Finding Text
2022-002 The Fire District is required to have internal controls in place that enable it to apply generally accepted accounting principles to its transactions (recurring). Criteria: The Fire District is required to have internal controls in place that enable it to apply generally accepted accounting principles to its transactions. Specifically, this includes accounting for property taxes and year-end accrual transactions. Condition: The Fire District executes basic and routine transactions throughout the year; however, the Fire District does not apply generally accepted accounting principles to certain non-routine transactions recorded during the year and in making its year-end accruals. Cause: The Fire District lacks personnel with the expertise to apply generally accepted accounting principles to its transactions. Effect: Management relied on the auditor?s year-end adjustments to bring the Fire District?s accounting records into compliance with generally accepted accounting principles. Management reviewed, approved, and accepted responsibility for the adjusting journal entries prior to the issuance of the financial statements. Recommendation: We recommend management review the costs and benefits involved to retain a consultant with the required expertise to advise the Fire District during the year concerning non-routine transactions and to assist the Fire District with its year-end close so that the Fire District?s accounting records will be in compliance with generally accepted accounting principles. Response: The Fire District does not believe that hiring a professional consultant to aid in financial reporting would be cost effective or economically feasible at this time.