Audit 309529

FY End
2023-12-31
Total Expended
$1.64M
Findings
2
Programs
3
Year: 2023 Accepted: 2024-06-21

Organization Exclusion Status:

Checking exclusion status...

Findings

ID Ref Severity Repeat Requirement
401407 2023-001 Material Weakness - B
977849 2023-001 Material Weakness - B

Contacts

Name Title Type
JPJHZK3V2PX7 Karen Harper Auditee
7609318200 Heather Hernandez Auditor
No contacts on file

Notes to SEFA

Title: Nature of the Organization Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting except for amounts passed through to subrecipients which are reported on the Schedule when the disbursement is made to the subrecipient. Such expenditures are recognized following the cost principles contained in Title 48 U.S. Code of Federal Regulation Part 31, Contract Cost Principles and Procedures, wherein certain types of expenditures are now allowable or are limited as to reimbursement. Pass-through entity indentifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: The Organization has a negotiated facility & administrative (“F&A”) and fringe benefits rates with the government. Building Engineering & Talent (the “Organization”) is a California not-for-profit organization and is required by the terms of its federal grant to have a financial related audit (as defined in the Government Auditing Standards).
Title: Basis of Presentation Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting except for amounts passed through to subrecipients which are reported on the Schedule when the disbursement is made to the subrecipient. Such expenditures are recognized following the cost principles contained in Title 48 U.S. Code of Federal Regulation Part 31, Contract Cost Principles and Procedures, wherein certain types of expenditures are now allowable or are limited as to reimbursement. Pass-through entity indentifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: The Organization has a negotiated facility & administrative (“F&A”) and fringe benefits rates with the government. The accompanying Schedule of Expenditures of Federal Awards (the “Schedule”) includes the federal award activity of Building Engineering & Science Talent under programs of the federal government for the year ended December 31, 2023. The information in this Schedule 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). Because the Schedule presents only a selected portion of the operations of Building Engineering & Science Talent, it is not intended to and does not present the financial position, changes in net assets or cash flows of Building Engineering & Science Talent.
Title: Summary of Significant Accounting Policies Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting except for amounts passed through to subrecipients which are reported on the Schedule when the disbursement is made to the subrecipient. Such expenditures are recognized following the cost principles contained in Title 48 U.S. Code of Federal Regulation Part 31, Contract Cost Principles and Procedures, wherein certain types of expenditures are now allowable or are limited as to reimbursement. Pass-through entity indentifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: The Organization has a negotiated facility & administrative (“F&A”) and fringe benefits rates with the government. Basis of accounting Expenditures reported on the Schedule are reported on the accrual basis of accounting except for amounts passed through to subrecipients which are reported on the Schedule when the disbursement is made to the subrecipient. Such expenditures are recognized following the cost principles contained in Title 48 U.S. Code of Federal Regulations Part 31, Contract Cost Principles and Procedures, wherein certain types of expenditures are now allowable or are limited as to reimbursement. Pass-through entity identifying numbers are presented where available. Fringe and indirect cost rates The Organization has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance. The Organization has a negotiated facility & administrative (“F&A”) and fringe benefits rates with the government. The provisional rates billed for the year were 34.5% and 33.1% , respectively as set forth in the grant documents. The F&A and fringe cost amounts, as included in the Schedule, are in accordance with the rates in the grant budgets. Costs are allocated to grants based on the grant direct labor, materials & supplies, and travel.

Finding Details

Identification of the federal programs 12.800 - Air Force Defense Research Sciences Program - FA8650-20-2-5506. Criteria or Specific Requirement Per 2 CFR Part 200 Subpart F section 200.502, amounts provided to subrecipients should be reported as expended when the disbursement is made to the subrecipient. Condition The Organization recorded disbursements made to subrecipients in the incorrect fiscal year period on the Schedule of Expenditures of Federal Awards. Cause The Organization recorded the expenses in accordance with GAAP rather than with the CFR compliance on the Schedule of Expenditures of Federal Awards. As such the Organization incorrectly incurred expenses in the wrong fiscal year period for the purposes of the single audit. Effect or potential effect Subrecipient expenditures are recorded in the incorrect year. Questioned Costs None noted. Context The condition noted above was identified during the audit procedures related to Subrecipient Monitoring. Identification as a Repeat Finding None Recommendation The Organization should have a formal process put in place to ensure subrecipient expenditures are being recorded in the proper period. Views of Responsible Officials Management concurs with the finding. The Organization revised its review procedures and controls so that subrecipient expenditures are recorded in the proper accounting fiscal year according to 2 CFR Part 200 Subpart F section 200.502, whereby amounts will be reported as expended when the disbursement is made to the subrecipient for single audit purposes. These steps should correct the deficiency.
Identification of the federal programs 12.800 - Air Force Defense Research Sciences Program - FA8650-20-2-5506. Criteria or Specific Requirement Per 2 CFR Part 200 Subpart F section 200.502, amounts provided to subrecipients should be reported as expended when the disbursement is made to the subrecipient. Condition The Organization recorded disbursements made to subrecipients in the incorrect fiscal year period on the Schedule of Expenditures of Federal Awards. Cause The Organization recorded the expenses in accordance with GAAP rather than with the CFR compliance on the Schedule of Expenditures of Federal Awards. As such the Organization incorrectly incurred expenses in the wrong fiscal year period for the purposes of the single audit. Effect or potential effect Subrecipient expenditures are recorded in the incorrect year. Questioned Costs None noted. Context The condition noted above was identified during the audit procedures related to Subrecipient Monitoring. Identification as a Repeat Finding None Recommendation The Organization should have a formal process put in place to ensure subrecipient expenditures are being recorded in the proper period. Views of Responsible Officials Management concurs with the finding. The Organization revised its review procedures and controls so that subrecipient expenditures are recorded in the proper accounting fiscal year according to 2 CFR Part 200 Subpart F section 200.502, whereby amounts will be reported as expended when the disbursement is made to the subrecipient for single audit purposes. These steps should correct the deficiency.