Audit 308812

2023‐001 ‐ Proper General Ledger Posting, Reconciliations and Adequate Oversight Criteria: Effectively designed and executed policies and procedures of financial processes should exist to ensure accurate recording of transactions to proper general ledger codes. Reconciliations and oversight should be designed and executed to ensure proper posting and detect errors on a timely basis. Condition: Throughout the year, transactions were not consistently recorded to the correct general ledger code in accordance generally accepted accounting principles. Various receivables were recorded incorrectly as a reduction to deferred revenue and various liability transactions were recorded as a reduction to asset balances. Further, oversight did not detect such errors. Cause: An inconsistent application of generally accepted accounting principles resulted in the Agency posting accounts receivable and deferred revenue transactions to the same balance sheet account potentially misstating asset and liability balances. This complicates reconciliation processes and coupled with fact that books and records were not reconciled with the final audited financials, result in users of the financials not having complete and accurate financials available for decision-making purposes. Effect: The lack of accurate general ledger posting, reconciliations and adequate oversight led to material audit adjustments in the following areas: accounts receivable, accrued liabilities/accrued salaries, unemployment liabilities, deferred revenue, contract and grant revenues, and expenditures. Recommendation: We recommend the management review current policies and procedures to ensure that transactions are posted to the proper general ledger account and regular oversight and reconciliation processes be enhanced. Such reconciliations and oversight should be completed before financial records are presented to executive management and the board for decision-making purposes. Views of Responsible Official and Planned Corrective Actions: The Executive Director and Senior Director of Finance will engage with all team members whose responsibilities include posting to the OCO General Ledger; updates will be completed on the procedure to provide clarifications where needed. A general step by step process/guide for reviewing ledgers for common mistakes and methods of investigation will be incorporated into the procedure. Training will be completed for those who are authorized to post to the general ledgers and corrective actions will be issued as errors are identified. The Controller will continue to complete monthly reviews of the ledger in accordance with the updated procedures.

2023‐002 ‐ Schedule of Expenditures of Federal Awards (SEFA) Preparation Criteria: Under Uniform Guidance (2 C.F.R. Part 200) Subpart F Section 200.502 the auditee must also prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period covered by the auditee's financial statements which must include the total of all federal awards expended. Condition: The Agency implemented a process to identify and track federal expenditures however it did not include a reconciliation to the final trial balance and audit adjustments were required to present a complete and accurate SEFA in compliance with those of Uniform Guidance. Cause: The Agency needs to refine the preparation of the SEFA reporting process to reduce the risk of manual errors and incorporate reconciliation to the trial balance. This process should be analyzed by a member of management with adequate experience and training to properly analyze federal expenditures. Effect: Several SEFA versions prepared by management required adjustments to present the Agency’s federal expenditures in accordance with the requirements of Uniform Guidance, including properly delineating federal vs. non-federal expenses and reconciling with the final trial balance. Recommendation: We recommend that management review the preparation of the SEFA reporting process, including reconciling expenditures with final trial balance amounts. We recommend management continue to refine the oversight function over the process of preparing the SEFA. Views of Responsible Official and Planned Corrective Actions: The Executive Director and Senior Director of Finance will work with the Controller to update the procedures for the SEFA incorporating additional steps that share the responsibility for recording Federal Expenses and Revenue in line with the needs of the SEFA report.

