Finding 9504 (2022-001)

2022-001 Internal Control over Revenue Process – Significant Deficiency Criteria – Grants and contributions are recognized when the donor makes an unconditional promise to give to KOM or when qualifying expenditures have been incurred. Condition – Grants and contributions were not properly recorded in the accounting records at the time of commitment or occurrence of expenditures. Cause – There was a breakdown in communication between management and its contracted accounting staff. Effect – A material misstatement of the financial statements occurred and was not detected. Recommendation – Management either allow its contracted accounting staff to access donor correspondence or develop a procedure whereby significant funding awards are communicated to contracted accounting staff to help determine the proper accounting treatment. Auditee's comments and response – Management and its contracted accounting staff will monitor financial reports and activities of KOM to ensure proper recording. Responsible party for the corrective action – Alexis Walstad, Co-Executive Director