FAC Explorer

Finding 537964 (2023-002)

Material Weakness
Requirement
F
Questioned Costs
-
Year
2023
Accepted
2025-03-27
Audit: 348997
Organization: Autoridad Del Distrito Del Centro De Convenciones (PR)
Auditor: Rsm Puerto Rico

AI Summary

  • Answer: Management found errors in the discount rate for lease receivables and deferred inflows due to GASB Statement No. 87.
  • Trend: These errors affected the Authority's financial statements from the previous year.
  • List: Follow up by reviewing the impact on financial reporting and ensuring accurate application of lease accounting standards.

Finding Text

During the year ended June 30, 2023, management identified certain errors related to the discount rate used to measure lease receivables and deferred inflows of resources related to leases, in connection with the implementation of GASB Statement No. 87 Leases that impacted the Authority’s previously issued financial statements.

Corrective Action Plan

Management acknowledges the audit finding regarding the errors in the discount rate applied in measuring leases receivables and deferred inflows in resources. These errors were identified during a comprehensive review of the Authority’s financial reporting processes for leases for the fiscal year ended June 30, 2023 and the following actions were taken: The financial statements were restated to reflect the correct discount rate and lease-related balances per GASB 87. Internal controls were strengthened for GASB standards implementation, including a detailed review of assumptions and methodologies. Technical accounting advisors were engaged to ensure accuracy and compliance with complex GASB standards.A standardized methodology for calculating and reviewing discount rates in lease accounting was developed and integrated. Remediated in Fiscal year 2023.

Categories

No categories assigned yet.

Other Findings in this Audit

  • 537963 2023-001
    Material Weakness
  • 537965 2023-003
    Material Weakness
  • 537966 2023-004
    -
  • 537967 2023-005
    Significant Deficiency
  • 537968 2023-006
    Significant Deficiency Repeat
  • 1114405 2023-001
    Material Weakness
  • 1114406 2023-002
    Material Weakness
  • 1114407 2023-003
    Material Weakness
  • 1114408 2023-004
    -
  • 1114409 2023-005
    Significant Deficiency
  • 1114410 2023-006
    Significant Deficiency Repeat

Programs in Audit

ALN Program Name Expenditures
21.027 Coronavirus State and Local Fiscal Recovery Funds $9.48M
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $594,115