2023‐001 ‐ Proper General Ledger Posting, Reconciliations and Adequate Oversight Criteria: Effectively designed and executed policies and procedures of financial processes should exist to ensure accurate recording of transactions to proper general ledger codes. Reconciliations and oversight should be designed and executed to ensure proper posting and detect errors on a timely basis. Condition: Throughout the year, transactions were not consistently recorded to the correct general ledger code in accordance generally accepted accounting principles. Various receivables were recorded incorrectly as a reduction to deferred revenue and various liability transactions were recorded as a reduction to asset balances. Further, oversight did not detect such errors. Cause: An inconsistent application of generally accepted accounting principles resulted in the Agency posting accounts receivable and deferred revenue transactions to the same balance sheet account potentially misstating asset and liability balances. This complicates reconciliation processes and coupled with fact that books and records were not reconciled with the final audited financials, result in users of the financials not having complete and accurate financials available for decision-making purposes. Effect: The lack of accurate general ledger posting, reconciliations and adequate oversight led to material audit adjustments in the following areas: accounts receivable, accrued liabilities/accrued salaries, unemployment liabilities, deferred revenue, contract and grant revenues, and expenditures. Recommendation: We recommend the management review current policies and procedures to ensure that transactions are posted to the proper general ledger account and regular oversight and reconciliation processes be enhanced. Such reconciliations and oversight should be completed before financial records are presented to executive management and the board for decision-making purposes. Views of Responsible Official and Planned Corrective Actions: The Executive Director and Senior Director of Finance will engage with all team members whose responsibilities include posting to the OCO General Ledger; updates will be completed on the procedure to provide clarifications where needed. A general step by step process/guide for reviewing ledgers for common mistakes and methods of investigation will be incorporated into the procedure. Training will be completed for those who are authorized to post to the general ledgers and corrective actions will be issued as errors are identified. The Controller will continue to complete monthly reviews of the ledger in accordance with the updated procedures.

2023‐002 ‐ Schedule of Expenditures of Federal Awards (SEFA) Preparation Criteria: Under Uniform Guidance (2 C.F.R. Part 200) Subpart F Section 200.502 the auditee must also prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period covered by the auditee's financial statements which must include the total of all federal awards expended. Condition: The Agency implemented a process to identify and track federal expenditures however it did not include a reconciliation to the final trial balance and audit adjustments were required to present a complete and accurate SEFA in compliance with those of Uniform Guidance. Cause: The Agency needs to refine the preparation of the SEFA reporting process to reduce the risk of manual errors and incorporate reconciliation to the trial balance. This process should be analyzed by a member of management with adequate experience and training to properly analyze federal expenditures. Effect: Several SEFA versions prepared by management required adjustments to present the Agency’s federal expenditures in accordance with the requirements of Uniform Guidance, including properly delineating federal vs. non-federal expenses and reconciling with the final trial balance. Recommendation: We recommend that management review the preparation of the SEFA reporting process, including reconciling expenditures with final trial balance amounts. We recommend management continue to refine the oversight function over the process of preparing the SEFA. Views of Responsible Official and Planned Corrective Actions: The Executive Director and Senior Director of Finance will work with the Controller to update the procedures for the SEFA incorporating additional steps that share the responsibility for recording Federal Expenses and Revenue in line with the needs of the SEFA report.

2023‐001 ‐ Proper General Ledger Posting, Reconciliations and Adequate Oversight Criteria: Effectively designed and executed policies and procedures of financial processes should exist to ensure accurate recording of transactions to proper general ledger codes. Reconciliations and oversight should be designed and executed to ensure proper posting and detect errors on a timely basis. Condition: Throughout the year, transactions were not consistently recorded to the correct general ledger code in accordance generally accepted accounting principles. Various receivables were recorded incorrectly as a reduction to deferred revenue and various liability transactions were recorded as a reduction to asset balances. Further, oversight did not detect such errors. Cause: An inconsistent application of generally accepted accounting principles resulted in the Agency posting accounts receivable and deferred revenue transactions to the same balance sheet account potentially misstating asset and liability balances. This complicates reconciliation processes and coupled with fact that books and records were not reconciled with the final audited financials, result in users of the financials not having complete and accurate financials available for decision-making purposes. Effect: The lack of accurate general ledger posting, reconciliations and adequate oversight led to material audit adjustments in the following areas: accounts receivable, accrued liabilities/accrued salaries, unemployment liabilities, deferred revenue, contract and grant revenues, and expenditures. Recommendation: We recommend the management review current policies and procedures to ensure that transactions are posted to the proper general ledger account and regular oversight and reconciliation processes be enhanced. Such reconciliations and oversight should be completed before financial records are presented to executive management and the board for decision-making purposes. Views of Responsible Official and Planned Corrective Actions: The Executive Director and Senior Director of Finance will engage with all team members whose responsibilities include posting to the OCO General Ledger; updates will be completed on the procedure to provide clarifications where needed. A general step by step process/guide for reviewing ledgers for common mistakes and methods of investigation will be incorporated into the procedure. Training will be completed for those who are authorized to post to the general ledgers and corrective actions will be issued as errors are identified. The Controller will continue to complete monthly reviews of the ledger in accordance with the updated procedures.

