FAC Explorer

Finding 370372 (2022-002)

Material Weakness Repeat Finding
Requirement
ABEILN
Questioned Costs
-
Year
2022
Accepted
2024-02-23
Audit: 291961
Organization: Underwood Community School District (IA)
Auditor: Nolte Cornman & Johnson PC

AI Summary

  • Core Issue: One employee has too much control over key financial areas, risking incompatible duties.
  • Impacted Requirements: This affects compliance with internal control standards for federal programs.
  • Recommended Follow-Up: Implement proper segregation of duties to enhance internal controls and reduce risk.

Finding Text

One important aspect of the internal control structure is the segregation of duties among employees to prevent an individual employee from handling duties which are incompatible. We noted one individual has control over portions of one or more of the following areas for the District relating to major federal programs; cash, investments, receipts, disbursements, payroll, financial reporting and computer systems and journal entries. See finding 2022-001.

Corrective Action Plan

In June 2023, we moved all accounts payable and receivable deposits to the accounting assistant and the school business official reconciles the general fund account. We have two employees so internal control is obtained by using the electronic systems that we put in place. The board reviews all bills paid monthly from reports that are generated from our software system. We use online requisitions and the PO system that go through an approval process before purchases are made. All cash is receipted by the building secretaries, checked by the accounting assistant who then deposits the money into the bank. All receipts are prenumbered.

Categories

Internal Control / Segregation of Duties Reporting

Other Findings in this Audit

  • 370373 2022-002
    Material Weakness Repeat
  • 370374 2022-003
    Significant Deficiency
  • 370375 2022-003
    Significant Deficiency
  • 946814 2022-002
    Material Weakness Repeat
  • 946815 2022-002
    Material Weakness Repeat
  • 946816 2022-003
    Significant Deficiency
  • 946817 2022-003
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
10.555 National School Lunch Program $545,501
84.425 Education Stabilization Fund $145,324
10.553 School Breakfast Program $70,003
84.010 Title I Grants to Local Educational Agencies $38,183
84.424 Student Support and Academic Enrichment Program $10,000
84.367 Improving Teacher Quality State Grants $9,485
84.027 Special Education_grants to States $4,990