Audit 305207

Finding 2023-001 Material Weakness: Schedule of Expenditures of Federal Awards (SEFA) – Control Finding Criteria Or Specific Requirement: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance) provides guidance related to preparation and reporting of the SEFA. 2 CFR Section 200.100 identifies the required elements of the SEFA and 2 CFR Section 200.510 specifically requires that the SEFA include information on each federal award expended during the year. Southwest Organizing Project (the Project) is required to prepare a complete and accurate SEFA and to have a system of internal controls, the design and operation of which allows management or employees in the normal course of performing their assigned functions to prevent, or detect and correct, errors on a timely basis. Condition: The SEFA was incomplete and contained inaccurate assistance listing numbers. Additionally, federal programs were excluded from the SEFA in error and federal expenditures included unallowable amounts. As a result, while not material to the financial statements, the SFEA required material adjustments during the audit process. Cause: Management does not have an internal control process in place to ensure an accurate SEFA. Effect: The possibility exists that errors within the SEFA could become material to the financial statements or result in an incorrect major program determination. Questioned Costs: Not applicable Context: A sufficient review of the SEFA did not occur so errors were not detected by management. Identification As A Repeat Finding: N/A Recommendation: The Project should strengthen its internal controls by implementing additional training and oversight of personnel to ensure the SEFA accurately reflects federal expenditures for the fiscal year. Views Of Responsible Officials And Planned Corrective Action: An adequate system of internal controls will be put in place by the end of fiscal year 2024. To ensure SEFA will include accurate assisting listing numbers and accurate inclusion of all federal programs. Allowable and unallowable costs will be reviewed to ensure accurate federal expenditure reporting. Management will perform an exhaustive review of all grants to close out the fiscal year in preparation for the audit process. In addition to these, SWOP will work with a consultant to provide necessary training of finance personnel.

Finding 2023-001 Material Weakness: Schedule of Expenditures of Federal Awards (SEFA) – Control Finding Criteria Or Specific Requirement: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance) provides guidance related to preparation and reporting of the SEFA. 2 CFR Section 200.100 identifies the required elements of the SEFA and 2 CFR Section 200.510 specifically requires that the SEFA include information on each federal award expended during the year. Southwest Organizing Project (the Project) is required to prepare a complete and accurate SEFA and to have a system of internal controls, the design and operation of which allows management or employees in the normal course of performing their assigned functions to prevent, or detect and correct, errors on a timely basis. Condition: The SEFA was incomplete and contained inaccurate assistance listing numbers. Additionally, federal programs were excluded from the SEFA in error and federal expenditures included unallowable amounts. As a result, while not material to the financial statements, the SFEA required material adjustments during the audit process. Cause: Management does not have an internal control process in place to ensure an accurate SEFA. Effect: The possibility exists that errors within the SEFA could become material to the financial statements or result in an incorrect major program determination. Questioned Costs: Not applicable Context: A sufficient review of the SEFA did not occur so errors were not detected by management. Identification As A Repeat Finding: N/A Recommendation: The Project should strengthen its internal controls by implementing additional training and oversight of personnel to ensure the SEFA accurately reflects federal expenditures for the fiscal year. Views Of Responsible Officials And Planned Corrective Action: An adequate system of internal controls will be put in place by the end of fiscal year 2024. To ensure SEFA will include accurate assisting listing numbers and accurate inclusion of all federal programs. Allowable and unallowable costs will be reviewed to ensure accurate federal expenditure reporting. Management will perform an exhaustive review of all grants to close out the fiscal year in preparation for the audit process. In addition to these, SWOP will work with a consultant to provide necessary training of finance personnel.

