Finding 2022-001 ? Internal Control Deficiency over Activities Allowed/Allowable Costs Principles, Period of Performance Identification of the federal program: Federal Grantor: United States Department of Health and Human Services Assistance Listing No.: 93.048 Program Name: Special Programs for the Aging, Title IV, and Title II, Discretionary Projects Criteria or Specific Requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: AdviseWell did not have adequately designed internal controls in place over expenses charged to the federal program. Cause: Management did not have effective internal controls in place Effect or potential effect: Ineffective internal controls could result in expenses being charged to the federal program that are not allowed or are outside the Period of Performance. Questioned Costs: None. Context: Payroll controls are designed where the Executive Director reviews time sheets of the employees working on the program, however, no one reviews the time submitted by the Executive Director and if the Executive Director is not available to review the employees timesheets, a third-party payroll servicer approves the time. The third-party servicer does not have first-hand knowledge of the activities of each employee. Because the internal controls were not designed effectively, we did not test controls surrounding payroll. For direct expenses, internal requisitions are to be approved by either the Executive Director or the Assistant Program Director if under $5,000 and if over $5,000 by the Executive Director prior to the Organization entering into a transaction. For 20 out of 40 transactions selected for testing, the requisition was approved after entering into the transaction. Because the internal controls were not designed effectively, we did not test controls surrounding direct expenses. For indirect expenses and fringe benefits, the Executive Director calculates the amount and requests reimbursement from the federal program. There is no independent review of the Executive Director?s calculations prior to submitting the request for reimbursement. Management asserts that it has internal controls in place to ensure that expenditures are charged to the federal programs within the period of performance. AdviseWell did not retain documentation to evidence the internal controls over their review of expenditures to ensure they were within the period of performance. Because documentation was not retained for Period of Performance, we could not test internal controls. Identification as a repeat finding, if applicable: Not a repeat finding Recommendation: AdviseWell should develop and implement effective internal controls to ensure expenses charged to the federal program are appropriately reviewed and approved by an individual knowledgeable of the program requirements, reviewed prior to entering into the expenditure, and charged within the period of performance. AdviseWell should maintain effective segregation of duties. View of Responsible Officials: Management agrees with the finding. Internal controls will be implemented to ensure expenditures are appropriately reviewed and approved prior to entering into the expenditure or requesting reimbursement from the federal program. Documentation will be maintained to support that expenditures were reviewed for appropriate period of performance. Management will ensure all duties are appropriately segregated.
Finding 2022-002 ? Internal Control Deficiency Cash Management Identification of the federal program: Federal Grantor: United States Department of Health and Human Services Assistance Listing No.: 93.048 Program Name: Special Programs for the Aging, Title IV, and Title II, Discretionary Projects Criteria or Specific Requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: There is no evidence of internal controls in place to ensure that requests for reimbursement are based on expenses paid for by AdviseWell. Cause: Controls were not designed to properly to ensure the monthly cash draw downs were complete and accurate and based on expenses that were paid for by AdviseWell. Effect or potential effect: Inaccurate requests for reimbursement could occur. Questioned Costs: None. Context: A monthly profit and loss statement is generated for each grant within the program. This monthly statement is used to make the monthly request for reimbursement. There is no documentation evidencing that the monthly profit and loss statement is reviewed. Additionally, there is no process in place to ensure that the expenditures have been paid for prior to requesting reimbursement. Identification as a repeat finding, if applicable: Not a repeat finding Recommendation: AdviseWell should implement internal controls to ensure expense are paid for prior to requesting reimbursement and that any inputs used in the request for reimbursement are reviewed and evidence of that review is retained. View of Responsible Officials: Management agrees with the finding. Controls will be implemented and documentation retained to ensure cash management drawdowns are complete and accurate and based upon expenses paid for by the Organization.
