FAC Explorer

Audit 295534

FY End
2023-09-30
Total Expended
$6.11M
Findings
12
Programs
16
Organization: Blue Water Community Action (MI)
Year: 2023 Accepted: 2024-03-18
Auditor: Uhy LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
380804 2023-001 Significant Deficiency - P
380805 2023-002 Significant Deficiency - L
380806 2023-001 Significant Deficiency - P
380807 2023-002 Significant Deficiency - L
380808 2023-001 Significant Deficiency - P
380809 2023-002 Significant Deficiency - L
957246 2023-001 Significant Deficiency - P
957247 2023-002 Significant Deficiency - L
957248 2023-001 Significant Deficiency - P
957249 2023-002 Significant Deficiency - L
957250 2023-001 Significant Deficiency - P
957251 2023-002 Significant Deficiency - L

Programs

ALN Program Spent Major Findings
93.600 Head Start $988,084 Yes 2
93.569 Community Services Block Grant $177,647 - 0
21.023 Emergency Rental Assistance Program $176,555 - 0
14.231 Emergency Solutions Grant Program $158,886 - 0
93.568 Low-Income Home Energy Assistance $145,111 - 0
21.027 Coronavirus State and Local Fiscal Recovery Funds $89,499 - 0
14.169 Housing Counseling Assistance Program $71,522 - 0
14.267 Continuum of Care Program $34,192 - 0
14.239 Home Investment Partnerships Program $26,564 - 0
93.391 Activities to Support State, Tribal, Local and Territorial (stlt) Health Department Response to Public Health Or Healthcare Crises $12,500 - 0
81.042 Weatherization Assistance for Low-Income Persons $11,660 - 0
21.026 Homeowner Assistance Fund $8,100 - 0
14.871 Section 8 Housing Choice Vouchers $8,018 - 0
10.565 Commodity Supplemental Food Program $6,644 - 0
10.558 Child and Adult Care Food Program $5,820 - 0
20.509 Formula Grants for Rural Areas and Tribal Transit Program $3,893 - 0

Contacts

Name Title Type
UC52HNS3VJZ3 Karen Lake Auditee
8104556410 Karen Shafik Auditor
No contacts on file