Finding 2023-001 Material Weakness: Schedule of Expenditures of Federal Awards (SEFA) – Control Finding Criteria Or Specific Requirement: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance) provides guidance related to preparation and reporting of the SEFA. 2 CFR Section 200.100 identifies the required elements of the SEFA and 2 CFR Section 200.510 specifically requires that the SEFA include information on each federal award expended during the year. Southwest Organizing Project (the Project) is required to prepare a complete and accurate SEFA and to have a system of internal controls, the design and operation of which allows management or employees in the normal course of performing their assigned functions to prevent, or detect and correct, errors on a timely basis. Condition: The SEFA was incomplete and contained inaccurate assistance listing numbers. Additionally, federal programs were excluded from the SEFA in error and federal expenditures included unallowable amounts. As a result, while not material to the financial statements, the SFEA required material adjustments during the audit process. Cause: Management does not have an internal control process in place to ensure an accurate SEFA. Effect: The possibility exists that errors within the SEFA could become material to the financial statements or result in an incorrect major program determination. Questioned Costs: Not applicable Context: A sufficient review of the SEFA did not occur so errors were not detected by management. Identification As A Repeat Finding: N/A Recommendation: The Project should strengthen its internal controls by implementing additional training and oversight of personnel to ensure the SEFA accurately reflects federal expenditures for the fiscal year. Views Of Responsible Officials And Planned Corrective Action: An adequate system of internal controls will be put in place by the end of fiscal year 2024. To ensure SEFA will include accurate assisting listing numbers and accurate inclusion of all federal programs. Allowable and unallowable costs will be reviewed to ensure accurate federal expenditure reporting. Management will perform an exhaustive review of all grants to close out the fiscal year in preparation for the audit process. In addition to these, SWOP will work with a consultant to provide necessary training of finance personnel.

Finding 2023-001 Material Weakness: Schedule of Expenditures of Federal Awards (SEFA) – Control Finding Criteria Or Specific Requirement: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance) provides guidance related to preparation and reporting of the SEFA. 2 CFR Section 200.100 identifies the required elements of the SEFA and 2 CFR Section 200.510 specifically requires that the SEFA include information on each federal award expended during the year. Southwest Organizing Project (the Project) is required to prepare a complete and accurate SEFA and to have a system of internal controls, the design and operation of which allows management or employees in the normal course of performing their assigned functions to prevent, or detect and correct, errors on a timely basis. Condition: The SEFA was incomplete and contained inaccurate assistance listing numbers. Additionally, federal programs were excluded from the SEFA in error and federal expenditures included unallowable amounts. As a result, while not material to the financial statements, the SFEA required material adjustments during the audit process. Cause: Management does not have an internal control process in place to ensure an accurate SEFA. Effect: The possibility exists that errors within the SEFA could become material to the financial statements or result in an incorrect major program determination. Questioned Costs: Not applicable Context: A sufficient review of the SEFA did not occur so errors were not detected by management. Identification As A Repeat Finding: N/A Recommendation: The Project should strengthen its internal controls by implementing additional training and oversight of personnel to ensure the SEFA accurately reflects federal expenditures for the fiscal year. Views Of Responsible Officials And Planned Corrective Action: An adequate system of internal controls will be put in place by the end of fiscal year 2024. To ensure SEFA will include accurate assisting listing numbers and accurate inclusion of all federal programs. Allowable and unallowable costs will be reviewed to ensure accurate federal expenditure reporting. Management will perform an exhaustive review of all grants to close out the fiscal year in preparation for the audit process. In addition to these, SWOP will work with a consultant to provide necessary training of finance personnel.

Finding 2023-001 Material Weakness: Schedule of Expenditures of Federal Awards (SEFA) – Control Finding Criteria Or Specific Requirement: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance) provides guidance related to preparation and reporting of the SEFA. 2 CFR Section 200.100 identifies the required elements of the SEFA and 2 CFR Section 200.510 specifically requires that the SEFA include information on each federal award expended during the year. Southwest Organizing Project (the Project) is required to prepare a complete and accurate SEFA and to have a system of internal controls, the design and operation of which allows management or employees in the normal course of performing their assigned functions to prevent, or detect and correct, errors on a timely basis. Condition: The SEFA was incomplete and contained inaccurate assistance listing numbers. Additionally, federal programs were excluded from the SEFA in error and federal expenditures included unallowable amounts. As a result, while not material to the financial statements, the SFEA required material adjustments during the audit process. Cause: Management does not have an internal control process in place to ensure an accurate SEFA. Effect: The possibility exists that errors within the SEFA could become material to the financial statements or result in an incorrect major program determination. Questioned Costs: Not applicable Context: A sufficient review of the SEFA did not occur so errors were not detected by management. Identification As A Repeat Finding: N/A Recommendation: The Project should strengthen its internal controls by implementing additional training and oversight of personnel to ensure the SEFA accurately reflects federal expenditures for the fiscal year. Views Of Responsible Officials And Planned Corrective Action: An adequate system of internal controls will be put in place by the end of fiscal year 2024. To ensure SEFA will include accurate assisting listing numbers and accurate inclusion of all federal programs. Allowable and unallowable costs will be reviewed to ensure accurate federal expenditure reporting. Management will perform an exhaustive review of all grants to close out the fiscal year in preparation for the audit process. In addition to these, SWOP will work with a consultant to provide necessary training of finance personnel.

