Laserfiche WebLink
cause errors in balances and inconsistent classification of the accounts within the <br /> statement captions . <br /> The Organization manually tracks its accounts payable and accounts receivable and <br /> enters the transactions on a periodic basis, as the modules within the current system do <br /> not allow for an easy, efficient way of tracking these numbers . This can cause inaccurate <br /> account balances due to human error and causes duplication of work. <br /> When assets are purchased during the year, an expense account is debited for analytical <br /> purposes to show that money was spent for the fixed assets . The Company tracks its <br /> fixed assets and depreciation activity in a Lotus spreadsheet. Several times a year this <br /> spreadsheet is updated for additional assets and depreciation. Only at year-end is the <br /> general ledger updated to reverse the posted expenditures to fixed assets and to record <br /> depreciation. These procedures can lead to incorrect interim financial reporting and the <br /> tracking of the fixed assets off line in Lotus can lead to inaccurate numbers due to <br /> inaccurate formulas and/or manual inputting of the information. The tracking of the fixed <br /> assets in Lotus can pose access control issues that could lead to misappropriation of <br /> assets and/or decreased integrity of the financial information. <br /> We recommend that the Company consider evaluating alternative accounting systems <br /> that will include the necessary modules (e.g. receivables, payables, fixed assets and <br /> financial statement report writers) to perform the functions needed to streamline the <br /> accounting function, and properly account for and report on accounting information. <br /> Management 's Response: The Board has approved purchase of new software system <br /> capable of correcting the difficulties cited. The goal is to have it up and running by <br /> 12/31/2002. <br /> This report is intended solely for information and the use of management and the audit <br /> committee of the board of directors and are not intended to be and should not be used by <br /> anyone else. <br /> September 13 , 2002 <br />