Kleeman Village Housing Corporation, NFPNon-Profit

2025 - 001 Preparation of Financial Statements Condition: The Project prepares its accounting records and reports on the cash basis of accounting. As part of the audit, the accounting records were converted to the accrual basis as required by accounting principles generally accepted in the United States of America. In addition, audit adjustments were also made to properly record fixed assets and depreciation. The Project engages MCK CPAs & Advisors, the external auditors, to assist in preparing its financial statements and accompanying disclosures. Criteria: A strong system of internal controls requires the Project to prepare its own financial statements and accompanying disclosures in accordance with accounting principles generally accepted in the United States of America. Cause: The Project employs limited personnel over the accounting function, which are not trained in monitoring recent accounting developments to the extent necessary to assure preparation of financial statements and related disclosures. Effect: This increases the risk of material omissions or other errors in financial statements and accompanying disclosures. Identification oF Repeat Findings: This condition was included as finding 2024-001 in the Schedule of Findings and Questioned Costs, year ended June 30, 2024. Recommendation: To establish proper internal control over the preparation of its financial statements, including disclosures, the Project should design and implement a comprehensive review procedure to ensure that the accounting records and financial statements, including disclosures, are complete and accurate. Such review procedures should be performed by an individual possessing a thorough understanding of applicable generally accepted accounting principles and knowledge of the Project's activities and operations Management Response: This condition is inherent in operations which, for economic reasons, must function with a small number of office personnel. Correction of this condition would require the employment of additional office personnel. We will continue to monitor financial reports and accounting information as correction of this condition is not practical.

Condition: The Project prepares its accounting records and reports on the cash basis of accounting. As part of the audit, the accounting records were converted to the accrual basis as required by accounting principles generally accepted in the United States of America. In addition, audit adjustments were made to properly record fixed assets and depreciation. The Project engages MCK CPAs & Advisors, the external auditors, to assist in preparing its financial statements and accompanying disclosures. Criteria: A strong system of internal controls requires the Project to prepare its own financial statements and accompanying disclosures in accordance with accounting principles generally accepted in the United States of America. Cause: Limited personnel over the accounting function, which are not trained in monitoring recent accounting developments to the extent necessary to enable them to prepare the Project's financial statements and related disclosures to provide a high level of assurance that potential omissions or other errors would be identified and corrected. Effect: This increases the risk of material omissions or other errors in financial statements and accompanying disclosures. Identification of Repeat Findings: This condition was included as finding 2021-001 in the Schedule of Findings and Questioned Costs, year ended June 30, 2021. Recommendation: To establish proper internal control over the preparation of its financial statements, including disclosures, the Project should design and implement a comprehensive review procedure to ensure that the accounting records and financial statements, including disclosures, are complete and accurate. Such review procedures should be performed by an individual possessing a thorough understanding of applicable generally accepted accounting principles and knowledge of the Project's activities and operations. Management Response: This condition is inherent in operation which, for economic reasons, must function with a small number of office personnel. Correction of this condition would require the employment of additional office personnel. We will continue to monitor financial reports and accounting information as correction of this condition is not practical.

Condition: The Project prepares its accounting records and reports on the cash basis of accounting. As part of the audit, the accounting records were converted to the accrual basis as required by accounting principles generally accepted in the United States of America. In addition, audit adjustments were made to properly record fixed assets and depreciation. The Project engages MCK CPAs & Advisors, the external auditors, to assist in preparing its financial statements and accompanying disclosures. Criteria: A strong system of internal controls requires the Project to prepare its own financial statements and accompanying disclosures in accordance with accounting principles generally accepted in the United States of America. Cause: Limited personnel over the accounting function, which are not trained in monitoring recent accounting developments to the extent necessary to enable them to prepare the Project's financial statements and related disclosures to provide a high level of assurance that potential omissions or other errors would be identified and corrected. Effect: This increases the risk of material omissions or other errors in financial statements and accompanying disclosures. Identification of Repeat Findings: This condition was included as finding 2020-001 in the Schedule of Findings and Questioned Costs, year ended June 30, 2020. Recommendation: To establish proper internal control over the preparation of its financial statements, including disclosures, the Project should design and implement a comprehensive review procedure to ensure that the accounting records and financial statements, including disclosures, are complete and accurate. Such review procedures should be performed by an individual possessing a thorough understanding of applicable generally accepted accounting principles and knowledge of the Project's activities and operations. Management Response: This condition is inherent in operations which, for economic reasons, must function with a small number of office personnel. Correction of this condition would require the employment of additional office personnel. We will continue to monitor financial reports and accounting information as correction of this condition is not practical.