Finding 2023-001 Material Weakness: Schedule of Expenditures of Federal Awards (SEFA) – Control Finding Criteria Or Specific Requirement: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance) provides guidance related to preparation and reporting of the SEFA. 2 CFR Section 200.100 identifies the required elements of the SEFA and 2 CFR Section 200.510 specifically requires that the SEFA include information on each federal award expended during the year. Southwest Organizing Project (the Project) is required to prepare a complete and accurate SEFA and to have a system of internal controls, the design and operation of which allows management or employees in the normal course of performing their assigned functions to prevent, or detect and correct, errors on a timely basis. Condition: The SEFA was incomplete and contained inaccurate assistance listing numbers. Additionally, federal programs were excluded from the SEFA in error and federal expenditures included unallowable amounts. As a result, while not material to the financial statements, the SFEA required material adjustments during the audit process. Cause: Management does not have an internal control process in place to ensure an accurate SEFA. Effect: The possibility exists that errors within the SEFA could become material to the financial statements or result in an incorrect major program determination. Questioned Costs: Not applicable Context: A sufficient review of the SEFA did not occur so errors were not detected by management. Identification As A Repeat Finding: N/A Recommendation: The Project should strengthen its internal controls by implementing additional training and oversight of personnel to ensure the SEFA accurately reflects federal expenditures for the fiscal year. Views Of Responsible Officials And Planned Corrective Action: An adequate system of internal controls will be put in place by the end of fiscal year 2024. To ensure SEFA will include accurate assisting listing numbers and accurate inclusion of all federal programs. Allowable and unallowable costs will be reviewed to ensure accurate federal expenditure reporting. Management will perform an exhaustive review of all grants to close out the fiscal year in preparation for the audit process. In addition to these, SWOP will work with a consultant to provide necessary training of finance personnel.

Finding 2023-002 Material Weakness: Subrecipient Monitoring - Compliance and Control Finding ALN 93.391: Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Healthcare Crises Federal Agency: U.S. Department of Health and Human Services Pass-through Entity: City of Chicago, Illinois Criteria Or Specific Requirement: Per 2 CFR 200.332, the Project is responsible for evaluating each subrecipient’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward as well as informing subrecipients of the Federal award identifiers including but not limited to award date, period of performance, Federal awarding agency, Assistance Listing Number and program name. The Project is required to monitor subrecipients’ compliance with Federal statutes, regulations and the terms and conditions of the subaward. The monitoring policy should include an initial evaluation of the risk of noncompliance to determine the appropriate level of monitoring required related to the subaward and ensure the continued monitoring of the subrecipients, inclusive of review of subrecipients’ single audit reports, when applicable. Condition: We noted that management did not evaluate the risk of noncompliance of its subrecipients and did not provide subrecipients with required information. Cause: Management does not have an internal control process in place to ensure proper subrecipient monitoring. Effect: The Project was not in compliance with the subrecipient monitoring regulations set forth in the Uniform Guidance. Further, the amount of funding passed through to subrecipients was material to the program. Questioned Costs: None Context: During the testing performed, we noted the Project did not perform a risk assessment of subrecipients and documentation informing subrecipients of all required rules and regulations related to federal funding was not maintained. Identification As A Repeat Finding: N/A Recommendation: We recommend that management implement a formal subrecipient monitoring policy that defines how the Project will monitor each subrecipient. This policy should include an evaluation of the risk of noncompliance for each subrecipient as well as how the subrecipients will be monitored. The Project should also request a copy of the subrecipients’ single audit, as applicable. Views Of Responsible Officials And Planned Corrective Action: An adequate subrecipients risk assessment policy will be put in place to evaluate and monitor subrecipients. Southwest Organizing Project will provide subrecipients with all required federal awards identifiers. Subrecipients will be required to provide a single audit when applicable and a signed statement if not applicable. Management will monitor receipt of single audits during the budgeting process and when closing out programs as well as record keeping for audit and reporting evidence.

