12-Non-profit agencies requesting funding

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um ARNOLD, WALKER, ARNOLD, & CO., P.C. Certified Pzcblic Accountants and Consultants Bob J. Amold, C.P.A. Lanny G. Walker, C.P.A. Kris Amold, C.P.A. ,andrew T. Amold, C.P.A. Melissa J. Godfrey, C.P.A. ivfEMBER American Institute Of Certified Public Accountants Texas State Society Of CeRified Public AccountanU REPORT ON INTERN.4L CONTROL OVER FINANCIAL REPORTPI i G AND ON COVIPLIANCE AND OTHER INIATTERS BASED ON Ai'V AUDIT OF FINANCLIkL, STATENIENTS PERFORititED INACCORDAiNCE WITH GOVERNAIEIVT AUDITIIVG STArVDARDS Board of D'uectors Shelter Agencies for Families in East Texas, Inc. Ivfount Pleasant, Texas We have audited the financial statements of Shelter Agencies for Families in East Texas, Inc. as of and for the year ended Auo st 31, 2008, which collectively comprise the Agency's financial statements and have issued our report thereon dated, January 7, 2009. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards appiicable to financial audits contained in Government Az«liting Standards, issued by the Comptroller General of the United States. Internal Control Over Financial Reporting In planning and perfonning our audit, we considered the Agency's internal control over financial reporting in order to detemune our auditing procedures 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 Agency's internal control over financial reporting. Accordingly, we do not express an opinion on the effectiveness of the Agency's intemal control over financial reporting. Our consideration of internal control over financial reporting was for the limited purpose described in the preceding paragraph and would not necessarily identify all deficiencies in internal control over financial reporting that might be significant deficiencies or material weaknesses. However, as discussed below, we identified certain deficiencies in internal control over financial reporting that we consider to be significant deficiencies. A control deficiency exists when the design or operation of a control does not allow management or employees, in the normal course of perfornung their assigned functions, to prevent or detect misstatements on a timely basis. A significant deficiency is a control deficiency, or combination of control deficiencies, that adversely affects the Agency's ability to initiate, authorize, record, process, or report financial data reliably in accordance with generally accepted accounting principles such that there is more than a remote likelihood that a misstatement of the Agency's financial statements that is more than inconsequential will not be prevented or detected by the Agency's internal control. We consider the deficiency described in the accompanying schedule of findings and questioned costs as item 08-1 to be a significant deficiency in internal control over financial reporting. A material wealmess is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the financial statements will not be prevented or detected by the Agency's internal control. Our consideration of the intemal control over financial reporting was for the limited purpose described in the first paragraph of this section and would not necessarily identify all deficiencies in intemal control that might be significant deficiencies and, accordingly, would not necessanly disclose aIl significant deficiencies that are also considered to be material weaknesses. However, we believe the significant deficiency described above is not a material weakness. 915 N. Jefferson Street . PO Box ]217 • Mt. Pleasant, Texas 75456-1217 .(403) 572-6606 . Fax (903)572-375 1 EmaiL firm@awacpa.com » 00(?173