Audit 308903

Finding # 2023-001: Type: Material weakness over preparation of schedule of expenditures of federal awards (SEFA). Assistance Listing: 10.937 Partnerships for Climate-Smart Commodities Criteria/Requirement The Organization should have procedures in place to properly identify and account for federal awards that are subject to Uniform Guidance. Condition/Context: The Organization did not correctly identify federal expenditures that should or should not be reported on the SEFA and significant adjustments were required. Cause: Payroll expenses by funding source were tracked outside of the accounting system’s payroll module. Reports that were generated from the accounting system to be used in the SEFA preparation were not complete since payroll costs were improperly excluded. In addition, certain federal agreements that are exempt from the Uniform Guidance were included in the SEFA. Effect: Major programs for the Single Audit may not be correctly identified and audited. Questioned Costs: None. Recommendation: The Organization should implement additional procedures and controls to accurately capture all activity under federal awards in preparing the SEFA. Federal cost reimbursement revenue should be compared to amounts reported on the SEFA to ensure completeness and accuracy. Management’s Response: The Organization agrees with the auditor’s recommendation. At the time of this audit’s publishing, the Organization has implemented the payroll module in the accounting system so that expenses are tracked in one system.

Finding # 2023-002 Type: Immaterial noncompliance over procurement Assistance Listing: 10.937 Partnerships for Climate-Smart Commodities Criteria/Requirement The Organization’s procurement policies should incorporate the provisions of the procurement standards set out at 2 CFR sections 200.318 through 200.327. Cause: The Organization’s fiscal policies and procedures do not meet the required federal standards for procurement. Effect: Executed contracts using federal funds may be in violation of federal guidelines. Questioned Costs: None. Recommendation: The Organization's procurement policy must have documented procurement procedures, consistent with state, local, and tribal laws and regulations for the acquisition of property or services required under a federal award or subaward. The Organization should maintain records sufficient to detail the history of procurement. Management’s Response: The Organization agrees with the auditor’s recommendation. At the time of this audit’s issuance, the Organization has updated its procurement policies and procedures to be consistent with federal requirements.

Finding # 2023-001: Type: Material weakness over preparation of schedule of expenditures of federal awards (SEFA). Assistance Listing: 10.937 Partnerships for Climate-Smart Commodities Criteria/Requirement The Organization should have procedures in place to properly identify and account for federal awards that are subject to Uniform Guidance. Condition/Context: The Organization did not correctly identify federal expenditures that should or should not be reported on the SEFA and significant adjustments were required. Cause: Payroll expenses by funding source were tracked outside of the accounting system’s payroll module. Reports that were generated from the accounting system to be used in the SEFA preparation were not complete since payroll costs were improperly excluded. In addition, certain federal agreements that are exempt from the Uniform Guidance were included in the SEFA. Effect: Major programs for the Single Audit may not be correctly identified and audited. Questioned Costs: None. Recommendation: The Organization should implement additional procedures and controls to accurately capture all activity under federal awards in preparing the SEFA. Federal cost reimbursement revenue should be compared to amounts reported on the SEFA to ensure completeness and accuracy. Management’s Response: The Organization agrees with the auditor’s recommendation. At the time of this audit’s publishing, the Organization has implemented the payroll module in the accounting system so that expenses are tracked in one system.

Finding # 2023-002 Type: Immaterial noncompliance over procurement Assistance Listing: 10.937 Partnerships for Climate-Smart Commodities Criteria/Requirement The Organization’s procurement policies should incorporate the provisions of the procurement standards set out at 2 CFR sections 200.318 through 200.327. Cause: The Organization’s fiscal policies and procedures do not meet the required federal standards for procurement. Effect: Executed contracts using federal funds may be in violation of federal guidelines. Questioned Costs: None. Recommendation: The Organization's procurement policy must have documented procurement procedures, consistent with state, local, and tribal laws and regulations for the acquisition of property or services required under a federal award or subaward. The Organization should maintain records sufficient to detail the history of procurement. Management’s Response: The Organization agrees with the auditor’s recommendation. At the time of this audit’s issuance, the Organization has updated its procurement policies and procedures to be consistent with federal requirements.

