Audit 302227

Information on the Federal Program – Assistance Listing Number 21.023 – Emergency Rental Assistance Program, U.S. Department of the Treasury. Pass-Through Entity - Commissioners of Worchester County, Maryland. Compliance Requirements: Reporting. Type of Finding: Significant deficiency. Criteria: Program requirements include submission of regular monthly subgrantee invoices to the County reporting amounts expended in the report month. Condition: For the year ended June 30, 2022, expenditures reported on the several monthly invoices did not agree to actual expenditures in the financial records. Although the Organization has controls in place to review the monthly invoices and reconcile the amounts with the financial records, the controls are not operating effectively.The Organization during the fiscal year supported a weak control environment of organizational oversight that promoted an environment that does not have the proper design or operation of controls over financial reporting to prevent, and detect and correct, misstatements on a timely basis. Cause: Errors on the monthly invoices were due to amounts not being totaled correctly on the worksheet used to prepare the invoices. Effect or potential effect: As a result, the Organization overstated expenditures for the fiscal year and may be required to repay the grantor for the overages. Questioned costs: Known questioned costs are $10,420. Recommendation: The Board of Directors and new management should review its internal control procedures to ensure they are operating as described. Procedures should be put in place to verify worksheet totals are correct. Views of responsible officials and planned corrective actions: Management agrees with the finding. There has been a change in management since these findings occurred. New management has already began assessing its internal control systems. New policies and procedures have been approved and enforced to promote a strong system of internal controls, including an improved control environment.

Information on the Federal Program – Assistance Listing Number 21.023 – Emergency Rental Assistance Program, U.S. Department of the Treasury. Pass-Through Entity - Commissioners of Worchester County, Maryland. Compliance Requirements: Reporting. Type of Finding: Significant deficiency. Criteria: Program requirements include submission of regular monthly subgrantee invoices to the County reporting amounts expended in the report month. Condition: For the year ended June 30, 2022, expenditures reported on the several monthly invoices did not agree to actual expenditures in the financial records. Although the Organization has controls in place to review the monthly invoices and reconcile the amounts with the financial records, the controls are not operating effectively.The Organization during the fiscal year supported a weak control environment of organizational oversight that promoted an environment that does not have the proper design or operation of controls over financial reporting to prevent, and detect and correct, misstatements on a timely basis. Cause: Errors on the monthly invoices were due to amounts not being totaled correctly on the worksheet used to prepare the invoices. Effect or potential effect: As a result, the Organization overstated expenditures for the fiscal year and may be required to repay the grantor for the overages. Questioned costs: Known questioned costs are $10,420. Recommendation: The Board of Directors and new management should review its internal control procedures to ensure they are operating as described. Procedures should be put in place to verify worksheet totals are correct. Views of responsible officials and planned corrective actions: Management agrees with the finding. There has been a change in management since these findings occurred. New management has already began assessing its internal control systems. New policies and procedures have been approved and enforced to promote a strong system of internal controls, including an improved control environment.