FINDING 2022-002 – Late Filing of Uniform Guidance Report
Assistance Listing #: All
Federal Awards: All
U.S. Department of Health and Human Services
Pass-Through Awards: National Association of State Mental Health Directors Pass-Through Awards: University of Maryland (R&D) Baltimore Campus
Criteria: The Uniform Guidance requires submission of the audited financial statements and report on the Schedule of Federal Awards and submission of the Data Collection Form within nine months after the organization’s fiscal year end.
Condition: The audited financial statements and report on the Schedule of Federal Awards and submission of the Data Collection Form was not completed and filed by June 30, 2023.
Cause: This was NFFCMH’s first contract requiring an audit in accordance with the Uniform Guidance. We worked with our previous accounting firm on this, and they spent several months deciding if it was necessary. They came back with a recommendation that it was however, at the same time, they advised us that due to a shortage of auditors in the firm, they were no longer willing to provide the organization with its first audit. There was a time lag while we identified a new firm and conducted the audit.
Effect: The Organization will not qualify as a low risk auditee for the next two fiscal years due to the late filing of the required report.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization ensure the audited financial statements, report on the Schedule of Expenditures of Federal Awards and the submission of the Data Collection Form are submitted timely in accordance with the required Uniform Guidance due date.
Response: NFFCMH is now aware of the timelines associated with the Uniform Guidance Report. As such, we expect no further issues or problems with the timely filing of this annual report.
FINDING 2022-002 – Late Filing of Uniform Guidance Report
Assistance Listing #: All
Federal Awards: All
U.S. Department of Health and Human Services
Pass-Through Awards: National Association of State Mental Health Directors Pass-Through Awards: University of Maryland (R&D) Baltimore Campus
Criteria: The Uniform Guidance requires submission of the audited financial statements and report on the Schedule of Federal Awards and submission of the Data Collection Form within nine months after the organization’s fiscal year end.
Condition: The audited financial statements and report on the Schedule of Federal Awards and submission of the Data Collection Form was not completed and filed by June 30, 2023.
Cause: This was NFFCMH’s first contract requiring an audit in accordance with the Uniform Guidance. We worked with our previous accounting firm on this, and they spent several months deciding if it was necessary. They came back with a recommendation that it was however, at the same time, they advised us that due to a shortage of auditors in the firm, they were no longer willing to provide the organization with its first audit. There was a time lag while we identified a new firm and conducted the audit.
Effect: The Organization will not qualify as a low risk auditee for the next two fiscal years due to the late filing of the required report.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization ensure the audited financial statements, report on the Schedule of Expenditures of Federal Awards and the submission of the Data Collection Form are submitted timely in accordance with the required Uniform Guidance due date.
Response: NFFCMH is now aware of the timelines associated with the Uniform Guidance Report. As such, we expect no further issues or problems with the timely filing of this annual report.
FINDING 2022-002 – Late Filing of Uniform Guidance Report
Assistance Listing #: All
Federal Awards: All
U.S. Department of Health and Human Services
Pass-Through Awards: National Association of State Mental Health Directors Pass-Through Awards: University of Maryland (R&D) Baltimore Campus
Criteria: The Uniform Guidance requires submission of the audited financial statements and report on the Schedule of Federal Awards and submission of the Data Collection Form within nine months after the organization’s fiscal year end.
Condition: The audited financial statements and report on the Schedule of Federal Awards and submission of the Data Collection Form was not completed and filed by June 30, 2023.
Cause: This was NFFCMH’s first contract requiring an audit in accordance with the Uniform Guidance. We worked with our previous accounting firm on this, and they spent several months deciding if it was necessary. They came back with a recommendation that it was however, at the same time, they advised us that due to a shortage of auditors in the firm, they were no longer willing to provide the organization with its first audit. There was a time lag while we identified a new firm and conducted the audit.
Effect: The Organization will not qualify as a low risk auditee for the next two fiscal years due to the late filing of the required report.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization ensure the audited financial statements, report on the Schedule of Expenditures of Federal Awards and the submission of the Data Collection Form are submitted timely in accordance with the required Uniform Guidance due date.
Response: NFFCMH is now aware of the timelines associated with the Uniform Guidance Report. As such, we expect no further issues or problems with the timely filing of this annual report.
FINDING 2022-002 – Late Filing of Uniform Guidance Report
Assistance Listing #: All
Federal Awards: All
U.S. Department of Health and Human Services
Pass-Through Awards: National Association of State Mental Health Directors Pass-Through Awards: University of Maryland (R&D) Baltimore Campus
Criteria: The Uniform Guidance requires submission of the audited financial statements and report on the Schedule of Federal Awards and submission of the Data Collection Form within nine months after the organization’s fiscal year end.
Condition: The audited financial statements and report on the Schedule of Federal Awards and submission of the Data Collection Form was not completed and filed by June 30, 2023.
Cause: This was NFFCMH’s first contract requiring an audit in accordance with the Uniform Guidance. We worked with our previous accounting firm on this, and they spent several months deciding if it was necessary. They came back with a recommendation that it was however, at the same time, they advised us that due to a shortage of auditors in the firm, they were no longer willing to provide the organization with its first audit. There was a time lag while we identified a new firm and conducted the audit.
