Finding Text
#2024-001 FINDING: Preparation of Financial Statements and Schedule of Expenditures of Federal Awards (SEFA)
Federal Programs Affected: Rural Housing Service Loan Balance AL # 10.766
Compliance Requirements: Reporting
Questioned Costs: None
Condition and Cause: We were requested to draft the audited consolidated financial statements, related footnote
disclosures and SEFA as part of our regular audit services. Ultimately, it is your responsibility to provide for the
preparation of your financial statements, disclosures and SEFA, and the responsibility of the auditor to determine the
fairness of presentation of those statements. From a practical standpoint, we do these items for you at the same time
in connection with our audit, which is not unusual for an organization of your size. However, auditing standards
require us to communicate this situation to you in writing as an internal control deficiency.
Criteria and Effect: This finding could result in a material misstatement to the financial statements and SEFA that
may not have been prevented or detected by you.
Repeat Finding from Prior Year: Yes, prior year finding 2023-001.
Recommendation: It is the responsibility of management to make the ultimate decision whether to accept the degree
of risk associated with this condition because of cost or other considerations. We have reviewed in detail with
management a draft of the auditor prepared financial statements, to include the SEFA, for accuracy and have answered
any questions. We are satisfied the appropriate steps have been taken to provide the completed financial statements.
Response/Correction Action Plan: Management is in agreement with the finding. See Correction Action Plan.