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APPENDIX A
Material Weakness
A. Ineffective Controls over Management’s Review of Accounts Payable
In our review of U.S. Trade and Development Agency’s (USTDA) accounts payable estimation process, we found that internal controls were not operating effectively as required by Government Accountability Office’s Standards for Internal Controls in the Federal Government, principle 10. Specifically, controls over the review of calculations used in the September 30, 2020 estimate and evaluation of the outcome of prior year estimates were not operating effectively nor in accordance with existing USTDA control policies and procedures. These deficiencies resulted in approximately $2.24 million in misstatements to the accounts payable balance that were corrected by USTDA management.
These deficiencies were caused by a lack of resources due to turnover in USTDA finance staff during the year.
Recommendation
We recommend that USTDA management continue to fill vacant finance staff positions to ensure controls operate in accordance with existing USTDA control policies and procedures. USTDA should also ensure that it effectively performs the review to determine that the accounts payable estimate is properly prepared and recorded.
B. Ineffective Controls over Management’s Review of Financial Statements
In our review of USTDA’s financial reporting process, we found that internal controls were not operating effectively as required by Government Accountability Office’s Standards for Internal Controls in the Federal Government, principle 10. Specifically, controls over the review of the financial statements and notes to the financial statements to determine that they were complete, accurate, and properly presented as of year-end were not operating effectively. These deficiencies could result in material misstatements to the financial statements.
These deficiencies were caused by a lack of resources due to turnover in USTDA finance staff during the year.
Recommendation
We recommend that USTDA management continue to fill vacant finance staff positions to ensure controls operate in accordance with existing USTDA control policies and procedures over the review of the financial statements and notes to the financial statements.
 36 U.S. TRADE AND DEVELOPMENT AGENCY  ANNUAL REPORT 2020






















































































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