Audit 307778

Finding 2023-001 – Material Weakness: Allowable Costs & Activities – Compliance and Control Finding ALN 84.215K – Innovative Approaches to Literacy; Full-Service Community Schools; and Promise Neighborhood Federal Grant Award: S215K220184 (09/12/2022 – 9/30/2023) Federal Agency: U.S. Department of Education Pass-Through Entity: None Federal Award Identification Number: N/A Fiscal Year: For the year ended August 31, 2023 Criteria Or Specific Requirement: 2 CFR section 200.430(i)(1) requires charges to federal awards for salaries and wages be based on records that accurately reflect the work performed. Condition: We noted through procedures performed that allocated salaries and wages were based on an estimated percentage of time to be devoted to the grant-funded programs as opposed to actual hours worked, resulting in a potential over-allocation or under-allocation of expenditures. Cause: Internal controls over compliance put in place by management were not designed effectively to ensure a review of allocated versus actual hours worked by the federal grant was performed and that proof of such reviews was documented and retained. Effect: Instances of noncompliance were not detected by management. Questioned Costs: $159,527 of known questioned costs, which represent the total allocated salary costs of the 6 full-time salaried employees allocated to the grant, were identified in our testing sample Context: Of the sample of 40 individual costs charged to the grant, 6 were allocated salary costs of full-time, salaried employees. For these 6 payroll items, allocated salary costs were based on the estimated, budgeted percentage of time expected to be devoted by each employee to the grant-funded programs. The St. Louis Symphony did not maintain documentation to support the actual time and effort of each employee charged to the grant. Identification As A Repeat Finding: Not applicable Recommendation: For employees working on grant-funded programs, management should develop a time-keeping process to track and verify that the amount of time charged to the grant is accurate and based on the employee’s time spent working on the grant. Documented review and approval of this time allocation by the employee’s supervisor should be maintained. Views Of Responsible Officials: Management’s belief, based on discussions with the staff involved in these grant-funded programs, is that the amount of time the 6 staff members worked actually meets or exceeds their budgeted percentage of time. However, management now understands the requirement to fully document their actual time spent on this type of grant-funded program.

Finding 2023-002 – Significant Deficiency: Cash Management – Control Finding ALN 84.215K – Innovative Approaches to Literacy; Full-Service Community Schools; and Promise Neighborhood Federal Grant Award: S215K220184 (09/12/2022 – 9/30/2023) Federal Agency: U.S. Department of Education Pass-Through Entity: None Federal Award Identification Number: N/A Fiscal Year: For the year ended August 31, 2023 Criteria Or Specific Requirement: Uniform Guidance requires that controls over compliance be properly designed, in place and operating effectively to ensure compliance with the requirements of the federal programs. Condition: Based on the testing completed over the cash management compliance requirement, the St. Louis Symphony did not retain documentation of a review of the cash drawdown to verify that the correct amount of funds are requested. Cause: Internal controls over compliance put in place by management were not operating effectively to ensure that proof of such reviews was documented and retained. Effect: Instances of noncompliance could go undetected by management. Questioned Costs: Not applicable Context: During testing performed for cash management, for the 3 cash drawdowns that occurred, appropriate documentation was not retained supporting the amount and timing of the cash drawdowns nor was there any documented review of the cash drawdown request prior to initiation. No instances were noted were cash was drawn in advance of the incurrence of eligible grant expenditures. Identification As A Repeat Finding: Not applicable Recommendation: We recommend that management put a control in place for a second review of the cash drawdown requests. The second review should be properly documented with the reviewer’s signature and the date the review was performed. The second review should be performed by someone other than the preparer and who has knowledge of the grant’s requirements. Views Of Responsible Officials: Internally, senior leadership and the grant manager communicated regarding the timing and amounts of drawdown requests. Management acknowledges that sufficient documentation of this review and approval process was not maintained, as the amounts would correspond to the St. Louis Symphony’s periodic grant expenditures.

