Audit 302727

FY End
2022-06-30
Total Expended
$2.10M
Findings
8
Programs
6
Year: 2022 Accepted: 2024-04-05
Auditor: Daviskelly LLP

Organization Exclusion Status:

Checking exclusion status...

Findings

ID Ref Severity Repeat Requirement
392370 2022-001 Significant Deficiency - B
392371 2022-001 Significant Deficiency - B
392372 2022-003 Significant Deficiency - L
392373 2022-002 Significant Deficiency - C
968812 2022-001 Significant Deficiency - B
968813 2022-001 Significant Deficiency - B
968814 2022-003 Significant Deficiency - L
968815 2022-002 Significant Deficiency - C

Contacts

Name Title Type
SPJ5SNMGSJH6 Matthew Roche Auditee
6176613991 Randall Davis Auditor
No contacts on file

Notes to SEFA

Accounting Policies: Basis of Presentation The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of Institute for Health and Recovery, Inc. (the Institute) under programs of the federal government for the year ended June 30, 2022. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Institute, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Institute. 2. Summary of Significant Accounting Policies (1) Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. (2) Pass-through entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: Auditee has a federally approved indirect cost rate

Finding Details

Condition – Documentation to support the allowability of certain costs billed to the programs could not be located. Criteria –Documentation should be maintained to support that costs charged to Federal awards were necessary and reasonable for the performance of the Federal award and allocable under the principles of 2 CFR part 200 (Uniform Guidance), Subpart E. Cause –Turnover in the top accounting position, Director of Finance combined with a physical relocation resulting in a temporary inability to locate some documents. Effect – We were unable to determine the allowability of certain costs. Context – A sample of 50 transactions per program (50 payroll and 50 non-payroll) was the selected from a population of over 250 transactions. Documentation could not be provided for 23 non payroll transaction totaling $2,286. Recommendation – We recommend that procedures be implemented to ensure that all documentation is maintained to provide reasonable assurance that the costs of goods and services charged to Federal awards are allowable and supported in accordance with the applicable requirements. Views of Responsible Officials and Planned Corrective Actions – The leadership at IHR takes this finding very seriously and to ensure more accurate record keeping has hired additional support with the skills necessary for maintaining a more comprehensive and accessible electronic record keeping system. This will also be accomplished by enforcing IHR’s existing procedures of authorizing, scanning, and properly coding documents by Accounts Payable.
Condition – Documentation to support the allowability of certain costs billed to the programs could not be located. Criteria –Documentation should be maintained to support that costs charged to Federal awards were necessary and reasonable for the performance of the Federal award and allocable under the principles of 2 CFR part 200 (Uniform Guidance), Subpart E. Cause –Turnover in the top accounting position, Director of Finance combined with a physical relocation resulting in a temporary inability to locate some documents. Effect – We were unable to determine the allowability of certain costs. Context – A sample of 50 transactions per program (50 payroll and 50 non-payroll) was the selected from a population of over 250 transactions. Documentation could not be provided for 23 non payroll transaction totaling $2,286. Recommendation – We recommend that procedures be implemented to ensure that all documentation is maintained to provide reasonable assurance that the costs of goods and services charged to Federal awards are allowable and supported in accordance with the applicable requirements. Views of Responsible Officials and Planned Corrective Actions – The leadership at IHR takes this finding very seriously and to ensure more accurate record keeping has hired additional support with the skills necessary for maintaining a more comprehensive and accessible electronic record keeping system. This will also be accomplished by enforcing IHR’s existing procedures of authorizing, scanning, and properly coding documents by Accounts Payable.
Condition – We were unable to trace amounts reported on the Federal Financial Report to the accounting records. Criteria –Reports for Federal awards should include all activity of the reporting period, should be supported by applicable accounting or performance records, and be fairly presented in accordance with governing requirements. Cause – Turnover in the top accounting position, Director of Finance combined with a physical relocation resulting in a temporary inability to locate some documents. Effect – We were unable to verify the accuracy and completeness of the Federal Financial Report. Recommendation – We recommend that procedures be implemented to ensure that all Federal reports are supported by accounting records that support the audited financial statements and Schedule of Expenditures of Federal Awards. Views of Responsible Officials and Planned Corrective Actions – The leadership at IHR takes this finding very seriously and to ensure more accurate record keeping, has hired additional support with the skills necessary for maintaining a more comprehensive and accessible electronic record keeping system. This will also be accomplished by enforcing IHR’s existing procedures of authorizing, scanning, and properly coding documents by Accounts Payable.
