Finding 397169 (2021-001)

Significant Deficiency

Requirement

Questioned Costs

Year

2022

Accepted

2024-05-17

Audit: 306523

Organization: Glimmerglass Opera Theatre INC (NY)

Auditor: Grossman St Amour CPAS

AI Summary

Core Issue: Inadequate segregation of duties in financial processes has led to insufficient oversight and potential vulnerabilities in recordkeeping.
Impacted Requirements: This affects compliance with effective recordkeeping and reporting standards, particularly in cash management and revenue classification.
Recommended Follow-Up: Management should enhance oversight functions and consider additional personnel to ensure proper segregation in financial cycles.

Finding Text

Criteria: Effective segregations and oversight should be present to ensure proper recordkeeping and reporting. Condition: Certain duties within significant financial cycles were not adequately segregated. Further, this contributed to inadequate review and oversight to properly present certain account balances within the financial statements and certain supporting reconciliations and support. Cause: During the year, the Finance department operates with a limited number of personnel. The overall lack of segregation requires that management and the board remain attentive and build in additional oversight functions, especially with respect to cash receipt, disbursement and payroll cycles, including the associated supporting records. This revenue and oversight is important in proper classification of account balances including investment revenue and release of net assets with donor restrictions. Effect: The lack of segregation leave the organization and their financial records vulnerable. The lack of oversight led to significant reclassifications within revenue accounts to present classifications in accordance with GAAP.

Corrective Action Plan

We recognize that due to cost constraints associated with the size of the Company the optimal segregations and internal control processes have not been enacted. Further, the Company is responsive to the recommendations provided by our auditors and in the 2021/22 fiscal year, the board implemented the review of monthly bank reconciliations and added two part time employees to segregate duties. In the current year Management, working in concert with the Board, plan to better document internal control policies and procedures, build in additional segregations and oversight where necessary and possible, and enhance the roles of investment and finance committees in providing regular oversight over certain key accounting functions and certain manual internal control processes.

Other Findings in this Audit

973611 2021-001

Significant Deficiency

Programs in Audit

ALN	Program Name	Expenditures
59.075	Shuttered Venue Operators Grant Program	$1.61M