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FLORIDA DEVELOPMENT FINANCE CORPORATION SCHEDULE OF FINDINGS AND RESPONSES JUNE 30, 2017 ADMINISTRATIVE SERVICES Recording of transactions occurring near year-end in the proper period Finding No. 2017-001 Criteria: Transactions should be recorded in the financial statements in the proper period Condition: Revenue related to reimbursable expenses incurred during July 2017, in the amount of $45,000, was recorded as fiscal 2017 activity; this revenue should have been recorded in the same period as when the expenses were incurred. In addition, management fee related to the fourth quarter of fiscal year ending June 30, 2017 was not recorded until the subsequent year. Effect: Expense was understated by $19,000 and revenue was overstated by $45,000. Cause: The entry to record revenue related to reimbursable expense was entered after books and records were closed, and was not subjected to review. The fourth quarter management fee was recorded on a cash basis, whereas it should have been accrued at year-end. Recommendation: We recommend that all journal entries be subjected to review and approval, with particular attention provided to year-end accruals. Management's Response: An invoice was created in our accounting system for revenue related to reimbursable expenses incurred in fiscal year 2017. Prior to finalizing the invoice, the invoice was modified to include additional amounts that should have been recognized as revenue in fiscal year 2018, but was inadvertently recorded as revenue in fiscal year 2017. The invoice for the management fee for the fourth quarter of fiscal year 2017 was received at a later date and was recorded in fiscal year 2018 due to a misunderstanding of what period the services were for. In the future, we will confirm the fiscal year when transactions occurred and make sure that transactions are recorded in the proper period. 16