Finding Text
Separate accounting records for housing project operations - (Material Weakness) Criteria: According to 7 CFR 3560.302, borrowers must establish accounting and financial management procedures necessary to conduct housing project operations in a financially safe and sound manner. Borrowers must maintain records in a manner suitable for an audit, and must be able to report accurate operational results to the Rural Development (RD) from these accounts and records. Condition: The CDP accounting software is not set up to separate transactions for its RD project (Fred Bell Way) and to produce a separate statement of financial position and a general ledger. Cause: The CDP changed its accounting software and merge various accounts during the transition which made it difficult to separate projects' activities and financial records. Effect: Lack of accounting system that segregates and tracks funds for projects allows for comingling of funds from different projects Questioned Cost: None noted Recommendation: Establish an accounting system that provides for separate accountability for projects by segregating and tracking projects funds separately and producing separate financial records for each project. Management's Views and Corrective Action Plan: Management's response is included in "Management's View and Corrective Action Plan" at the end of this report after the schedule of findings and questioned cost