Finding 6443 (2023-002)

Significant Deficiency
Requirement
J
Questioned Costs
-
Year
2023
Accepted
2023-12-23
Audit: 8383
Organization: Breaking Free (MN)
Auditor: Abdo

AI Summary

  • Issue: The Organization failed to recognize revenue from individual rent payments, leading to noncompliance in program income testing.
  • Requirements Impacted: Management needs to have procedures to verify all revenue is recognized accurately.
  • Follow-up: Review and improve internal accounting processes and policies to ensure proper revenue recognition moving forward.

Finding Text

Condition: During our audit we noted noncompliance around testing over program income. Criteria: Management should have a procedure in place to verify all revenue is being recognized. Cause: The Organization was not booking revenue related to rent of individuals as the Organization was not expecting them to pay. Effect: Instead of writing the revenue off - they did not note any of the revenue that should have been included in 2023's financials. Recommendation: We recommend the Organization reviews internal processes and ensure that there are proper accounting and review policies and systems.

Corrective Action Plan

Planned Action: The organization will review and revise all internal processes to ensure that there is proper accounting regarding this program and others. A review of policies and systems will be an important part of this process to ensure that revenue is recognized in the correct period.

Categories

Program Income

Other Findings in this Audit

  • 6442 2023-001
    Significant Deficiency
  • 582884 2023-001
    Significant Deficiency
  • 582885 2023-002
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
14.267 Continuum of Care Program $481,362
16.575 Crime Victim Assistance $170,376
21.027 Coronavirus State and Local Fiscal Recovery Funds $107,522
14.231 Emergency Solutions Grant Program $29,685
16.320 Services for Trafficking Victims $13,638
14.871 Section 8 Housing Choice Vouchers $7,000