Section II – Financial Statement Findings (Continued)
Type of Finding:
Condition: Management did not complete an analysis or adjust the general ledger to ensure the proper amount of accrued payroll was reflected.
Criteria or specific requirement: Internal controls are critical to ensure accurate financial reporting. These would include, but not limited to, reconciling statement of net position accounts monthly, a formal process of procedures and internal controls to ensure timely and accurate year-end financial statements and related notes and providing supporting audit documentation that reconciles to the trial balance under audit on a timely basis.
Effect: Audit adjustments were required to be made to adjust accrued payroll accounts and related expense accounts.
Cause: Lack of policy and procedures ensuring appropriate adjustments to accrued payroll accounts are made.
Recommendation: We recommend that policies and procedures regarding properly recording accrued payroll liabilities be reviewed and updated.
Views of responsible officials and planned corrective actions: There is no disagreement with the audit finding.
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