Finding 405994 (2023-001)

Federal Programs Affected: CDFI Rapid Response Program (CDFI RRP) ALN Number 21.024, Rural Housing Service Loan Balance ALN Number 10.766 Compliance Requirements: Reporting Questioned Costs: None Condition and Cause: We were requested to draft the audited consolidated financial statements, related footnote disclosures and SEFA as part of our regular audit services. Ultimately, it is your responsibility to provide for the preparation of your financial statements, disclosures and SEFA, and the responsibility of the auditor to determine the fairness of presentation of those statements. From a practical standpoint, we do these items for you at the same time in connection with our audit, which is not unusual for an organization of your size. However, auditing standards require us to communicate this situation to you in writing as an internal control deficiency. Criteria and Effect: This finding could result in a material misstatement to the financial statements and SEFA that may not have been prevented or detected by you. Repeat Finding from Prior Year: Yes, prior year finding 2022-001. Recommendation: It is the responsibility of management to make the ultimate decision whether to accept the degree of risk associated with this condition because of cost or other considerations. We have reviewed in detail with management a draft of the auditor prepared financial statements, to include the SEFA, for accuracy and have answered any questions you had. We are satisfied the appropriate steps have been taken to provide you with the completed financial statements. Response/Correction Action Plan: Management is in agreement with the finding. See Correction Action Plan.