Finding # 2023-001: Type: Material weakness over preparation of schedule of expenditures of federal awards (SEFA). Assistance Listing: 10.937 Partnerships for Climate-Smart Commodities Criteria/Requirement The Organization should have procedures in place to properly identify and account for federal awards that are subject to Uniform Guidance. Condition/Context: The Organization did not correctly identify federal expenditures that should or should not be reported on the SEFA and significant adjustments were required. Cause: Payroll expenses by funding source were tracked outside of the accounting system’s payroll module. Reports that were generated from the accounting system to be used in the SEFA preparation were not complete since payroll costs were improperly excluded. In addition, certain federal agreements that are exempt from the Uniform Guidance were included in the SEFA. Effect: Major programs for the Single Audit may not be correctly identified and audited. Questioned Costs: None. Recommendation: The Organization should implement additional procedures and controls to accurately capture all activity under federal awards in preparing the SEFA. Federal cost reimbursement revenue should be compared to amounts reported on the SEFA to ensure completeness and accuracy. Management’s Response: The Organization agrees with the auditor’s recommendation. At the time of this audit’s publishing, the Organization has implemented the payroll module in the accounting system so that expenses are tracked in one system.

Finding # 2023-002 Type: Immaterial noncompliance over procurement Assistance Listing: 10.937 Partnerships for Climate-Smart Commodities Criteria/Requirement The Organization’s procurement policies should incorporate the provisions of the procurement standards set out at 2 CFR sections 200.318 through 200.327. Cause: The Organization’s fiscal policies and procedures do not meet the required federal standards for procurement. Effect: Executed contracts using federal funds may be in violation of federal guidelines. Questioned Costs: None. Recommendation: The Organization's procurement policy must have documented procurement procedures, consistent with state, local, and tribal laws and regulations for the acquisition of property or services required under a federal award or subaward. The Organization should maintain records sufficient to detail the history of procurement. Management’s Response: The Organization agrees with the auditor’s recommendation. At the time of this audit’s issuance, the Organization has updated its procurement policies and procedures to be consistent with federal requirements.

Finding # 2023-001: Type: Material weakness over preparation of schedule of expenditures of federal awards (SEFA). Assistance Listing: 10.937 Partnerships for Climate-Smart Commodities Criteria/Requirement The Organization should have procedures in place to properly identify and account for federal awards that are subject to Uniform Guidance. Condition/Context: The Organization did not correctly identify federal expenditures that should or should not be reported on the SEFA and significant adjustments were required. Cause: Payroll expenses by funding source were tracked outside of the accounting system’s payroll module. Reports that were generated from the accounting system to be used in the SEFA preparation were not complete since payroll costs were improperly excluded. In addition, certain federal agreements that are exempt from the Uniform Guidance were included in the SEFA. Effect: Major programs for the Single Audit may not be correctly identified and audited. Questioned Costs: None. Recommendation: The Organization should implement additional procedures and controls to accurately capture all activity under federal awards in preparing the SEFA. Federal cost reimbursement revenue should be compared to amounts reported on the SEFA to ensure completeness and accuracy. Management’s Response: The Organization agrees with the auditor’s recommendation. At the time of this audit’s publishing, the Organization has implemented the payroll module in the accounting system so that expenses are tracked in one system.

Finding # 2023-002 Type: Immaterial noncompliance over procurement Assistance Listing: 10.937 Partnerships for Climate-Smart Commodities Criteria/Requirement The Organization’s procurement policies should incorporate the provisions of the procurement standards set out at 2 CFR sections 200.318 through 200.327. Cause: The Organization’s fiscal policies and procedures do not meet the required federal standards for procurement. Effect: Executed contracts using federal funds may be in violation of federal guidelines. Questioned Costs: None. Recommendation: The Organization's procurement policy must have documented procurement procedures, consistent with state, local, and tribal laws and regulations for the acquisition of property or services required under a federal award or subaward. The Organization should maintain records sufficient to detail the history of procurement. Management’s Response: The Organization agrees with the auditor’s recommendation. At the time of this audit’s issuance, the Organization has updated its procurement policies and procedures to be consistent with federal requirements.