Audit 294683

#2022-004 - Major Federal Award Finding - Period of Performance Nature of Finding: Compliance Finding - Period of Performance and Material Weakness in Internal Controls over Compliance Criteria/Condition: A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance. The Organization did not have controls in place to verify that costs were being charged to the award in the correct period of performance. Questioned Costs: Approximately $30,300 Identification of How Questioned Costs Were Computed: A sample of 40 non-payroll expenditures totaling approximately $92,000 was selected from a population of approximately $488,000 of non-payroll expenditures. Of the invoices selected for testing of non-payroll expenditures charged to the major program, $7,258 was related to the year ended December 31, 2023 and was inappropriately charged to the grant during 2022. Questioned costs are estimated by projecting the error identified in the sample tested to the population of non-payroll expenditures of the Opioid STR program. Cause/Context: There are not proper controls in place to review invoices and assign them to the appropriate grant period. Seven expenditures out of forty non-payroll related expenditures tested for the grant were for contracted annual services or other costs that partially or entirely related to a separate performance period but was billed in its entirety to the current fiscal year. Effect: An overstatement of expenditures for the grant was reported in the current year. Reimbursement was sought for expenditures outside of the grant's period of performance. Recommendation: We recommend procedures be established for the independent review of the grant period of performance when recording transactions and preparing grant reimbursement requests. Evidence of this review should be documented and maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to establish formal written policy documenting significant accounting procedures including but not limited to the independent review of the grant period of performance when recording transactions and preparing grant reimbursement requests. Evidence of the review to be documented and maintained according to the procedures to be implemented.

#2022-005 - Major Federal Award Finding - Cash Management Nature of Finding: Compliance Finding - Cash Management and Material Weakness in Internal Controls Over Compliance This finding is issued in conjunction with #2022-004 above, with the questioned costs indicated below being the result of both errors (amounts were excluded from questioned costs in the previous finding to avoid duplication). Criteria/Condition: 2 CFR 200.305 requires that non-federal entities must minimize the time elapsing between the transfer of federal funds to the non-federal entity and the disbursement of the funds by the non-federal entity for program costs. The Organization did not have proper controls in place to verify that specific vendor invoices were paid within a reasonable amount of time of requesting reimbursement for the expenditures. Questioned Costs: $30,000 Identification of How Questioned Costs Were Computed: The issues of noncompliance related to cash management in this circumstance were related to one vendor that was not paid within a reasonable amount of time of the Organization being reimbursed for the costs. Questioned costs include the one invoice that was charged to the grant for this vendor during the year ended December 31, 2022 and was not paid to the vendor within a reasonable amount of time of being reimbursed for the expenditures. Cause/Context: The Organization issued a check to vendor, but the vendor did not receive or cash the check. The replacement check was not issued until months later, during the next fiscal (and grant) year. Controls were not in place to ensure expenditures were paid to the vendor prior to requesting reimbursement. Controls were also not in place to detect this significant check that remained outstanding for a considerable length of time. This particular circumstance was likely an isolated incident due to the unique circumstance of this one payment. However, the lack of controls does not appear to be isolated. Effect: Grant funds were received well in advance of the payment of the invoice identified above. The lack of controls could continue to result in requests for reimbursement being submitted for unpaid expenditures. Recommendation: We recommend procedures be established that incorporate controls to review expenditures for payment prior to submitting requests for reimbursement, and that outstanding checks (and other reconciling items) be resolved within a reasonable period of time. Evidence of control activities including review should be documented and maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to establish procedures that incorporate controls to review expenditures for payment prior to submitting request for reimbursement, and that the outstanding checks (and other reconciling items) be resolved in a reasonable period of time. Such evidence of control activities including review will be documented and maintained.

#2022-006 - Major Federal Award Finding - Allocation of Costs Nature of Finding: Compliance Finding - Allowable Costs and Material Weakness in Internal Controls Over Compliance Criteria/Condition: Federal regulations 2 CFR 200.405 provide that costs benefiting two or more projects in proportions that can be easily determined must be allocated to the projects based on the proportional benefit. If proportions cannot be easily determined, the costs may be allocated to the benefitted projects on a reasonable and documented basis. Questioned Costs: Not able to be determined. Identification of How Questioned Costs Were Computed: Of the major program expenditures selected for testing, certain costs charged to the major program appear to be under-allocated, while others appear to be over-allocated to the major program. These matters are not isolated or contained to any particular type of expenditure. There was no meaningful methodology identified to quantify or extend the errors to the population. Cause/Context: Controls were not in place to evaluate the allocation of costs to grants based on proportional benefit provided to each grant. For 5 of the 40 expenditures selected for testing, costs were divided arbitrarily when charged to grants. No documented support for the allocation methodology was present. Effect: Expenditures that involve an allocation of costs between grants are not supported. The lack of controls results in questioned costs as a disproportionate amount of expenditures may be charged to the federal program. Recommendation: We recommend management establish procedures and controls to allocate costs between grants based upon actual costs attributed to the grant and the particular expenditure allowed by the grant. Any such allocations should be supported by activity-level substantiation and be reviewed. Documentation of the allocation methodology, review and approval should be maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to recommend to management the establishment of procedures and controls allocate costs between grants based on actual costs attributed to grant and the particular expenditure allowed by the grant. All such allocations will be supported by activity-level substantiation and be reviewed. Documentation of the allocation methodology, review and approval will be maintained in writing.