Finding 2022-003 ? Internal Control Deficiency Reporting Identification of the federal program: Federal Grantor: United States Department of Health and Human Services Assistance Listing No.: 93.048 Program Name: Special Programs for the Aging, Title IV, and Title II, Discretionary Projects Criteria or Specific Requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: There are no internal controls in place to ensure that reports that are submitted are complete and accurate. The same individual that prepares the SF-425 report, is the same person that reviews and submits the reports. Cause: Controls were not designed to properly segregate duties whereby some independent of the preparer is reviewing the reports prior to submission. Effect or potential effect: Reports could reflect inaccurate information. Questioned Costs: None. Context: Because there was not appropriate segregation of duties, we could not test internal controls over Reporting. Identification as a repeat finding, if applicable: Not a repeat finding Recommendation: AdviseWell should develop and implement effective internal controls to properly segregate duties whereby some independent of the preparer is reviewing the reports prior to submission. View of Responsible Officials: Management agrees with the finding. Controls will be implemented whereby the person preparing the reports is independent of the person reviewing the reports.
Finding 2022-004 ? Internal Control Deficiency and Noncompliance Over Procurement Identification of the federal program: Federal Grantor: United States Department of Health and Human Services Assistance Listing No.: 93.048 Program Name: Special Programs for the Aging, Title IV, and Title II, Discretionary Projects Criteria or Specific Requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.318(i) ? General procurement standards states: The non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.320 ? Methods of procurement to be followed ? the non-Federal entity must have and use documented procurements procedures, consistent with the standards of this section and 200.317, 200.318, and 200.319 for any of the following methods of procurement used for the acquisition of property or services required under a Federal award or sub-award: (a) (2) Small purchases ? (i) small purchase procedures ? the acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the non-Federal entity; (b) Formal procurement methods ? when the value of the procurement for property or services under a Federal financial assistance award exceeds the simplified acquisition threshold, or a lower threshold established by a non-federal entity, formal procurement methods are required. Formal procurement methods require following documented procedures. Formal procurement methods also require public advertising unless a non-competitive procurement can be used in accordance with 200.319. The following formal methods of procurement are used for procurement of property or services above the simplified acquisition threshold or a value below the simplified acquisition threshold the non-Federal entity determines appropriate? (1) sealed bids ? a procurement method in which bids are publicly solicited and a firm fixed-price contract (lump sum or unit price) is awarded to the responsible bidder whose bid, conforming with all the material terms and conditions of the invitation for bids, is the lowest in price; (2) proposals ? a procurement method in which either a fixed price or cost-reimbursement type contract is awarded. Title 2, Subtitle A, Chapter II, Part 200, Subpart C 200.214 ? Suspension and debarment ? Non-Federal entities are subject to the non-procurement debarment and suspension regulations that restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition: AdviseWell did not have internal controls in place to sufficiently document the history of procurement, including the rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. Additionally, management did not have evidence of internal controls being in place to document that vendors were not suspended or debarred prior to entering into a procurement transaction. AdviseWell does not have and use documented procurements procedures. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria section above. Effect or potential effect: Procurements were not supported by effective internal controls and could potentially include unreasonable prices or missing documentation to support the procurements made. If suspension and debarment searches are not conducted, the organization could contract with vendors that are suspended or debarred. Lack of written policies and procedures is out of compliance with the federal requirements and could lead to disallowed procurements. Questioned Costs: None. Context: For five procurements selected for testing, not all required documentation was available supporting the history of the procurement. As there is no written procurement policy or retained documentation of debarment searches performed on vendors prior to entering into a procurement transaction, we were unable to perform tests on these controls. Identification as a repeat finding, if applicable: Not a repeat finding Recommendation: AdviseWell should develop and implement effective internal controls to ensure procurements are in accordance with the federal guidelines, including creating a purchasing policy that contains the specified requirements and retaining documentation of adherence to the purchasing policy and the federal guidelines. AdviseWell should conduct searches for suspension and debarment prior to entering into a procurement transaction and retain documentation that the search was conducted prior to entering into the transaction. AdviseWell should periodically search recurring vendors for suspension and debarment and retain documentation to support that the search was conducted. View of Responsible Officials: Management agrees with the finding. A procurement policy will be established that is in accordance with the federal requirements and documentation for each procurement will be retained. Management currently searches vendors for suspension and debarment, but will retain evidence that the searches were conducted prior to entering into the procurement or on a periodic basis for recurring vendors.