Finding 2023-003 Significant Deficiency: Subrecipient Monitoring - Control Finding ALN 21.027: COVID-19: Coronavirus State and Local Fiscal Recovery Funds Federal Agency: U.S. Department of the Treasury Pass-through Entity: Illinois State Board of Education Criteria Or Specific Requirement: Per 2 CFR 200.332(a)(1), the Project is responsible for inform subrecipients of the Federal award identifiers including but not limited to award date, period of performance, Federal awarding agency, Assistance Listing Number and program name. Per 2 CFR 200.332(d), the Project is responsible for reviewing financial and performance reports inclusive of single audit reports. The monitoring policy should include an initial evaluation of the risk of noncompliance to determine the appropriate level of monitoring required related to the subaward and ensure the continued monitoring of the subrecipients inclusive of review of subrecipients’ single audit reports, when applicable. Condition: We noted that management did not provide subrecipients with all required information and the review of subrecipients’ single audit reports was not a part of their monitoring procedures. Cause: Management does not have an internal control process in place to ensure proper subrecipient monitoring. Effect: Failure to communicate all required federal award identification may result in subrecipients not complying with federal requirements of program funds. Questioned Costs: None Context: The Project did complete a risk assessment of subrecipients and completed monitoring of grant activity through monthly monitoring as well as mid-year reviews. However, during the testing performed, we noted management did not retain evidence of informing all subrecipients of all required information. Identification As A Repeat Finding: N/A Recommendation: We recommend that all subrecipient grant agreements are updated to include all required identification set forth by 2 CFR 200.332(a)(1) and 2 CFR 200.332(d). Views Of Responsible Officials And Planned Corrective Action: An adequate subrecipient risk assessment policy will be put in place to evaluate and monitor subrecipients. Southwest Organizing Project will provide subrecipients with all required federal award identifiers. Management will ensure that federal award identifiers are included in subrecipients grant agreements.

Finding 2023-001 Material Weakness: Schedule of Expenditures of Federal Awards (SEFA) – Control Finding Criteria Or Specific Requirement: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance) provides guidance related to preparation and reporting of the SEFA. 2 CFR Section 200.100 identifies the required elements of the SEFA and 2 CFR Section 200.510 specifically requires that the SEFA include information on each federal award expended during the year. Southwest Organizing Project (the Project) is required to prepare a complete and accurate SEFA and to have a system of internal controls, the design and operation of which allows management or employees in the normal course of performing their assigned functions to prevent, or detect and correct, errors on a timely basis. Condition: The SEFA was incomplete and contained inaccurate assistance listing numbers. Additionally, federal programs were excluded from the SEFA in error and federal expenditures included unallowable amounts. As a result, while not material to the financial statements, the SFEA required material adjustments during the audit process. Cause: Management does not have an internal control process in place to ensure an accurate SEFA. Effect: The possibility exists that errors within the SEFA could become material to the financial statements or result in an incorrect major program determination. Questioned Costs: Not applicable Context: A sufficient review of the SEFA did not occur so errors were not detected by management. Identification As A Repeat Finding: N/A Recommendation: The Project should strengthen its internal controls by implementing additional training and oversight of personnel to ensure the SEFA accurately reflects federal expenditures for the fiscal year. Views Of Responsible Officials And Planned Corrective Action: An adequate system of internal controls will be put in place by the end of fiscal year 2024. To ensure SEFA will include accurate assisting listing numbers and accurate inclusion of all federal programs. Allowable and unallowable costs will be reviewed to ensure accurate federal expenditure reporting. Management will perform an exhaustive review of all grants to close out the fiscal year in preparation for the audit process. In addition to these, SWOP will work with a consultant to provide necessary training of finance personnel.

