FAC Explorer

Audit 292742

FY End
2023-05-31
Total Expended
$7.93M
Findings
6
Programs
8
Organization: Umatilla Morrow Head Start, Inc. (OR)
Year: 2023 Accepted: 2024-02-28
Auditor: Wipfli LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
371100 2023-001 Material Weakness Yes L
371101 2023-002 Material Weakness Yes L
371102 2023-001 Significant Deficiency - L
947542 2023-001 Material Weakness Yes L
947543 2023-002 Material Weakness Yes L
947544 2023-001 Significant Deficiency - L

Programs

ALN Program Spent Major Findings
10.557 Special Supplemental Nutrition Program for Women, Infants, and Children $571,357 - 0
93.596 Child Care Mandatory and Matching Funds of the Child Care and Development Fund $435,736 - 0
93.600 Head Start $432,625 Yes 1
93.870 Maternal, Infant and Early Childhood Home Visiting Grant $254,648 - 0
10.558 Child and Adult Care Food Program $214,662 - 0
93.575 Child Care and Development Block Grant $9,795 - 0
93.489 Child Care Disaster Relief (a) $9,547 - 0
93.778 Medical Assistance Program $4,258 - 0

Contacts

Name Title Type
HLY6NML4HLK4 Casey Hinkley Auditee
5415646878 John Hemming Auditor
No contacts on file

Notes to SEFA

Title: SUBRECIPIENTS Accounting Policies: The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal grant activity of Umatilla-Morrow Head Start, Inc. under programs of the federal government for the year ended May 31, 2023. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the schedule presents only a selected portion of the operations of Umatilla-Morrow Head Start, Inc., it is not intended to and does not present the financial position, changes in net assets or cash flows of Umatilla-Morrow Head Start, Inc. Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance,wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: Umatilla-Morrow Head Start, Inc. has not elected to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. Umatilla-Morrow Head Start, Inc. did not use any subrecipients for the year ended May 31, 2023.

