Finding Text
Condition The Organization did not have controls properly implemented to ensure that federal grant revenue was recorded accurately. Criteria Generally accepted accounting principles requires revenues to be recorded when earned. Context Our audit procedures detected, misstatements to revenue related to Crime Victims Assistance for expenditures incurred in the prior period. The result was an understatement of revenue for cost-reimburseable expenditures in the prior fiscal year and an overstatement of revenue in the current fiscal year in the amount of $19,501. Effect Revenue was over stated in the current fiscal year and the auditor recorded adjustments to correct the error. Cause The Organization's internal controls over financial reporting did not ensure that revenue was recorded in the proper p Recommendation that revenue is recognized when federal expenditures under cost reimbursement contracta are reported when incurred. Management Response After further discussion with the auditor and grant program management, the Organization understands the justification underlying the finding identified, as the finding is required by nature of the fact that there were adjustments to the Organization?s financial statements made during, and as a result of, the audit. The Organization acknowledges this finding and understands the continued need to ensure proper reporting of financial statements, including the need to incorporate the adjustments made during this review.