Audit-committee advisor must resolve whether related-party revenue

SITUATION After a controller resignation with no documented handoff, ghost-employee payroll extract is what audit-committee advisor can touch in a nonprofit with restricted-fund complexity. Forensic Accounting will live with Remove access or reverse the item versus Temporary compensating control on this Revenue Integrity file.

DECISION Audit-committee advisor in a nonprofit with restricted-fund complexity must choose Remove access or reverse the item / Temporary compensating control / Approve a documented exception / Hold using ghost-employee payroll extract after a controller resignation with no documented handoff.

HYPOTHESES TO TEST 1. A nonprofit with restricted-fund complexity can accept Remove access or reverse the item on related-party revenue is arm's-length only from ghost-employee payroll extract after a controller resignation with no documented handoff, not from a neighboring Revenue Integrity file. 2. Temporary compensating control is the reading if ghost-employee payroll extract after a controller resignation with no documented handoff fails the Forensic Accounting test audit-committee advisor would cite. 3. Approve a documented exception stays open while ghost-employee payroll extract still contains both Remove access or reverse the item and Temporary compensating control signals. 4. Until ghost-employee payroll extract after a controller resignation with no documented handoff answers related-party revenue is arm's-length, audit-committee advisor should leave the Revenue Integrity close unnamed.

ANALYSIS REQUIRED 1. Test cutoff, reversals, and system-of-record ties for materiality on related-party revenue is arm's-length. 2. Quantify the entry if audit-committee advisor has to reverse it. 3. Separate a close-process miss from a qualitative SAB 99 issue in a nonprofit with restricted-fund complexity. 4. For this Forensic Accounting Revenue Integrity file, read ghost-employee payroll extract against a controller resignation with no documented handoff and write the one fact that would move related-party revenue is arm's-length for audit-committee advisor.

RECOMMENDATION Release Remove access or reverse the item for this Forensic Accounting Revenue Integrity file only when ghost-employee payroll extract after a controller resignation with no documented handoff names the fact related-party revenue is arm's-length requires. Audit-committee advisor in a nonprofit with restricted-fund complexity should withhold Remove access or reverse the item while that fact is still a hole in ghost-employee payroll extract.

COMMAND RETURNS - Bottom-line Forensic Accounting option on related-party revenue is arm's-length, then the evidence in ghost-employee payroll extract, then the action for audit-committee advisor - Hypothesis scorecard against ghost-employee payroll extract: supported / rejected / untestable - Regulatory or exam hook Revenue Integrity would cite - Revenue Integrity finding in ghost-employee payroll extract that a second reviewer can re-perform