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Justina Patterson
5 years ago
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Drescher & Malecki LLP 3083 William Street, Suite 5 Buffalo, New York 14227 Telephone: 716.565.

6 Drescher & Malecki LLP 3083 William Street, Suite 5 Buffalo, New York Telephone: Fax: Certified Public Accountants November 22, 2017 Board of Directors Auxiliary Services Corporation of Erie Community College, Inc.: In planning and performing our audit of the financial statements of the Auxiliary Services Corporation of Erie Community College, Inc. (the Corporation ) as of and for the years ended August 31, 2017 and 2016, in accordance with auditing standards generally accepted in the United States of America, we considered the Corporation s internal control over financial reporting ( internal control ) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Corporation s internal control. Accordingly, we do not express an opinion on the effectiveness of the Corporation s internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity s financial statements will not be prevented, or detected and corrected on a timely basis. A reasonable possibility exists when the likelihood of an event occurring is either reasonably possible or probable as defined below: Reasonably possible. The chance of the future event or events occurring is more than remote but less than likely. Probable. The future event or events are likely to occur. Our consideration of internal control was for the limited purpose described in the first paragraph and was not designed to identify all deficiencies in internal control that might be material weaknesses. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. In addition, during our audit we identified a matter involving the internal control and other operational matters that is presented for your consideration. This letter does not affect our report dated November 22, 2017 on the financial statements of the Corporation. We will review the status of this comment during our next audit engagement. Our comment and recommendation, which were discussed with the appropriate members of management, are intended to improve the internal control or result in other operating efficiencies. Our comment is summarized in Exhibit I. The Corporation s response to the items identified in our audit are described in the accompanying Exhibit I. The Corporation s response was not subjected to the auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on it

7 This communication is intended solely for the information and use of management and those charged with governance, and is not intended to be, and should not be, used by anyone other than these specified parties. November 22,

8 EXHIBIT I Outstanding Checks During procedures surrounding bank reconciliations we found that there were multiple outstanding checks which were issued over one year. Outstanding checks that are more than one year old should be considered canceled as a part of proper controls over cash disbursements. These outstanding checks should be investigated, adjusted for separately and payments stopped at the bank, as appropriate. We recommend that the Corporation develop a formal policy or procedure to address outstanding checks. This policy should include when or how often the Corporation should contact the payee to cash the outstanding checks. Also, the time frame to determine when a check can be appropriately voided should be stated in the policy. Management s Response: Management is aware of the old outstanding checks and attributes their age to a change in the Financial Director position. The Corporation has begun, with the efforts of the new Financial Director, the process of developing a formal policy to address outstanding checks. The Corporation will develop a policy to explicitly state how many months after the issuance of a check that the payee will be contacted to cash the check. Also, the policy will include how many months after the payee was contacted for which the Corporation will deem it reasonable to void the check. New Not-for-Profit Reporting Standard The Financial Accounting Standards Board ( FASB ) released Accounting Standards Update (ASU) Not-For-Profit Entities (Topic 958): Presentation of Financial Statements of Not-For-Profits, which will have a future impact on the Corporation s financial statement presentation. This standard should be evaluated to determine the extent the Corporation will be impacted in future years. The objective of ASU is to improve how not-for-profits communicate their financial performance and condition, while also reducing the certain costs and complexities in preparing financial statements. The standard is not effective until the Corporation s fiscal year ending August 31, 2019, however early application is permitted. Management s Response: Management is aware of the new reporting standard and will consider early implementation

Independent Auditors Report

Independent Auditors Report Board of Regents Oklahoma Agricultural and Mechanical Colleges We have audited the accompanying statement of net assets of the Oklahoma State University Center for Innovation