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Sample Government, FLORIDA SCHEDULE OF FINDINGS AND RESPONSES FISCAL YEAR ENDED SEPTEMBER 30, 2009 (Continued) I. CURRENT YEAR COMMENTS AND RECOMMENDATIONS (Continued) 2009-05 Bank Reconciliations Criteria The prime function of a properly executed bank reconciliation is to ascertain that the books and records of the entity and the records maintained by the depository are in agreement. As such, the department responsible for the bank reconciliations should have proper documentation to support all reconciling items included on the bank reconciliation. Condition We noted that the concentration account bank reconciliation included a reconciling item of approximately $1,7 million, After inquiry of various personnel, it was determined that this reconciling item did not reflect an actual cash transaction, but rather related to bond issuance costs for the Aviation department that were improperly recorded. Cause Bond issuance costs were improperly recorded as an increase to cash rather than as another asset or deferred charge. Effect Cash was overstated for $1. 7 million and bond issuance costs were understated by the same amount. Recommendation We recommend that personnel perform a detailed review of all reconciling items to ensure that they are appropriate, Views of Responsible Officials and Corrective Action Records, Taxes and Treasury (RTT) correctly identified bond costs as a reconciling item in the bank reconciliation and notified the responsible agency, but the correcting entry was not timely. Procedures have been put in place for the Accounting Division to communicate with RTT to ensure than any reconciling items requiring an entry are identified and recorded. 2009-06 Cash Receipts Criteria Assets and related revenues should be recorded in the applicable accounting period to ensure the financial statements are fairly presented. 5