Finding 374678 (2023-001)

Significant Deficiency
Requirement
P
Questioned Costs
-
Year
2023
Accepted
2024-03-11
Audit: 294369
Auditor: Bert Smith & CO

AI Summary

  • Core Issue: Incomplete analysis and reconciliation of account balances, along with inadequate documentation for journal entries.
  • Impacted Requirements: Accurate and complete accounting records are essential for assessing profitability and financial health.
  • Recommended Follow-Up: Increase staffing in the accounting department and ensure monthly account reconciliations with proper documentation retention.

Finding Text

Accounting records provide management with valuable insights into an organization’s profitability, liquidity, and overall financial health. As a result, it is imperative that organizations maintain accurate and complete accounting records, that are adequately supported with documentation. The Center has written accounting policies and procedures that outline the steps for processing, analyzing, and reconciling its account balances. However, during the audit, we identified some account balances that were not completely analyzed and reconciled and journal entries that were not supported with adequate documentation. Audit adjustments were made to correct the account balances. The Center does not have sufficient human resources in its accounting department to perform the monthly analysis and reconciliation of its account balances. The Center has one individual primarily performing its accounting functions. The additional resources will enable the Center to reconcile its accounts timelier and produce more accurate financial reports. Recommendation: We recommend the Center provide additional human resources to its accounting department. We also recommend the Center analyze and reconcile its accounts monthly and retain all documentation supporting the journal entries in its accounting system

Corrective Action Plan

The Center has secured the services of a consultant to assist with reconciliation and analysis on an ongoing basis. This process will provide the necessary checks and balances to the accounting department such that errors are identified and addressed in a timely manner. The implementation of this process will ensure that the Center’s accounting is adequately supported and that all month end reconciliations, closings and analysis are complete and accurate

Categories

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Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
93.224 Consolidated Health Centers (community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) $3.92M
93.527 Affordable Care Act (aca) Grants for New and Expanded Services Under the Health Center Program $161,475
93.526 Affordable Care Act (aca) Grants for Capital Development in Health Centers $97,699