2003-253I - Laserfiche WebLink

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lull Enhance Recordkeeping of Bank Accounts The Academy currently uses the Quickbooks accounting software to maintain its general ledger and its bank accounts . However, the monthly bank reconciliations are performed manually by hand rather than using the software reconciliation features . As a result, numerous errors and unreconciled differences occurred and we noted the following : • Several checks issued during the period were not recorded in the accounting software ; • Several checks were recorded in the wrong accounting period; • Checks were used out of sequence ; i Interest income was not recorded in the accounting software ; and, • Bank service charges were not recorded in the accounting software . We recommend that the Academy use the reconciliation feature of the accounting software to prepare all monthly bank reconcilations . To ensure that all items posted to the bank statements are recorded in the general ledger, each balance should be fully reconciled on a monthly basis and all unreconciled differences should be investigated, cleared, and recorded prior to closing out the reconciliation. Record Teacher Retention Bonus as Wages The Academy ' s teachers received a bonus during the year, referred to as the " Teacher Retention and Recruitment Bonus . " The Academy recorded these payments as professional fees and did not reflect the payments as wages for income tax reporting purposes . Any payments made to employees in the form of a bonus are considered wages and should be treated as such for income tax reporting purposes. Improve Accounting for Child Development Program The Academy maintains the Child Development Program as a separate company on the Quickbooks accounting software and was maintained separately from the Academy. We noted certain accounts in the general ledger detail were not supported by the underlying details in immaterial amounts, and in some cases certain amounts, such as receivables from others and from employees, were not properly recorded in the general ledger. We recommend the same individual maintaining the Academy ' s accounting records, as noted above, maintain the Child Development accounting records to ensure all transactions are properly recorded in the general ledger. Update General Ledger Account Codes During the past year, the State of Florida updated the " Red Book" accounting manual to be in compliance with the new accounting standard issued by the Governmental Accounting Standards Board . The updated version of the Red Book changed certain general ledger account codes. We recommend the Academy compare each of the general ledger account codes to the updated Red Book and make changes to the general ledger where necessary . 28