EIN: 344434288
UEI: LFRTH27KNGL5
Audited by: GBQ Partners LLC
Oversight agency: 16 [Department of Justice]
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Data as of August 28, 2026
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on May 17, 2024. Under 2 CFR 200.521(d), a pass-through entity that provided federal funds to this organization for this audit period must issue a management decision on these findings by November 17, 2024 (650 days ago).
What is a management decision? →FAC accepted this audit on November 9, 2021 — management decision was due May 9, 2022.
During our audit, it was determined that the system utilized for tracking and valuing inventory, in-kind revenue and expenses related to donated goods was not in accordance with accounting principals generally accepted in the United States of America (U.S. GAAP). Criteria or specific requirement: Criteria or specific requirement: Management is responsible for ensuring that the financial statements are accurately presented in accordance with U.S. GAAP. Historically, the Organization has estimated the inventory value of donated goods and materials in its retail stores using a calculation of cost of goods sold as a percent of retail sales. In addition, no physical inventory counts were performed at year-end or otherwise. As a result, beginning of year inventory was determined to be underestimated by approximately $152,000. Effect: Proper procedures were not established to assure that inventory was properly valued. Cause: For 2020, a physical inventory was performed and to verify existence we performed a physical inventory observation. In addition, management developed unit values based on historical information and sample counts. Inventory was then valued at fair market value using the physical counts and the unit values. Adjustments were proposed by its auditor during the audit to allow for scrap and obsolescence, which approximated $1,170,000. These adjustments were based on historic information related to saleable split rates and sell through rates used by Goodwill International, Inc. Finally, adjustments were proposed by its auditor and made by management to record the in-kind estimated value of donated goods and related expense of approximately $8,746,000. Repeat Finding: no Recommendation: These changes and adjustments needed to be made to be in conformity with accounting principles generally accepted in the United States of America (GAAP). We recommend going forward that management continue these processes.
Show full finding ▾Hide full finding ▴Type of Finding: ? Significant Deficiency in Internal Control over Financial Reporting Condition: During our audit, it was determined that the system utilized for tracking and valuing inventory, in-kind revenue and expenses related to donated goods was not in accordance with accounting principals generally accepted in the United States of America (U.S. GAAP). Criteria or specific requirement: Criteria or specific requirement: Management is responsible for ensuring that the financial statements are accurately presented in accordance with U.S. GAAP. Historically, the Organization has estimated the inventory value of donated goods and materials in its retail stores using a calculation of cost of goods sold as a percent of retail sales. In addition, no physical inventory counts were performed at year-end or otherwise. As a result, beginning of year inventory was determined to be underestimated by approximately $152,000. Effect: Proper procedures were not established to assure that inventory was properly valued. Cause: For 2020, a physical inventory was performed and to verify existence we performed a physical inventory observation. In addition, management developed unit values based on historical information and sample counts. Inventory was then valued at fair market value using the physical counts and the unit values. Adjustments were proposed by its auditor during the audit to allow for scrap and obsolescence, which approximated $1,170,000. These adjustments were based on historic information related to saleable split rates and sell through rates used by Goodwill International, Inc. Finally, adjustments were proposed by its auditor and made by management to record the in-kind estimated value of donated goods and related expense of approximately $8,746,000. Repeat Finding: no Recommendation: These changes and adjustments needed to be made to be in conformity with accounting principles generally accepted in the United States of America (GAAP). We recommend going forward that management continue these processes.
At the end of December 2020, it came to our attention that we needed to change the way we calculate inventory and cost of goods sold. It was determined that we were not in compliance with GAAP standards because the auditors a.) could not observe a physical count of inventory at year end and b.) we were unable to continue the practice of calculating inventory using a percent of retail sales alone. It is important to note that we have calculated inventory using the retail sales model since 2012. Due to the nature of our business, it would be nearly impossible to physically count all items in the stores, back rooms, trailers, warehouse, and donation stations. We were able to make reasonable estimates for 2020 that do comply with GAAP and will continue this method going forward. The sample count of inventory did not take place until early January 2021 due to the lateness of when this issue came to our attention. In the future we will have the auditors observe our inventory count at year end.
Data source: This information comes from the Federal Audit Clearinghouse, the official repository of Single Audit data. All data is public domain. Verify this organization's audit history at fac.gov.
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