Criteria: In accordance with 2 CFR Section 200.512(a), the audit must be completed and data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period, adjusted for any extensions permitted by the Office of Management and Budget. Additionally, management is required to prepare a complete and accurate SEFA.
Condition: We noted that the audit, reporting package, and data collection form for the year ended December 31, 2022, were not filed by the deadline of September 30, 2023, to the Federal Audit Clearinghouse. Additionally, the SEFA was not accurately, completely, and timely prepared.
Cause: The Corporation did not have a formal process in place during the year ended December 31, 2022, to accurately, completely, and timely prepare the SEFA.
Effect or Potential Effect: The audit, reporting package, and data collection form for the year ended December 31, 2022, were not accessible to the Federal Audit Clearinghouse in a timely manner and the SEFA was not timely, accurately, or completely prepared.
Questioned costs: None
Context: The audit, reporting package, and data collection form for the year ended December 31, 2022, was filed untimely to the Federal Audit Clearinghouse.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-004 in the 2021 report.
Recommendation: We recommend the Corporation adopt policies and procedures, including tracking and monitoring of reporting requirements, to ensure that the SEFA is timely, accurately, and completely prepare and that the audit, reporting package, and data collection form are electronically filed with the Federal Audit Clearinghouse within the applicable deadline.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to timely prepare the SEFA and related audit documentation.
Criteria: In accordance with 2 CFR Section 200.430.8(i), charges to Federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity. In addition, 2 CFR Section 200.430.8(i)(viii) states that budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting, provided certain additional internal controls are implemented.
Condition: During our testing of salaries and wages, we noted that all 242 sampled transactions did not have adequate supporting documentation and necessary approvals. Charges to Federal awards for salaries and wages were based on estimated allocations, rather than use of a system of internal controls that accounts for actual time and effort allocations. Allocation schedules, which included calculation and position title errors, were not prepared timely and documentation of approval by individuals knowledgeable of the Federal program was not retained.
Cause: While there is a time keeping system implemented to track daily hours worked by employees, the Corporation’s current internal control system does not allow for specific coding for time actually spent on each federally funded program that would support the amount charged to the Federal award.
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for salaries and wages reflect specific time worked or amounts allocated by employee to specific Federal programs. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: We selected 242 salary transactions charged to the Federal programs to test controls over allowable costs. All transactions charged to the Federal programs were based on budgeted Full Time Equivalents (FTE), and not actual hours employees worked for each Federal program. No analysis or true-up was performed to determine the accuracy of employee titles or amounts charged versus actual time and effort incurred. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-005 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls in order to track specific time spent on each Federal program. This can include, time and effort reports completed on a routine basis, such as monthly, and adjust program expenditures as needed to properly reflect actual work performed. Completed time and effort reports should be reviewed and verified by management for accuracy.
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of approval of salary and wage allocations.
Criteria: In accordance with 2 CFR Section 200.431.8(d), fringe benefits may be assigned to cost objectives by identifying specific benefits to specific individuals or by allocating on the basis of entity-wide salaries and wages of the employees receiving the benefits. When the allocation method is used, separate allocations must be made to selective groupings of employees, unless the non-Federal entity demonstrates that costs in relationships to salaries and wages do not differ significantly for different groups of employees.
Condition: During our testing of fringe benefits expenses, we noted that all 242 sampled transactions did not have adequate supporting documentation. Charges to the Federal award for fringe benefits were based on an anticipated fringe benefit cost, for which the Corporation did not maintain an assignment of cost objectives calculation and its related requirements.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for fringe benefits reflect specific time worked or amounts allocated to specific Federal programs, even though the charges are not in excess of amounts approved for the grant period.
Questioned costs: Unknown
Context: We selected 242 fringe benefit transactions charged to the Federal programs to test controls over allowable costs. Each fringe benefit transaction was calculated by applying a fringe benefit cost rate to actual salaries and wages of each employee tested. The fringe benefit cost rate was based on anticipated fringe benefit cost rate which was neither supported by an actual calculation nor analysis of the related group of employees used in such calculation. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-006 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of assignment of cost objectives calculations.