Finding Details

Finding 2023-001
2023-001: Reconciliations and Material Adjustments Questioned Costs: None How the questioned costs were computed: N/A Grant Funding Source Grant Period Head Start U.S. Department of Health 06/01/2022 - 05/31/2023 10CH010945-04 and Human Services Early Head Start U.S. Department of Health 07/01/2022 - 06/30/2023 Child Care Partnerships and Human Services 10HP000422-03 COVID-19 Head Start U.S. Department of Health 04/01/2021 - 03/31/2024 10HE000845-01 and Human Services COVID-19 Early Head U.S. Department of Health 07/01/2021 - 06/30/2022 Start Child Care and Human Services Partnerships 10HP000422-02-C3 Condition: At the time of audit fieldwork, Umatilla-Morrow Head Start, Inc. had not reconciled all account balances. As a result, Wipfli, LLP proposed and management posted adjusting journal entries to contributions receivable, grants receivable, refundable advance, property and equipment, grant revenue, and in-kind. During our tests of controls over bank reconciliations we also noted one individual is responsible for preparing the bank reconciliation, this individual also has the ability to post journal entries and there is no review of the completed bank reconciliation. As Umatilla-Morrow Head Start, Inc.’s internal controls did not discover these adjustments prior to our audit and as there is a lack of segregation of duties within the bank reconciliation process, a material weakness exists in Umatilla-Morrow Head Start, Inc.’s internal controls over financial reporting. Criteria: Federal Regulation 2 CFR 200.302(4) requires that an organization have…Effective control over, and accountability for, all funds, property, and other assets. Cause: During the audit year, Umatilla-Morrow Head Start, Inc. experienced turnover in its business office which contributed to the lack of timely reconciliations, review of reconciliations performed, and subsequent adjustments to account balances. Effect: As a result of the lack of segregation of duties surrounding bank reconciliations and not reconciling all account balances resulting in subsequent adjustments to accounts, a material weakness exists in internal controls over financial reporting. Recommendation: Accounts should be reconciled monthly with the adjustments posted timely so that management is relying on accurate financial information to make decisions. We recommend management and those charged with governance evaluate the operation of the business office and implement adequate and timely closing procedures to ensure that financial statement amounts are being reconciled, reviewed, and adjusted in a timely manner. View of Responsible Officials: Management agrees with the assessment and subsequent to year end, steps were taken to correct the matter.
Finding 2023-002
Questioned Costs: None How the questioned costs were computed: N/A Grant Funding Source Grant Period Head Start U.S. Department of Health 06/01/2022 - 05/31/2023 10CH010945-04 and Human Services Condition: Wipfli was unable to determine whether Umatilla-Morrow Head Start, Inc. had filed the final SF-425 for its Head Start award ended May 31, 2023. Criteria: In accordance with 45 CFR §75.302(b)(2) through 45 CFR §75.302(b)(4) , the financial management system must provide accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§75.341 and 75.342 and that records identify adequately the source and application of funds for federally-funded activities including authorizations, obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation. Effective internal controls and accountability must exist over all funds, property, and other assets to ensure they are used solely for authorized purposes. Cause: As we were unable to verify the final SF-425 has been submitted it has been determined Umatilla-Morrow Head Start, Inc. did not file the final report and internal controls failed to timely submit the final report. Effect: Because of the above conditions, Umatilla-Morrow Head Start, Inc. was not in compliance with this requirement and a non-material non-compliance exists. Recommendation: We recommend Umatilla-Morrow establish procedures to ensure funding source report deadlines are communicated and met. View of Responsible Officials: Management agrees with the assessment and subsequent to year end, steps were taken to correct the matter.
Finding 2023-001
2023-001: Reconciliations and Material Adjustments Questioned Costs: None How the questioned costs were computed: N/A Grant Funding Source Grant Period Head Start U.S. Department of Health 06/01/2022 - 05/31/2023 10CH010945-04 and Human Services Early Head Start U.S. Department of Health 07/01/2022 - 06/30/2023 Child Care Partnerships and Human Services 10HP000422-03 COVID-19 Head Start U.S. Department of Health 04/01/2021 - 03/31/2024 10HE000845-01 and Human Services COVID-19 Early Head U.S. Department of Health 07/01/2021 - 06/30/2022 Start Child Care and Human Services Partnerships 10HP000422-02-C3 Condition: At the time of audit fieldwork, Umatilla-Morrow Head Start, Inc. had not reconciled all account balances. As a result, Wipfli, LLP proposed and management posted adjusting journal entries to contributions receivable, grants receivable, refundable advance, property and equipment, grant revenue, and in-kind. During our tests of controls over bank reconciliations we also noted one individual is responsible for preparing the bank reconciliation, this individual also has the ability to post journal entries and there is no review of the completed bank reconciliation. As Umatilla-Morrow Head Start, Inc.’s internal controls did not discover these adjustments prior to our audit and as there is a lack of segregation of duties within the bank reconciliation process, a material weakness exists in Umatilla-Morrow Head Start, Inc.’s internal controls over financial reporting. Criteria: Federal Regulation 2 CFR 200.302(4) requires that an organization have…Effective control over, and accountability for, all funds, property, and other assets. Cause: During the audit year, Umatilla-Morrow Head Start, Inc. experienced turnover in its business office which contributed to the lack of timely reconciliations, review of reconciliations performed, and subsequent adjustments to account balances. Effect: As a result of the lack of segregation of duties surrounding bank reconciliations and not reconciling all account balances resulting in subsequent adjustments to accounts, a material weakness exists in internal controls over financial reporting. Recommendation: Accounts should be reconciled monthly with the adjustments posted timely so that management is relying on accurate financial information to make decisions. We recommend management and those charged with governance evaluate the operation of the business office and implement adequate and timely closing procedures to ensure that financial statement amounts are being reconciled, reviewed, and adjusted in a timely manner. View of Responsible Officials: Management agrees with the assessment and subsequent to year end, steps were taken to correct the matter.
