Notice of Audit
of the Fical Affairs of the Hot Springs School Districts No. 23-2
Notice is hereby given that Hot Springs School District No. 23-2, Fall River County, South Dakota, has been audited by Wohlenberg, Ritzman and Co, LLC for the years ended June 30, 2020. A detailed report thereon is available for public inspection, during normal business hours, at the business office of the School District, and also at the Department of Legislative Audit in Pierre, South Dakota or on the Department of Legislative Audit website at: http://legislativeaudit.sd.gov/reports/reports.aspx
The following finding and recommendations provide a brief description of material weaknesses in internal control, legal noncompliance and other matters that are described in more detail in the audit report.
Finding 2020-001 - Cash Reconciliations
Condition: The School District did not regularly and timely reconcile cash accounts during the 2019-2020 School Year. A reconciliation was performed subsequent to year end; however, it did not accurately reconcile cash balances. We, as auditors, proposed adjusting journal entries affecting cash balances. A prior period adjustment was made to beginning equity in the General Fund to reflect the unreconciled difference.
Recommendation: We recommend the School District ensure appropriate internal controls are in place and a system of monitoring exists to ensure the implementation of these controls.
Finding 2020-002 - Preparation of Financial Statements
Condition: We, as auditors, were requested to draft the audited financial statements and related footnote disclosures for the year ended June 30, 2020. The School District does not have a documented internal control system over financial reporting to provide for the preparation of the financial statements, including the accompanying footnote disclosures as required by U.S generally accepted accounting principles.
Recommendation: It is the responsibility of management and those charged with governance to make the decision whether to accept the degree of risk associated with this condition. We recommend the School District establish appropriate internal controls over financial reporting and the auditee person responsible for the preparation of financial statements and related footnote disclosures receive appropriate training in order that management can take responsibility for the preparation of its financial statements and related footnote disclosures.
Finding 2020-003 - Internal Control Over Significant Accounts
Condition: During the course of our engagement, we noted the School District did not have an adequately designed system of internal controls over significant accounts and processes. General ledger accounts are not reconciled to underlying subsidiary records on a regular basis by internal staff members. We, as auditors< proposed material adjustment to taxes receivable, capital assets and pension related liabilities.
Recommendation: We recommend management take steps to possess the necessary knowledge and accounting expertise to appropriately design and implement as effective system of internal controls that will prevent, detect and correct potential misstatements of significant accounts.
The report also contains the auditor’s finding and recommendations concerning less significant deficiencies in internal control at the District.
Wohlenberg, Ritzman and Co., LLC
Published twice at the total approximate cost of $78.12
Published: Oct. 7, 14, 2021