#2022-007 - Major Federal Award Finding - Allowable Costs - Payroll Nature of Finding: Compliance Finding - Allowable Costs and Material Weakness in Internal Controls Over Compliance Criteria/Condition: A non-federal entity may only charge allowable costs to federal programs. The Organization did not have controls in place to verify that costs were being charged to the award were based upon actual costs incurred and consistent with those provided in the grant budget. Questioned Costs: Approximately $115,000 Identification of How Questioned Costs Were Computed: Payroll expenditures charged to the grant during the year were traced in total to the year-to-date payroll reports. Questioned costs represent the error identified in the testing of the population of payroll expenditures of the major program. Cause/Context: There are not proper controls in place to review payroll costs monthly to ensure costs were charge to the grant appropriately. This resulted in three instances of noncompliance: - Amounts were billed to the grant using estimated monthly wages rather than actual wages incurred. - The employee portion of payroll taxes were billed to the grant twice - once as part of gross wages and again as fringe benefits and added to employer payroll tax costs. - Costs were charged to the grant for one employee who was not listed in the grant budget as an allowable cost. Effect: An overstatement of expenditures for the grant was reported and submitted for reimbursement. Recommendation: We recommend that a full-range of controls over payroll and payroll related costs be implemented. The Organization should devote the resources necessary to ensure that such costs are of direct benefit to the program, are reviewed, approved, documented, and that the accounting and reporting process is accurate. Further, controls over grant billings should be established to ensure expenditures represent actual costs incurred. All control activities, including independent review should be documented and evidence of review and approval be maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement a full-range of control over costs charged to federal programs. MARR's primary decision-making authority regarding such controls shall be placed with the MARR's president. MARR's protocol shall ensure that such costs are the direct benefit to the program, are reviewed, approved, documented and ensure the accounting and reporting process be accurate. Further, controls over grant billings will be established to ensure expenditures represent actual costs incurred. All control activities, including independent review, should be documented and evidence of review and approval will be maintained.

#2022-008 - Major Federal Award Finding - Allowable Costs - Non-Payroll Nature of Finding: Compliance Finding - Allowable Costs and Material Weakness in Internal Controls Over Compliance Criteria/Condition: A non-federal entity may only charge allowable costs incurred by the entity that are necessary and reasonable for the administration of the program and are of a nature in line with the categories allowed in the grant budget. The Organization did not have controls in place to verify that costs were being charged to the award in the correct amount or for necessary and reasonable expenditures. Questioned Costs: Approximately $12,100 Identification of How Questioned Costs Were Computed: A sample of 40 non-payroll expenditures totaling approximately $92,000 was selected form a population of approximately $488,000 of non-payroll expenditures. Of the invoices selected for testing of non-payroll expenditures charged to the major program, $23 was charged to the grant in excess of invoiced amounts or for costs that were not necessary and reasonable. Questioned costs are estimated by projecting this error identified in the sample tested to the population of non-payroll expenditures of the Opioid STR program. Additionally, a questioned cost was identified for costs relating to the lease of a second space. Costs totaling up to $12,000 were allocated in part to the major program as office lease expenditures but were instead described to be an employee fringe benefit. These costs were determined to be outside of those necessary and reasonable for the administration of the program. Cause/Context: There are not proper controls in place to review invoices and ensure grant billings are in line with allowable costs incurred. Further, a portion of lease costs appear to be classified inconsistent with the underlying nature of the space. Effect: An overstatement of expenditures for the grant was reported and submitted for reimbursement. Recommendation: We recommend that a full-range of controls over costs charged to federal programs be implemented. The Organization should devote the resources necessary to ensure that such costs are of direct benefit to the program, are reviewed, approved, documented, and that the accounting and reporting process is accurate. Further, controls over grant billings should be established to ensure expenditures represent actual costs incurred. All control activities, including independent review should be documented and evidence of review and approval be maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement a full range of controls over costs charged to federal programs. MARR's protocol shall ensure that such costs are the direct benefit to the program, are reviewed, approved, documented and ensure the accounting and reporting process be accurate. Further, controls over grant billings will be established to ensure expenditures represent actual costs incurred. All control activities, including independent review, should be documented and evidence of review and approval will be maintained.

#2022-009 - Major Federal Award Finding - Reporting Nature of Finding: Compliance Finding - Reporting and Material Weakness in Internal Controls Over Compliance Criteria/Condition: Federal regulations 2 CFR 200.328 - 200.329 provide that required reporting under the federal program must be completed timely and accurately. The federal award agreement includes specific report filing due dates. Segregation of duties is also a key element of internal controls, including controls over compliance, and involves processes whereby the activities of one employee are reviewed or checked by the activities of another individual, and avoids one employee having the ability to perform a transaction or process from beginning to end. We noted during testing that no review procedures are in place surrounding these reports. Cause/Context: Controls were not in place to ensure accurate reporting. Only one individual was involved in the reporting process. Of the two reports tested, one Federal Status Report included an expenditure reported in an inaccurate budget category. Payroll tax costs were divided between the Fringe Benefits/Payroll tax budget line and the Other Expenses line, with a total of $1,554 reported in the incorrect budget category. Additionally, the client failed to identify that submission of a single audit was an applicable reporting requirement for the December 31, 2022 year, resulting in a late single audit filing. Effect: The lack of controls resulted in inaccurate, late, and failed reporting compliance. Recommendation: We recommend that a full-range of controls related to reporting, including federal program reporting be implemented. The Organization should devote the resources necessary to ensure that reports are timely and accurately prepared, reviewed, and approved prior to filing. All controls, including review and approval should be documented and that documentation be maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement a full-range of controls relating to reporting, including federal program reporting. MARR will take such steps as necessary to ensure that reports are timely and accurately prepared, reviewed, and approved prior to filing. All controls, including review and approval will be documented in such documentation to be maintained.

#2022-010 - Major Federal Award Finding - Required Policies Nature of Finding: Compliance Finding - Uniform Guidance Administrative Requirements and Material Weakness in Internal Controls Over Compliance Criteria/Condition: The Uniform Guidance requires written policies and procedures that pertain to key matters important to the administration of federal grants. Cause/Context: The Organization has not established the administrative policies required by Uniform Guidance. Effect: The Organization is not in compliance with the administrative requirements of Uniform Guidance. Recommendation: The Organization should adopt formal written policies related to grants management required by Uniform Guidance. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement and adopt formal written policies relating to grants management ordered by Uniform Guidance.

#2022-011 - Major Federal Award Finding - Document Retention Nature of Finding: Compliance Finding - Uniform Guidance Administrative Requirements and Material Weakness in Internal Controls Over Compliance Criteria/Condition: Federal regulations 2 CFR 200.334 provides that a non-federal entity must retain all records pertinent to a federal award for a minimum period of three years from the date of submission of the annual financial report. We noted during testing that records were not consistently being maintained. Cause/Context: For 2 of the 40 expenditures selected for testing, the Organization was unable to provide appropriate invoice documentation supporting the amount charged to the grant. Effect: Federal expenditures could be charged to the grant at incorrect amounts or for unallowable costs. Recommendation: We recommend the Organization implement a document retention policy that is consistent with the federal document retention requirements. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement a document retention policy that is consistent with federal document retention requirements.