Effect: The Organization will not qualify as a low risk auditee for the next two fiscal years due to the late filing of the required report.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization ensure the audited financial statements, report on the Schedule of Expenditures of Federal Awards and the submission of the Data Collection Form are submitted timely in accordance with the required Uniform Guidance due date.
Response: NFFCMH is now aware of the timelines associated with the Uniform Guidance Report. As such, we expect no further issues or problems with the timely filing of this annual report.
Finding 2022-003 – Procurement, suspension and debarment
Assistance Listing #: 93.243
Criteria: In accordance with the Uniform Guidance, recipients who receive federal funding shall fully comply with Subpart C of 2 CFR Part 180, which requires nonfederal entities to verify that the person/entity with whom you intend to do business is not excluded or disqualified, if the expected payments are equal to or exceed $25,000.
A non-federal entity has three options for performing this verification: 1) checking SAM exclusions; 2) collecting a certification from that person; or 3) adding a clause or condition to the covered transaction with that person.
Condition: During fiscal year 2022, the Organization contracted with several vendors for products and services who were paid more than $25,000. There was no evidence documenting that these vendors were checked for suspension and debarment prior to payment.
Cause: Fiscal year 2022 marks the Organization’s first year subject to Single Audit and it appears the vast rules and regulations are new to the Organization, however the Organization is taking steps towards compliance and updating applicable policies and procedures.
Effect: Without verifying whether vendors are suspended or debarred prior to payment, the Organization faces a heightened risk that they are expending federal dollars to excluded parties.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization review its current policies to ensure they are following the suspension and debarment provisions set forth in the Uniform Guidance, lessening the risk that payments are made to parties who may be excluded from receiving federal funds.
Response: While the Organization does verify on an annual basis that the Vendor is not excluded or disqualified, that will be documented going forward. Additionally, while we did verify on first utilization of these long-utilized service providers, those will be verified on an annual basis and documented going forward.
Finding 2022-003 – Procurement, suspension and debarment
Assistance Listing #: 93.243
Criteria: In accordance with the Uniform Guidance, recipients who receive federal funding shall fully comply with Subpart C of 2 CFR Part 180, which requires nonfederal entities to verify that the person/entity with whom you intend to do business is not excluded or disqualified, if the expected payments are equal to or exceed $25,000.
A non-federal entity has three options for performing this verification: 1) checking SAM exclusions; 2) collecting a certification from that person; or 3) adding a clause or condition to the covered transaction with that person.
Condition: During fiscal year 2022, the Organization contracted with several vendors for products and services who were paid more than $25,000. There was no evidence documenting that these vendors were checked for suspension and debarment prior to payment.
Cause: Fiscal year 2022 marks the Organization’s first year subject to Single Audit and it appears the vast rules and regulations are new to the Organization, however the Organization is taking steps towards compliance and updating applicable policies and procedures.
Effect: Without verifying whether vendors are suspended or debarred prior to payment, the Organization faces a heightened risk that they are expending federal dollars to excluded parties.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization review its current policies to ensure they are following the suspension and debarment provisions set forth in the Uniform Guidance, lessening the risk that payments are made to parties who may be excluded from receiving federal funds.
Response: While the Organization does verify on an annual basis that the Vendor is not excluded or disqualified, that will be documented going forward. Additionally, while we did verify on first utilization of these long-utilized service providers, those will be verified on an annual basis and documented going forward.
Finding 2022-003 – Procurement, suspension and debarment
Assistance Listing #: 93.243
Criteria: In accordance with the Uniform Guidance, recipients who receive federal funding shall fully comply with Subpart C of 2 CFR Part 180, which requires nonfederal entities to verify that the person/entity with whom you intend to do business is not excluded or disqualified, if the expected payments are equal to or exceed $25,000.
A non-federal entity has three options for performing this verification: 1) checking SAM exclusions; 2) collecting a certification from that person; or 3) adding a clause or condition to the covered transaction with that person.
Condition: During fiscal year 2022, the Organization contracted with several vendors for products and services who were paid more than $25,000. There was no evidence documenting that these vendors were checked for suspension and debarment prior to payment.
Cause: Fiscal year 2022 marks the Organization’s first year subject to Single Audit and it appears the vast rules and regulations are new to the Organization, however the Organization is taking steps towards compliance and updating applicable policies and procedures.
Effect: Without verifying whether vendors are suspended or debarred prior to payment, the Organization faces a heightened risk that they are expending federal dollars to excluded parties.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization review its current policies to ensure they are following the suspension and debarment provisions set forth in the Uniform Guidance, lessening the risk that payments are made to parties who may be excluded from receiving federal funds.
Response: While the Organization does verify on an annual basis that the Vendor is not excluded or disqualified, that will be documented going forward. Additionally, while we did verify on first utilization of these long-utilized service providers, those will be verified on an annual basis and documented going forward.
Finding 2022-004 – Allowable costs – payroll
Assistance Listing #: 93.243
Criteria: In accordance with the Uniform Guidance’s compensation requirements (2 CFR 200.430), payroll systems must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated.
