Finding Text
2022-001 Ineffective Accounting Policies and Procedures
Criteria: The Organization has submitted and is required to follow its Management Plan with the Texas
Department of Agriculture.
Condition: The Organization did not follow its Accounting Policies and Procedures as outlined in the
Management Plan. In particular, the organization did not implement controls and processes to ensure
the following: accounting records are maintained in accordance with generally accepted accounting
principles; all bank account transactions are electronically pulled into a spreadsheet for review; thethe reconciled cash balances are compared to the general ledger balances. In addition, the Program
Coordinator did not provide effective oversight to ensure these steps are followed and reviewed by a
CPA, as was required in its Accounting Policies and Procedures.
Cause: The Organization’s Program Coordinator, who is in charge of the accounting function, is not
knowledgeable or experienced in accounting or in the use of the Organization’s accounting software.
Effect: The Organization’s books and records were not kept in accordance with generally accepted
accounting principles, its cash and related transactions were not recorded correctly in its accounting
software, and the Organization’s books and records were therefore inaccurate. This caused the
Organization to inappropriately report to its grantor agencies, use inaccurate information for purposes
of assessing compliance with its budgets, and to miss its deadline for submission of its single audit.
Recommendation: The Organization should employ or hire a knowledgeable and experienced accountant
to maintain its books and records, and implement appropriate controls and accounting processes to
ensure the accuracy of its financial statements and the timely filing of its reporting requirements.
Views of Responsible Officials and Planned Corrective Actions: The Organization’s management agrees
and plans to hire a skilled accountant to manage its books and records going forward.