Incorrect Reporting of Prior Year Adjustments on Impairment Loss
National Housing Authority · 2023
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What Happened?
Category: Financial ManagementIssue: Non-complianceThe entity recorded prior year adjustments for impairment losses in the wrong financial statement line item. These losses should have been reported in the Surplus or Deficit account, not in the Statement of Changes in Net Assets/Equity.
Why It Matters
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Original Audit Finding Excerpt
"we reiterate that reporting prior year adjustments on impairment loss in the Statement of Changes in Net Assets/Equity is incorrect. The prior year adjustments pertain to adjustments on some past due accounts over 365 days, which is inconsistent with the policy on impairment loss, where losses are recognized in the Surplus or deficit account."