The Uniform Guidance allows for use of budget estimates on an interim basis. When using budget estimates on an interim basis, grantees must reconcile estimates against actual time or effort on a regular basis to ensure that estimates conform to actual staff activity. Grantees must make adjustments in the payroll distribution to align with actual time.
Condition: During fiscal year 2022, the Organization charged payroll costs to the federal award programs using a set percentage based on budget and not based on employee’s actual time or effort amongst various programs.
Cause: As noted above, fiscal year 2022 is the Organization’s first Single Audit and management was unaware that using budget estimates was not allowed without further reconciliation against actual time or effort activities.
Effect: The salary costs charged to the federal programs may have been under or over reported based on the actual level of effort.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization make changes overall its timekeeping processes to ensure that payroll costs accurately reflect the work performed and if budget estimates are utilized, that they are reconciled and trued up on a consistent basis.
Response: The Organization is now aware that utilization of budget estimates is not allowed for charging payroll and will utilize proper accounting treatment going forward.
Finding 2022-004 – Allowable costs – payroll
Assistance Listing #: 93.243
Criteria: In accordance with the Uniform Guidance’s compensation requirements (2 CFR 200.430), payroll systems must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated.
The Uniform Guidance allows for use of budget estimates on an interim basis. When using budget estimates on an interim basis, grantees must reconcile estimates against actual time or effort on a regular basis to ensure that estimates conform to actual staff activity. Grantees must make adjustments in the payroll distribution to align with actual time.
Condition: During fiscal year 2022, the Organization charged payroll costs to the federal award programs using a set percentage based on budget and not based on employee’s actual time or effort amongst various programs.
Cause: As noted above, fiscal year 2022 is the Organization’s first Single Audit and management was unaware that using budget estimates was not allowed without further reconciliation against actual time or effort activities.
Effect: The salary costs charged to the federal programs may have been under or over reported based on the actual level of effort.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization make changes overall its timekeeping processes to ensure that payroll costs accurately reflect the work performed and if budget estimates are utilized, that they are reconciled and trued up on a consistent basis.
Response: The Organization is now aware that utilization of budget estimates is not allowed for charging payroll and will utilize proper accounting treatment going forward.
Finding 2022-004 – Allowable costs – payroll
Assistance Listing #: 93.243
Criteria: In accordance with the Uniform Guidance’s compensation requirements (2 CFR 200.430), payroll systems must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated.
The Uniform Guidance allows for use of budget estimates on an interim basis. When using budget estimates on an interim basis, grantees must reconcile estimates against actual time or effort on a regular basis to ensure that estimates conform to actual staff activity. Grantees must make adjustments in the payroll distribution to align with actual time.
Condition: During fiscal year 2022, the Organization charged payroll costs to the federal award programs using a set percentage based on budget and not based on employee’s actual time or effort amongst various programs.
Cause: As noted above, fiscal year 2022 is the Organization’s first Single Audit and management was unaware that using budget estimates was not allowed without further reconciliation against actual time or effort activities.
Effect: The salary costs charged to the federal programs may have been under or over reported based on the actual level of effort.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization make changes overall its timekeeping processes to ensure that payroll costs accurately reflect the work performed and if budget estimates are utilized, that they are reconciled and trued up on a consistent basis.
Response: The Organization is now aware that utilization of budget estimates is not allowed for charging payroll and will utilize proper accounting treatment going forward.
Finding 2022-005 – Procurement Policies
Assistance Listing #: ALL
Criteria: The Uniform Guidance, 2 CFR Subpart D, requires that all non-federal entities must follow the procurement standards as set forth in parts §200.318 through §200.327 and the non-federal entity’s documented procurement procedures must conform to these procurement standards.
Condition: The Organization has general policies and procedures that broadly address procurement, however, the written policies do not comply with the requirements of the Uniform Guidance.
The Organization’s procurement policies have been adopted using a model applicable to a commercial entity with multiple references to the Federal Acquisition Regulation (FAR) and its standards, rather than a non-profit organization subject to the Uniform Guidance.
Cause: As noted above, fiscal year 2022 is the Organization’s first Single Audit and It appears the Organization is not fully aware of the applicable requirements.
Effect: The Organization is not in compliance with the requirements of the Uniform Guidance and its relative procurement standards.
In addition, since the Organization is not following the procurement guidance as specified, they are at a heightened risk that they will procure goods and services outside of the allowed scope of the Uniform Guidance, not follow proper procurement steps to selection, and/or not maintain proper procurement history, etc.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend management update its procurement policies and procedures to comply with the requirements of the Uniform Guidance.
Response: The Organization is generally identified and approached by Federal agencies, or prime contractors having or considering federal agencies, to utilize grant funding for NFFCMH contracts. The Organization works with trusted partners, each having a unique or specialized forte within the grant requirements, to assemble a joint team of providers. Many of these partners are, due to repeated utilization and unique recognition within their field, uniquely qualified, or the true only option, for their areas of expertise. The Organization will revise the procurement policy to comply with Uniform Guidance, as opposed to the Federal Acquisition Regulations.