#2022-004 - Major Federal Award Finding - Period of Performance Nature of Finding: Compliance Finding - Period of Performance and Material Weakness in Internal Controls over Compliance Criteria/Condition: A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance. The Organization did not have controls in place to verify that costs were being charged to the award in the correct period of performance. Questioned Costs: Approximately $30,300 Identification of How Questioned Costs Were Computed: A sample of 40 non-payroll expenditures totaling approximately $92,000 was selected from a population of approximately $488,000 of non-payroll expenditures. Of the invoices selected for testing of non-payroll expenditures charged to the major program, $7,258 was related to the year ended December 31, 2023 and was inappropriately charged to the grant during 2022. Questioned costs are estimated by projecting the error identified in the sample tested to the population of non-payroll expenditures of the Opioid STR program. Cause/Context: There are not proper controls in place to review invoices and assign them to the appropriate grant period. Seven expenditures out of forty non-payroll related expenditures tested for the grant were for contracted annual services or other costs that partially or entirely related to a separate performance period but was billed in its entirety to the current fiscal year. Effect: An overstatement of expenditures for the grant was reported in the current year. Reimbursement was sought for expenditures outside of the grant's period of performance. Recommendation: We recommend procedures be established for the independent review of the grant period of performance when recording transactions and preparing grant reimbursement requests. Evidence of this review should be documented and maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to establish formal written policy documenting significant accounting procedures including but not limited to the independent review of the grant period of performance when recording transactions and preparing grant reimbursement requests. Evidence of the review to be documented and maintained according to the procedures to be implemented.

#2022-005 - Major Federal Award Finding - Cash Management Nature of Finding: Compliance Finding - Cash Management and Material Weakness in Internal Controls Over Compliance This finding is issued in conjunction with #2022-004 above, with the questioned costs indicated below being the result of both errors (amounts were excluded from questioned costs in the previous finding to avoid duplication). Criteria/Condition: 2 CFR 200.305 requires that non-federal entities must minimize the time elapsing between the transfer of federal funds to the non-federal entity and the disbursement of the funds by the non-federal entity for program costs. The Organization did not have proper controls in place to verify that specific vendor invoices were paid within a reasonable amount of time of requesting reimbursement for the expenditures. Questioned Costs: $30,000 Identification of How Questioned Costs Were Computed: The issues of noncompliance related to cash management in this circumstance were related to one vendor that was not paid within a reasonable amount of time of the Organization being reimbursed for the costs. Questioned costs include the one invoice that was charged to the grant for this vendor during the year ended December 31, 2022 and was not paid to the vendor within a reasonable amount of time of being reimbursed for the expenditures. Cause/Context: The Organization issued a check to vendor, but the vendor did not receive or cash the check. The replacement check was not issued until months later, during the next fiscal (and grant) year. Controls were not in place to ensure expenditures were paid to the vendor prior to requesting reimbursement. Controls were also not in place to detect this significant check that remained outstanding for a considerable length of time. This particular circumstance was likely an isolated incident due to the unique circumstance of this one payment. However, the lack of controls does not appear to be isolated. Effect: Grant funds were received well in advance of the payment of the invoice identified above. The lack of controls could continue to result in requests for reimbursement being submitted for unpaid expenditures. Recommendation: We recommend procedures be established that incorporate controls to review expenditures for payment prior to submitting requests for reimbursement, and that outstanding checks (and other reconciling items) be resolved within a reasonable period of time. Evidence of control activities including review should be documented and maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to establish procedures that incorporate controls to review expenditures for payment prior to submitting request for reimbursement, and that the outstanding checks (and other reconciling items) be resolved in a reasonable period of time. Such evidence of control activities including review will be documented and maintained.

#2022-006 - Major Federal Award Finding - Allocation of Costs Nature of Finding: Compliance Finding - Allowable Costs and Material Weakness in Internal Controls Over Compliance Criteria/Condition: Federal regulations 2 CFR 200.405 provide that costs benefiting two or more projects in proportions that can be easily determined must be allocated to the projects based on the proportional benefit. If proportions cannot be easily determined, the costs may be allocated to the benefitted projects on a reasonable and documented basis. Questioned Costs: Not able to be determined. Identification of How Questioned Costs Were Computed: Of the major program expenditures selected for testing, certain costs charged to the major program appear to be under-allocated, while others appear to be over-allocated to the major program. These matters are not isolated or contained to any particular type of expenditure. There was no meaningful methodology identified to quantify or extend the errors to the population. Cause/Context: Controls were not in place to evaluate the allocation of costs to grants based on proportional benefit provided to each grant. For 5 of the 40 expenditures selected for testing, costs were divided arbitrarily when charged to grants. No documented support for the allocation methodology was present. Effect: Expenditures that involve an allocation of costs between grants are not supported. The lack of controls results in questioned costs as a disproportionate amount of expenditures may be charged to the federal program. Recommendation: We recommend management establish procedures and controls to allocate costs between grants based upon actual costs attributed to the grant and the particular expenditure allowed by the grant. Any such allocations should be supported by activity-level substantiation and be reviewed. Documentation of the allocation methodology, review and approval should be maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to recommend to management the establishment of procedures and controls allocate costs between grants based on actual costs attributed to grant and the particular expenditure allowed by the grant. All such allocations will be supported by activity-level substantiation and be reviewed. Documentation of the allocation methodology, review and approval will be maintained in writing.

