Fayette County Airport Authority

Lack of Segregation of Duties: Criteria: Management is responsible for establishing and maintaining effective internal control to ensure that transactions are authorized and recorded properly to permit the preparation of financial statements in accordance with generally accepted accounting principles. Condition: A majority of the Authority’s transactions are processed and recorded by a single office manager. Cause: Due to budget restraints, it has historically not been cost effective for the Authority to hire additional office staff to allow for an appropriate segregation of duties. Effect: The lack of segregation of duties creates a significant deficiency in the control environment which may not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect and correct misstatements on a timely basis. Recommendation: Board members should increase their involvement in day-to-day activities of the Authority and consider hiring additional office staff. Views of responsible officials and corrective action: The Authority acknowledges this finding. The Board will discuss the possibility of utilizing additional board members or hiring additional staff to assist the office manager.

2021-001: Lack of Segregation of Duties: Criteria: Management is responsible for establishing and maintaining effective internal control to ensure that transactions are authorized and recorded properly to permit the preparation of financial statements in accordance with generally accepted accounting principles. Condition: A majority of the Authority?s transactions are processed and recorded by a single office manager. Cause: Due to budget restraints, historically not been cost effective for the Authority to hire additional office staff to allow for an appropriate segregation of duties. Effect: The lack of segregation of duties creates a significant deficiency in the control environment which may not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect and correct misstatements on a timely basis. Recommendation: Board members should increase their involvement in day-to-day activities of the Authority and consider hiring additional office staff.

2021-002: Improper Recording of Revenues and Expense: Criteria: Management is responsible for the oversight of all financial activity. This includes the proper recording of all income and expenses to appropriate general ledger accounts to ensure the completeness and understandability of all financial reports. Condition: Several general ledger accounts were incorrectly presented due to improper recording of income and expense transactions. We identified several grant income deposits which were incorrectly recorded to expenditure accounts. Additionally, several fuel sale transactions were not properly recorded to recognize the cost of the sale. Cause: Grant transactions entered into by the Authority are non-routine transactions and involve a certain level of complexity with regard to the allocation of costs between funding sources. Furthermore, the Authority has continued to update its procedures related to the collection and recording of credit card fuel sales which has created inconsistencies in the recording process. Effect: The improper recording of income and expense transactions creates a significant deficiency which may result a misstatement in the presentation of financial statements. Recommendation: Board members should increase their involvement in the oversight of financial activity of the Authority and seek training for the office personnel.