FAC Explorer

Audit 308162

FY End
2023-12-31
Total Expended
$1.78M
Findings
4
Programs
1
Organization: Esperanza Foster Family Agency (CA)
Year: 2023 Accepted: 2024-06-05
Auditor: Price Paige & Company

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
399983 2023-004 Material Weakness - B
399984 2023-005 Significant Deficiency - P
976425 2023-004 Material Weakness - B
976426 2023-005 Significant Deficiency - P

Programs

ALN Program Spent Major Findings
93.658 Foster Care_title IV-E $1.78M Yes 2

Contacts

Name Title Type
E7E3GH3MD5H5 Claudia Gutierrez Auditee
5592250071 Larisa Murren Auditor
No contacts on file

Notes to SEFA

Title: NOTE 1 – GENERAL Accounting Policies: NOTE 1 – GENERAL The accompanying Schedule of Expenditures of Federal Awards (SEFA) presents the activity of all federal award programs of Esperanza Foster Family Agency, Inc. (the Agency). Federal awards received directly from federal agencies, as well as federal awards passed through other government agencies are included in the schedule. The information in this SEFA is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). NOTE 2 – BASIS OF ACCOUNTING The accompanying SEFA is presented using the accrual basis of accounting, which is described in Note 2 of the Agency’s financial statements. De Minimis Rate Used: N Rate Explanation: NOTE 4 – INDIRECT COST RATE The Agency has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. The accompanying Schedule of Expenditures of Federal Awards (SEFA) presents the activity of all federal award programs of Esperanza Foster Family Agency, Inc. (the Agency). Federal awards received directly from federal agencies, as well as federal awards passed through other government agencies are included in the schedule. The information in this SEFA is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance).
Title: NOTE 2 – BASIS OF ACCOUNTING Accounting Policies: NOTE 1 – GENERAL The accompanying Schedule of Expenditures of Federal Awards (SEFA) presents the activity of all federal award programs of Esperanza Foster Family Agency, Inc. (the Agency). Federal awards received directly from federal agencies, as well as federal awards passed through other government agencies are included in the schedule. The information in this SEFA is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). NOTE 2 – BASIS OF ACCOUNTING The accompanying SEFA is presented using the accrual basis of accounting, which is described in Note 2 of the Agency’s financial statements. De Minimis Rate Used: N Rate Explanation: NOTE 4 – INDIRECT COST RATE The Agency has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. The accompanying SEFA is presented using the accrual basis of accounting, which is described in Note 2 of the Agency’s financial statements.
Title: NOTE 3 – RELATIONSHIP TO BASIC FINANCIAL STATEMENTS Accounting Policies: NOTE 1 – GENERAL The accompanying Schedule of Expenditures of Federal Awards (SEFA) presents the activity of all federal award programs of Esperanza Foster Family Agency, Inc. (the Agency). Federal awards received directly from federal agencies, as well as federal awards passed through other government agencies are included in the schedule. The information in this SEFA is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). NOTE 2 – BASIS OF ACCOUNTING The accompanying SEFA is presented using the accrual basis of accounting, which is described in Note 2 of the Agency’s financial statements. De Minimis Rate Used: N Rate Explanation: NOTE 4 – INDIRECT COST RATE The Agency has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. Federal award expenditures agree or can be reconciled with the amounts reported in the Agency’s financial statements.
Title: NOTE 4 – INDIRECT COST RATE Accounting Policies: NOTE 1 – GENERAL The accompanying Schedule of Expenditures of Federal Awards (SEFA) presents the activity of all federal award programs of Esperanza Foster Family Agency, Inc. (the Agency). Federal awards received directly from federal agencies, as well as federal awards passed through other government agencies are included in the schedule. The information in this SEFA is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). NOTE 2 – BASIS OF ACCOUNTING The accompanying SEFA is presented using the accrual basis of accounting, which is described in Note 2 of the Agency’s financial statements. De Minimis Rate Used: N Rate Explanation: NOTE 4 – INDIRECT COST RATE The Agency has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. The Agency has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance.

Finding Details

Finding 2023-004
Condition: We identified unallowable costs totaling $11,454, comprised of $2,275 of employee meals and $9,179 of investment advisory fees. Criteria: Title 2, CFR, Part 200, Subpart E-Cost Principles, Basic Considerations, section 200.403, Factors Affecting Allowability of Costs, states, in part, that “Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: a) be necessary and reasonable for the performance of the Federal award, b) be properly documented showing the business nature of the charge. Cause: Internal controls over reporting compliance requirements were not properly designed and were not placed in operation. Management is responsible for compliance with the requirements of allowable/unallowable costs and for the design, implementation, and maintenance of effective internal controls over compliance with the requirements of laws, statutes, regulations, rules, and provisions of grant agreements applicable to its federal program. Effect: The lack of internal controls and procedures over compliance increases the risk of using federal funds for unallowable costs. Recommendation: We recommend the Agency develop a written policies and procedures manual for allowable/unallowable costs compliance, which should include a checklist detailing all the necessary steps to ensure a proper review of all costs charged to the federal program.
Finding 2023-005
Condition: During our audit, we found that the Agency’s Board did not review and approve material disbursements charged to the federal program. Criteria: The Agency’s policy states that the Board’s review and approval are required for the transactions over $1,000 charged to the federal program. Cause: Internal controls over material disbursements charged to the federal program were not properly implemented or operating effectively. Effect: Internal controls are not functioning effectively, which increases the risk of error and fraud. Recommendation: We recommend the Agency develop a written policies and procedures manual which should include a checklist detailing all the necessary steps to ensure a proper review of all costs charged to the federal program.
Finding 2023-004
Condition: We identified unallowable costs totaling $11,454, comprised of $2,275 of employee meals and $9,179 of investment advisory fees. Criteria: Title 2, CFR, Part 200, Subpart E-Cost Principles, Basic Considerations, section 200.403, Factors Affecting Allowability of Costs, states, in part, that “Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: a) be necessary and reasonable for the performance of the Federal award, b) be properly documented showing the business nature of the charge. Cause: Internal controls over reporting compliance requirements were not properly designed and were not placed in operation. Management is responsible for compliance with the requirements of allowable/unallowable costs and for the design, implementation, and maintenance of effective internal controls over compliance with the requirements of laws, statutes, regulations, rules, and provisions of grant agreements applicable to its federal program. Effect: The lack of internal controls and procedures over compliance increases the risk of using federal funds for unallowable costs. Recommendation: We recommend the Agency develop a written policies and procedures manual for allowable/unallowable costs compliance, which should include a checklist detailing all the necessary steps to ensure a proper review of all costs charged to the federal program.
Finding 2023-005
Condition: During our audit, we found that the Agency’s Board did not review and approve material disbursements charged to the federal program. Criteria: The Agency’s policy states that the Board’s review and approval are required for the transactions over $1,000 charged to the federal program. Cause: Internal controls over material disbursements charged to the federal program were not properly implemented or operating effectively. Effect: Internal controls are not functioning effectively, which increases the risk of error and fraud. Recommendation: We recommend the Agency develop a written policies and procedures manual which should include a checklist detailing all the necessary steps to ensure a proper review of all costs charged to the federal program.