Finding Text
Condition: During audit fieldwork, our testing resulted in a restatement of fund balance in order to correct accrued payroll, leased capital assets, buildings, land improvements and equipment categories of capital assets, and grant receivables that were improperly recorded in prior years.
Criteria: A good system of internal controls would provide for accurate recording and reporting of accrued payroll, leases, capital assets, and grant receivables on a regular basis in order to provide for accurate financial reporting.
Cause: Year-end entries related to accrued payroll, leases, capital assets, and grant receivables were required in order to accurately present the District’s financial statements.
Effect: A material adjustment to the District’s beginning fund balance was required to properly state accrued payroll, leases, capital assets, and grant receivables.
Recommendation: We recommend the District implement effective internal controls in order to provide an accurate assessment of reporting requirements. This implementation of improved controls would result in the appropriate recognition for financial reporting requirements.
Corrective Action Plan: The District and Assistant Superintendent of Administrative Services will implement internal controls to properly record accrued payroll, leases, capital assets, and grant receivables on a timely basis prior to audit fieldwork.