#2022-007 - Major Federal Award Finding - Allowable Costs - Payroll Nature of Finding: Compliance Finding - Allowable Costs and Material Weakness in Internal Controls Over Compliance Criteria/Condition: A non-federal entity may only charge allowable costs to federal programs. The Organization did not have controls in place to verify that costs were being charged to the award were based upon actual costs incurred and consistent with those provided in the grant budget. Questioned Costs: Approximately $115,000 Identification of How Questioned Costs Were Computed: Payroll expenditures charged to the grant during the year were traced in total to the year-to-date payroll reports. Questioned costs represent the error identified in the testing of the population of payroll expenditures of the major program. Cause/Context: There are not proper controls in place to review payroll costs monthly to ensure costs were charge to the grant appropriately. This resulted in three instances of noncompliance: - Amounts were billed to the grant using estimated monthly wages rather than actual wages incurred. - The employee portion of payroll taxes were billed to the grant twice - once as part of gross wages and again as fringe benefits and added to employer payroll tax costs. - Costs were charged to the grant for one employee who was not listed in the grant budget as an allowable cost. Effect: An overstatement of expenditures for the grant was reported and submitted for reimbursement. Recommendation: We recommend that a full-range of controls over payroll and payroll related costs be implemented. The Organization should devote the resources necessary to ensure that such costs are of direct benefit to the program, are reviewed, approved, documented, and that the accounting and reporting process is accurate. Further, controls over grant billings should be established to ensure expenditures represent actual costs incurred. All control activities, including independent review should be documented and evidence of review and approval be maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement a full-range of control over costs charged to federal programs. MARR's primary decision-making authority regarding such controls shall be placed with the MARR's president. MARR's protocol shall ensure that such costs are the direct benefit to the program, are reviewed, approved, documented and ensure the accounting and reporting process be accurate. Further, controls over grant billings will be established to ensure expenditures represent actual costs incurred. All control activities, including independent review, should be documented and evidence of review and approval will be maintained.

#2022-008 - Major Federal Award Finding - Allowable Costs - Non-Payroll Nature of Finding: Compliance Finding - Allowable Costs and Material Weakness in Internal Controls Over Compliance Criteria/Condition: A non-federal entity may only charge allowable costs incurred by the entity that are necessary and reasonable for the administration of the program and are of a nature in line with the categories allowed in the grant budget. The Organization did not have controls in place to verify that costs were being charged to the award in the correct amount or for necessary and reasonable expenditures. Questioned Costs: Approximately $12,100 Identification of How Questioned Costs Were Computed: A sample of 40 non-payroll expenditures totaling approximately $92,000 was selected form a population of approximately $488,000 of non-payroll expenditures. Of the invoices selected for testing of non-payroll expenditures charged to the major program, $23 was charged to the grant in excess of invoiced amounts or for costs that were not necessary and reasonable. Questioned costs are estimated by projecting this error identified in the sample tested to the population of non-payroll expenditures of the Opioid STR program. Additionally, a questioned cost was identified for costs relating to the lease of a second space. Costs totaling up to $12,000 were allocated in part to the major program as office lease expenditures but were instead described to be an employee fringe benefit. These costs were determined to be outside of those necessary and reasonable for the administration of the program. Cause/Context: There are not proper controls in place to review invoices and ensure grant billings are in line with allowable costs incurred. Further, a portion of lease costs appear to be classified inconsistent with the underlying nature of the space. Effect: An overstatement of expenditures for the grant was reported and submitted for reimbursement. Recommendation: We recommend that a full-range of controls over costs charged to federal programs be implemented. The Organization should devote the resources necessary to ensure that such costs are of direct benefit to the program, are reviewed, approved, documented, and that the accounting and reporting process is accurate. Further, controls over grant billings should be established to ensure expenditures represent actual costs incurred. All control activities, including independent review should be documented and evidence of review and approval be maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement a full range of controls over costs charged to federal programs. MARR's protocol shall ensure that such costs are the direct benefit to the program, are reviewed, approved, documented and ensure the accounting and reporting process be accurate. Further, controls over grant billings will be established to ensure expenditures represent actual costs incurred. All control activities, including independent review, should be documented and evidence of review and approval will be maintained.

#2022-009 - Major Federal Award Finding - Reporting Nature of Finding: Compliance Finding - Reporting and Material Weakness in Internal Controls Over Compliance Criteria/Condition: Federal regulations 2 CFR 200.328 - 200.329 provide that required reporting under the federal program must be completed timely and accurately. The federal award agreement includes specific report filing due dates. Segregation of duties is also a key element of internal controls, including controls over compliance, and involves processes whereby the activities of one employee are reviewed or checked by the activities of another individual, and avoids one employee having the ability to perform a transaction or process from beginning to end. We noted during testing that no review procedures are in place surrounding these reports. Cause/Context: Controls were not in place to ensure accurate reporting. Only one individual was involved in the reporting process. Of the two reports tested, one Federal Status Report included an expenditure reported in an inaccurate budget category. Payroll tax costs were divided between the Fringe Benefits/Payroll tax budget line and the Other Expenses line, with a total of $1,554 reported in the incorrect budget category. Additionally, the client failed to identify that submission of a single audit was an applicable reporting requirement for the December 31, 2022 year, resulting in a late single audit filing. Effect: The lack of controls resulted in inaccurate, late, and failed reporting compliance. Recommendation: We recommend that a full-range of controls related to reporting, including federal program reporting be implemented. The Organization should devote the resources necessary to ensure that reports are timely and accurately prepared, reviewed, and approved prior to filing. All controls, including review and approval should be documented and that documentation be maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement a full-range of controls relating to reporting, including federal program reporting. MARR will take such steps as necessary to ensure that reports are timely and accurately prepared, reviewed, and approved prior to filing. All controls, including review and approval will be documented in such documentation to be maintained.

#2022-010 - Major Federal Award Finding - Required Policies Nature of Finding: Compliance Finding - Uniform Guidance Administrative Requirements and Material Weakness in Internal Controls Over Compliance Criteria/Condition: The Uniform Guidance requires written policies and procedures that pertain to key matters important to the administration of federal grants. Cause/Context: The Organization has not established the administrative policies required by Uniform Guidance. Effect: The Organization is not in compliance with the administrative requirements of Uniform Guidance. Recommendation: The Organization should adopt formal written policies related to grants management required by Uniform Guidance. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement and adopt formal written policies relating to grants management ordered by Uniform Guidance.

#2022-011 - Major Federal Award Finding - Document Retention Nature of Finding: Compliance Finding - Uniform Guidance Administrative Requirements and Material Weakness in Internal Controls Over Compliance Criteria/Condition: Federal regulations 2 CFR 200.334 provides that a non-federal entity must retain all records pertinent to a federal award for a minimum period of three years from the date of submission of the annual financial report. We noted during testing that records were not consistently being maintained. Cause/Context: For 2 of the 40 expenditures selected for testing, the Organization was unable to provide appropriate invoice documentation supporting the amount charged to the grant. Effect: Federal expenditures could be charged to the grant at incorrect amounts or for unallowable costs. Recommendation: We recommend the Organization implement a document retention policy that is consistent with the federal document retention requirements. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement a document retention policy that is consistent with federal document retention requirements.

