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Audit Objective

Determine whether Company officials ensured that financial activities were properly recorded and reported and that money was safeguarded.

Key Findings

• The bylaws provided limited guidance on financial responsibilities and the Board did not establish any supplemental financial policies or procedures.
• The Treasurer did not maintain adequate accounting records and prepare monthly bank reconciliations.
• Most claims were paid without Membership approval, as required by the bylaws and 47 claims totaling $34,437 were paid without proper supporting documentation.
• Company officials did not ensure that cash receipts were adequately documented. Of 125 deposits totaling $318,091 made during the audit period, 43 deposits totaling $16,023 were either supported by only a deposit receipt or had no supporting documentation.

Key Recommendations

• Amend the bylaws or adopt separate written financial policies and procedures to establish internal controls over key financial areas.
• Maintain complete and accurate accounting records.
• Ensure claims are audited before payment and have adequate supporting documentation.
• Ensure cash receipts are supported by adequate documentation.

Company officials agreed with our recommendations and have initiated or indicated they planned to initiate corrective action.