Finding Text
Criteria: Proper controls over financial reporting includes the ability to prepare the schedule of expenditures of federal awards (Schedule) and accompanying notes to the Schedule.
Condition: The Organization does not have an internal control system designed to provide for a complete an accurate Schedule being audited. As auditors, we were requested to assist with the preparation of the Schedule.
Cause: Auditor assistance with preparation of the Schedule is not unusual as the Schedule has unique and specialized requirements and preparation is only required when the Organization meets a specified threshold of federal expenditures.
Effect: The initial Schedule prepared by management of the Organization excluded two Federal awards and misclassified several awards in the schedule. Numerous revisions to the Schedule were required for complete and accurate presentation.
Questioned Costs: None reported.
Context: Sampling was not used.
Repeat Finding from Prior Years: No.
Recommendation: We recommend management be aware of the financial reporting requirements relating to the Organization’s Schedule and review its processes and internal controls that impact the preparation of the Schedule.
Views of Responsible Officials: Management agrees with the finding.