2023‐002 ‐ Schedule of Expenditures of Federal Awards (SEFA) Preparation Criteria: Under Uniform Guidance (2 C.F.R. Part 200) Subpart F Section 200.502 the auditee must also prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period covered by the auditee's financial statements which must include the total of all federal awards expended. Condition: The Agency implemented a process to identify and track federal expenditures however it did not include a reconciliation to the final trial balance and audit adjustments were required to present a complete and accurate SEFA in compliance with those of Uniform Guidance. Cause: The Agency needs to refine the preparation of the SEFA reporting process to reduce the risk of manual errors and incorporate reconciliation to the trial balance. This process should be analyzed by a member of management with adequate experience and training to properly analyze federal expenditures. Effect: Several SEFA versions prepared by management required adjustments to present the Agency’s federal expenditures in accordance with the requirements of Uniform Guidance, including properly delineating federal vs. non-federal expenses and reconciling with the final trial balance. Recommendation: We recommend that management review the preparation of the SEFA reporting process, including reconciling expenditures with final trial balance amounts. We recommend management continue to refine the oversight function over the process of preparing the SEFA. Views of Responsible Official and Planned Corrective Actions: The Executive Director and Senior Director of Finance will work with the Controller to update the procedures for the SEFA incorporating additional steps that share the responsibility for recording Federal Expenses and Revenue in line with the needs of the SEFA report.

2023‐001 ‐ Proper General Ledger Posting, Reconciliations and Adequate Oversight Criteria: Effectively designed and executed policies and procedures of financial processes should exist to ensure accurate recording of transactions to proper general ledger codes. Reconciliations and oversight should be designed and executed to ensure proper posting and detect errors on a timely basis. Condition: Throughout the year, transactions were not consistently recorded to the correct general ledger code in accordance generally accepted accounting principles. Various receivables were recorded incorrectly as a reduction to deferred revenue and various liability transactions were recorded as a reduction to asset balances. Further, oversight did not detect such errors. Cause: An inconsistent application of generally accepted accounting principles resulted in the Agency posting accounts receivable and deferred revenue transactions to the same balance sheet account potentially misstating asset and liability balances. This complicates reconciliation processes and coupled with fact that books and records were not reconciled with the final audited financials, result in users of the financials not having complete and accurate financials available for decision-making purposes. Effect: The lack of accurate general ledger posting, reconciliations and adequate oversight led to material audit adjustments in the following areas: accounts receivable, accrued liabilities/accrued salaries, unemployment liabilities, deferred revenue, contract and grant revenues, and expenditures. Recommendation: We recommend the management review current policies and procedures to ensure that transactions are posted to the proper general ledger account and regular oversight and reconciliation processes be enhanced. Such reconciliations and oversight should be completed before financial records are presented to executive management and the board for decision-making purposes. Views of Responsible Official and Planned Corrective Actions: The Executive Director and Senior Director of Finance will engage with all team members whose responsibilities include posting to the OCO General Ledger; updates will be completed on the procedure to provide clarifications where needed. A general step by step process/guide for reviewing ledgers for common mistakes and methods of investigation will be incorporated into the procedure. Training will be completed for those who are authorized to post to the general ledgers and corrective actions will be issued as errors are identified. The Controller will continue to complete monthly reviews of the ledger in accordance with the updated procedures.

