Finding Text
Criteria
The Organization is responsible for ensuring they are following accrual accounting.
Conditions and Context
During the audit we identified significant adjustments for expense and revenue which were not properly recognized for the year ended December 31, 2023. These items included grant revenue and subsequent receipts that were not accrued, with a total impact of approximately $340,000 increase in revenue. Expenses were not recorded in the proper period. Expenses increased $143,000. We recommend recording transactions using the invoice and bill functions in Quick Books.
Effect
The Organization understated the change in net assets by $197,000 in the current year.
Recommendation
We recommended that the Organization review and modify as necessary internal policies and procedures related to monthly and year end cutoff procedures to ensure revenue is reported in the correct period.