Finding Text
Criteria or Specific Requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award Section 200.303 requires entities to establish and maintain effective internal controls over Federal Awards.
Condition: During our testing we noted internal controls over disbursements were not always properly followed.
Questioned Costs: None
Context: 1 of 27 cash disbursements in our sample were missing approvals.
Cause: LSI has a limited number of individuals in the finance department, and has experienced significant turnover in the finance department.
Effect: The auditor noted no instances of noncompliance with the allowability of costs or support for costs; the lack of internal controls over disbursements provides an opportunity for noncompliance.
Repeat Finding: Yes, see 2021-002.
Recommendation: We recommend LSI design controls to ensure an adequate review process is in place for all disbursements.
Views of Responsible Officials: There is no disagreement with the audit finding.