Finding Text
2022 ? 001: Segregation of Duties Type of Finding: ? Significant Deficiency in Internal Control over Financial Reporting Condition: The University does not have appropriate segregation of duties and review procedures in place to provide reasonable assurance that financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP); therefore, the potential exists that a material misstatement of the annual financial statements could occur and not be prevented, or detected and corrected, by the University?s internal controls. Criteria or specific requirement: Internal controls should be in place to provide reasonable assurance that financial statements are prepared in accordance with U.S. GAAP. Context: While performing audit procedures, it was noted that due to staffing turnover and changes, management does not have appropriate segregation of duties and documented review procedures in place to provide reasonable assurance that financial statements are prepared in accordance with U.S. GAAP. Effect: The lack of segregation of duties and documented review procedures in place over the financial reporting function increases the risk of misstatements, fraud, or errors occurring and not being detected and corrected. Cause: While performing audit procedures, it was noted that due to staffing turnover and changes, management does not have appropriate segregation of duties and documented review procedures in place as the vice president of finance and administration is completing a significant amount of the financial reporting function. Repeat Finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number was 2021-001. Recommendation: The University should evaluate their financial reporting processes and controls, including the segregation of duties among its internal staff (including number of internal staff), to determine whether additional controls over the preparation of annual financial statements can be implemented to provide reasonable assurance that financial statements are prepared in accordance with U.S. GAAP. Views of responsible officials and planned corrective actions: Management has already filled vacancies and has been working to strengthen the segregation of duties now that individuals fill these roles.