Finding 576246 (2024-001)

Significant Deficiency

Requirement

Questioned Costs

Year

2024

Accepted

2025-09-12

Audit: 366161

Organization: Fayette County Airport Authority (PA)

Auditor: McClure and Wolf LLP

AI Summary

Core Issue: There is a significant lack of segregation of duties, with one office manager handling most transactions.
Impacted Requirements: This situation undermines effective internal controls, risking misstatements in financial reporting.
Recommended Follow-Up: Board members should engage more in daily operations and explore hiring additional staff to improve controls.

Finding Text

Lack of Segregation of Duties: Criteria: Management is responsible for establishing and maintaining effective internal control to ensure that transactions are authorized and recorded properly to permit the preparation of financial statements in accordance with generally accepted accounting principles. Condition: A majority of the Authority’s transactions are processed and recorded by a single office manager. Cause: Due to budget restraints, it has historically not been cost effective for the Authority to hire additional office staff to allow for an appropriate segregation of duties. Effect: The lack of segregation of duties creates a significant deficiency in the control environment which may not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect and correct misstatements on a timely basis. Recommendation: Board members should increase their involvement in day-to-day activities of the Authority and consider hiring additional office staff. Views of responsible officials and corrective action: The Authority acknowledges this finding. The Board will discuss the possibility of utilizing additional board members or hiring additional staff to assist the office manager.

Corrective Action Plan

The Authority acknowledges that the lack of segregation of duties is present. The Board plans to utilize additional board members in day-to-day involvement. The Airport Manager, John Neckerauer, acknowledges this finding and accepts responsibility in overseeing the addressing of the matter. In addition to this, the Board will ensure oversight of the operations of the Authority during 2025, in order to mitigate the risk associated with the lack of segregation of duties.

Other Findings in this Audit

576247 2024-001

Significant Deficiency
576248 2024-001

Significant Deficiency
576249 2024-001

Significant Deficiency
1152688 2024-001

Significant Deficiency
1152689 2024-001

Significant Deficiency
1152690 2024-001

Significant Deficiency
1152691 2024-001

Significant Deficiency

Programs in Audit

ALN	Program Name	Expenditures
20.106	Airport Improvement Program, Covid-19 Airports Programs, and Infrastructure Investment and Jobs Act Programs	$38,732