Condition: The Project prepares its accounting records and reports on the cash basis of accounting. As part of the audit, the accounting records were converted to the accrual basis as required by accounting principles generally accepted in the United States of America. In addition, audit adjustments were also made to properly record fixed assets and depreciation. The Project also engages MCK CP As & Advisors to assist in preparing its financial statements and accompanying disclosures. However, as independent auditors, MCK CPAs & Advisors cannot be considered part of the Project's internal control system. Criteria: A strong system of internal controls requires the Project to prepare its own financial statements and accompanying disclosures in accordance with accounting principles generally accepted in the United States of America. Cause: The Project engages MCK CPAs & Advisors to assist in this process as correction of this condition by the Project would require the employment of additional personnel. Consequently, corrective action may not be practical. Effect: This increases the risk of material omissions or other errors in financial statements and accompanying disclosures. Identification o(Repeat Findings: This condition was included as finding 2019-001 in the Schedule of Findings and Questioned Costs, year ended June 30, 2019. Recommendation: To establish proper internal control over the preparation of its financial statements, including disclosures, the Project should design and implement a comprehensive review procedure to ensure that the accounting records and financial statements, including disclosures, are complete and accurate. Such review procedures should be performed by an individual possessing a thorough understanding of applicable generally accepted accounting principles and knowledge of the Project's activities and operations Management Response: This condition is inherent in operations which, for economic reasons, must function with a small number of office personnel. Correction of this condition would require the employment of additional office personnel. We will continue to monitor financial reports and accounting information as correction of this condition is not practical.

2019 - 001 Preparation of Financial Statements Condition: The Project prepares its accounting records and reports on the cash basis of accounting. As part of the audit, the accounting records were converted to the accrual basis as required by accounting principles generally accepted in the United States of America. In addition, audit adjustments were also made to properly record fixed assets and depreciation. The Project also engages May, Cocagne & King, P.C. to assist in preparing its financial statements and accompanying disclosures. However, as independent auditors, May, Cocagne & King, P.C. cannot be considered part of the Project?s internal control system. Criteria: A strong system of internal controls requires the Project to prepare its own financial statements and accompanying disclosures in accordance with accounting principles generally accepted in the United States of America. Cause: The Project engages May, Cocagne & King, P.C. to assist in this process as correction of this condition by the Project would require the employment of additional personnel. Consequently, corrective action may not be practical. Effect: This increases the risk of material omissions or other errors in financial statements and accompanying disclosures. Identification of Repeat Findings: This condition was included as finding 2019-001 in the Schedule of Findings and Questioned Costs, year ended June 30, 2019. Recommendation: To establish proper internal control over the preparation of its financial statements, including disclosures, the Project should design and implement a comprehensive review procedure to ensure that the accounting records and financial statements, including disclosures, are complete and accurate. Such review procedures should be performed by an individual possessing a thorough understanding of applicable generally accepted accounting principles and knowledge of the Project?s activities and operations Management Response: This condition is inherent in operations which, for economic reasons, must function with a small number of office personnel. Correction of this condition would require the employment of additional office personnel. We will continue to monitor financial reports and accounting information as correction of this condition is not practical.

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