FAC Explorer

Finding 401598 (2023-006)

Material Weakness
Requirement
A
Questioned Costs
-
Year
2023
Accepted
2024-06-24
Audit: 309599
Organization: Refugee & Immigrant Self-Empowerment, Inc. (NY)
Auditor: Efpr Group Cpa's PLLC

AI Summary

  • Core Issue: Employees are using credit cards assigned to others without proper documentation, increasing the risk of fraud.
  • Impacted Requirements: Internal controls for credit card usage are not being followed, leading to potential financial mismanagement.
  • Recommended Follow-Up: Develop a formal approval process for credit card transactions, including identity verification and mandatory documentation.

Finding Text

Criteria - Internal controls require the Organization to define authorization level and responsibilities for credit card usage in order to prevent unauthorized use. Condition - Employees have been noted using credit cards assigned to other employees with no supporting documentation to verify the identity of the user or purpose of the transaction leading to a heightened risk of fraudulent activity or misappropriation of funds. Cause - Resulted from a lack of internal controls over financial reporting. Effect - The Organization is not following proper internal control procedures. Questioned Costs - None identified. Recommendation - We recommend that the Organization further develops its internal control policies to establish a formal approval and review process for credit card transactions that establishes the purpose and approval for the purchase. Management’s Response - (a) Comments on the finding and recommendation: Refugee & Immigrant Self-Empowerment, Inc. acknowledges the need for documenting credit card usage. (b) Actions Taken: Refugee & Immigrant Self-Empowerment, Inc. will establish a clear process requiring verification of identity and purpose for each transaction. We will implement strict controls, such as mandatory receipts, detailed transaction logs, and periodic audits. Additionally, we will provide comprehensive training to all employees on the proper use and accountability of credit cards, emphasizing the importance of adherence to established protocols. We will regularly review and update these procedures to adapt to evolving risks and maintain effective internal controls. (c) Anticipated Completion Date: August 31, 2024

Corrective Action Plan

Name of Auditee: Refugee & Immigrant Self-Empowerment, Inc. Name of Audit Firm: EFPR Group, CPAs, PLLC Period Covered by the Audit: Year ended September 30, 2023 CAP Prepared by: Haji Adan, Executive Director Phone: 315-214-4480 (A) Current Finding on the Schedule of Findings and Responses (6) Audit Finding 2023-006 (a) Comments on the finding and recommendation: Refugee & Immigrant Self-Empowerment, Inc. acknowledges the need for documenting credit card usage. (b) Actions Taken: Refugee & Immigrant Self-Empowerment, Inc. will establish a clear process requiring verification of identity and purpose for each transaction. We will implement strict controls, such as mandatory receipts, detailed transaction logs, and periodic audits. Additionally, we will provide comprehensive training to all employees on the proper use and accountability of credit cards, emphasizing the importance of adherence to established protocols. We will regularly review and update these procedures to adapt to evolving risks and maintain effective internal controls. (c) Anticipated Completion Date: August 31, 2024

Categories

Procurement, Suspension & Debarment HUD Housing Programs Reporting Internal Control / Segregation of Duties

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
19.510 U.s. Refugee Admissions Program $316,149
93.576 Refugee and Entrant Assistance_discretionary Grants $312,450
10.311 Beginning Farmer and Rancher Development Program $99,644
10.175 Farmers Market and Local Food Promotion Program (b) $90,883
10.225 Community Food Projects $82,461