Finding 503882 (2024-003)

Material Weakness
Requirement
P
Questioned Costs
-
Year
2024
Accepted
2024-10-28

AI Summary

  • Core Issue: Management lacked adequate controls over financial reporting, leading to significant adjustments needed for accurate financial statements.
  • Impacted Requirements: Timely submission of audited financial statements to the Federal Audit Clearinghouse was not met, affecting compliance with federal regulations.
  • Recommended Follow-Up: Management should enhance internal controls and establish procedures to ensure timely and accurate financial reporting and submissions.

Finding Text

Criteria 1. Management is responsible for the design, implementation, and maintenance of internal controls relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. 2. Management is responsible for timely submission of audited financial statements to Federal Audit Clearinghouse ("FAC"). Submission of June 30, 2023 financial statements was not completed within specified time frame. Condition 1. The accounting records required numerous material adjustments to be proposed and recorded in order for the financial statements to be fairly presented in accordance with generally accepted accounting principles in the United States of America. 2. Single Audit reports are required to be submitted to the FAC pursuant to the audit requirement of Title 2 U.S. Code of Federal Regulations Part 200. Cause Management did not have sufficient controls over financial reporting. Effect or Potential Effect Condition 1 may lead to inaccurate financial reporting and potential misstatement of the financial statements such that they are not in accordance with accounting principles generally accepted in the United States of America. Condition 2 results in auditee being designated as a not-low risk auditee, which may have an effect on future federal grants and program eligibility. Recommendation 1. Management should undertake a review of internal controls over financial reporting and ensure that financial data is properly recorded in the books and records of the Project to prevent misstatements from occurring in the future. 2. Management should implement procedures to ensure that required filing is completed as required. Views of Responsible Officials 1. Management agrees with the finding and recommendation and has implemented reviews of the financial statements by senior management prior to releasing them to ensure accuracy of information. 2. Management agrees with the finding and recommendation and will ensure single audit reports are submitted to the FAC pursuant to the audit requirement of Title 2 U.S. Code of Federal Regulations Part 200. Finding Resolution Status: Resolved

Corrective Action Plan

Management agrees with the finding and recommendation and has implemented reviews of the financial statements by senior management prior to releasing them to ensure accuracy of information. 2. Management agrees with the finding and recommendation and will ensure single audit reports are submitted to the FAC pursuant to the audit requirement of Title 2 U.S. Code of Federal Regulations Part 200.

Categories

Eligibility Reporting Internal Control / Segregation of Duties

Other Findings in this Audit

  • 503878 2024-001
    Material Weakness
  • 503879 2024-001
    Material Weakness
  • 503880 2024-002
    Material Weakness
  • 503881 2024-002
    Material Weakness
  • 503883 2024-003
    Material Weakness
  • 503884 2024-004
    Material Weakness
  • 503885 2024-004
    Material Weakness
  • 503886 2024-005
    Material Weakness
  • 503887 2024-005
    Material Weakness
  • 1080320 2024-001
    Material Weakness
  • 1080321 2024-001
    Material Weakness
  • 1080322 2024-002
    Material Weakness
  • 1080323 2024-002
    Material Weakness
  • 1080324 2024-003
    Material Weakness
  • 1080325 2024-003
    Material Weakness
  • 1080326 2024-004
    Material Weakness
  • 1080327 2024-004
    Material Weakness
  • 1080328 2024-005
    Material Weakness
  • 1080329 2024-005
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
14.157 Supportive Housing for the Elderly $6.20M
14.157 Supportive Housing for the Elderly ("prac") $381,660