Audit 11494

Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of reporting. The federal award required that an annual audit be conducted in accordance with the audit requirements of Uniform Guidance and submitted within six months after the Organization’s fiscal year-end if amounts were expended over $750,000. The Organization should have internal controls designed to ensure compliance with these provisions. Condition: The Organization did not submit annual audit on a timely basis in accordance with reporting provisions of federal awards. Questioned costs: None Context: The Organization did not retain the outsourced accounting firm to continue to assist the Organization in maintaining accurate financial records and as a result, completion of the audit was delayed for numerous adjustments that were required to be made and to reconcile the program revenue and receivables to the billing system used by the Organization. Cause: The Organization experienced significant growth in 2022 and thought they could handle the accounting function independently of the previously used outsourced accounting firm. Repeat Finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number was 2021-002. Effect: The Organization was not incompliance with the annual audit reporting requirement as provided with the federal award. Recommendation: We recommend the Organization implement policies and procedures to ensure the books and records are closed and audit ready in a timely manner in order to meet the six-month audit requirement. Views of responsible officials and planned corrective actions: Carlsbad Lifehouse will initiate the 2023 audit earlier in 2024. Carlsbad Lifehouse will reconsider staffing and partners engaged in finance to expedite the process.

Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award requires compliance with the provisions of reporting. The federal award required that an annual audit be conducted in accordance with the audit requirements of Uniform Guidance and submitted within six months after the Organization’s fiscal year-end if amounts were expended over $750,000. The Organization should have internal controls designed to ensure compliance with these provisions. Condition: The Organization did not submit annual audit on a timely basis in accordance with reporting provisions of federal awards. Questioned costs: None Context: The Organization did not retain the outsourced accounting firm to continue to assist the Organization in maintaining accurate financial records and as a result, completion of the audit was delayed for numerous adjustments that were required to be made and to reconcile the program revenue and receivables to the billing system used by the Organization. Cause: The Organization experienced significant growth in 2022 and thought they could handle the accounting function independently of the previously used outsourced accounting firm. Repeat Finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number was 2021-002. Effect: The Organization was not incompliance with the annual audit reporting requirement as provided with the federal award. Recommendation: We recommend the Organization implement policies and procedures to ensure the books and records are closed and audit ready in a timely manner in order to meet the six-month audit requirement. Views of responsible officials and planned corrective actions: Carlsbad Lifehouse will initiate the 2023 audit earlier in 2024. Carlsbad Lifehouse will reconsider staffing and partners engaged in finance to expedite the process.