Finding 607163 (2022-001)

Significant Deficiency Repeat Finding
Requirement
C
Questioned Costs
-
Year
2022
Accepted
2023-08-01

AI Summary

  • Core Issue: Limited segregation of duties in the disbursements cycle increases the risk of misstatement or fraud.
  • Impacted Requirements: Adequate separation of functions such as receipts, disbursements, and transaction authorization is not being met.
  • Recommended Follow-Up: Enhance monitoring by having the Board review cancelled checks, unopened bank statements, and bank reconciliations.

Finding Text

"Condition ? During our audit we reviewed procedures over transaction cycles related to receipting, cash disbursements and payroll and found the Organization to have limited segregation of duties related to the disbursements cycle. Criteria ? Adequate separation of duties calls for clear segregation of functions such as receipts, disbursements, recording, custody of assets, transaction authorization and performance monitoring. Cause ? The accounting staff of the Organization maintain and control the check stock, prepares checks, records disbursements, prepares deposits and posts to general ledger. Effect ? The existence of this limited segregation of duties increases the risk of misstatement or fraud. Recommendation ? While we recognize the number of staff is not large enough to eliminate these deficiencies entirely, we believe the risk has been reduced with better monitoring through the Board and other parties reviewing cancelled checks and unopened bank statements and reviewing the bank reconcilement."

Categories

Subrecipient Monitoring Internal Control / Segregation of Duties

Other Findings in this Audit

  • 30721 2022-001
    Significant Deficiency Repeat

Programs in Audit

ALN Program Name Expenditures
10.766 Community Facilities Loans and Grants $886,497