Finding 2022-005 – Procurement Policies
Assistance Listing #: ALL
Criteria: The Uniform Guidance, 2 CFR Subpart D, requires that all non-federal entities must follow the procurement standards as set forth in parts §200.318 through §200.327 and the non-federal entity’s documented procurement procedures must conform to these procurement standards.
Condition: The Organization has general policies and procedures that broadly address procurement, however, the written policies do not comply with the requirements of the Uniform Guidance.
The Organization’s procurement policies have been adopted using a model applicable to a commercial entity with multiple references to the Federal Acquisition Regulation (FAR) and its standards, rather than a non-profit organization subject to the Uniform Guidance.
Cause: As noted above, fiscal year 2022 is the Organization’s first Single Audit and It appears the Organization is not fully aware of the applicable requirements.
Effect: The Organization is not in compliance with the requirements of the Uniform Guidance and its relative procurement standards.
In addition, since the Organization is not following the procurement guidance as specified, they are at a heightened risk that they will procure goods and services outside of the allowed scope of the Uniform Guidance, not follow proper procurement steps to selection, and/or not maintain proper procurement history, etc.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend management update its procurement policies and procedures to comply with the requirements of the Uniform Guidance.
Response: The Organization is generally identified and approached by Federal agencies, or prime contractors having or considering federal agencies, to utilize grant funding for NFFCMH contracts. The Organization works with trusted partners, each having a unique or specialized forte within the grant requirements, to assemble a joint team of providers. Many of these partners are, due to repeated utilization and unique recognition within their field, uniquely qualified, or the true only option, for their areas of expertise. The Organization will revise the procurement policy to comply with Uniform Guidance, as opposed to the Federal Acquisition Regulations.
Finding 2022-005 – Procurement Policies
Assistance Listing #: ALL
Criteria: The Uniform Guidance, 2 CFR Subpart D, requires that all non-federal entities must follow the procurement standards as set forth in parts §200.318 through §200.327 and the non-federal entity’s documented procurement procedures must conform to these procurement standards.
Condition: The Organization has general policies and procedures that broadly address procurement, however, the written policies do not comply with the requirements of the Uniform Guidance.
The Organization’s procurement policies have been adopted using a model applicable to a commercial entity with multiple references to the Federal Acquisition Regulation (FAR) and its standards, rather than a non-profit organization subject to the Uniform Guidance.
Cause: As noted above, fiscal year 2022 is the Organization’s first Single Audit and It appears the Organization is not fully aware of the applicable requirements.
Effect: The Organization is not in compliance with the requirements of the Uniform Guidance and its relative procurement standards.
In addition, since the Organization is not following the procurement guidance as specified, they are at a heightened risk that they will procure goods and services outside of the allowed scope of the Uniform Guidance, not follow proper procurement steps to selection, and/or not maintain proper procurement history, etc.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend management update its procurement policies and procedures to comply with the requirements of the Uniform Guidance.
Response: The Organization is generally identified and approached by Federal agencies, or prime contractors having or considering federal agencies, to utilize grant funding for NFFCMH contracts. The Organization works with trusted partners, each having a unique or specialized forte within the grant requirements, to assemble a joint team of providers. Many of these partners are, due to repeated utilization and unique recognition within their field, uniquely qualified, or the true only option, for their areas of expertise. The Organization will revise the procurement policy to comply with Uniform Guidance, as opposed to the Federal Acquisition Regulations.
Finding 2022-005 – Procurement Policies
Assistance Listing #: ALL
Criteria: The Uniform Guidance, 2 CFR Subpart D, requires that all non-federal entities must follow the procurement standards as set forth in parts §200.318 through §200.327 and the non-federal entity’s documented procurement procedures must conform to these procurement standards.
Condition: The Organization has general policies and procedures that broadly address procurement, however, the written policies do not comply with the requirements of the Uniform Guidance.
The Organization’s procurement policies have been adopted using a model applicable to a commercial entity with multiple references to the Federal Acquisition Regulation (FAR) and its standards, rather than a non-profit organization subject to the Uniform Guidance.
Cause: As noted above, fiscal year 2022 is the Organization’s first Single Audit and It appears the Organization is not fully aware of the applicable requirements.
Effect: The Organization is not in compliance with the requirements of the Uniform Guidance and its relative procurement standards.
In addition, since the Organization is not following the procurement guidance as specified, they are at a heightened risk that they will procure goods and services outside of the allowed scope of the Uniform Guidance, not follow proper procurement steps to selection, and/or not maintain proper procurement history, etc.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend management update its procurement policies and procedures to comply with the requirements of the Uniform Guidance.
Response: The Organization is generally identified and approached by Federal agencies, or prime contractors having or considering federal agencies, to utilize grant funding for NFFCMH contracts. The Organization works with trusted partners, each having a unique or specialized forte within the grant requirements, to assemble a joint team of providers. Many of these partners are, due to repeated utilization and unique recognition within their field, uniquely qualified, or the true only option, for their areas of expertise. The Organization will revise the procurement policy to comply with Uniform Guidance, as opposed to the Federal Acquisition Regulations.