Condition – The trial balance for a Federal cost reimbursement grant showed that Federal drawdowns exceeded allowable costs. Criteria –Federal drawdowns should be limited to amounts necessary to cover project costs. Cause – Turnover in the top accounting position, Director of Finance combined with a physical relocation resulting in a temporary inability to locate some documents. Effect – Federal drawdowns exceeded allowable costs by approximately $23,000 during the year. Recommendation – We recommend that procedures be implemented to ensure drawdowns are limited to amounts necessary to cover project costs. Views of Responsible Officials and Planned Corrective Actions – The leadership at IHR takes this finding very seriously and to ensure more accurate record keeping, has hired additional support with the skills necessary for maintaining a more comprehensive and accessible electronic record keeping system. This will also be accomplished by enforcing IHR’s existing procedures of authorizing, scanning, and properly coding documents by Accounts Payable.
Condition – Documentation to support the allowability of certain costs billed to the programs could not be located. Criteria –Documentation should be maintained to support that costs charged to Federal awards were necessary and reasonable for the performance of the Federal award and allocable under the principles of 2 CFR part 200 (Uniform Guidance), Subpart E. Cause –Turnover in the top accounting position, Director of Finance combined with a physical relocation resulting in a temporary inability to locate some documents. Effect – We were unable to determine the allowability of certain costs. Context – A sample of 50 transactions per program (50 payroll and 50 non-payroll) was the selected from a population of over 250 transactions. Documentation could not be provided for 23 non payroll transaction totaling $2,286. Recommendation – We recommend that procedures be implemented to ensure that all documentation is maintained to provide reasonable assurance that the costs of goods and services charged to Federal awards are allowable and supported in accordance with the applicable requirements. Views of Responsible Officials and Planned Corrective Actions – The leadership at IHR takes this finding very seriously and to ensure more accurate record keeping has hired additional support with the skills necessary for maintaining a more comprehensive and accessible electronic record keeping system. This will also be accomplished by enforcing IHR’s existing procedures of authorizing, scanning, and properly coding documents by Accounts Payable.
Condition – Documentation to support the allowability of certain costs billed to the programs could not be located. Criteria –Documentation should be maintained to support that costs charged to Federal awards were necessary and reasonable for the performance of the Federal award and allocable under the principles of 2 CFR part 200 (Uniform Guidance), Subpart E. Cause –Turnover in the top accounting position, Director of Finance combined with a physical relocation resulting in a temporary inability to locate some documents. Effect – We were unable to determine the allowability of certain costs. Context – A sample of 50 transactions per program (50 payroll and 50 non-payroll) was the selected from a population of over 250 transactions. Documentation could not be provided for 23 non payroll transaction totaling $2,286. Recommendation – We recommend that procedures be implemented to ensure that all documentation is maintained to provide reasonable assurance that the costs of goods and services charged to Federal awards are allowable and supported in accordance with the applicable requirements. Views of Responsible Officials and Planned Corrective Actions – The leadership at IHR takes this finding very seriously and to ensure more accurate record keeping has hired additional support with the skills necessary for maintaining a more comprehensive and accessible electronic record keeping system. This will also be accomplished by enforcing IHR’s existing procedures of authorizing, scanning, and properly coding documents by Accounts Payable.
Condition – We were unable to trace amounts reported on the Federal Financial Report to the accounting records. Criteria –Reports for Federal awards should include all activity of the reporting period, should be supported by applicable accounting or performance records, and be fairly presented in accordance with governing requirements. Cause – Turnover in the top accounting position, Director of Finance combined with a physical relocation resulting in a temporary inability to locate some documents. Effect – We were unable to verify the accuracy and completeness of the Federal Financial Report. Recommendation – We recommend that procedures be implemented to ensure that all Federal reports are supported by accounting records that support the audited financial statements and Schedule of Expenditures of Federal Awards. Views of Responsible Officials and Planned Corrective Actions – The leadership at IHR takes this finding very seriously and to ensure more accurate record keeping, has hired additional support with the skills necessary for maintaining a more comprehensive and accessible electronic record keeping system. This will also be accomplished by enforcing IHR’s existing procedures of authorizing, scanning, and properly coding documents by Accounts Payable.
Condition – The trial balance for a Federal cost reimbursement grant showed that Federal drawdowns exceeded allowable costs. Criteria –Federal drawdowns should be limited to amounts necessary to cover project costs. Cause – Turnover in the top accounting position, Director of Finance combined with a physical relocation resulting in a temporary inability to locate some documents. Effect – Federal drawdowns exceeded allowable costs by approximately $23,000 during the year. Recommendation – We recommend that procedures be implemented to ensure drawdowns are limited to amounts necessary to cover project costs. Views of Responsible Officials and Planned Corrective Actions – The leadership at IHR takes this finding very seriously and to ensure more accurate record keeping, has hired additional support with the skills necessary for maintaining a more comprehensive and accessible electronic record keeping system. This will also be accomplished by enforcing IHR’s existing procedures of authorizing, scanning, and properly coding documents by Accounts Payable.