Notes to SEFA

Title: SUPPLEMENTARY DATA: Accounting Policies: The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal grant activity of Blue Water Community Action (the “Agency”) for the year ended September 30, 2023. Expenditures reported on the Schedule are reported on the same basis of accounting as the financial statements, the accrual basis, although the basis for determining when federal awards are expended is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). In addition, expenditures reported on the Schedule are recognized following the cost principles contained in 2 CFR Part 200, Subpart E, Cost Principles, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Therefore, some amounts presented on the Schedule may differ from amounts presented in, or used in the preparation of, the financial statements. Capital asset acquisitions made with federal grant resources are recognized on the Schedule as expenditures at the purchase price. Commodities are recognized as revenue in the accounting period in which they are received and distributed. The related expenses are recognized at the same time as an offsetting entry. The value of commodities is based on valuations provided by the Michigan Department of Education (MDE). The Agency has elected not to use the 10 percent de minimus indirect cost rate to recover indirect costs as allowed under the Uniform Guidance. Revenue has been accrued at September 30, 2023 to match allowable expenditures incurred during the year for each program. Grant funds received in advance that are in excess of incurred costs have been reflected as refundable advances on the statement of financial position. Because the Schedule presents only a selected portion of the operations of the Agency, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Agency. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The following table was prepared to meet the Single Audit reporting requirements of each assistance listing number (ALN) of the MDE: Accrued Accrued (Deferred) (Deferred) Revenue Prior Years’ Current-year Current-year Revenue 10/1/22 Expenditures Expenditures Cash Receipts 9/30/23 Child Care Food Program ALN 10.558 Meals reimbursement - 221920 $ 18,781 $ 151,051 $ - $ 18,781 $ - 231920 - - 139,697 139,697 - 18,781 151,051 139,697 158,478 - Cash in Lieu - 222010 770 6,059 - 770 - 232010 - - 5,820 5,820 - 770 6,059 5,820 6,590 - Total ALN 10.558 $ 19,551 $ 157,110 $ 145,517 $ 165,068 $ - Temporary Emergency Food Assistance ALN 10.568 - 220990 $ 2,834 $ 61,184 $ - $ 2,834 $ - * Agrees with amounts reported on the MDE Grant Auditors Report - Form R7120.
Title: RECONCILIATION TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS: Accounting Policies: The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal grant activity of Blue Water Community Action (the “Agency”) for the year ended September 30, 2023. Expenditures reported on the Schedule are reported on the same basis of accounting as the financial statements, the accrual basis, although the basis for determining when federal awards are expended is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). In addition, expenditures reported on the Schedule are recognized following the cost principles contained in 2 CFR Part 200, Subpart E, Cost Principles, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Therefore, some amounts presented on the Schedule may differ from amounts presented in, or used in the preparation of, the financial statements. Capital asset acquisitions made with federal grant resources are recognized on the Schedule as expenditures at the purchase price. Commodities are recognized as revenue in the accounting period in which they are received and distributed. The related expenses are recognized at the same time as an offsetting entry. The value of commodities is based on valuations provided by the Michigan Department of Education (MDE). The Agency has elected not to use the 10 percent de minimus indirect cost rate to recover indirect costs as allowed under the Uniform Guidance. Revenue has been accrued at September 30, 2023 to match allowable expenditures incurred during the year for each program. Grant funds received in advance that are in excess of incurred costs have been reflected as refundable advances on the statement of financial position. Because the Schedule presents only a selected portion of the operations of the Agency, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Agency. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. Grants and awards per basic financial statements $ 7,329,546 Less: State grants ( 654,654) Local grants ( 563,003) Expenditures of federal awards $ 6,111,889
Title: LOANS: Accounting Policies: The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal grant activity of Blue Water Community Action (the “Agency”) for the year ended September 30, 2023. Expenditures reported on the Schedule are reported on the same basis of accounting as the financial statements, the accrual basis, although the basis for determining when federal awards are expended is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). In addition, expenditures reported on the Schedule are recognized following the cost principles contained in 2 CFR Part 200, Subpart E, Cost Principles, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Therefore, some amounts presented on the Schedule may differ from amounts presented in, or used in the preparation of, the financial statements. Capital asset acquisitions made with federal grant resources are recognized on the Schedule as expenditures at the purchase price. Commodities are recognized as revenue in the accounting period in which they are received and distributed. The related expenses are recognized at the same time as an offsetting entry. The value of commodities is based on valuations provided by the Michigan Department of Education (MDE). The Agency has elected not to use the 10 percent de minimus indirect cost rate to recover indirect costs as allowed under the Uniform Guidance. Revenue has been accrued at September 30, 2023 to match allowable expenditures incurred during the year for each program. Grant funds received in advance that are in excess of incurred costs have been reflected as refundable advances on the statement of financial position. Because the Schedule presents only a selected portion of the operations of the Agency, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Agency. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. Funding has been provided for the purchase and renovations of the Agency’s operating facility by the United States Department of Agriculture Rural Development. Information for the project at and for the year ended September 30, 2023 is as follows: Authorized $ 1,500,000 Loan Balance at September 30, 2023 $ 1,319,119 2023 Activity: Proceeds $ - Expenditure - Building improvements -

