Finding Text
• Criteria or specific requirement: Proper Documentation Finding 2023-3
• Condition: There was little to no evidence that invoices and
documents for payment were properly reviewed and/or approved by management.
• Context: The results of the internal control testing for cash
disbursements indicated little to no evidence of
management’s review and approval on each individual
supporting document.
• Effect: Internal control polices and procedures with respect to
documenting management review and approval are not sufficient or are not in place which can affect the financial statements.
• Cause: Internal control policy for the proper documentation and
management review and approval process is not in place
or is not being adhered to.
• Recommendation: Management should develop and consistently monitor a
policy to document the review and approval of each document for payment and ensure that the procedures are adhered to.
• Management’s response: All invoices and documents for payment are reviewed by
the Director of Operations and the Executive Director
during weekly meetings prior to payment. All invoices
and documents for payment are saved and attached to
the payment in MESA’s accounting software. The
Executive Director reviews all monthly bank statements
for irregularities. The Accounting Advisor reconciles all
bank accounts, maintains the general ledger and supports
the preparation of monthly and year end financial
statements. These policies are maintained in MESA’s
Accounting Manual and are adhered to. Management
recognizes that affixing documentation of review and
and approval of each supporting document is needed
to verify that this policy is being followed and amended
the Accounting Manual to reflect these changes
immediately.