#2022-004 - Major Federal Award Finding - Period of Performance Nature of Finding: Compliance Finding - Period of Performance and Material Weakness in Internal Controls over Compliance Criteria/Condition: A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance. The Organization did not have controls in place to verify that costs were being charged to the award in the correct period of performance. Questioned Costs: Approximately $30,300 Identification of How Questioned Costs Were Computed: A sample of 40 non-payroll expenditures totaling approximately $92,000 was selected from a population of approximately $488,000 of non-payroll expenditures. Of the invoices selected for testing of non-payroll expenditures charged to the major program, $7,258 was related to the year ended December 31, 2023 and was inappropriately charged to the grant during 2022. Questioned costs are estimated by projecting the error identified in the sample tested to the population of non-payroll expenditures of the Opioid STR program. Cause/Context: There are not proper controls in place to review invoices and assign them to the appropriate grant period. Seven expenditures out of forty non-payroll related expenditures tested for the grant were for contracted annual services or other costs that partially or entirely related to a separate performance period but was billed in its entirety to the current fiscal year. Effect: An overstatement of expenditures for the grant was reported in the current year. Reimbursement was sought for expenditures outside of the grant's period of performance. Recommendation: We recommend procedures be established for the independent review of the grant period of performance when recording transactions and preparing grant reimbursement requests. Evidence of this review should be documented and maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to establish formal written policy documenting significant accounting procedures including but not limited to the independent review of the grant period of performance when recording transactions and preparing grant reimbursement requests. Evidence of the review to be documented and maintained according to the procedures to be implemented.

#2022-005 - Major Federal Award Finding - Cash Management Nature of Finding: Compliance Finding - Cash Management and Material Weakness in Internal Controls Over Compliance This finding is issued in conjunction with #2022-004 above, with the questioned costs indicated below being the result of both errors (amounts were excluded from questioned costs in the previous finding to avoid duplication). Criteria/Condition: 2 CFR 200.305 requires that non-federal entities must minimize the time elapsing between the transfer of federal funds to the non-federal entity and the disbursement of the funds by the non-federal entity for program costs. The Organization did not have proper controls in place to verify that specific vendor invoices were paid within a reasonable amount of time of requesting reimbursement for the expenditures. Questioned Costs: $30,000 Identification of How Questioned Costs Were Computed: The issues of noncompliance related to cash management in this circumstance were related to one vendor that was not paid within a reasonable amount of time of the Organization being reimbursed for the costs. Questioned costs include the one invoice that was charged to the grant for this vendor during the year ended December 31, 2022 and was not paid to the vendor within a reasonable amount of time of being reimbursed for the expenditures. Cause/Context: The Organization issued a check to vendor, but the vendor did not receive or cash the check. The replacement check was not issued until months later, during the next fiscal (and grant) year. Controls were not in place to ensure expenditures were paid to the vendor prior to requesting reimbursement. Controls were also not in place to detect this significant check that remained outstanding for a considerable length of time. This particular circumstance was likely an isolated incident due to the unique circumstance of this one payment. However, the lack of controls does not appear to be isolated. Effect: Grant funds were received well in advance of the payment of the invoice identified above. The lack of controls could continue to result in requests for reimbursement being submitted for unpaid expenditures. Recommendation: We recommend procedures be established that incorporate controls to review expenditures for payment prior to submitting requests for reimbursement, and that outstanding checks (and other reconciling items) be resolved within a reasonable period of time. Evidence of control activities including review should be documented and maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to establish procedures that incorporate controls to review expenditures for payment prior to submitting request for reimbursement, and that the outstanding checks (and other reconciling items) be resolved in a reasonable period of time. Such evidence of control activities including review will be documented and maintained.

#2022-006 - Major Federal Award Finding - Allocation of Costs Nature of Finding: Compliance Finding - Allowable Costs and Material Weakness in Internal Controls Over Compliance Criteria/Condition: Federal regulations 2 CFR 200.405 provide that costs benefiting two or more projects in proportions that can be easily determined must be allocated to the projects based on the proportional benefit. If proportions cannot be easily determined, the costs may be allocated to the benefitted projects on a reasonable and documented basis. Questioned Costs: Not able to be determined. Identification of How Questioned Costs Were Computed: Of the major program expenditures selected for testing, certain costs charged to the major program appear to be under-allocated, while others appear to be over-allocated to the major program. These matters are not isolated or contained to any particular type of expenditure. There was no meaningful methodology identified to quantify or extend the errors to the population. Cause/Context: Controls were not in place to evaluate the allocation of costs to grants based on proportional benefit provided to each grant. For 5 of the 40 expenditures selected for testing, costs were divided arbitrarily when charged to grants. No documented support for the allocation methodology was present. Effect: Expenditures that involve an allocation of costs between grants are not supported. The lack of controls results in questioned costs as a disproportionate amount of expenditures may be charged to the federal program. Recommendation: We recommend management establish procedures and controls to allocate costs between grants based upon actual costs attributed to the grant and the particular expenditure allowed by the grant. Any such allocations should be supported by activity-level substantiation and be reviewed. Documentation of the allocation methodology, review and approval should be maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to recommend to management the establishment of procedures and controls allocate costs between grants based on actual costs attributed to grant and the particular expenditure allowed by the grant. All such allocations will be supported by activity-level substantiation and be reviewed. Documentation of the allocation methodology, review and approval will be maintained in writing.

#2022-007 - Major Federal Award Finding - Allowable Costs - Payroll Nature of Finding: Compliance Finding - Allowable Costs and Material Weakness in Internal Controls Over Compliance Criteria/Condition: A non-federal entity may only charge allowable costs to federal programs. The Organization did not have controls in place to verify that costs were being charged to the award were based upon actual costs incurred and consistent with those provided in the grant budget. Questioned Costs: Approximately $115,000 Identification of How Questioned Costs Were Computed: Payroll expenditures charged to the grant during the year were traced in total to the year-to-date payroll reports. Questioned costs represent the error identified in the testing of the population of payroll expenditures of the major program. Cause/Context: There are not proper controls in place to review payroll costs monthly to ensure costs were charge to the grant appropriately. This resulted in three instances of noncompliance: - Amounts were billed to the grant using estimated monthly wages rather than actual wages incurred. - The employee portion of payroll taxes were billed to the grant twice - once as part of gross wages and again as fringe benefits and added to employer payroll tax costs. - Costs were charged to the grant for one employee who was not listed in the grant budget as an allowable cost. Effect: An overstatement of expenditures for the grant was reported and submitted for reimbursement. Recommendation: We recommend that a full-range of controls over payroll and payroll related costs be implemented. The Organization should devote the resources necessary to ensure that such costs are of direct benefit to the program, are reviewed, approved, documented, and that the accounting and reporting process is accurate. Further, controls over grant billings should be established to ensure expenditures represent actual costs incurred. All control activities, including independent review should be documented and evidence of review and approval be maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement a full-range of control over costs charged to federal programs. MARR's primary decision-making authority regarding such controls shall be placed with the MARR's president. MARR's protocol shall ensure that such costs are the direct benefit to the program, are reviewed, approved, documented and ensure the accounting and reporting process be accurate. Further, controls over grant billings will be established to ensure expenditures represent actual costs incurred. All control activities, including independent review, should be documented and evidence of review and approval will be maintained.