Finding 2022-001 ? Internal Control Deficiency over Activities Allowed/Allowable Costs Principles, Period of Performance Identification of the federal program: Federal Grantor: United States Department of Health and Human Services Assistance Listing No.: 93.048 Program Name: Special Programs for the Aging, Title IV, and Title II, Discretionary Projects Criteria or Specific Requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: AdviseWell did not have adequately designed internal controls in place over expenses charged to the federal program. Cause: Management did not have effective internal controls in place Effect or potential effect: Ineffective internal controls could result in expenses being charged to the federal program that are not allowed or are outside the Period of Performance. Questioned Costs: None. Context: Payroll controls are designed where the Executive Director reviews time sheets of the employees working on the program, however, no one reviews the time submitted by the Executive Director and if the Executive Director is not available to review the employees timesheets, a third-party payroll servicer approves the time. The third-party servicer does not have first-hand knowledge of the activities of each employee. Because the internal controls were not designed effectively, we did not test controls surrounding payroll. For direct expenses, internal requisitions are to be approved by either the Executive Director or the Assistant Program Director if under $5,000 and if over $5,000 by the Executive Director prior to the Organization entering into a transaction. For 20 out of 40 transactions selected for testing, the requisition was approved after entering into the transaction. Because the internal controls were not designed effectively, we did not test controls surrounding direct expenses. For indirect expenses and fringe benefits, the Executive Director calculates the amount and requests reimbursement from the federal program. There is no independent review of the Executive Director?s calculations prior to submitting the request for reimbursement. Management asserts that it has internal controls in place to ensure that expenditures are charged to the federal programs within the period of performance. AdviseWell did not retain documentation to evidence the internal controls over their review of expenditures to ensure they were within the period of performance. Because documentation was not retained for Period of Performance, we could not test internal controls. Identification as a repeat finding, if applicable: Not a repeat finding Recommendation: AdviseWell should develop and implement effective internal controls to ensure expenses charged to the federal program are appropriately reviewed and approved by an individual knowledgeable of the program requirements, reviewed prior to entering into the expenditure, and charged within the period of performance. AdviseWell should maintain effective segregation of duties. View of Responsible Officials: Management agrees with the finding. Internal controls will be implemented to ensure expenditures are appropriately reviewed and approved prior to entering into the expenditure or requesting reimbursement from the federal program. Documentation will be maintained to support that expenditures were reviewed for appropriate period of performance. Management will ensure all duties are appropriately segregated.
Finding 2022-002 ? Internal Control Deficiency Cash Management Identification of the federal program: Federal Grantor: United States Department of Health and Human Services Assistance Listing No.: 93.048 Program Name: Special Programs for the Aging, Title IV, and Title II, Discretionary Projects Criteria or Specific Requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: There is no evidence of internal controls in place to ensure that requests for reimbursement are based on expenses paid for by AdviseWell. Cause: Controls were not designed to properly to ensure the monthly cash draw downs were complete and accurate and based on expenses that were paid for by AdviseWell. Effect or potential effect: Inaccurate requests for reimbursement could occur. Questioned Costs: None. Context: A monthly profit and loss statement is generated for each grant within the program. This monthly statement is used to make the monthly request for reimbursement. There is no documentation evidencing that the monthly profit and loss statement is reviewed. Additionally, there is no process in place to ensure that the expenditures have been paid for prior to requesting reimbursement. Identification as a repeat finding, if applicable: Not a repeat finding Recommendation: AdviseWell should implement internal controls to ensure expense are paid for prior to requesting reimbursement and that any inputs used in the request for reimbursement are reviewed and evidence of that review is retained. View of Responsible Officials: Management agrees with the finding. Controls will be implemented and documentation retained to ensure cash management drawdowns are complete and accurate and based upon expenses paid for by the Organization.