Finding Details

Finding 2023-001
Type: Significant deficiency in internal control over compliance. Criteria: Agency policy requires documentation to be maintained for payments made and certain approvals to occur for payments Condition: The Agency could not locate one of the 40 invoices selected for testing, and disbursement registers did not have approval for the months of July through September. Context: Certain payments did not have adequate controls to ensure maintenance of invoices or approval of payments. Cause: The Agency has misplaced one of the 40 invoices, but all others selected were located. The registers did not have documentation of approval, as there were significant changes in management and staff during the year, and this process was missed in the transition of staff. Effect: Expenditures could have been paid that were not approved by management or the board. Recommendation: We recommend management review the process of approvals and maintenance of invoices to ensure payments made are proper and documentation of approvals are maintained. View of responsible officials and planned corrective action: Management agrees with the finding. See corrective action plan.
Finding 2023-002
Type: Significant deficiency in internal control over compliance. Criteria: Controls over compliance requirements are to be in place for the Agency. Agency policy states the Fiscal Director or Executive Director are to review and sign reports to the funding sources. Condition: The Fiscal Director both prepared and certified the reports to the funding source and there is no documentation of another individuals’ review or approval over the reports. Context: There was no documentation of review on reports to the funding source. Cause: The Fiscal Director was also the Acting Executive Director for much of the year due to staffing changes. Effect: The preparer and reviewer were the same individual. Recommendation: We recommend management review and update the reporting procedure to ensure reports are reviewed and approved by a separate individual from the preparer prior to submission. View of responsible officials and planned corrective action: Management agrees with the finding. See corrective action plan.
Finding 2023-001
Type: Significant deficiency in internal control over compliance. Criteria: Agency policy requires documentation to be maintained for payments made and certain approvals to occur for payments Condition: The Agency could not locate one of the 40 invoices selected for testing, and disbursement registers did not have approval for the months of July through September. Context: Certain payments did not have adequate controls to ensure maintenance of invoices or approval of payments. Cause: The Agency has misplaced one of the 40 invoices, but all others selected were located. The registers did not have documentation of approval, as there were significant changes in management and staff during the year, and this process was missed in the transition of staff. Effect: Expenditures could have been paid that were not approved by management or the board. Recommendation: We recommend management review the process of approvals and maintenance of invoices to ensure payments made are proper and documentation of approvals are maintained. View of responsible officials and planned corrective action: Management agrees with the finding. See corrective action plan.
Finding 2023-002
Type: Significant deficiency in internal control over compliance. Criteria: Controls over compliance requirements are to be in place for the Agency. Agency policy states the Fiscal Director or Executive Director are to review and sign reports to the funding sources. Condition: The Fiscal Director both prepared and certified the reports to the funding source and there is no documentation of another individuals’ review or approval over the reports. Context: There was no documentation of review on reports to the funding source. Cause: The Fiscal Director was also the Acting Executive Director for much of the year due to staffing changes. Effect: The preparer and reviewer were the same individual. Recommendation: We recommend management review and update the reporting procedure to ensure reports are reviewed and approved by a separate individual from the preparer prior to submission. View of responsible officials and planned corrective action: Management agrees with the finding. See corrective action plan.
Finding 2023-001
Type: Significant deficiency in internal control over compliance. Criteria: Agency policy requires documentation to be maintained for payments made and certain approvals to occur for payments Condition: The Agency could not locate one of the 40 invoices selected for testing, and disbursement registers did not have approval for the months of July through September. Context: Certain payments did not have adequate controls to ensure maintenance of invoices or approval of payments. Cause: The Agency has misplaced one of the 40 invoices, but all others selected were located. The registers did not have documentation of approval, as there were significant changes in management and staff during the year, and this process was missed in the transition of staff. Effect: Expenditures could have been paid that were not approved by management or the board. Recommendation: We recommend management review the process of approvals and maintenance of invoices to ensure payments made are proper and documentation of approvals are maintained. View of responsible officials and planned corrective action: Management agrees with the finding. See corrective action plan.
Finding 2023-002
Type: Significant deficiency in internal control over compliance. Criteria: Controls over compliance requirements are to be in place for the Agency. Agency policy states the Fiscal Director or Executive Director are to review and sign reports to the funding sources. Condition: The Fiscal Director both prepared and certified the reports to the funding source and there is no documentation of another individuals’ review or approval over the reports. Context: There was no documentation of review on reports to the funding source. Cause: The Fiscal Director was also the Acting Executive Director for much of the year due to staffing changes. Effect: The preparer and reviewer were the same individual. Recommendation: We recommend management review and update the reporting procedure to ensure reports are reviewed and approved by a separate individual from the preparer prior to submission. View of responsible officials and planned corrective action: Management agrees with the finding. See corrective action plan.
