Finding Text
Condition and Criteria: The Organization drew federal funds in excess of expenditures during
the period in the amount of $11,938. Effects: The Organization withdrew cash that it was not eligible to withdraw and failed to correct the error. Grant revenue was overstated. Cause: The Organization’s procedures to reconcile draws on federal funds to expenditures are inadequate. Context: Comparing draws on the federal grant to federal expenditures per the statement of activities as provided by Organization uncovered the internal control deficiency. Auditor’s Recommendation: The Organization should implement procedures to periodically compare federal grant draws to federal grant expenditures utilizing the cash account details and bank statement details while performing the reconciliation. The federal draws and expenditures reconciliations should be reviewed at the time of bank account reconciliation to ensure that all federal expenditures are properly recorded. Views of Responsible Officials and Planned Corrective Action: The Organization’s management has reviewed the disclosed audit finding. See attached management’s response letter submitted by the Organization detailing their corrective action plan for the audit year ended August 31, 2024.