Finding 2023-001
2023-001: Reconciliations and Material Adjustments Questioned Costs: None How the questioned costs were computed: N/A Grant Funding Source Grant Period Head Start U.S. Department of Health 06/01/2022 - 05/31/2023 10CH010945-04 and Human Services Early Head Start U.S. Department of Health 07/01/2022 - 06/30/2023 Child Care Partnerships and Human Services 10HP000422-03 COVID-19 Head Start U.S. Department of Health 04/01/2021 - 03/31/2024 10HE000845-01 and Human Services COVID-19 Early Head U.S. Department of Health 07/01/2021 - 06/30/2022 Start Child Care and Human Services Partnerships 10HP000422-02-C3 Condition: At the time of audit fieldwork, Umatilla-Morrow Head Start, Inc. had not reconciled all account balances. As a result, Wipfli, LLP proposed and management posted adjusting journal entries to contributions receivable, grants receivable, refundable advance, property and equipment, grant revenue, and in-kind. During our tests of controls over bank reconciliations we also noted one individual is responsible for preparing the bank reconciliation, this individual also has the ability to post journal entries and there is no review of the completed bank reconciliation. As Umatilla-Morrow Head Start, Inc.’s internal controls did not discover these adjustments prior to our audit and as there is a lack of segregation of duties within the bank reconciliation process, a material weakness exists in Umatilla-Morrow Head Start, Inc.’s internal controls over financial reporting. Criteria: Federal Regulation 2 CFR 200.302(4) requires that an organization have…Effective control over, and accountability for, all funds, property, and other assets. Cause: During the audit year, Umatilla-Morrow Head Start, Inc. experienced turnover in its business office which contributed to the lack of timely reconciliations, review of reconciliations performed, and subsequent adjustments to account balances. Effect: As a result of the lack of segregation of duties surrounding bank reconciliations and not reconciling all account balances resulting in subsequent adjustments to accounts, a material weakness exists in internal controls over financial reporting. Recommendation: Accounts should be reconciled monthly with the adjustments posted timely so that management is relying on accurate financial information to make decisions. We recommend management and those charged with governance evaluate the operation of the business office and implement adequate and timely closing procedures to ensure that financial statement amounts are being reconciled, reviewed, and adjusted in a timely manner. View of Responsible Officials: Management agrees with the assessment and subsequent to year end, steps were taken to correct the matter.
Finding 2023-002
Questioned Costs: None How the questioned costs were computed: N/A Grant Funding Source Grant Period Head Start U.S. Department of Health 06/01/2022 - 05/31/2023 10CH010945-04 and Human Services Condition: Wipfli was unable to determine whether Umatilla-Morrow Head Start, Inc. had filed the final SF-425 for its Head Start award ended May 31, 2023. Criteria: In accordance with 45 CFR §75.302(b)(2) through 45 CFR §75.302(b)(4) , the financial management system must provide accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§75.341 and 75.342 and that records identify adequately the source and application of funds for federally-funded activities including authorizations, obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation. Effective internal controls and accountability must exist over all funds, property, and other assets to ensure they are used solely for authorized purposes. Cause: As we were unable to verify the final SF-425 has been submitted it has been determined Umatilla-Morrow Head Start, Inc. did not file the final report and internal controls failed to timely submit the final report. Effect: Because of the above conditions, Umatilla-Morrow Head Start, Inc. was not in compliance with this requirement and a non-material non-compliance exists. Recommendation: We recommend Umatilla-Morrow establish procedures to ensure funding source report deadlines are communicated and met. View of Responsible Officials: Management agrees with the assessment and subsequent to year end, steps were taken to correct the matter.
Finding 2023-001
2023-001: Reconciliations and Material Adjustments Questioned Costs: None How the questioned costs were computed: N/A Grant Funding Source Grant Period Head Start U.S. Department of Health 06/01/2022 - 05/31/2023 10CH010945-04 and Human Services Early Head Start U.S. Department of Health 07/01/2022 - 06/30/2023 Child Care Partnerships and Human Services 10HP000422-03 COVID-19 Head Start U.S. Department of Health 04/01/2021 - 03/31/2024 10HE000845-01 and Human Services COVID-19 Early Head U.S. Department of Health 07/01/2021 - 06/30/2022 Start Child Care and Human Services Partnerships 10HP000422-02-C3 Condition: At the time of audit fieldwork, Umatilla-Morrow Head Start, Inc. had not reconciled all account balances. As a result, Wipfli, LLP proposed and management posted adjusting journal entries to contributions receivable, grants receivable, refundable advance, property and equipment, grant revenue, and in-kind. During our tests of controls over bank reconciliations we also noted one individual is responsible for preparing the bank reconciliation, this individual also has the ability to post journal entries and there is no review of the completed bank reconciliation. As Umatilla-Morrow Head Start, Inc.’s internal controls did not discover these adjustments prior to our audit and as there is a lack of segregation of duties within the bank reconciliation process, a material weakness exists in Umatilla-Morrow Head Start, Inc.’s internal controls over financial reporting. Criteria: Federal Regulation 2 CFR 200.302(4) requires that an organization have…Effective control over, and accountability for, all funds, property, and other assets. Cause: During the audit year, Umatilla-Morrow Head Start, Inc. experienced turnover in its business office which contributed to the lack of timely reconciliations, review of reconciliations performed, and subsequent adjustments to account balances. Effect: As a result of the lack of segregation of duties surrounding bank reconciliations and not reconciling all account balances resulting in subsequent adjustments to accounts, a material weakness exists in internal controls over financial reporting. Recommendation: Accounts should be reconciled monthly with the adjustments posted timely so that management is relying on accurate financial information to make decisions. We recommend management and those charged with governance evaluate the operation of the business office and implement adequate and timely closing procedures to ensure that financial statement amounts are being reconciled, reviewed, and adjusted in a timely manner. View of Responsible Officials: Management agrees with the assessment and subsequent to year end, steps were taken to correct the matter.