Audit 313970

2022-001 ? ALN 93.958 Block Grants for Community Mental Health ServicesMaterial Weakness ? Internal Control Over Compliance ? Allowable CostsCriteria: Italian Home for Children, Inc. is required to be in compliance with the requirements of allowable services and costs under the Uniform Guidance, and to maintain an adequate system of internal control over compliance. Expenses being charged under the grant must meet the specific requirements of the grant and be properly approved by management.Condition: While performing tests on federal program compliance, out of our sample of forty items tested, we noted two instances where there was no evidence of approval of the check/ACH remittance, four instances where there was no evidence of approval of the invoice, and six instances where the same individual approved the invoice and also signed the check remitted for payment.Cause: The Organization was not able to provide evidence that the control processes had been followed. As there was no documentation for approval and/or no segregation of duties exercised in approving and paying the invoices, evidence was not available to ensure that the invoices were reviewed and approved prior to payment.Effect: It is possible that unauthorized payments were made.Recommendation: We recommend that the appropriate individuals physically or electronically approve individual invoices indicating review and approval, and another individual authorizes payment, to reduce the risk of unauthorized payment ofinvoices. In addition, the Organization should retain an audit trail of the review and approvals as evidence that all expenditures are appropriately reviewed and approved prior to payment.Views of Responsible Officials: See corrective action plan.

2022-001 ? ALN 93.958 Block Grants for Community Mental Health ServicesMaterial Weakness ? Internal Control Over Compliance ? Allowable CostsCriteria: Italian Home for Children, Inc. is required to be in compliance with the requirements of allowable services and costs under the Uniform Guidance, and to maintain an adequate system of internal control over compliance. Expenses being charged under the grant must meet the specific requirements of the grant and be properly approved by management.Condition: While performing tests on federal program compliance, out of our sample of forty items tested, we noted two instances where there was no evidence of approval of the check/ACH remittance, four instances where there was no evidence of approval of the invoice, and six instances where the same individual approved the invoice and also signed the check remitted for payment.Cause: The Organization was not able to provide evidence that the control processes had been followed. As there was no documentation for approval and/or no segregation of duties exercised in approving and paying the invoices, evidence was not available to ensure that the invoices were reviewed and approved prior to payment.Effect: It is possible that unauthorized payments were made.Recommendation: We recommend that the appropriate individuals physically or electronically approve individual invoices indicating review and approval, and another individual authorizes payment, to reduce the risk of unauthorized payment ofinvoices. In addition, the Organization should retain an audit trail of the review and approvals as evidence that all expenditures are appropriately reviewed and approved prior to payment.Views of Responsible Officials: See corrective action plan.