KOHALA COAST RESORT ASSOCIATION

Finding 2020-001: Lack of Internal Control over Cash Disbursements ? Coronavirus Relief Fund, CFDA 21.019 Criteria: Government Auditing Standards require adequate internal controls over accounting functions. These internal controls should reduce to a relatively low level the risk that material noncompliance with applicable requirements of laws, regulations, contracts, and grant agreements in relation to a federal program being audited, may occur and not be detected in a timely manner by employees in the normal course of performing their assigned functions. Condition: We noted there is a lack of annotated approval documented either through email or signature on invoices. We also noted that there was a disbursement made, without proper support at the time the check was created. Cause of Condition: The fiscal team is small. Potential Effect: A lack of internal controls could result in erroneous disbursements being paid out of the Organization?s funds without another person in the Organization detecting it in the normal course of their assigned duties. Questioned Costs: None Recommendation: Recommend having a consistent approval process of signing the supporting documents and making sure all disbursements are properly support before a check is disbursed.

Finding 2020-001: Lack of Internal Control over Cash Disbursements ? Coronavirus Relief Fund, CFDA 21.019 To address the concerns of the auditor over lack of internal controls, the KCRA board of directors will undertake the following additional measure to have all invoices initialed and dated by 2 of the 3 Executive Committee members.