FINDING 2022-002 – Late Filing of Uniform Guidance Report
Assistance Listing #: All
Federal Awards: All
U.S. Department of Health and Human Services
Pass-Through Awards: National Association of State Mental Health Directors Pass-Through Awards: University of Maryland (R&D) Baltimore Campus
Criteria: The Uniform Guidance requires submission of the audited financial statements and report on the Schedule of Federal Awards and submission of the Data Collection Form within nine months after the organization’s fiscal year end.
Condition: The audited financial statements and report on the Schedule of Federal Awards and submission of the Data Collection Form was not completed and filed by June 30, 2023.
Cause: This was NFFCMH’s first contract requiring an audit in accordance with the Uniform Guidance. We worked with our previous accounting firm on this, and they spent several months deciding if it was necessary. They came back with a recommendation that it was however, at the same time, they advised us that due to a shortage of auditors in the firm, they were no longer willing to provide the organization with its first audit. There was a time lag while we identified a new firm and conducted the audit.
Effect: The Organization will not qualify as a low risk auditee for the next two fiscal years due to the late filing of the required report.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization ensure the audited financial statements, report on the Schedule of Expenditures of Federal Awards and the submission of the Data Collection Form are submitted timely in accordance with the required Uniform Guidance due date.
Response: NFFCMH is now aware of the timelines associated with the Uniform Guidance Report. As such, we expect no further issues or problems with the timely filing of this annual report.
FINDING 2022-002 – Late Filing of Uniform Guidance Report
Assistance Listing #: All
Federal Awards: All
U.S. Department of Health and Human Services
Pass-Through Awards: National Association of State Mental Health Directors Pass-Through Awards: University of Maryland (R&D) Baltimore Campus
Criteria: The Uniform Guidance requires submission of the audited financial statements and report on the Schedule of Federal Awards and submission of the Data Collection Form within nine months after the organization’s fiscal year end.
Condition: The audited financial statements and report on the Schedule of Federal Awards and submission of the Data Collection Form was not completed and filed by June 30, 2023.
Cause: This was NFFCMH’s first contract requiring an audit in accordance with the Uniform Guidance. We worked with our previous accounting firm on this, and they spent several months deciding if it was necessary. They came back with a recommendation that it was however, at the same time, they advised us that due to a shortage of auditors in the firm, they were no longer willing to provide the organization with its first audit. There was a time lag while we identified a new firm and conducted the audit.
Effect: The Organization will not qualify as a low risk auditee for the next two fiscal years due to the late filing of the required report.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization ensure the audited financial statements, report on the Schedule of Expenditures of Federal Awards and the submission of the Data Collection Form are submitted timely in accordance with the required Uniform Guidance due date.
Response: NFFCMH is now aware of the timelines associated with the Uniform Guidance Report. As such, we expect no further issues or problems with the timely filing of this annual report.
FINDING 2022-002 – Late Filing of Uniform Guidance Report
Assistance Listing #: All
Federal Awards: All
U.S. Department of Health and Human Services
Pass-Through Awards: National Association of State Mental Health Directors Pass-Through Awards: University of Maryland (R&D) Baltimore Campus
Criteria: The Uniform Guidance requires submission of the audited financial statements and report on the Schedule of Federal Awards and submission of the Data Collection Form within nine months after the organization’s fiscal year end.
Condition: The audited financial statements and report on the Schedule of Federal Awards and submission of the Data Collection Form was not completed and filed by June 30, 2023.
Cause: This was NFFCMH’s first contract requiring an audit in accordance with the Uniform Guidance. We worked with our previous accounting firm on this, and they spent several months deciding if it was necessary. They came back with a recommendation that it was however, at the same time, they advised us that due to a shortage of auditors in the firm, they were no longer willing to provide the organization with its first audit. There was a time lag while we identified a new firm and conducted the audit.
Effect: The Organization will not qualify as a low risk auditee for the next two fiscal years due to the late filing of the required report.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization ensure the audited financial statements, report on the Schedule of Expenditures of Federal Awards and the submission of the Data Collection Form are submitted timely in accordance with the required Uniform Guidance due date.
Response: NFFCMH is now aware of the timelines associated with the Uniform Guidance Report. As such, we expect no further issues or problems with the timely filing of this annual report.
FINDING 2022-002 – Late Filing of Uniform Guidance Report
Assistance Listing #: All
Federal Awards: All
U.S. Department of Health and Human Services
Pass-Through Awards: National Association of State Mental Health Directors Pass-Through Awards: University of Maryland (R&D) Baltimore Campus
Criteria: The Uniform Guidance requires submission of the audited financial statements and report on the Schedule of Federal Awards and submission of the Data Collection Form within nine months after the organization’s fiscal year end.
Condition: The audited financial statements and report on the Schedule of Federal Awards and submission of the Data Collection Form was not completed and filed by June 30, 2023.
Cause: This was NFFCMH’s first contract requiring an audit in accordance with the Uniform Guidance. We worked with our previous accounting firm on this, and they spent several months deciding if it was necessary. They came back with a recommendation that it was however, at the same time, they advised us that due to a shortage of auditors in the firm, they were no longer willing to provide the organization with its first audit. There was a time lag while we identified a new firm and conducted the audit.