#2022-008 - Major Federal Award Finding - Allowable Costs - Non-Payroll Nature of Finding: Compliance Finding - Allowable Costs and Material Weakness in Internal Controls Over Compliance Criteria/Condition: A non-federal entity may only charge allowable costs incurred by the entity that are necessary and reasonable for the administration of the program and are of a nature in line with the categories allowed in the grant budget. The Organization did not have controls in place to verify that costs were being charged to the award in the correct amount or for necessary and reasonable expenditures. Questioned Costs: Approximately $12,100 Identification of How Questioned Costs Were Computed: A sample of 40 non-payroll expenditures totaling approximately $92,000 was selected form a population of approximately $488,000 of non-payroll expenditures. Of the invoices selected for testing of non-payroll expenditures charged to the major program, $23 was charged to the grant in excess of invoiced amounts or for costs that were not necessary and reasonable. Questioned costs are estimated by projecting this error identified in the sample tested to the population of non-payroll expenditures of the Opioid STR program. Additionally, a questioned cost was identified for costs relating to the lease of a second space. Costs totaling up to $12,000 were allocated in part to the major program as office lease expenditures but were instead described to be an employee fringe benefit. These costs were determined to be outside of those necessary and reasonable for the administration of the program. Cause/Context: There are not proper controls in place to review invoices and ensure grant billings are in line with allowable costs incurred. Further, a portion of lease costs appear to be classified inconsistent with the underlying nature of the space. Effect: An overstatement of expenditures for the grant was reported and submitted for reimbursement. Recommendation: We recommend that a full-range of controls over costs charged to federal programs be implemented. The Organization should devote the resources necessary to ensure that such costs are of direct benefit to the program, are reviewed, approved, documented, and that the accounting and reporting process is accurate. Further, controls over grant billings should be established to ensure expenditures represent actual costs incurred. All control activities, including independent review should be documented and evidence of review and approval be maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement a full range of controls over costs charged to federal programs. MARR's protocol shall ensure that such costs are the direct benefit to the program, are reviewed, approved, documented and ensure the accounting and reporting process be accurate. Further, controls over grant billings will be established to ensure expenditures represent actual costs incurred. All control activities, including independent review, should be documented and evidence of review and approval will be maintained.

#2022-009 - Major Federal Award Finding - Reporting Nature of Finding: Compliance Finding - Reporting and Material Weakness in Internal Controls Over Compliance Criteria/Condition: Federal regulations 2 CFR 200.328 - 200.329 provide that required reporting under the federal program must be completed timely and accurately. The federal award agreement includes specific report filing due dates. Segregation of duties is also a key element of internal controls, including controls over compliance, and involves processes whereby the activities of one employee are reviewed or checked by the activities of another individual, and avoids one employee having the ability to perform a transaction or process from beginning to end. We noted during testing that no review procedures are in place surrounding these reports. Cause/Context: Controls were not in place to ensure accurate reporting. Only one individual was involved in the reporting process. Of the two reports tested, one Federal Status Report included an expenditure reported in an inaccurate budget category. Payroll tax costs were divided between the Fringe Benefits/Payroll tax budget line and the Other Expenses line, with a total of $1,554 reported in the incorrect budget category. Additionally, the client failed to identify that submission of a single audit was an applicable reporting requirement for the December 31, 2022 year, resulting in a late single audit filing. Effect: The lack of controls resulted in inaccurate, late, and failed reporting compliance. Recommendation: We recommend that a full-range of controls related to reporting, including federal program reporting be implemented. The Organization should devote the resources necessary to ensure that reports are timely and accurately prepared, reviewed, and approved prior to filing. All controls, including review and approval should be documented and that documentation be maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement a full-range of controls relating to reporting, including federal program reporting. MARR will take such steps as necessary to ensure that reports are timely and accurately prepared, reviewed, and approved prior to filing. All controls, including review and approval will be documented in such documentation to be maintained.

#2022-010 - Major Federal Award Finding - Required Policies Nature of Finding: Compliance Finding - Uniform Guidance Administrative Requirements and Material Weakness in Internal Controls Over Compliance Criteria/Condition: The Uniform Guidance requires written policies and procedures that pertain to key matters important to the administration of federal grants. Cause/Context: The Organization has not established the administrative policies required by Uniform Guidance. Effect: The Organization is not in compliance with the administrative requirements of Uniform Guidance. Recommendation: The Organization should adopt formal written policies related to grants management required by Uniform Guidance. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement and adopt formal written policies relating to grants management ordered by Uniform Guidance.

#2022-011 - Major Federal Award Finding - Document Retention Nature of Finding: Compliance Finding - Uniform Guidance Administrative Requirements and Material Weakness in Internal Controls Over Compliance Criteria/Condition: Federal regulations 2 CFR 200.334 provides that a non-federal entity must retain all records pertinent to a federal award for a minimum period of three years from the date of submission of the annual financial report. We noted during testing that records were not consistently being maintained. Cause/Context: For 2 of the 40 expenditures selected for testing, the Organization was unable to provide appropriate invoice documentation supporting the amount charged to the grant. Effect: Federal expenditures could be charged to the grant at incorrect amounts or for unallowable costs. Recommendation: We recommend the Organization implement a document retention policy that is consistent with the federal document retention requirements. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement a document retention policy that is consistent with federal document retention requirements.