Criteria: Recipients of Federal awards must establish and maintain effective internal controls over reports that are prepared and submitted as required by the Federal programs and maintain evidence that such internal controls were performed.
Condition: We tested 14 sampled reports and noted that the Corporation was unable to provide sufficient and appropriate evidence that programmatic or financial reports required under the Federal programs were reviewed and approved by appropriate personnel prior to submission to the granting agency.
Cause: The Corporation did not have formal policies and procedures over reporting.
Effect or Potential Effect: Programmatic or financial reports submitted to the granting agencies may be incomplete or inaccurate.
Questioned costs: None
Context: Management was not able to produce sufficient and appropriate evidence that programmatic and SF-425 financial reports were reviewed and approved prior to submission to the granting agencies.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-007 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the review and approval of programmatic and financial reports by appropriate personnel who is knowledgeable of such reporting requirements.
View of Responsible Officials: The pandemic and subsequent shift to remote work disrupted the previous workflow of reviewing and approval of Federal programs reports prior to submission to the granting agency. In addition, due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation did not maintain sufficient or appropriate evidence that reviews and approvals were performed for each sampled report.
Criteria: In accordance with 2 CFR Section 200.305, non-Federal entities must minimize the time elapsing between the transfer of funds from the Federal agency or pass-through entity and disbursement by the Corporation for program costs and proportionate share of allowable indirect costs. Additionally, 2 CFR Section 200.302(b)(c) requires non-Federal entities to establish written procedures to implement the requirements 2 CFR Section 200.305. The Federal Acquisition Regulation clause at 48 CFR section 52.216-7(b)(1) requires that the non-Federal entity request reimbursement for only allocable, allowable, and reasonable contract costs that have already been paid or incurred.
Condition: During our testing of reimbursement requests, we noted that 12 out of 34 sampled requests did not have adequate supporting documentation as to evidence of timely review and approval.
Cause: The Corporation did not maintain detailed listings of eligible costs incurred at the time of reimbursement request to support the amount of reimbursement requested in the Payment Management System. Additionally, the Corporation did not maintain documentation of such review or approval that such costs were incurred prior to request for reimbursement, or the amount requested was in accordance with 2 CFR Section 200.305. Eligible cost listings to support amounts drawn during the grant period in total were reconstructed to support annual activity.
Effect or Potential Effect: Requests for reimbursement per the Payment Management System may not have minimized the time elapsing between payment by the Federal agency or pass through and disbursement by the Corporation and the amounts requested for reimbursement may be inaccurate.
Questioned costs: Unknown
Context: We selected 34 reimbursement requests submitted through the Payment Management System and DC Portal during the year ended December 31, 2022. The Corporation was unable to provide evidence of timely review and approval of 12 requests out of 34. Additionally, cost listings were not maintained and were recreated to validate amount of the draw downs during the fiscal year. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-009 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the determination of cash drawn downs and review and approval of drawn downs by appropriate personnel who is knowledgeable of such requirements.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation neither retained support eligible cost listings at the time of reimbursement request nor documented review or approval of such reimbursement request.
Criteria: The Corporation must maintain and adhere to documented procurement procedures that must conform to the procurement standards in 2 CFR Sections 200.317 through 200.327. These sections include policies and procedures related to competition, informal and formal procurement methods and noncompetitive procurement. Additionally, in accordance with 2 CFR Section 200.214, the Corporation must verify that vendors are not suspended or debarred from participating in Federal funds.
Condition: We noted that there was a lack of evidence that policies and procedures were applied as required under the noted 2 CFR Sections in “Criteria”.
Cause: The Corporation did not maintain formal documentation or evidence to support that a competitive price analysis for vendors or that suspension and debarment verifications were performed for vendors, as required by the general procurement standards of the Uniform Guidance.