Effect: The Organization will not qualify as a low risk auditee for the next two fiscal years due to the late filing of the required report.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization ensure the audited financial statements, report on the Schedule of Expenditures of Federal Awards and the submission of the Data Collection Form are submitted timely in accordance with the required Uniform Guidance due date.
Response: NFFCMH is now aware of the timelines associated with the Uniform Guidance Report. As such, we expect no further issues or problems with the timely filing of this annual report.
Finding 2022-003 – Procurement, suspension and debarment
Assistance Listing #: 93.243
Criteria: In accordance with the Uniform Guidance, recipients who receive federal funding shall fully comply with Subpart C of 2 CFR Part 180, which requires nonfederal entities to verify that the person/entity with whom you intend to do business is not excluded or disqualified, if the expected payments are equal to or exceed $25,000.
A non-federal entity has three options for performing this verification: 1) checking SAM exclusions; 2) collecting a certification from that person; or 3) adding a clause or condition to the covered transaction with that person.
Condition: During fiscal year 2022, the Organization contracted with several vendors for products and services who were paid more than $25,000. There was no evidence documenting that these vendors were checked for suspension and debarment prior to payment.
Cause: Fiscal year 2022 marks the Organization’s first year subject to Single Audit and it appears the vast rules and regulations are new to the Organization, however the Organization is taking steps towards compliance and updating applicable policies and procedures.
Effect: Without verifying whether vendors are suspended or debarred prior to payment, the Organization faces a heightened risk that they are expending federal dollars to excluded parties.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization review its current policies to ensure they are following the suspension and debarment provisions set forth in the Uniform Guidance, lessening the risk that payments are made to parties who may be excluded from receiving federal funds.
Response: While the Organization does verify on an annual basis that the Vendor is not excluded or disqualified, that will be documented going forward. Additionally, while we did verify on first utilization of these long-utilized service providers, those will be verified on an annual basis and documented going forward.
Finding 2022-003 – Procurement, suspension and debarment
Assistance Listing #: 93.243
Criteria: In accordance with the Uniform Guidance, recipients who receive federal funding shall fully comply with Subpart C of 2 CFR Part 180, which requires nonfederal entities to verify that the person/entity with whom you intend to do business is not excluded or disqualified, if the expected payments are equal to or exceed $25,000.
A non-federal entity has three options for performing this verification: 1) checking SAM exclusions; 2) collecting a certification from that person; or 3) adding a clause or condition to the covered transaction with that person.
Condition: During fiscal year 2022, the Organization contracted with several vendors for products and services who were paid more than $25,000. There was no evidence documenting that these vendors were checked for suspension and debarment prior to payment.
Cause: Fiscal year 2022 marks the Organization’s first year subject to Single Audit and it appears the vast rules and regulations are new to the Organization, however the Organization is taking steps towards compliance and updating applicable policies and procedures.
Effect: Without verifying whether vendors are suspended or debarred prior to payment, the Organization faces a heightened risk that they are expending federal dollars to excluded parties.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization review its current policies to ensure they are following the suspension and debarment provisions set forth in the Uniform Guidance, lessening the risk that payments are made to parties who may be excluded from receiving federal funds.
Response: While the Organization does verify on an annual basis that the Vendor is not excluded or disqualified, that will be documented going forward. Additionally, while we did verify on first utilization of these long-utilized service providers, those will be verified on an annual basis and documented going forward.
Finding 2022-003 – Procurement, suspension and debarment
Assistance Listing #: 93.243
Criteria: In accordance with the Uniform Guidance, recipients who receive federal funding shall fully comply with Subpart C of 2 CFR Part 180, which requires nonfederal entities to verify that the person/entity with whom you intend to do business is not excluded or disqualified, if the expected payments are equal to or exceed $25,000.
A non-federal entity has three options for performing this verification: 1) checking SAM exclusions; 2) collecting a certification from that person; or 3) adding a clause or condition to the covered transaction with that person.
Condition: During fiscal year 2022, the Organization contracted with several vendors for products and services who were paid more than $25,000. There was no evidence documenting that these vendors were checked for suspension and debarment prior to payment.
Cause: Fiscal year 2022 marks the Organization’s first year subject to Single Audit and it appears the vast rules and regulations are new to the Organization, however the Organization is taking steps towards compliance and updating applicable policies and procedures.
Effect: Without verifying whether vendors are suspended or debarred prior to payment, the Organization faces a heightened risk that they are expending federal dollars to excluded parties.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization review its current policies to ensure they are following the suspension and debarment provisions set forth in the Uniform Guidance, lessening the risk that payments are made to parties who may be excluded from receiving federal funds.
Response: While the Organization does verify on an annual basis that the Vendor is not excluded or disqualified, that will be documented going forward. Additionally, while we did verify on first utilization of these long-utilized service providers, those will be verified on an annual basis and documented going forward.
Finding 2022-004 – Allowable costs – payroll
Assistance Listing #: 93.243
Criteria: In accordance with the Uniform Guidance’s compensation requirements (2 CFR 200.430), payroll systems must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated.
