FAC Explorer

Finding 943797 (2023-002)

Significant Deficiency Repeat Finding
Requirement
L
Questioned Costs
-
Year
2023
Accepted
2024-02-14
Audit: 290343
Organization: Board of Education of Allegany County (MD)
Auditor: Huber Michaels & Company

AI Summary

  • Core Issue: Material adjustments were needed for the financial statements due to errors in revenue recognition and fund classification.
  • Impacted Requirements: Internal controls were inadequate, leading to overstated revenues and fund balances in the School Construction and Student Activities Funds.
  • Recommended Follow-Up: Staff should enhance their understanding of governmental accounting principles and stay updated on standards like GASB 84 to prevent future issues.

Finding Text

2023-002 Material Adjustments to the Financial Statements were Required. Criteria: Governmental entities are required to maintain a system of internal controls such that all material transactions are properly recorded as to amount, account, and period. Condition: Material adjustments to the Board’s financial statements were required. A material adjustment to the School Construction Fund was required as a deferred revenue was not recorded for the year ended June 30, 2022. As a result, revenue and fund balance were overstated. A material adjustment to the Student Activities Fund was required. The Board determined that as GASB 84, Fiduciary Activities was effective during the year ended June 30, 2022, the Student Activities Fund should have been reported as a Government Fund and not a Fiduciary Fund. These errors were corrected with a prior period adjustment in the June 30, 2023 financial statements. Cause: There was a lack of understanding of deferred revenues and GASB 84, Fiduciary Activities. Effect: Revenues and fund balance were overstated by a material amount in the School Construction Fund for the year ended June 30, 2022. Fund balance was overstated for the Fiduciary Fund and understated for the Government Funds for the year ended June 30, 2022. These errors were corrected on the June 30, 2023 financial statements with a prior period adjustment. If the adjustments were not made, the financial statements would be materially misstated and could have improperly influenced the users of the financial statements. Repeat Finding: This finding is a repeat of a finding in the prior year audit (Finding 2022-002). Recommendation: We recommend that staff be more cognizant of the governmental accounting principles for revenue recognition and stay abreast of changing governmental accounting standards. Views of Responsible Officials and Planned Corrective Action: The recognition of state revenue relative to the School Construction Fund projects has been an ongoing audit discussion topic. The Board acknowledges that they are responsible for the financial statements and now understand the application of state revenues and corresponding deferrals relative to school construction projects. The Board will remain cognizant of the application of governmental accounting principles for revenue recognition. The Board further acknowledges the expectation and need to stay abreast of changing governmental accounting standards such as GASB 84. This will be addressed by staff through ongoing staff development opportunities and continuing professional education outlets.