Finding 2023-001
Type: Significant deficiency in internal control over compliance. Criteria: Agency policy requires documentation to be maintained for payments made and certain approvals to occur for payments Condition: The Agency could not locate one of the 40 invoices selected for testing, and disbursement registers did not have approval for the months of July through September. Context: Certain payments did not have adequate controls to ensure maintenance of invoices or approval of payments. Cause: The Agency has misplaced one of the 40 invoices, but all others selected were located. The registers did not have documentation of approval, as there were significant changes in management and staff during the year, and this process was missed in the transition of staff. Effect: Expenditures could have been paid that were not approved by management or the board. Recommendation: We recommend management review the process of approvals and maintenance of invoices to ensure payments made are proper and documentation of approvals are maintained. View of responsible officials and planned corrective action: Management agrees with the finding. See corrective action plan.
Finding 2023-002
Type: Significant deficiency in internal control over compliance. Criteria: Controls over compliance requirements are to be in place for the Agency. Agency policy states the Fiscal Director or Executive Director are to review and sign reports to the funding sources. Condition: The Fiscal Director both prepared and certified the reports to the funding source and there is no documentation of another individuals’ review or approval over the reports. Context: There was no documentation of review on reports to the funding source. Cause: The Fiscal Director was also the Acting Executive Director for much of the year due to staffing changes. Effect: The preparer and reviewer were the same individual. Recommendation: We recommend management review and update the reporting procedure to ensure reports are reviewed and approved by a separate individual from the preparer prior to submission. View of responsible officials and planned corrective action: Management agrees with the finding. See corrective action plan.
Finding 2023-001
Type: Significant deficiency in internal control over compliance. Criteria: Agency policy requires documentation to be maintained for payments made and certain approvals to occur for payments Condition: The Agency could not locate one of the 40 invoices selected for testing, and disbursement registers did not have approval for the months of July through September. Context: Certain payments did not have adequate controls to ensure maintenance of invoices or approval of payments. Cause: The Agency has misplaced one of the 40 invoices, but all others selected were located. The registers did not have documentation of approval, as there were significant changes in management and staff during the year, and this process was missed in the transition of staff. Effect: Expenditures could have been paid that were not approved by management or the board. Recommendation: We recommend management review the process of approvals and maintenance of invoices to ensure payments made are proper and documentation of approvals are maintained. View of responsible officials and planned corrective action: Management agrees with the finding. See corrective action plan.
Finding 2023-002
Type: Significant deficiency in internal control over compliance. Criteria: Controls over compliance requirements are to be in place for the Agency. Agency policy states the Fiscal Director or Executive Director are to review and sign reports to the funding sources. Condition: The Fiscal Director both prepared and certified the reports to the funding source and there is no documentation of another individuals’ review or approval over the reports. Context: There was no documentation of review on reports to the funding source. Cause: The Fiscal Director was also the Acting Executive Director for much of the year due to staffing changes. Effect: The preparer and reviewer were the same individual. Recommendation: We recommend management review and update the reporting procedure to ensure reports are reviewed and approved by a separate individual from the preparer prior to submission. View of responsible officials and planned corrective action: Management agrees with the finding. See corrective action plan.
Finding 2023-001
Type: Significant deficiency in internal control over compliance. Criteria: Agency policy requires documentation to be maintained for payments made and certain approvals to occur for payments Condition: The Agency could not locate one of the 40 invoices selected for testing, and disbursement registers did not have approval for the months of July through September. Context: Certain payments did not have adequate controls to ensure maintenance of invoices or approval of payments. Cause: The Agency has misplaced one of the 40 invoices, but all others selected were located. The registers did not have documentation of approval, as there were significant changes in management and staff during the year, and this process was missed in the transition of staff. Effect: Expenditures could have been paid that were not approved by management or the board. Recommendation: We recommend management review the process of approvals and maintenance of invoices to ensure payments made are proper and documentation of approvals are maintained. View of responsible officials and planned corrective action: Management agrees with the finding. See corrective action plan.
Finding 2023-002
Type: Significant deficiency in internal control over compliance. Criteria: Controls over compliance requirements are to be in place for the Agency. Agency policy states the Fiscal Director or Executive Director are to review and sign reports to the funding sources. Condition: The Fiscal Director both prepared and certified the reports to the funding source and there is no documentation of another individuals’ review or approval over the reports. Context: There was no documentation of review on reports to the funding source. Cause: The Fiscal Director was also the Acting Executive Director for much of the year due to staffing changes. Effect: The preparer and reviewer were the same individual. Recommendation: We recommend management review and update the reporting procedure to ensure reports are reviewed and approved by a separate individual from the preparer prior to submission. View of responsible officials and planned corrective action: Management agrees with the finding. See corrective action plan.