#2022-004 - Major Federal Award Finding - Period of Performance Nature of Finding: Compliance Finding - Period of Performance and Material Weakness in Internal Controls over Compliance Criteria/Condition: A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance. The Organization did not have controls in place to verify that costs were being charged to the award in the correct period of performance. Questioned Costs: Approximately $30,300 Identification of How Questioned Costs Were Computed: A sample of 40 non-payroll expenditures totaling approximately $92,000 was selected from a population of approximately $488,000 of non-payroll expenditures. Of the invoices selected for testing of non-payroll expenditures charged to the major program, $7,258 was related to the year ended December 31, 2023 and was inappropriately charged to the grant during 2022. Questioned costs are estimated by projecting the error identified in the sample tested to the population of non-payroll expenditures of the Opioid STR program. Cause/Context: There are not proper controls in place to review invoices and assign them to the appropriate grant period. Seven expenditures out of forty non-payroll related expenditures tested for the grant were for contracted annual services or other costs that partially or entirely related to a separate performance period but was billed in its entirety to the current fiscal year. Effect: An overstatement of expenditures for the grant was reported in the current year. Reimbursement was sought for expenditures outside of the grant's period of performance. Recommendation: We recommend procedures be established for the independent review of the grant period of performance when recording transactions and preparing grant reimbursement requests. Evidence of this review should be documented and maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to establish formal written policy documenting significant accounting procedures including but not limited to the independent review of the grant period of performance when recording transactions and preparing grant reimbursement requests. Evidence of the review to be documented and maintained according to the procedures to be implemented.

#2022-005 - Major Federal Award Finding - Cash Management Nature of Finding: Compliance Finding - Cash Management and Material Weakness in Internal Controls Over Compliance This finding is issued in conjunction with #2022-004 above, with the questioned costs indicated below being the result of both errors (amounts were excluded from questioned costs in the previous finding to avoid duplication). Criteria/Condition: 2 CFR 200.305 requires that non-federal entities must minimize the time elapsing between the transfer of federal funds to the non-federal entity and the disbursement of the funds by the non-federal entity for program costs. The Organization did not have proper controls in place to verify that specific vendor invoices were paid within a reasonable amount of time of requesting reimbursement for the expenditures. Questioned Costs: $30,000 Identification of How Questioned Costs Were Computed: The issues of noncompliance related to cash management in this circumstance were related to one vendor that was not paid within a reasonable amount of time of the Organization being reimbursed for the costs. Questioned costs include the one invoice that was charged to the grant for this vendor during the year ended December 31, 2022 and was not paid to the vendor within a reasonable amount of time of being reimbursed for the expenditures. Cause/Context: The Organization issued a check to vendor, but the vendor did not receive or cash the check. The replacement check was not issued until months later, during the next fiscal (and grant) year. Controls were not in place to ensure expenditures were paid to the vendor prior to requesting reimbursement. Controls were also not in place to detect this significant check that remained outstanding for a considerable length of time. This particular circumstance was likely an isolated incident due to the unique circumstance of this one payment. However, the lack of controls does not appear to be isolated. Effect: Grant funds were received well in advance of the payment of the invoice identified above. The lack of controls could continue to result in requests for reimbursement being submitted for unpaid expenditures. Recommendation: We recommend procedures be established that incorporate controls to review expenditures for payment prior to submitting requests for reimbursement, and that outstanding checks (and other reconciling items) be resolved within a reasonable period of time. Evidence of control activities including review should be documented and maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to establish procedures that incorporate controls to review expenditures for payment prior to submitting request for reimbursement, and that the outstanding checks (and other reconciling items) be resolved in a reasonable period of time. Such evidence of control activities including review will be documented and maintained.

#2022-006 - Major Federal Award Finding - Allocation of Costs Nature of Finding: Compliance Finding - Allowable Costs and Material Weakness in Internal Controls Over Compliance Criteria/Condition: Federal regulations 2 CFR 200.405 provide that costs benefiting two or more projects in proportions that can be easily determined must be allocated to the projects based on the proportional benefit. If proportions cannot be easily determined, the costs may be allocated to the benefitted projects on a reasonable and documented basis. Questioned Costs: Not able to be determined. Identification of How Questioned Costs Were Computed: Of the major program expenditures selected for testing, certain costs charged to the major program appear to be under-allocated, while others appear to be over-allocated to the major program. These matters are not isolated or contained to any particular type of expenditure. There was no meaningful methodology identified to quantify or extend the errors to the population. Cause/Context: Controls were not in place to evaluate the allocation of costs to grants based on proportional benefit provided to each grant. For 5 of the 40 expenditures selected for testing, costs were divided arbitrarily when charged to grants. No documented support for the allocation methodology was present. Effect: Expenditures that involve an allocation of costs between grants are not supported. The lack of controls results in questioned costs as a disproportionate amount of expenditures may be charged to the federal program. Recommendation: We recommend management establish procedures and controls to allocate costs between grants based upon actual costs attributed to the grant and the particular expenditure allowed by the grant. Any such allocations should be supported by activity-level substantiation and be reviewed. Documentation of the allocation methodology, review and approval should be maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to recommend to management the establishment of procedures and controls allocate costs between grants based on actual costs attributed to grant and the particular expenditure allowed by the grant. All such allocations will be supported by activity-level substantiation and be reviewed. Documentation of the allocation methodology, review and approval will be maintained in writing.

#2022-007 - Major Federal Award Finding - Allowable Costs - Payroll Nature of Finding: Compliance Finding - Allowable Costs and Material Weakness in Internal Controls Over Compliance Criteria/Condition: A non-federal entity may only charge allowable costs to federal programs. The Organization did not have controls in place to verify that costs were being charged to the award were based upon actual costs incurred and consistent with those provided in the grant budget. Questioned Costs: Approximately $115,000 Identification of How Questioned Costs Were Computed: Payroll expenditures charged to the grant during the year were traced in total to the year-to-date payroll reports. Questioned costs represent the error identified in the testing of the population of payroll expenditures of the major program. Cause/Context: There are not proper controls in place to review payroll costs monthly to ensure costs were charge to the grant appropriately. This resulted in three instances of noncompliance: - Amounts were billed to the grant using estimated monthly wages rather than actual wages incurred. - The employee portion of payroll taxes were billed to the grant twice - once as part of gross wages and again as fringe benefits and added to employer payroll tax costs. - Costs were charged to the grant for one employee who was not listed in the grant budget as an allowable cost. Effect: An overstatement of expenditures for the grant was reported and submitted for reimbursement. Recommendation: We recommend that a full-range of controls over payroll and payroll related costs be implemented. The Organization should devote the resources necessary to ensure that such costs are of direct benefit to the program, are reviewed, approved, documented, and that the accounting and reporting process is accurate. Further, controls over grant billings should be established to ensure expenditures represent actual costs incurred. All control activities, including independent review should be documented and evidence of review and approval be maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement a full-range of control over costs charged to federal programs. MARR's primary decision-making authority regarding such controls shall be placed with the MARR's president. MARR's protocol shall ensure that such costs are the direct benefit to the program, are reviewed, approved, documented and ensure the accounting and reporting process be accurate. Further, controls over grant billings will be established to ensure expenditures represent actual costs incurred. All control activities, including independent review, should be documented and evidence of review and approval will be maintained.