Finding 2022-003 ? Internal Control Deficiency Reporting Identification of the federal program: Federal Grantor: United States Department of Health and Human Services Assistance Listing No.: 93.048 Program Name: Special Programs for the Aging, Title IV, and Title II, Discretionary Projects Criteria or Specific Requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: There are no internal controls in place to ensure that reports that are submitted are complete and accurate. The same individual that prepares the SF-425 report, is the same person that reviews and submits the reports. Cause: Controls were not designed to properly segregate duties whereby some independent of the preparer is reviewing the reports prior to submission. Effect or potential effect: Reports could reflect inaccurate information. Questioned Costs: None. Context: Because there was not appropriate segregation of duties, we could not test internal controls over Reporting. Identification as a repeat finding, if applicable: Not a repeat finding Recommendation: AdviseWell should develop and implement effective internal controls to properly segregate duties whereby some independent of the preparer is reviewing the reports prior to submission. View of Responsible Officials: Management agrees with the finding. Controls will be implemented whereby the person preparing the reports is independent of the person reviewing the reports.
Finding 2022-004 ? Internal Control Deficiency and Noncompliance Over Procurement Identification of the federal program: Federal Grantor: United States Department of Health and Human Services Assistance Listing No.: 93.048 Program Name: Special Programs for the Aging, Title IV, and Title II, Discretionary Projects Criteria or Specific Requirement (including statutory, regulatory or other citation): Section 200.303 of the Uniform Guidance states the following regarding internal control: ?The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework,? issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.318(i) ? General procurement standards states: The non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.320 ? Methods of procurement to be followed ? the non-Federal entity must have and use documented procurements procedures, consistent with the standards of this section and 200.317, 200.318, and 200.319 for any of the following methods of procurement used for the acquisition of property or services required under a Federal award or sub-award: (a) (2) Small purchases ? (i) small purchase procedures ? the acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the non-Federal entity; (b) Formal procurement methods ? when the value of the procurement for property or services under a Federal financial assistance award exceeds the simplified acquisition threshold, or a lower threshold established by a non-federal entity, formal procurement methods are required. Formal procurement methods require following documented procedures. Formal procurement methods also require public advertising unless a non-competitive procurement can be used in accordance with 200.319. The following formal methods of procurement are used for procurement of property or services above the simplified acquisition threshold or a value below the simplified acquisition threshold the non-Federal entity determines appropriate? (1) sealed bids ? a procurement method in which bids are publicly solicited and a firm fixed-price contract (lump sum or unit price) is awarded to the responsible bidder whose bid, conforming with all the material terms and conditions of the invitation for bids, is the lowest in price; (2) proposals ? a procurement method in which either a fixed price or cost-reimbursement type contract is awarded. Title 2, Subtitle A, Chapter II, Part 200, Subpart C 200.214 ? Suspension and debarment ? Non-Federal entities are subject to the non-procurement debarment and suspension regulations that restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition: AdviseWell did not have internal controls in place to sufficiently document the history of procurement, including the rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. Additionally, management did not have evidence of internal controls being in place to document that vendors were not suspended or debarred prior to entering into a procurement transaction. AdviseWell does not have and use documented procurements procedures. Cause: Management did not have effective internal controls in place over the compliance requirement as stated in the criteria section above. Effect or potential effect: Procurements were not supported by effective internal controls and could potentially include unreasonable prices or missing documentation to support the procurements made. If suspension and debarment searches are not conducted, the organization could contract with vendors that are suspended or debarred. Lack of written policies and procedures is out of compliance with the federal requirements and could lead to disallowed procurements. Questioned Costs: None. Context: For five procurements selected for testing, not all required documentation was available supporting the history of the procurement. As there is no written procurement policy or retained documentation of debarment searches performed on vendors prior to entering into a procurement transaction, we were unable to perform tests on these controls. Identification as a repeat finding, if applicable: Not a repeat finding Recommendation: AdviseWell should develop and implement effective internal controls to ensure procurements are in accordance with the federal guidelines, including creating a purchasing policy that contains the specified requirements and retaining documentation of adherence to the purchasing policy and the federal guidelines. AdviseWell should conduct searches for suspension and debarment prior to entering into a procurement transaction and retain documentation that the search was conducted prior to entering into the transaction. AdviseWell should periodically search recurring vendors for suspension and debarment and retain documentation to support that the search was conducted. View of Responsible Officials: Management agrees with the finding. A procurement policy will be established that is in accordance with the federal requirements and documentation for each procurement will be retained. Management currently searches vendors for suspension and debarment, but will retain evidence that the searches were conducted prior to entering into the procurement or on a periodic basis for recurring vendors.