Categories

Cash Management Internal Control / Segregation of Duties

Other Findings in this Audit

  • 367260 2023-001
    Significant Deficiency Repeat
  • 367261 2023-001
    Significant Deficiency Repeat
  • 367262 2023-001
    Significant Deficiency Repeat
  • 367263 2023-001
    Significant Deficiency Repeat
  • 367264 2023-001
    Significant Deficiency Repeat
  • 367265 2023-001
    Significant Deficiency Repeat
  • 367266 2023-001
    Significant Deficiency Repeat
  • 367267 2023-001
    Significant Deficiency Repeat
  • 367268 2023-001
    Significant Deficiency Repeat
  • 367269 2023-001
    Significant Deficiency Repeat
  • 367270 2023-001
    Significant Deficiency Repeat
  • 367271 2023-001
    Significant Deficiency Repeat
  • 367272 2023-001
    Significant Deficiency Repeat
  • 367273 2023-001
    Significant Deficiency Repeat
  • 367274 2023-001
    Significant Deficiency Repeat
  • 367275 2023-001
    Significant Deficiency Repeat
  • 367276 2023-001
    Significant Deficiency Repeat
  • 367277 2023-001
    Significant Deficiency Repeat
  • 367278 2023-001
    Significant Deficiency Repeat
  • 367279 2023-001
    Significant Deficiency Repeat
  • 367280 2023-001
    Significant Deficiency Repeat
  • 367281 2023-001
    Significant Deficiency Repeat
  • 367282 2023-001
    Significant Deficiency Repeat
  • 367283 2023-001
    Significant Deficiency Repeat
  • 367284 2023-001
    Significant Deficiency Repeat
  • 367285 2023-001
    Significant Deficiency Repeat
  • 367286 2023-001
    Significant Deficiency Repeat
  • 367287 2023-001
    Significant Deficiency Repeat
  • 367288 2023-001
    Significant Deficiency Repeat
  • 367289 2023-001
    Significant Deficiency Repeat
  • 367290 2023-001
    Significant Deficiency Repeat
  • 367291 2023-001
    Significant Deficiency Repeat
  • 367292 2023-001
    Significant Deficiency Repeat
  • 367293 2023-001
    Significant Deficiency Repeat
  • 367294 2023-001
    Significant Deficiency Repeat
  • 367295 2023-001
    Significant Deficiency Repeat
  • 367296 2023-001
    Significant Deficiency Repeat
  • 367297 2023-001
    Significant Deficiency Repeat
  • 367298 2023-001
    Significant Deficiency Repeat
  • 367299 2023-001
    Significant Deficiency Repeat
  • 367300 2023-001
    Significant Deficiency Repeat
  • 367301 2023-001
    Significant Deficiency Repeat
  • 367302 2023-001
    Significant Deficiency Repeat
  • 367303 2023-001
    Significant Deficiency Repeat
  • 367304 2023-001
    Significant Deficiency Repeat
  • 367305 2023-001
    Significant Deficiency Repeat
  • 367306 2023-001
    Significant Deficiency Repeat
  • 367307 2023-001
    Significant Deficiency Repeat
  • 367308 2023-001
    Significant Deficiency Repeat
  • 367309 2023-001
    Significant Deficiency Repeat
  • 367310 2023-001
    Significant Deficiency Repeat
  • 367311 2023-001
    Significant Deficiency Repeat
  • 367312 2023-001
    Significant Deficiency Repeat
  • 367313 2023-001
    Significant Deficiency Repeat
  • 367314 2023-001
    Significant Deficiency Repeat
  • 367315 2023-001
    Significant Deficiency Repeat
  • 367316 2023-001
    Significant Deficiency Repeat
  • 367317 2023-001
    Significant Deficiency Repeat
  • 367318 2023-002
    Significant Deficiency Repeat
  • 367319 2023-002
    Significant Deficiency Repeat
  • 367320 2023-002
    Significant Deficiency Repeat
  • 367321 2023-002
    Significant Deficiency Repeat
  • 367322 2023-002
    Significant Deficiency Repeat
  • 367323 2023-002
    Significant Deficiency Repeat
  • 367324 2023-002
    Significant Deficiency Repeat
  • 367325 2023-002
    Significant Deficiency Repeat
  • 367326 2023-002
    Significant Deficiency Repeat
  • 367327 2023-002
    Significant Deficiency Repeat
  • 367328 2023-002
    Significant Deficiency Repeat
  • 367329 2023-002
    Significant Deficiency Repeat
  • 367330 2023-002
    Significant Deficiency Repeat
  • 367331 2023-002
    Significant Deficiency Repeat
  • 367332 2023-002
    Significant Deficiency Repeat
  • 367333 2023-002
    Significant Deficiency Repeat
  • 367334 2023-002
    Significant Deficiency Repeat
  • 367335 2023-002
    Significant Deficiency Repeat
  • 367336 2023-002
    Significant Deficiency Repeat
  • 367337 2023-002
    Significant Deficiency Repeat
  • 367338 2023-002
    Significant Deficiency Repeat
  • 367339 2023-002
    Significant Deficiency Repeat
  • 367340 2023-002
    Significant Deficiency Repeat