Finding 2023-001 – Material Weakness: Allowable Costs & Activities – Compliance and Control Finding ALN 84.215K – Innovative Approaches to Literacy; Full-Service Community Schools; and Promise Neighborhood Federal Grant Award: S215K220184 (09/12/2022 – 9/30/2023) Federal Agency: U.S. Department of Education Pass-Through Entity: None Federal Award Identification Number: N/A Fiscal Year: For the year ended August 31, 2023 Criteria Or Specific Requirement: 2 CFR section 200.430(i)(1) requires charges to federal awards for salaries and wages be based on records that accurately reflect the work performed. Condition: We noted through procedures performed that allocated salaries and wages were based on an estimated percentage of time to be devoted to the grant-funded programs as opposed to actual hours worked, resulting in a potential over-allocation or under-allocation of expenditures. Cause: Internal controls over compliance put in place by management were not designed effectively to ensure a review of allocated versus actual hours worked by the federal grant was performed and that proof of such reviews was documented and retained. Effect: Instances of noncompliance were not detected by management. Questioned Costs: $159,527 of known questioned costs, which represent the total allocated salary costs of the 6 full-time salaried employees allocated to the grant, were identified in our testing sample Context: Of the sample of 40 individual costs charged to the grant, 6 were allocated salary costs of full-time, salaried employees. For these 6 payroll items, allocated salary costs were based on the estimated, budgeted percentage of time expected to be devoted by each employee to the grant-funded programs. The St. Louis Symphony did not maintain documentation to support the actual time and effort of each employee charged to the grant. Identification As A Repeat Finding: Not applicable Recommendation: For employees working on grant-funded programs, management should develop a time-keeping process to track and verify that the amount of time charged to the grant is accurate and based on the employee’s time spent working on the grant. Documented review and approval of this time allocation by the employee’s supervisor should be maintained. Views Of Responsible Officials: Management’s belief, based on discussions with the staff involved in these grant-funded programs, is that the amount of time the 6 staff members worked actually meets or exceeds their budgeted percentage of time. However, management now understands the requirement to fully document their actual time spent on this type of grant-funded program.

Finding 2023-002 – Significant Deficiency: Cash Management – Control Finding ALN 84.215K – Innovative Approaches to Literacy; Full-Service Community Schools; and Promise Neighborhood Federal Grant Award: S215K220184 (09/12/2022 – 9/30/2023) Federal Agency: U.S. Department of Education Pass-Through Entity: None Federal Award Identification Number: N/A Fiscal Year: For the year ended August 31, 2023 Criteria Or Specific Requirement: Uniform Guidance requires that controls over compliance be properly designed, in place and operating effectively to ensure compliance with the requirements of the federal programs. Condition: Based on the testing completed over the cash management compliance requirement, the St. Louis Symphony did not retain documentation of a review of the cash drawdown to verify that the correct amount of funds are requested. Cause: Internal controls over compliance put in place by management were not operating effectively to ensure that proof of such reviews was documented and retained. Effect: Instances of noncompliance could go undetected by management. Questioned Costs: Not applicable Context: During testing performed for cash management, for the 3 cash drawdowns that occurred, appropriate documentation was not retained supporting the amount and timing of the cash drawdowns nor was there any documented review of the cash drawdown request prior to initiation. No instances were noted were cash was drawn in advance of the incurrence of eligible grant expenditures. Identification As A Repeat Finding: Not applicable Recommendation: We recommend that management put a control in place for a second review of the cash drawdown requests. The second review should be properly documented with the reviewer’s signature and the date the review was performed. The second review should be performed by someone other than the preparer and who has knowledge of the grant’s requirements. Views Of Responsible Officials: Internally, senior leadership and the grant manager communicated regarding the timing and amounts of drawdown requests. Management acknowledges that sufficient documentation of this review and approval process was not maintained, as the amounts would correspond to the St. Louis Symphony’s periodic grant expenditures.