential because they provide evidence that preventive controls are operating as intended, as well as offer an after the fact chance to detect irregularities. Detective controls include monthly reconciliations of departmental transactions, reviewing organizational performance, physical inventories. The University makes sure that the internal control over the accounting process and the federal awards and institutionally and adequately operate monitoring activities to monitor the internal control system over compliance. The Finance Committee at Bethesda University is responsible for the review, and the quality assurance. Person Responsible for Corrective Action Plan: Sheng Wang, Chief Financial Officer Anticipated Date of Completion: June 30, 2023

Categories

Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties

Other Findings in this Audit

  • 33441 2022-001
    Material Weakness
  • 33442 2022-005
    Significant Deficiency
  • 33443 2022-007
    Significant Deficiency
  • 33445 2022-001
    Material Weakness
  • 33446 2022-002
    Material Weakness
  • 33447 2022-005
    Significant Deficiency
  • 33448 2022-006
    Significant Deficiency
  • 33449 2022-007
    Significant Deficiency
  • 33450 2022-001
    Material Weakness
  • 33451 2022-002
    Material Weakness
  • 33889 2022-005
    Significant Deficiency
  • 33890 2022-007
    Significant Deficiency
  • 33891 2022-001
    Material Weakness
  • 33892 2022-002
    Material Weakness
  • 33893 2022-003
    Significant Deficiency
  • 33894 2022-004
    Significant Deficiency
  • 33895 2022-001
    Material Weakness
  • 33896 2022-002
    Material Weakness
  • 33897 2022-003
    Significant Deficiency
  • 33898 2022-004
    Significant Deficiency
  • 33899 2022-001
    Material Weakness
  • 33900 2022-002
    Material Weakness
  • 33901 2022-003
    Significant Deficiency
  • 33902 2022-004
    Significant Deficiency
  • 609883 2022-001
    Material Weakness
  • 609884 2022-005
    Significant Deficiency
  • 609885 2022-007
    Significant Deficiency
  • 609886 2022-002
    Material Weakness
  • 609887 2022-001
    Material Weakness
  • 609888 2022-002
    Material Weakness
  • 609889 2022-005
    Significant Deficiency
  • 609890 2022-006
    Significant Deficiency
  • 609891 2022-007
    Significant Deficiency
  • 609892 2022-001
    Material Weakness
  • 609893 2022-002
    Material Weakness
  • 610331 2022-005
    Significant Deficiency
  • 610332 2022-007
    Significant Deficiency
  • 610333 2022-001
    Material Weakness
  • 610334 2022-002
    Material Weakness
  • 610335 2022-003
    Significant Deficiency
  • 610336 2022-004
    Significant Deficiency
  • 610337 2022-001
    Material Weakness
  • 610338 2022-002
    Material Weakness
  • 610339 2022-003
    Significant Deficiency
  • 610340 2022-004
    Significant Deficiency
  • 610341 2022-001
    Material Weakness
  • 610342 2022-002
    Material Weakness
  • 610343 2022-003
    Significant Deficiency
  • 610344 2022-004
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $581,082
84.063 Federal Pell Grant Program $337,369
84.425 Education Stabilization Fund $44,105
84.007 Federal Supplemental Educational Opportunity Grants $4,450