Finding Text
FINDING: Preparation of Financial Statements and Schedule of Expenditures of Federal Awards (SEFA) Federal Programs Affected: Housing Trust Fund, ALN #14.275 and Section 8 Subsidy ALN #14.181 Compliance Requirements: Reporting Questioned Costs: None Condition and Cause: We were requested to draft the audited consolidated financial statements, related footnote disclosures and SEFA as part of our regular audit services. Ultimately, it is your responsibility to provide for the preparation of your financial statements, disclosures and SEFA, and the responsibility of the auditor to determine the fairness of presentation with those statements. From a practical standpoint, we do these items for you at the same time in connection with our audit, which is not unusual for an organization of your size. However, auditing standards require us to communicate this situation to you in writing as an internal control deficiency. Criteria and Effect: This finding could result in a material misstatement to the financial statements and SEFA that may not have been prevented or detected by you. Repeat Finding from Prior Year: Yes, revision of prior year finding #2021-001. Recommendation: It is the responsibility of management to make the ultimate decision whether to accept the degree of risk associated with this condition because of cost or other considerations. We have reviewed in detail with management a draft of the auditor prepared financial statements, to include all audit adjustments, for accuracy and have answered any questions you had. We are satisfied the appropriate steps have been taken to provide you with the completed financial statements. Response/Correction Action Plan: Management is in agreement with the finding. See Correction Action Plan.