Finding 2023-001 Material Weakness: Schedule of Expenditures of Federal Awards (SEFA) – Control Finding Criteria Or Specific Requirement: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance) provides guidance related to preparation and reporting of the SEFA. 2 CFR Section 200.100 identifies the required elements of the SEFA and 2 CFR Section 200.510 specifically requires that the SEFA include information on each federal award expended during the year. Southwest Organizing Project (the Project) is required to prepare a complete and accurate SEFA and to have a system of internal controls, the design and operation of which allows management or employees in the normal course of performing their assigned functions to prevent, or detect and correct, errors on a timely basis. Condition: The SEFA was incomplete and contained inaccurate assistance listing numbers. Additionally, federal programs were excluded from the SEFA in error and federal expenditures included unallowable amounts. As a result, while not material to the financial statements, the SFEA required material adjustments during the audit process. Cause: Management does not have an internal control process in place to ensure an accurate SEFA. Effect: The possibility exists that errors within the SEFA could become material to the financial statements or result in an incorrect major program determination. Questioned Costs: Not applicable Context: A sufficient review of the SEFA did not occur so errors were not detected by management. Identification As A Repeat Finding: N/A Recommendation: The Project should strengthen its internal controls by implementing additional training and oversight of personnel to ensure the SEFA accurately reflects federal expenditures for the fiscal year. Views Of Responsible Officials And Planned Corrective Action: An adequate system of internal controls will be put in place by the end of fiscal year 2024. To ensure SEFA will include accurate assisting listing numbers and accurate inclusion of all federal programs. Allowable and unallowable costs will be reviewed to ensure accurate federal expenditure reporting. Management will perform an exhaustive review of all grants to close out the fiscal year in preparation for the audit process. In addition to these, SWOP will work with a consultant to provide necessary training of finance personnel.

Finding 2023-001 Material Weakness: Schedule of Expenditures of Federal Awards (SEFA) – Control Finding Criteria Or Specific Requirement: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance) provides guidance related to preparation and reporting of the SEFA. 2 CFR Section 200.100 identifies the required elements of the SEFA and 2 CFR Section 200.510 specifically requires that the SEFA include information on each federal award expended during the year. Southwest Organizing Project (the Project) is required to prepare a complete and accurate SEFA and to have a system of internal controls, the design and operation of which allows management or employees in the normal course of performing their assigned functions to prevent, or detect and correct, errors on a timely basis. Condition: The SEFA was incomplete and contained inaccurate assistance listing numbers. Additionally, federal programs were excluded from the SEFA in error and federal expenditures included unallowable amounts. As a result, while not material to the financial statements, the SFEA required material adjustments during the audit process. Cause: Management does not have an internal control process in place to ensure an accurate SEFA. Effect: The possibility exists that errors within the SEFA could become material to the financial statements or result in an incorrect major program determination. Questioned Costs: Not applicable Context: A sufficient review of the SEFA did not occur so errors were not detected by management. Identification As A Repeat Finding: N/A Recommendation: The Project should strengthen its internal controls by implementing additional training and oversight of personnel to ensure the SEFA accurately reflects federal expenditures for the fiscal year. Views Of Responsible Officials And Planned Corrective Action: An adequate system of internal controls will be put in place by the end of fiscal year 2024. To ensure SEFA will include accurate assisting listing numbers and accurate inclusion of all federal programs. Allowable and unallowable costs will be reviewed to ensure accurate federal expenditure reporting. Management will perform an exhaustive review of all grants to close out the fiscal year in preparation for the audit process. In addition to these, SWOP will work with a consultant to provide necessary training of finance personnel.

Finding 2023-001 Material Weakness: Schedule of Expenditures of Federal Awards (SEFA) – Control Finding Criteria Or Specific Requirement: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance) provides guidance related to preparation and reporting of the SEFA. 2 CFR Section 200.100 identifies the required elements of the SEFA and 2 CFR Section 200.510 specifically requires that the SEFA include information on each federal award expended during the year. Southwest Organizing Project (the Project) is required to prepare a complete and accurate SEFA and to have a system of internal controls, the design and operation of which allows management or employees in the normal course of performing their assigned functions to prevent, or detect and correct, errors on a timely basis. Condition: The SEFA was incomplete and contained inaccurate assistance listing numbers. Additionally, federal programs were excluded from the SEFA in error and federal expenditures included unallowable amounts. As a result, while not material to the financial statements, the SFEA required material adjustments during the audit process. Cause: Management does not have an internal control process in place to ensure an accurate SEFA. Effect: The possibility exists that errors within the SEFA could become material to the financial statements or result in an incorrect major program determination. Questioned Costs: Not applicable Context: A sufficient review of the SEFA did not occur so errors were not detected by management. Identification As A Repeat Finding: N/A Recommendation: The Project should strengthen its internal controls by implementing additional training and oversight of personnel to ensure the SEFA accurately reflects federal expenditures for the fiscal year. Views Of Responsible Officials And Planned Corrective Action: An adequate system of internal controls will be put in place by the end of fiscal year 2024. To ensure SEFA will include accurate assisting listing numbers and accurate inclusion of all federal programs. Allowable and unallowable costs will be reviewed to ensure accurate federal expenditure reporting. Management will perform an exhaustive review of all grants to close out the fiscal year in preparation for the audit process. In addition to these, SWOP will work with a consultant to provide necessary training of finance personnel.