#2022-008 - Major Federal Award Finding - Allowable Costs - Non-Payroll Nature of Finding: Compliance Finding - Allowable Costs and Material Weakness in Internal Controls Over Compliance Criteria/Condition: A non-federal entity may only charge allowable costs incurred by the entity that are necessary and reasonable for the administration of the program and are of a nature in line with the categories allowed in the grant budget. The Organization did not have controls in place to verify that costs were being charged to the award in the correct amount or for necessary and reasonable expenditures. Questioned Costs: Approximately $12,100 Identification of How Questioned Costs Were Computed: A sample of 40 non-payroll expenditures totaling approximately $92,000 was selected form a population of approximately $488,000 of non-payroll expenditures. Of the invoices selected for testing of non-payroll expenditures charged to the major program, $23 was charged to the grant in excess of invoiced amounts or for costs that were not necessary and reasonable. Questioned costs are estimated by projecting this error identified in the sample tested to the population of non-payroll expenditures of the Opioid STR program. Additionally, a questioned cost was identified for costs relating to the lease of a second space. Costs totaling up to $12,000 were allocated in part to the major program as office lease expenditures but were instead described to be an employee fringe benefit. These costs were determined to be outside of those necessary and reasonable for the administration of the program. Cause/Context: There are not proper controls in place to review invoices and ensure grant billings are in line with allowable costs incurred. Further, a portion of lease costs appear to be classified inconsistent with the underlying nature of the space. Effect: An overstatement of expenditures for the grant was reported and submitted for reimbursement. Recommendation: We recommend that a full-range of controls over costs charged to federal programs be implemented. The Organization should devote the resources necessary to ensure that such costs are of direct benefit to the program, are reviewed, approved, documented, and that the accounting and reporting process is accurate. Further, controls over grant billings should be established to ensure expenditures represent actual costs incurred. All control activities, including independent review should be documented and evidence of review and approval be maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement a full range of controls over costs charged to federal programs. MARR's protocol shall ensure that such costs are the direct benefit to the program, are reviewed, approved, documented and ensure the accounting and reporting process be accurate. Further, controls over grant billings will be established to ensure expenditures represent actual costs incurred. All control activities, including independent review, should be documented and evidence of review and approval will be maintained.

#2022-009 - Major Federal Award Finding - Reporting Nature of Finding: Compliance Finding - Reporting and Material Weakness in Internal Controls Over Compliance Criteria/Condition: Federal regulations 2 CFR 200.328 - 200.329 provide that required reporting under the federal program must be completed timely and accurately. The federal award agreement includes specific report filing due dates. Segregation of duties is also a key element of internal controls, including controls over compliance, and involves processes whereby the activities of one employee are reviewed or checked by the activities of another individual, and avoids one employee having the ability to perform a transaction or process from beginning to end. We noted during testing that no review procedures are in place surrounding these reports. Cause/Context: Controls were not in place to ensure accurate reporting. Only one individual was involved in the reporting process. Of the two reports tested, one Federal Status Report included an expenditure reported in an inaccurate budget category. Payroll tax costs were divided between the Fringe Benefits/Payroll tax budget line and the Other Expenses line, with a total of $1,554 reported in the incorrect budget category. Additionally, the client failed to identify that submission of a single audit was an applicable reporting requirement for the December 31, 2022 year, resulting in a late single audit filing. Effect: The lack of controls resulted in inaccurate, late, and failed reporting compliance. Recommendation: We recommend that a full-range of controls related to reporting, including federal program reporting be implemented. The Organization should devote the resources necessary to ensure that reports are timely and accurately prepared, reviewed, and approved prior to filing. All controls, including review and approval should be documented and that documentation be maintained. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement a full-range of controls relating to reporting, including federal program reporting. MARR will take such steps as necessary to ensure that reports are timely and accurately prepared, reviewed, and approved prior to filing. All controls, including review and approval will be documented in such documentation to be maintained.

#2022-010 - Major Federal Award Finding - Required Policies Nature of Finding: Compliance Finding - Uniform Guidance Administrative Requirements and Material Weakness in Internal Controls Over Compliance Criteria/Condition: The Uniform Guidance requires written policies and procedures that pertain to key matters important to the administration of federal grants. Cause/Context: The Organization has not established the administrative policies required by Uniform Guidance. Effect: The Organization is not in compliance with the administrative requirements of Uniform Guidance. Recommendation: The Organization should adopt formal written policies related to grants management required by Uniform Guidance. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement and adopt formal written policies relating to grants management ordered by Uniform Guidance.

#2022-011 - Major Federal Award Finding - Document Retention Nature of Finding: Compliance Finding - Uniform Guidance Administrative Requirements and Material Weakness in Internal Controls Over Compliance Criteria/Condition: Federal regulations 2 CFR 200.334 provides that a non-federal entity must retain all records pertinent to a federal award for a minimum period of three years from the date of submission of the annual financial report. We noted during testing that records were not consistently being maintained. Cause/Context: For 2 of the 40 expenditures selected for testing, the Organization was unable to provide appropriate invoice documentation supporting the amount charged to the grant. Effect: Federal expenditures could be charged to the grant at incorrect amounts or for unallowable costs. Recommendation: We recommend the Organization implement a document retention policy that is consistent with the federal document retention requirements. Views of Responsible Officials and Planned Corrective Actions: MARR will retain a CPA consultant to implement a document retention policy that is consistent with federal document retention requirements.