2023‐002 ‐ Schedule of Expenditures of Federal Awards (SEFA) Preparation Criteria: Under Uniform Guidance (2 C.F.R. Part 200) Subpart F Section 200.502 the auditee must also prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period covered by the auditee's financial statements which must include the total of all federal awards expended. Condition: The Agency implemented a process to identify and track federal expenditures however it did not include a reconciliation to the final trial balance and audit adjustments were required to present a complete and accurate SEFA in compliance with those of Uniform Guidance. Cause: The Agency needs to refine the preparation of the SEFA reporting process to reduce the risk of manual errors and incorporate reconciliation to the trial balance. This process should be analyzed by a member of management with adequate experience and training to properly analyze federal expenditures. Effect: Several SEFA versions prepared by management required adjustments to present the Agency’s federal expenditures in accordance with the requirements of Uniform Guidance, including properly delineating federal vs. non-federal expenses and reconciling with the final trial balance. Recommendation: We recommend that management review the preparation of the SEFA reporting process, including reconciling expenditures with final trial balance amounts. We recommend management continue to refine the oversight function over the process of preparing the SEFA. Views of Responsible Official and Planned Corrective Actions: The Executive Director and Senior Director of Finance will work with the Controller to update the procedures for the SEFA incorporating additional steps that share the responsibility for recording Federal Expenses and Revenue in line with the needs of the SEFA report.

2023‐001 ‐ Proper General Ledger Posting, Reconciliations and Adequate Oversight Criteria: Effectively designed and executed policies and procedures of financial processes should exist to ensure accurate recording of transactions to proper general ledger codes. Reconciliations and oversight should be designed and executed to ensure proper posting and detect errors on a timely basis. Condition: Throughout the year, transactions were not consistently recorded to the correct general ledger code in accordance generally accepted accounting principles. Various receivables were recorded incorrectly as a reduction to deferred revenue and various liability transactions were recorded as a reduction to asset balances. Further, oversight did not detect such errors. Cause: An inconsistent application of generally accepted accounting principles resulted in the Agency posting accounts receivable and deferred revenue transactions to the same balance sheet account potentially misstating asset and liability balances. This complicates reconciliation processes and coupled with fact that books and records were not reconciled with the final audited financials, result in users of the financials not having complete and accurate financials available for decision-making purposes. Effect: The lack of accurate general ledger posting, reconciliations and adequate oversight led to material audit adjustments in the following areas: accounts receivable, accrued liabilities/accrued salaries, unemployment liabilities, deferred revenue, contract and grant revenues, and expenditures. Recommendation: We recommend the management review current policies and procedures to ensure that transactions are posted to the proper general ledger account and regular oversight and reconciliation processes be enhanced. Such reconciliations and oversight should be completed before financial records are presented to executive management and the board for decision-making purposes. Views of Responsible Official and Planned Corrective Actions: The Executive Director and Senior Director of Finance will engage with all team members whose responsibilities include posting to the OCO General Ledger; updates will be completed on the procedure to provide clarifications where needed. A general step by step process/guide for reviewing ledgers for common mistakes and methods of investigation will be incorporated into the procedure. Training will be completed for those who are authorized to post to the general ledgers and corrective actions will be issued as errors are identified. The Controller will continue to complete monthly reviews of the ledger in accordance with the updated procedures.

2023‐002 ‐ Schedule of Expenditures of Federal Awards (SEFA) Preparation Criteria: Under Uniform Guidance (2 C.F.R. Part 200) Subpart F Section 200.502 the auditee must also prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period covered by the auditee's financial statements which must include the total of all federal awards expended. Condition: The Agency implemented a process to identify and track federal expenditures however it did not include a reconciliation to the final trial balance and audit adjustments were required to present a complete and accurate SEFA in compliance with those of Uniform Guidance. Cause: The Agency needs to refine the preparation of the SEFA reporting process to reduce the risk of manual errors and incorporate reconciliation to the trial balance. This process should be analyzed by a member of management with adequate experience and training to properly analyze federal expenditures. Effect: Several SEFA versions prepared by management required adjustments to present the Agency’s federal expenditures in accordance with the requirements of Uniform Guidance, including properly delineating federal vs. non-federal expenses and reconciling with the final trial balance. Recommendation: We recommend that management review the preparation of the SEFA reporting process, including reconciling expenditures with final trial balance amounts. We recommend management continue to refine the oversight function over the process of preparing the SEFA. Views of Responsible Official and Planned Corrective Actions: The Executive Director and Senior Director of Finance will work with the Controller to update the procedures for the SEFA incorporating additional steps that share the responsibility for recording Federal Expenses and Revenue in line with the needs of the SEFA report.

