FAC Explorer

Finding 575821 (2024-001)

Material Weakness Repeat Finding
Requirement
FGHIJ
Questioned Costs
-
Year
2024
Accepted
2025-09-08
Audit: 365803
Organization: Beacon, Inc. (IN)
Auditor: Blue and CO LLC

AI Summary

  • Core Issue: Beacon, Inc. lacks effective internal controls for preparing year-end financial statements, leading to reliance on external auditors.
  • Impacted Requirements: This situation represents a material weakness in internal control over financial reporting, as management cannot ensure compliance with accounting standards.
  • Recommended Follow-Up: Management should explore ways to enhance financial reporting processes and controls to improve in-house capabilities.

Finding Text

Finding Reference Number: 2024-001 (repeat of 2023-001) – Preparation of Financial Statements Criteria: Management is responsible for establishing and maintaining effective internal controls over financial reporting. Effective internal controls are an important component of a system that supports the preparation of external year-end financial statements and related note disclosures, as well as the oversight of the external financial reporting process by those charged with governance. Condition and Context: Beacon, Inc. (“Beacon”) does not currently have in place the processes and controls that would assure the preparation of external year-end financial statements and related note disclosures in accordance with the modified cash basis of accounting. Cause: Preparation of the external financial statements and related note disclosures, with a closing process to identify and correct material misstatements in the financial statements would require the in-house ability to maintain appropriate technical knowledge and to research current and changing accounting standards as well as unique industry considerations. Beacon has not allocated sufficient resources toward developing these capabilities because management believes the cost of doing so outweighs the benefits. Effect: Beacon engages the auditors to draft the year-end external financial statements and to perform the necessary steps to ensure the disclosures are complete. Once drafted, the financial statements are submitted to management for review and approval. While this practice is common and practical, it must be reported as a material weakness in internal control over financial reporting in internal control over financial reporting since the year-end external financial statement preparation cannot be carried out in-house. Recommendation: Beacon, Inc. should review and consider enhancements to the external financial reporting procedures and controls in place to make improvements as they are practical to do so. Responsible Official’s Response: Management concurs with the reported finding. The current economics of the organization does not allow us to correct this weakness. We believe our current accounting capacity is sufficient for routine day-to-day needs. We will continue to seek outside guidance through our annual independent audit to correct minor errors that sometimes occur or to perform other accounting needs.

Corrective Action Plan

2024 CORRECTIVE ACTION PLAN July 30, 2025 Beacon, Inc. respectfully submits the following Corrective Action Plan for the year ended December 31, 2024. Name and address of independent public accounting firm: Blue & Co., LLC 720 E Pete Rose Way, Suite 100 Cincinnati, OH 45202 Audit period: January 01, 2024 - December 31, 2024 Beacon, Inc.’s response to the findings from the December 31, 2024 schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Financial Statement Findings 2024-001 Finding: Preparation of Financial Statements Management’s response: Management concurs with the above finding and, accordingly, has engaged the auditors to assist with the preparation of the 2024 year-end external financial statements. Action planned: Engagement of the auditors to assist with the preparation of the 2024 year-end external financial statements. Management is currently reviewing the procedures and controls in place to address the preparation and review of external year-end financial statements and will revise and enhance as warranted. Implementation Date: Ongoing Responsible Person: Rev Forrest Gilmore, Executive Director Respectfully submitted, _________________________________________________________ Rev. Forrest Gilmore Executive Director

Categories

Internal Control / Segregation of Duties Material Weakness Reporting

Other Findings in this Audit

  • 575822 2024-001
    Material Weakness Repeat
  • 575823 2024-001
    Material Weakness Repeat
  • 575824 2024-001
    Material Weakness Repeat
  • 575825 2024-001
    Material Weakness Repeat
  • 575826 2024-001
    Material Weakness Repeat
  • 575827 2024-001
    Material Weakness Repeat
  • 575828 2024-001
    Material Weakness Repeat
  • 1152263 2024-001
    Material Weakness Repeat
  • 1152264 2024-001
    Material Weakness Repeat
  • 1152265 2024-001
    Material Weakness Repeat
  • 1152266 2024-001
    Material Weakness Repeat
  • 1152267 2024-001
    Material Weakness Repeat
  • 1152268 2024-001
    Material Weakness Repeat
  • 1152269 2024-001
    Material Weakness Repeat
  • 1152270 2024-001
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
21.027 Coronavirus State and Local Fiscal Recovery Funds $500,000
14.231 Emergency Solutions Grant Program $48,640
93.558 Temporary Assistance for Needy Families $28,425
14.267 Continuum of Care Program $8,000
14.218 Community Development Block Grants/entitlement Grants $2,251
93.569 Community Services Block Grant $1,942