Finding 2023-001 Material Weakness: Schedule of Expenditures of Federal Awards (SEFA) – Control Finding Criteria Or Specific Requirement: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance) provides guidance related to preparation and reporting of the SEFA. 2 CFR Section 200.100 identifies the required elements of the SEFA and 2 CFR Section 200.510 specifically requires that the SEFA include information on each federal award expended during the year. Southwest Organizing Project (the Project) is required to prepare a complete and accurate SEFA and to have a system of internal controls, the design and operation of which allows management or employees in the normal course of performing their assigned functions to prevent, or detect and correct, errors on a timely basis. Condition: The SEFA was incomplete and contained inaccurate assistance listing numbers. Additionally, federal programs were excluded from the SEFA in error and federal expenditures included unallowable amounts. As a result, while not material to the financial statements, the SFEA required material adjustments during the audit process. Cause: Management does not have an internal control process in place to ensure an accurate SEFA. Effect: The possibility exists that errors within the SEFA could become material to the financial statements or result in an incorrect major program determination. Questioned Costs: Not applicable Context: A sufficient review of the SEFA did not occur so errors were not detected by management. Identification As A Repeat Finding: N/A Recommendation: The Project should strengthen its internal controls by implementing additional training and oversight of personnel to ensure the SEFA accurately reflects federal expenditures for the fiscal year. Views Of Responsible Officials And Planned Corrective Action: An adequate system of internal controls will be put in place by the end of fiscal year 2024. To ensure SEFA will include accurate assisting listing numbers and accurate inclusion of all federal programs. Allowable and unallowable costs will be reviewed to ensure accurate federal expenditure reporting. Management will perform an exhaustive review of all grants to close out the fiscal year in preparation for the audit process. In addition to these, SWOP will work with a consultant to provide necessary training of finance personnel.

Finding 2023-001 Material Weakness: Schedule of Expenditures of Federal Awards (SEFA) – Control Finding Criteria Or Specific Requirement: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance) provides guidance related to preparation and reporting of the SEFA. 2 CFR Section 200.100 identifies the required elements of the SEFA and 2 CFR Section 200.510 specifically requires that the SEFA include information on each federal award expended during the year. Southwest Organizing Project (the Project) is required to prepare a complete and accurate SEFA and to have a system of internal controls, the design and operation of which allows management or employees in the normal course of performing their assigned functions to prevent, or detect and correct, errors on a timely basis. Condition: The SEFA was incomplete and contained inaccurate assistance listing numbers. Additionally, federal programs were excluded from the SEFA in error and federal expenditures included unallowable amounts. As a result, while not material to the financial statements, the SFEA required material adjustments during the audit process. Cause: Management does not have an internal control process in place to ensure an accurate SEFA. Effect: The possibility exists that errors within the SEFA could become material to the financial statements or result in an incorrect major program determination. Questioned Costs: Not applicable Context: A sufficient review of the SEFA did not occur so errors were not detected by management. Identification As A Repeat Finding: N/A Recommendation: The Project should strengthen its internal controls by implementing additional training and oversight of personnel to ensure the SEFA accurately reflects federal expenditures for the fiscal year. Views Of Responsible Officials And Planned Corrective Action: An adequate system of internal controls will be put in place by the end of fiscal year 2024. To ensure SEFA will include accurate assisting listing numbers and accurate inclusion of all federal programs. Allowable and unallowable costs will be reviewed to ensure accurate federal expenditure reporting. Management will perform an exhaustive review of all grants to close out the fiscal year in preparation for the audit process. In addition to these, SWOP will work with a consultant to provide necessary training of finance personnel.