2023‐001 ‐ Proper General Ledger Posting, Reconciliations and Adequate Oversight Criteria: Effectively designed and executed policies and procedures of financial processes should exist to ensure accurate recording of transactions to proper general ledger codes. Reconciliations and oversight should be designed and executed to ensure proper posting and detect errors on a timely basis. Condition: Throughout the year, transactions were not consistently recorded to the correct general ledger code in accordance generally accepted accounting principles. Various receivables were recorded incorrectly as a reduction to deferred revenue and various liability transactions were recorded as a reduction to asset balances. Further, oversight did not detect such errors. Cause: An inconsistent application of generally accepted accounting principles resulted in the Agency posting accounts receivable and deferred revenue transactions to the same balance sheet account potentially misstating asset and liability balances. This complicates reconciliation processes and coupled with fact that books and records were not reconciled with the final audited financials, result in users of the financials not having complete and accurate financials available for decision-making purposes. Effect: The lack of accurate general ledger posting, reconciliations and adequate oversight led to material audit adjustments in the following areas: accounts receivable, accrued liabilities/accrued salaries, unemployment liabilities, deferred revenue, contract and grant revenues, and expenditures. Recommendation: We recommend the management review current policies and procedures to ensure that transactions are posted to the proper general ledger account and regular oversight and reconciliation processes be enhanced. Such reconciliations and oversight should be completed before financial records are presented to executive management and the board for decision-making purposes. Views of Responsible Official and Planned Corrective Actions: The Executive Director and Senior Director of Finance will engage with all team members whose responsibilities include posting to the OCO General Ledger; updates will be completed on the procedure to provide clarifications where needed. A general step by step process/guide for reviewing ledgers for common mistakes and methods of investigation will be incorporated into the procedure. Training will be completed for those who are authorized to post to the general ledgers and corrective actions will be issued as errors are identified. The Controller will continue to complete monthly reviews of the ledger in accordance with the updated procedures.

2023‐002 ‐ Schedule of Expenditures of Federal Awards (SEFA) Preparation Criteria: Under Uniform Guidance (2 C.F.R. Part 200) Subpart F Section 200.502 the auditee must also prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period covered by the auditee's financial statements which must include the total of all federal awards expended. Condition: The Agency implemented a process to identify and track federal expenditures however it did not include a reconciliation to the final trial balance and audit adjustments were required to present a complete and accurate SEFA in compliance with those of Uniform Guidance. Cause: The Agency needs to refine the preparation of the SEFA reporting process to reduce the risk of manual errors and incorporate reconciliation to the trial balance. This process should be analyzed by a member of management with adequate experience and training to properly analyze federal expenditures. Effect: Several SEFA versions prepared by management required adjustments to present the Agency’s federal expenditures in accordance with the requirements of Uniform Guidance, including properly delineating federal vs. non-federal expenses and reconciling with the final trial balance. Recommendation: We recommend that management review the preparation of the SEFA reporting process, including reconciling expenditures with final trial balance amounts. We recommend management continue to refine the oversight function over the process of preparing the SEFA. Views of Responsible Official and Planned Corrective Actions: The Executive Director and Senior Director of Finance will work with the Controller to update the procedures for the SEFA incorporating additional steps that share the responsibility for recording Federal Expenses and Revenue in line with the needs of the SEFA report.