  • 367341 2023-002
    Significant Deficiency Repeat
  • 367342 2023-002
    Significant Deficiency Repeat
  • 367343 2023-002
    Significant Deficiency Repeat
  • 367344 2023-002
    Significant Deficiency Repeat
  • 367345 2023-002
    Significant Deficiency Repeat
  • 367346 2023-002
    Significant Deficiency Repeat
  • 367347 2023-002
    Significant Deficiency Repeat
  • 367348 2023-002
    Significant Deficiency Repeat
  • 367349 2023-002
    Significant Deficiency Repeat
  • 367350 2023-002
    Significant Deficiency Repeat
  • 367351 2023-002
    Significant Deficiency Repeat
  • 367352 2023-002
    Significant Deficiency Repeat
  • 367353 2023-002
    Significant Deficiency Repeat
  • 367354 2023-002
    Significant Deficiency Repeat
  • 367355 2023-002
    Significant Deficiency Repeat
  • 367356 2023-002
    Significant Deficiency Repeat
  • 367357 2023-002
    Significant Deficiency Repeat
  • 367358 2023-002
    Significant Deficiency Repeat
  • 367359 2023-002
    Significant Deficiency Repeat
  • 367360 2023-002
    Significant Deficiency Repeat
  • 367361 2023-002
    Significant Deficiency Repeat
  • 367362 2023-002
    Significant Deficiency Repeat
  • 367363 2023-002
    Significant Deficiency Repeat
  • 367364 2023-002
    Significant Deficiency Repeat
  • 367365 2023-002
    Significant Deficiency Repeat
  • 367366 2023-002
    Significant Deficiency Repeat
  • 367367 2023-002
    Significant Deficiency Repeat
  • 367368 2023-002
    Significant Deficiency Repeat
  • 367369 2023-002
    Significant Deficiency Repeat
  • 367370 2023-002
    Significant Deficiency Repeat
  • 367371 2023-002
    Significant Deficiency Repeat
  • 367372 2023-002
    Significant Deficiency Repeat
  • 367373 2023-002
    Significant Deficiency Repeat
  • 367374 2023-002
    Significant Deficiency Repeat
  • 367375 2023-002
    Significant Deficiency Repeat
  • 943702 2023-001
    Significant Deficiency Repeat
  • 943703 2023-001
    Significant Deficiency Repeat
  • 943704 2023-001
    Significant Deficiency Repeat
  • 943705 2023-001
    Significant Deficiency Repeat
  • 943706 2023-001
    Significant Deficiency Repeat
  • 943707 2023-001
    Significant Deficiency Repeat
  • 943708 2023-001
    Significant Deficiency Repeat
  • 943709 2023-001
    Significant Deficiency Repeat
  • 943710 2023-001
    Significant Deficiency Repeat
  • 943711 2023-001
    Significant Deficiency Repeat
  • 943712 2023-001
    Significant Deficiency Repeat
  • 943713 2023-001
    Significant Deficiency Repeat
  • 943714 2023-001
    Significant Deficiency Repeat
  • 943715 2023-001
    Significant Deficiency Repeat
  • 943716 2023-001
    Significant Deficiency Repeat
  • 943717 2023-001
    Significant Deficiency Repeat
  • 943718 2023-001
    Significant Deficiency Repeat
  • 943719 2023-001
    Significant Deficiency Repeat
  • 943720 2023-001
    Significant Deficiency Repeat
  • 943721 2023-001
    Significant Deficiency Repeat
  • 943722 2023-001
    Significant Deficiency Repeat
  • 943723 2023-001
    Significant Deficiency Repeat
  • 943724 2023-001
    Significant Deficiency Repeat
  • 943725 2023-001
    Significant Deficiency Repeat
  • 943726 2023-001
    Significant Deficiency Repeat
  • 943727 2023-001
    Significant Deficiency Repeat
  • 943728 2023-001
    Significant Deficiency Repeat
  • 943729 2023-001
    Significant Deficiency Repeat
  • 943730 2023-001
    Significant Deficiency Repeat
  • 943731 2023-001
    Significant Deficiency Repeat
  • 943732 2023-001
    Significant Deficiency Repeat
  • 943733 2023-001
    Significant Deficiency Repeat
  • 943734 2023-001
    Significant Deficiency Repeat
  • 943735 2023-001
    Significant Deficiency Repeat
  • 943736 2023-001
    Significant Deficiency Repeat
  • 943737 2023-001
    Significant Deficiency Repeat
  • 943738 2023-001
    Significant Deficiency Repeat
  • 943739 2023-001
    Significant Deficiency Repeat
  • 943740 2023-001
    Significant Deficiency Repeat
  • 943741 2023-001
    Significant Deficiency Repeat
  • 943742 2023-001
    Significant Deficiency Repeat
  • 943743 2023-001
    Significant Deficiency Repeat
  • 943744 2023-001
    Significant Deficiency Repeat
  • 943745 2023-001
    Significant Deficiency Repeat
  • 943746 2023-001
    Significant Deficiency Repeat
  • 943747 2023-001
    Significant Deficiency Repeat
  • 943748 2023-001
    Significant Deficiency Repeat
  • 943749 2023-001
    Significant Deficiency Repeat
