Finding Text
Condition: During the audit process, a material audit adjustment was identified. The adjustment pertained to recording the current year depreciation expense.
Effect: A control deficiency exists when the design or operation of a control does not allow management or employees in the normal course of performing their assigned functions to prevent or detect misstatements on a timely basis. This could affect the Organization’s ability to initiate, record, process, and report financial data consistent with the assertion of management in the financial statements.
Cause: The management agent did not make all necessary adjustments to the financial statements prior to the audit process.
Criteria: The Organization should have procedures in place and these procedures must be followed to ensure all necessary adjustments are made to the financial statements. Recommendation: We recommend that the Organization verifies all necessary adjustments are made to the financial statements prior to the audit process.
Views of Responsible Officials and Planned Corrective Actions: The Organization agrees with the finding and
the auditor’s recommendations will be adopted.