FAC Explorer

Finding 34419 (2022-003)

Significant Deficiency
Requirement
P
Questioned Costs
-
Year
2022
Accepted
2023-03-30
Audit: 32025
Organization: Morehouse Place Cooperative (MN)
Auditor: Westberg Eischens

AI Summary

  • Core Issue: The Cooperative's internal controls failed to prevent or detect financial statement misstatements.
  • Impacted Requirements: Internal controls related to reconciling procedures were not followed, leading to potential inaccuracies.
  • Recommended Follow-Up: Continue reviewing and adhering to internal control measures to ensure accurate financial reporting.

Finding Text

Finding 2022-003 Criteria: A control deficiency exists when the design or operation of a control does not allow management or employees in the normal course of performing their assigned functions, to prevent or detect misstatements of the financial statements on a timely basis. A control deficiency that is typically considered significant is the identification by the auditor of a misstatement in the financial statements that was not initially identified by the Cooperative?s internal control. Condition: The Cooperative?s internal controls did not allow the prevention of misstatements when recording the necessary entries for proper financial statement presentation. Questioned Costs: None. Context: The Cooperative did not follow their internal controls in respect to reconciling procedures. Effect: The condition of this finding increases the likelihood of a lack of internal controls. Cause: The Cooperative did not properly record the necessary entries to reflect the physical transactions in the financial statements. Repeat Finding: N/A. Recommendation: We recommend that the Cooperative continue to review internal controls currently in place. Current Status: Resolved, the Cooperative took the necessary action to record the required transactions in the financial statements. Action Taken: The Cooperative took the proper action to correct the misposted transactions during on-site visit. Views of Responsible Officials and Planned Corrective Actions: The Cooperative agrees with this finding and will adhere to the corrective action plan on pages 31-32 in this audit report.

Corrective Action Plan

Housing and Urban Development Morehouse Place Cooperative respectfully submits the following corrective action plan for the year ended December 31, 2022. Westberg Eischens, PLLP 2630 1st Street South P.O. Box 362 Willmar, MN 56201 Audit Period: December 31, 2022 The findings from the December 31, 2022 schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Summary of audit results does not include findings and is not addressed. Finding 2022-003 Recommendation: We recommend that the Cooperative continue to review internal controls currently in place. Action Taken: The Cooperative took the proper action to correct the misposted transactions during on-site visit. Planned Completion Date: March 31, 2023.

Categories

Internal Control / Segregation of Duties

Other Findings in this Audit

  • 34417 2022-001
    Significant Deficiency
  • 34418 2022-002
    Significant Deficiency
  • 34420 2022-004
    Significant Deficiency
  • 34421 2022-005
    Significant Deficiency
  • 610859 2022-001
    Significant Deficiency
  • 610860 2022-002
    Significant Deficiency
  • 610861 2022-003
    Significant Deficiency
  • 610862 2022-004
    Significant Deficiency
  • 610863 2022-005
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
14.126 Mortgage Insurance_cooperative Projects $2.79M