The Uniform Guidance allows for use of budget estimates on an interim basis. When using budget estimates on an interim basis, grantees must reconcile estimates against actual time or effort on a regular basis to ensure that estimates conform to actual staff activity. Grantees must make adjustments in the payroll distribution to align with actual time.
Condition: During fiscal year 2022, the Organization charged payroll costs to the federal award programs using a set percentage based on budget and not based on employee’s actual time or effort amongst various programs.
Cause: As noted above, fiscal year 2022 is the Organization’s first Single Audit and management was unaware that using budget estimates was not allowed without further reconciliation against actual time or effort activities.
Effect: The salary costs charged to the federal programs may have been under or over reported based on the actual level of effort.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization make changes overall its timekeeping processes to ensure that payroll costs accurately reflect the work performed and if budget estimates are utilized, that they are reconciled and trued up on a consistent basis.
Response: The Organization is now aware that utilization of budget estimates is not allowed for charging payroll and will utilize proper accounting treatment going forward.
Finding 2022-004 – Allowable costs – payroll
Assistance Listing #: 93.243
Criteria: In accordance with the Uniform Guidance’s compensation requirements (2 CFR 200.430), payroll systems must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated.
The Uniform Guidance allows for use of budget estimates on an interim basis. When using budget estimates on an interim basis, grantees must reconcile estimates against actual time or effort on a regular basis to ensure that estimates conform to actual staff activity. Grantees must make adjustments in the payroll distribution to align with actual time.
Condition: During fiscal year 2022, the Organization charged payroll costs to the federal award programs using a set percentage based on budget and not based on employee’s actual time or effort amongst various programs.
Cause: As noted above, fiscal year 2022 is the Organization’s first Single Audit and management was unaware that using budget estimates was not allowed without further reconciliation against actual time or effort activities.
Effect: The salary costs charged to the federal programs may have been under or over reported based on the actual level of effort.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization make changes overall its timekeeping processes to ensure that payroll costs accurately reflect the work performed and if budget estimates are utilized, that they are reconciled and trued up on a consistent basis.
Response: The Organization is now aware that utilization of budget estimates is not allowed for charging payroll and will utilize proper accounting treatment going forward.
Finding 2022-004 – Allowable costs – payroll
Assistance Listing #: 93.243
Criteria: In accordance with the Uniform Guidance’s compensation requirements (2 CFR 200.430), payroll systems must be based on records that accurately reflect the work performed and supported by a system of internal controls that provides reasonable assurances that charges are accurate; allowable and reasonable; and properly allocated.
The Uniform Guidance allows for use of budget estimates on an interim basis. When using budget estimates on an interim basis, grantees must reconcile estimates against actual time or effort on a regular basis to ensure that estimates conform to actual staff activity. Grantees must make adjustments in the payroll distribution to align with actual time.
Condition: During fiscal year 2022, the Organization charged payroll costs to the federal award programs using a set percentage based on budget and not based on employee’s actual time or effort amongst various programs.
Cause: As noted above, fiscal year 2022 is the Organization’s first Single Audit and management was unaware that using budget estimates was not allowed without further reconciliation against actual time or effort activities.
Effect: The salary costs charged to the federal programs may have been under or over reported based on the actual level of effort.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend the Organization make changes overall its timekeeping processes to ensure that payroll costs accurately reflect the work performed and if budget estimates are utilized, that they are reconciled and trued up on a consistent basis.
Response: The Organization is now aware that utilization of budget estimates is not allowed for charging payroll and will utilize proper accounting treatment going forward.
Finding 2022-005 – Procurement Policies
Assistance Listing #: ALL
Criteria: The Uniform Guidance, 2 CFR Subpart D, requires that all non-federal entities must follow the procurement standards as set forth in parts §200.318 through §200.327 and the non-federal entity’s documented procurement procedures must conform to these procurement standards.
Condition: The Organization has general policies and procedures that broadly address procurement, however, the written policies do not comply with the requirements of the Uniform Guidance.
The Organization’s procurement policies have been adopted using a model applicable to a commercial entity with multiple references to the Federal Acquisition Regulation (FAR) and its standards, rather than a non-profit organization subject to the Uniform Guidance.
Cause: As noted above, fiscal year 2022 is the Organization’s first Single Audit and It appears the Organization is not fully aware of the applicable requirements.
Effect: The Organization is not in compliance with the requirements of the Uniform Guidance and its relative procurement standards.
In addition, since the Organization is not following the procurement guidance as specified, they are at a heightened risk that they will procure goods and services outside of the allowed scope of the Uniform Guidance, not follow proper procurement steps to selection, and/or not maintain proper procurement history, etc.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend management update its procurement policies and procedures to comply with the requirements of the Uniform Guidance.
Response: The Organization is generally identified and approached by Federal agencies, or prime contractors having or considering federal agencies, to utilize grant funding for NFFCMH contracts. The Organization works with trusted partners, each having a unique or specialized forte within the grant requirements, to assemble a joint team of providers. Many of these partners are, due to repeated utilization and unique recognition within their field, uniquely qualified, or the true only option, for their areas of expertise. The Organization will revise the procurement policy to comply with Uniform Guidance, as opposed to the Federal Acquisition Regulations.