Finding 2023-002 Material Weakness: Subrecipient Monitoring - Compliance and Control Finding ALN 93.391: Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Healthcare Crises Federal Agency: U.S. Department of Health and Human Services Pass-through Entity: City of Chicago, Illinois Criteria Or Specific Requirement: Per 2 CFR 200.332, the Project is responsible for evaluating each subrecipient’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward as well as informing subrecipients of the Federal award identifiers including but not limited to award date, period of performance, Federal awarding agency, Assistance Listing Number and program name. The Project is required to monitor subrecipients’ compliance with Federal statutes, regulations and the terms and conditions of the subaward. The monitoring policy should include an initial evaluation of the risk of noncompliance to determine the appropriate level of monitoring required related to the subaward and ensure the continued monitoring of the subrecipients, inclusive of review of subrecipients’ single audit reports, when applicable. Condition: We noted that management did not evaluate the risk of noncompliance of its subrecipients and did not provide subrecipients with required information. Cause: Management does not have an internal control process in place to ensure proper subrecipient monitoring. Effect: The Project was not in compliance with the subrecipient monitoring regulations set forth in the Uniform Guidance. Further, the amount of funding passed through to subrecipients was material to the program. Questioned Costs: None Context: During the testing performed, we noted the Project did not perform a risk assessment of subrecipients and documentation informing subrecipients of all required rules and regulations related to federal funding was not maintained. Identification As A Repeat Finding: N/A Recommendation: We recommend that management implement a formal subrecipient monitoring policy that defines how the Project will monitor each subrecipient. This policy should include an evaluation of the risk of noncompliance for each subrecipient as well as how the subrecipients will be monitored. The Project should also request a copy of the subrecipients’ single audit, as applicable. Views Of Responsible Officials And Planned Corrective Action: An adequate subrecipients risk assessment policy will be put in place to evaluate and monitor subrecipients. Southwest Organizing Project will provide subrecipients with all required federal awards identifiers. Subrecipients will be required to provide a single audit when applicable and a signed statement if not applicable. Management will monitor receipt of single audits during the budgeting process and when closing out programs as well as record keeping for audit and reporting evidence.

Finding 2023-003 Significant Deficiency: Subrecipient Monitoring - Control Finding ALN 21.027: COVID-19: Coronavirus State and Local Fiscal Recovery Funds Federal Agency: U.S. Department of the Treasury Pass-through Entity: Illinois State Board of Education Criteria Or Specific Requirement: Per 2 CFR 200.332(a)(1), the Project is responsible for inform subrecipients of the Federal award identifiers including but not limited to award date, period of performance, Federal awarding agency, Assistance Listing Number and program name. Per 2 CFR 200.332(d), the Project is responsible for reviewing financial and performance reports inclusive of single audit reports. The monitoring policy should include an initial evaluation of the risk of noncompliance to determine the appropriate level of monitoring required related to the subaward and ensure the continued monitoring of the subrecipients inclusive of review of subrecipients’ single audit reports, when applicable. Condition: We noted that management did not provide subrecipients with all required information and the review of subrecipients’ single audit reports was not a part of their monitoring procedures. Cause: Management does not have an internal control process in place to ensure proper subrecipient monitoring. Effect: Failure to communicate all required federal award identification may result in subrecipients not complying with federal requirements of program funds. Questioned Costs: None Context: The Project did complete a risk assessment of subrecipients and completed monitoring of grant activity through monthly monitoring as well as mid-year reviews. However, during the testing performed, we noted management did not retain evidence of informing all subrecipients of all required information. Identification As A Repeat Finding: N/A Recommendation: We recommend that all subrecipient grant agreements are updated to include all required identification set forth by 2 CFR 200.332(a)(1) and 2 CFR 200.332(d). Views Of Responsible Officials And Planned Corrective Action: An adequate subrecipient risk assessment policy will be put in place to evaluate and monitor subrecipients. Southwest Organizing Project will provide subrecipients with all required federal award identifiers. Management will ensure that federal award identifiers are included in subrecipients grant agreements.