Finding Text
Criteria – Under generally accepted accounting principles (GAAP), not-for-profit organizations are required to track and record donated goods and materials. In addition, donated materials in excess of $25,000 have additional reporting requirements on an organization’s federal Form 990.
Condition – Donated materials received during the year were not accurately tracked and recorded. Support requested for audit testing did not agree to amounts recorded.
Cause – There was change in staffing with those responsible for in-kind donation tracking and the same level of focus on tracking was not maintained.
Effect – Management was not in compliance with the requirements of GAAP.
Repeat Finding – No.
Recommendation – We recommend that management enhance its internal controls, policies and procedures to ensure that all in-kind contributions are properly tracked, valued, and recorded.
Auditee's comments and response – Management will implement a process to properly track and record in-kind donations.
Responsible party for the corrective action – Molly Jalma, Executive Director.