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Not - for - profit auditing case study: In June 2 0 2 0 John Doe completed his audit of a 2 0 1 9
Notforprofit auditing case study: In June John Doe completed his audit of a grant that a city made to Better Future a private, notforprofit organization that sponsors recreational programs for disadvantaged teens. In the course of his testing, King discovered that material disbursements that were made in were charged as expenditures. The program director acknowledged the overcharges, pointing out that the organization faced a temporary cash shortage in that year. By charging the disbursements as expenditures, he was able to obtain early reimbursement and thereby avoid a financial crisis. He assured John that no dishonesty was intended; he was simply shifting funds from one year to another. Indeed, John was able to verify that the organization did not request reimbursement for the same charges in The Better Future grant was a passthrough grant in that the federal government provided the funds to the city. Were this discrepancy set forth as a finding in Johns single audit report, it is almost certain that the organization would be ineligible for federal awards in the future. Do you think Jason King made the correct decision by not listing the disbursements as an audit finding on his Schedule of Findings and Questionable Costs? If you were Jason, what recommendations do you have for Better Future in order to avoid this type of situation in the future? Please list the links of sources you used for research, if any.
Notforprofit auditing case study:
In June John Doe completed his audit of a grant that a city made to Better Future a private, notforprofit organization that sponsors recreational programs for disadvantaged teens. In the course of his testing, King discovered that material disbursements that were made in were charged as expenditures. The program director acknowledged the overcharges, pointing out that the organization faced a temporary cash shortage in that year. By charging the disbursements as expenditures, he was able to obtain early reimbursement and thereby avoid a financial crisis. He assured John that no dishonesty was intended; he was simply shifting funds from one year to another. Indeed, John was able to verify that the organization did not request reimbursement for the same charges in
The Better Future grant was a passthrough grant in that the federal government provided the funds to the city. Were this discrepancy set forth as a finding in Johns single audit report, it is almost certain that the organization would be ineligible for federal awards in the future.
Do you think Jason King made the correct decision by not listing the disbursements as an audit finding on his Schedule of Findings and Questionable Costs? If you were Jason, what recommendations do you have for Better Future in order to avoid this type of situation in the future?
Please list the links of sources you used for research, if any.
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