Finding 569121 (2024-001)

Significant Deficiency Repeat Finding
Requirement
P
Questioned Costs
-
Year
2024
Accepted
2025-06-30
Audit: 360715
Organization: Nutrition, INC (IN)

AI Summary

  • Core Issue: One person has access to all financial records, violating GAAP and Government Auditing Standards on segregation of duties.
  • Impacted Requirements: Compliance with accounting principles and safeguarding of assets is compromised due to inadequate internal controls.
  • Recommended Follow-Up: Monitor the situation as no immediate changes are feasible; management acknowledges the limitations and has a corrective action plan in place.

Finding Text

Finding 2024-001 – Financial Statement and Federal Awards Program Information: 10.558 Department of Agriculture, Child and Adult Care Food Program Finding Resolution Status: Remains open and repeat finding. Information on Universe and Population: This is not applicable. Sample Size Information: This is not applicable. Statement of Condition: Compliance with generally accepted accounting principles (GAAP) and Government Auditing Standards require that certain accounting and administrative responsibilities must be performed by more than one person; however, only one person has access to all books and records. Due to the size of Nutrition, proper segregation of duties cannot be achieved without the cost exceeding any benefit. Criteria: Generally accepted accounting principles and Government Auditing Standards require management of Nutrition to establish policies to safeguard assets. Effect or Potential Effect: Because of inherent limitations in any internal control system, errors, irregularities, or instances of non-compliance may nevertheless occur and not be detected. Also, projection of any evaluation to future periods is subject to risk that procedures may become inadequate because of changes in conditions or that the effectiveness of the design and operation of policies and procedures may deteriorate. Cause: Nutrition lacks the size to adequately segregate duties. Recommendation: No recommendation. Due to the size of Nutrition, and the makeup of the staff, proper segregation of duties cannot be achieved without the cost exceeding the benefit at this moment in time. Questioned Costs: $0 Views of Responsible Officials and Planned Corrective Actions: The views of the management of Nutrition are set out in the Corrective Action Plan.

Corrective Action Plan

June 26, 2025 Nutrition, Inc. Audit performed by Pettit & Company, LLC 6249 South East Street, Suite E Indianapolis, IN 46227 Period covered by the audit October 1, 2023 through September 30, 2024 The findings from the September 30, 2024 schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Finding No. 2024-1 Type of Finding: Significant Deficiency in Internal Control over Financial Reporting Statement of Condition: Condition: In order to comply with generally accepted accounting principles (GAAP) and Government Auditing Standards certain accounting an administrative responsibilities should be segregated. One person has access to all books and records. Due to the size of the Organization, proper segregation of duties cannot be achieved without the cost exceeding the benefit. Corrective Action Planned or Taken: Coming out of the pandemic impacted the ability to complete the segregation of duties process, due to the lack of staff. As a result, Nutrition is working to develop the processes that will help to implement the procedures that will segregate duties and will continue working with team members to implement processes to segregate duties moving forward. At this time, the development is on-oing and will take place when the business growth warrants and supports such an action. Presently, adding additional staff to provide another layer of preparation, review, and monitoring would outweigh the costs. Sudie Shaw-Price, Executive Director (317) 543-9452

Categories

Internal Control / Segregation of Duties

Other Findings in this Audit

  • 1145563 2024-001
    Significant Deficiency Repeat

Programs in Audit

ALN Program Name Expenditures
10.558 Child and Adult Care Food Program $3.19M