Finding 2022-005 – Procurement Policies
Assistance Listing #: ALL
Criteria: The Uniform Guidance, 2 CFR Subpart D, requires that all non-federal entities must follow the procurement standards as set forth in parts §200.318 through §200.327 and the non-federal entity’s documented procurement procedures must conform to these procurement standards.
Condition: The Organization has general policies and procedures that broadly address procurement, however, the written policies do not comply with the requirements of the Uniform Guidance.
The Organization’s procurement policies have been adopted using a model applicable to a commercial entity with multiple references to the Federal Acquisition Regulation (FAR) and its standards, rather than a non-profit organization subject to the Uniform Guidance.
Cause: As noted above, fiscal year 2022 is the Organization’s first Single Audit and It appears the Organization is not fully aware of the applicable requirements.
Effect: The Organization is not in compliance with the requirements of the Uniform Guidance and its relative procurement standards.
In addition, since the Organization is not following the procurement guidance as specified, they are at a heightened risk that they will procure goods and services outside of the allowed scope of the Uniform Guidance, not follow proper procurement steps to selection, and/or not maintain proper procurement history, etc.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend management update its procurement policies and procedures to comply with the requirements of the Uniform Guidance.
Response: The Organization is generally identified and approached by Federal agencies, or prime contractors having or considering federal agencies, to utilize grant funding for NFFCMH contracts. The Organization works with trusted partners, each having a unique or specialized forte within the grant requirements, to assemble a joint team of providers. Many of these partners are, due to repeated utilization and unique recognition within their field, uniquely qualified, or the true only option, for their areas of expertise. The Organization will revise the procurement policy to comply with Uniform Guidance, as opposed to the Federal Acquisition Regulations.
Finding 2022-005 – Procurement Policies
Assistance Listing #: ALL
Criteria: The Uniform Guidance, 2 CFR Subpart D, requires that all non-federal entities must follow the procurement standards as set forth in parts §200.318 through §200.327 and the non-federal entity’s documented procurement procedures must conform to these procurement standards.
Condition: The Organization has general policies and procedures that broadly address procurement, however, the written policies do not comply with the requirements of the Uniform Guidance.
The Organization’s procurement policies have been adopted using a model applicable to a commercial entity with multiple references to the Federal Acquisition Regulation (FAR) and its standards, rather than a non-profit organization subject to the Uniform Guidance.
Cause: As noted above, fiscal year 2022 is the Organization’s first Single Audit and It appears the Organization is not fully aware of the applicable requirements.
Effect: The Organization is not in compliance with the requirements of the Uniform Guidance and its relative procurement standards.
In addition, since the Organization is not following the procurement guidance as specified, they are at a heightened risk that they will procure goods and services outside of the allowed scope of the Uniform Guidance, not follow proper procurement steps to selection, and/or not maintain proper procurement history, etc.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend management update its procurement policies and procedures to comply with the requirements of the Uniform Guidance.
Response: The Organization is generally identified and approached by Federal agencies, or prime contractors having or considering federal agencies, to utilize grant funding for NFFCMH contracts. The Organization works with trusted partners, each having a unique or specialized forte within the grant requirements, to assemble a joint team of providers. Many of these partners are, due to repeated utilization and unique recognition within their field, uniquely qualified, or the true only option, for their areas of expertise. The Organization will revise the procurement policy to comply with Uniform Guidance, as opposed to the Federal Acquisition Regulations.
Finding 2022-005 – Procurement Policies
Assistance Listing #: ALL
Criteria: The Uniform Guidance, 2 CFR Subpart D, requires that all non-federal entities must follow the procurement standards as set forth in parts §200.318 through §200.327 and the non-federal entity’s documented procurement procedures must conform to these procurement standards.
Condition: The Organization has general policies and procedures that broadly address procurement, however, the written policies do not comply with the requirements of the Uniform Guidance.
The Organization’s procurement policies have been adopted using a model applicable to a commercial entity with multiple references to the Federal Acquisition Regulation (FAR) and its standards, rather than a non-profit organization subject to the Uniform Guidance.
Cause: As noted above, fiscal year 2022 is the Organization’s first Single Audit and It appears the Organization is not fully aware of the applicable requirements.
Effect: The Organization is not in compliance with the requirements of the Uniform Guidance and its relative procurement standards.
In addition, since the Organization is not following the procurement guidance as specified, they are at a heightened risk that they will procure goods and services outside of the allowed scope of the Uniform Guidance, not follow proper procurement steps to selection, and/or not maintain proper procurement history, etc.
Questioned Costs: N/A
Repeat Finding: No
Recommendation: We recommend management update its procurement policies and procedures to comply with the requirements of the Uniform Guidance.
Response: The Organization is generally identified and approached by Federal agencies, or prime contractors having or considering federal agencies, to utilize grant funding for NFFCMH contracts. The Organization works with trusted partners, each having a unique or specialized forte within the grant requirements, to assemble a joint team of providers. Many of these partners are, due to repeated utilization and unique recognition within their field, uniquely qualified, or the true only option, for their areas of expertise. The Organization will revise the procurement policy to comply with Uniform Guidance, as opposed to the Federal Acquisition Regulations.