Finding Text
Real Estate Held for Sale and Development Tracking
Material Weakness
Condition: Condition: The Organization does not reconcile its real estate held for sale to the general ledger.
Criteria: Adequate internal control functions over the financial reporting process.
Cause: Oversight by management.
Effect: Misstatement of the Organization's financial statements will not be prevented, or detected and corrected, on a timely basis.
Recommendation: We recommend that the Organization review detailed real estate listings and the supporting documentation from third parties on at least a quarterly basis and reconcile the listing to the general ledger, with any large discrepancies investigated. Additionally, we recommend that purchases and sales of real estate be tracked on an individual item basis to include the date of the purchase and/or sale. This will help ensure that real estate held for sale or development is accurately recorded in the financial statements.
View of Responsible Official and Planned Corrective Action: Management agrees with the finding. See corrective action plan.