Finding 395882 (2023-002)

Finding Number 2023-002: Federal Program: CFDA 14.157 – Section 202 Capital Advance Type: Financial Statement Statement of Condition: Related party transactions are not always communicated and recorded in a timely manner. Criteria: Accounting records not properly maintained. Effect: Misstated financial reports result from inaccurate accounting records, inaccurate surplus cash calculations. Unrecorded transactions. Cause: Transactions processed on behalf of the Project by related parties are not always timely communicated to the management agent creating delay in recording, causing differences and reconciling items between management agent and Project owner accounting records. Recommendation: Management needs to ensure accounting transactions affecting related parties are communicated in a timely manner to ensure accuracy and agreement between the entities. Management’s Response: Management concurs with the auditor’s finding that the Project’s related parties should communicate and reconcile accounting transactions in a timely manner. Communications and reconciliation will begin immediately.