Finding 395123 (2019-003)

Material Weakness Repeat Finding

Requirement

Questioned Costs

Year

2019

Accepted

2024-04-30

Audit: 305046

Organization: Family Center of Hope (TN)

Auditor: Wharton CPA LLC

AI Summary

Issue: Family Center of Hope included $578,214 in cash from another entity's bank account in their financial statements.
Requirements Impacted: Financial statements should only reflect assets owned by the reporting entity.
Follow-up: Ensure the agency prepares financial statements that accurately represent their own assets.

Finding Text

Cash Recorded from Bank Account of Another Entity: Condition: Family Center of Hope provided financial statements including cash of $578,214 that is in the bank account of another entity. The financial statements also included significant expenses paid from the same bank account. Criteria: The financial statements of any entity should include only the assets owned by them. Cause: The cause is undeterminable. Effect: The agency provided financial statements that did not present fairly their financial position. Recommendation: It is recommended that the agency compile financial statements that include only the assets owned by them.

Corrective Action Plan

The Family Center of Hope, Incorporated understands the gravity of this adverse opinion as a result of FEMA funds for the "IMPROVED PROJECT" being in another account. We were poorly advised, which caused an error in our financial statements. The account in question was solely used towards the completion of the Improved Project-4137 Washington Avenue. • There has been no comingling of funds. • Family Center of Hope's Finance Officer, Bookkeeper and Executive Director had sole governance of this account. • The Family Center of Hope managed, accounted for all funds, received, deposited, obligated, and expended as proof of the financial statements. • All funds are accounted for. We are of the opinion that if the 2018 audit had been completed in a timely manner, this adverse opinion would have been immediately addressed and corrected. As of this audit Family Center of Hope's funds are in Family Center of Hope's bank account as of December 2023. We have hired a new accounting firm.

Other Findings in this Audit

395121 2019-001

Material Weakness Repeat
395122 2019-002

Material Weakness Repeat
971563 2019-001

Material Weakness Repeat
971564 2019-002

Material Weakness Repeat
971565 2019-003

Material Weakness Repeat

Programs in Audit

ALN	Program Name	Expenditures
97.036	Disaster Grants - Public Assistance (presidentially Declared Disasters)	$795,916