wwwcrawfordcpascom frankcrawfordcpascom Prepared and Presented By Frank Crawford CPA CRITERIA CONDITION CAUSE EFFECT RECOMMENDATION BENEFIT MANAGEMENT RESPONSE Common Elements of Findings ID: 283665
Download Presentation The PPT/PDF document "Common Single Audit Findings in the Isla..." is the property of its rightful owner. Permission is granted to download and print the materials on this web site for personal, non-commercial use only, and to display it on your personal computer provided you do not modify the materials and that you retain all copyright notices contained in the materials. By downloading content from our website, you accept the terms of this agreement.
Slide1
Common Single Audit Findings in the Islands
www.crawfordcpas.comfrank@crawfordcpas.com
Prepared and Presented By: Frank Crawford, CPASlide2
CRITERIACONDITIONCAUSE
EFFECTRECOMMENDATION / BENEFITMANAGEMENT RESPONSE
Common Elements of FindingsSlide3
What Should BeFor internal control findings, criteria is the control element, policy or procedure that should be designed and/or complied withFor compliance findings, the criteria is the specific compliance requirement
CriteriaSlide4
What Is or Has HappenedFor internal control findings, condition is a finding that an important control element, policy or procedure is not designed, or is designed but not complied with
For compliance findings, the condition is the specific finding or instance of noncompliance ConditionSlide5
Why the Condition Exists or Occurred
Cause is the most difficult element of a complete finding to write; if not written well, it will be difficult to understand; the writer of the finding must use their best professional judgment to determine causeCause may involve multiple issues such as lack of priority, ability, resources, motivation, or may involve intent
It is the most crucial element of the finding for writing an effective recommendation for corrective actionCauseSlide6
What Has or Can Happen as a ResultEffect is important to communicate in order to get the attention of the decision makers
Effect could involve the occurrence or higher than acceptable risk of:Undetected errorsUndetected fraudFinancial lossesIncreased liability
EffectSlide7
What You Should Do About ItThe “recommendation” must be specific and complete if you expect the proposed corrective action to be the right corrective action and be effective
The “recommendation” is built upon the proper identification of the “cause”RecommendationSlide8
Proposed Corrective Action or InactionManagement’s response is important to ensure the finding is not in error or to learn that mitigating factors may exist
Auditors should let management know when their proposed corrective action may not be sufficient to correct the conditionManagement’s ResponseSlide9
Types of Findings
Internal control deficienciesNoncomplianceOther matters
Appropriate ReportsFinancial reporting on internal control, compliance and other matters – financial statements (YB)Financial reporting on internal control and compliance - A133 Single Audit Single audit schedule of findings and questioned costs
Management letter
WHERE THEY GET REPORTEDSlide10
Controls over financial reporting
Significant deficienciesMaterial weaknesses
Controls over complianceFinancial statementsSignificant deficienciesMaterial weaknessesFederal awardsSignificant deficiencies
Material weaknesses
Internal Control
DeficienciesSlide11
Financial statements complianceDirect and material effect
Federal awards complianceMaterial to a type of requirement of a major program
ComplianceSlide12
Potential fraudIndications of abuse
Other operational or performance mattersOther Matters