  • 943750 2023-001
    Significant Deficiency Repeat
  • 943751 2023-001
    Significant Deficiency Repeat
  • 943752 2023-001
    Significant Deficiency Repeat
  • 943753 2023-001
    Significant Deficiency Repeat
  • 943754 2023-001
    Significant Deficiency Repeat
  • 943755 2023-001
    Significant Deficiency Repeat
  • 943756 2023-001
    Significant Deficiency Repeat
  • 943757 2023-001
    Significant Deficiency Repeat
  • 943758 2023-001
    Significant Deficiency Repeat
  • 943759 2023-001
    Significant Deficiency Repeat
  • 943760 2023-002
    Significant Deficiency Repeat
  • 943761 2023-002
    Significant Deficiency Repeat
  • 943762 2023-002
    Significant Deficiency Repeat
  • 943763 2023-002
    Significant Deficiency Repeat
  • 943764 2023-002
    Significant Deficiency Repeat
  • 943765 2023-002
    Significant Deficiency Repeat
  • 943766 2023-002
    Significant Deficiency Repeat
  • 943767 2023-002
    Significant Deficiency Repeat
  • 943768 2023-002
    Significant Deficiency Repeat
  • 943769 2023-002
    Significant Deficiency Repeat
  • 943770 2023-002
    Significant Deficiency Repeat
  • 943771 2023-002
    Significant Deficiency Repeat
  • 943772 2023-002
    Significant Deficiency Repeat
  • 943773 2023-002
    Significant Deficiency Repeat
  • 943774 2023-002
    Significant Deficiency Repeat
  • 943775 2023-002
    Significant Deficiency Repeat
  • 943776 2023-002
    Significant Deficiency Repeat
  • 943777 2023-002
    Significant Deficiency Repeat
  • 943778 2023-002
    Significant Deficiency Repeat
  • 943779 2023-002
    Significant Deficiency Repeat
  • 943780 2023-002
    Significant Deficiency Repeat
  • 943781 2023-002
    Significant Deficiency Repeat
  • 943782 2023-002
    Significant Deficiency Repeat
  • 943783 2023-002
    Significant Deficiency Repeat
  • 943784 2023-002
    Significant Deficiency Repeat
  • 943785 2023-002
    Significant Deficiency Repeat
  • 943786 2023-002
    Significant Deficiency Repeat
  • 943787 2023-002
    Significant Deficiency Repeat
  • 943788 2023-002
    Significant Deficiency Repeat
  • 943789 2023-002
    Significant Deficiency Repeat
  • 943790 2023-002
    Significant Deficiency Repeat
  • 943791 2023-002
    Significant Deficiency Repeat
  • 943792 2023-002
    Significant Deficiency Repeat
  • 943793 2023-002
    Significant Deficiency Repeat
  • 943794 2023-002
    Significant Deficiency Repeat
  • 943795 2023-002
    Significant Deficiency Repeat
  • 943796 2023-002
    Significant Deficiency Repeat
  • 943798 2023-002
    Significant Deficiency Repeat
  • 943799 2023-002
    Significant Deficiency Repeat
  • 943800 2023-002
    Significant Deficiency Repeat
  • 943801 2023-002
    Significant Deficiency Repeat
  • 943802 2023-002
    Significant Deficiency Repeat
  • 943803 2023-002
    Significant Deficiency Repeat
  • 943804 2023-002
    Significant Deficiency Repeat
  • 943805 2023-002
    Significant Deficiency Repeat
  • 943806 2023-002
    Significant Deficiency Repeat
  • 943807 2023-002
    Significant Deficiency Repeat
  • 943808 2023-002
    Significant Deficiency Repeat
  • 943809 2023-002
    Significant Deficiency Repeat
  • 943810 2023-002
    Significant Deficiency Repeat
  • 943811 2023-002
    Significant Deficiency Repeat
  • 943812 2023-002
    Significant Deficiency Repeat
  • 943813 2023-002
    Significant Deficiency Repeat
  • 943814 2023-002
    Significant Deficiency Repeat
  • 943815 2023-002
    Significant Deficiency Repeat
  • 943816 2023-002
    Significant Deficiency Repeat
  • 943817 2023-002
    Significant Deficiency Repeat

Programs in Audit

ALN Program Name Expenditures
84.425 Education Stabilization Fund $1.03M
10.553 School Breakfast Program $928,639
10.555 National School Lunch Program $470,819
84.367 Improving Teacher Quality State Grants $313,624
84.424 Student Support and Academic Enrichment Program $226,894
84.048 Career and Technical Education -- Basic Grants to States $148,103
21.027 Coronavirus State and Local Fiscal Recovery Funds $89,946
84.181 Special Education-Grants for Infants and Families $67,764
10.582 Fresh Fruit and Vegetable Program $62,003
23.011 Appalachian Research, Technical Assistance, and Demonstration Projects $44,359
10.559 Summer Food Service Program for Children $29,572
84.010 Title I Grants to Local Educational Agencies $19,831
84.027 Special Education_grants to States $15,514
84.173 Special Education_preschool Grants $527