Effect or Potential Effect: We were unable to determine whether charges relating to vendor services or goods charged to the Federal programs are in accordance with 2 CFR Sections 200.317 through 200.327 or 200.214.
Questioned costs: None
Context: The Corporation was unable to provide evidence of procurement, suspension or debarment verification performed for walkthrough purposes or any samples that would be selected. Additionally, per management, no written documentation can be provided for any sole source procurements.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-010 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating procurement, required price analysis of vendors, and suspension and debarment verifications.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to provide evidence of procurement, suspension or debarment
verification performed as of December 31, 2022.
Criteria: Recipients of Federal awards must establish and maintain effective internal controls over special tests and provisions and maintain evidence that such internal controls were performed.
Condition: During our testing of sliding fee discounts, we noted that 14 out of 40 sampled financial records reflected an incorrect discount.
Cause: Front office staff collect completed income verification forms and any relevant income documentation or Patient Income Self Attestation forms from patients applying for a sliding fee discount. The Corporation did not implement controls to include review and approval by an individual other than the front office staff of the accuracy of provided discounts that were entered into the patient billing system.
Effect or Potential Effect: Sliding fee discounts provided to patients may be inaccurate based on the individual’s or family’s income.
Questioned costs: None
Context: We tested a sample of 40 financial records for controls over patients treated during the audit period to determine whether patient charges were ppropriately adjusted based on income and family size. It was noted the Corporation did not implement controls to review the accuracy of income verification forms and the data entered the patient billing system. As a result, 14 of the 40 financial records selected reflected an incorrect discount. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-011 in the 2021 report.
Recommendation: We recommend the Corporation revise the Sliding Fee Discount Program policy to include a level of review of patient’s income verification forms and related documentation and the accuracy of the applicable discount entered into the patient billing system.
View of Responsible Officials: Due to turnover of several key financial executives and revenue cycle personnel, the Corporation did not perform or document evidence of approval for provided sliding fee discounts to individuals or families.
Criteria: In accordance with 2 CFR Section 200.512(a), the audit must be completed and data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period, adjusted for any extensions permitted by the Office of Management and Budget. Additionally, management is required to prepare a complete and accurate SEFA.
Condition: We noted that the audit, reporting package, and data collection form for the year ended December 31, 2022, were not filed by the deadline of September 30, 2023, to the Federal Audit Clearinghouse. Additionally, the SEFA was not accurately, completely, and timely prepared.
Cause: The Corporation did not have a formal process in place during the year ended December 31, 2022, to accurately, completely, and timely prepare the SEFA.
Effect or Potential Effect: The audit, reporting package, and data collection form for the year ended December 31, 2022, were not accessible to the Federal Audit Clearinghouse in a timely manner and the SEFA was not timely, accurately, or completely prepared.
Questioned costs: None
Context: The audit, reporting package, and data collection form for the year ended December 31, 2022, was filed untimely to the Federal Audit Clearinghouse.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-004 in the 2021 report.
Recommendation: We recommend the Corporation adopt policies and procedures, including tracking and monitoring of reporting requirements, to ensure that the SEFA is timely, accurately, and completely prepare and that the audit, reporting package, and data collection form are electronically filed with the Federal Audit Clearinghouse within the applicable deadline.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to timely prepare the SEFA and related audit documentation.
Criteria: In accordance with 2 CFR Section 200.430.8(i), charges to Federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity. In addition, 2 CFR Section 200.430.8(i)(viii) states that budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting, provided certain additional internal controls are implemented.
Condition: During our testing of salaries and wages, we noted that all 242 sampled transactions did not have adequate supporting documentation and necessary approvals. Charges to Federal awards for salaries and wages were based on estimated allocations, rather than use of a system of internal controls that accounts for actual time and effort allocations. Allocation schedules, which included calculation and position title errors, were not prepared timely and documentation of approval by individuals knowledgeable of the Federal program was not retained.
Cause: While there is a time keeping system implemented to track daily hours worked by employees, the Corporation’s current internal control system does not allow for specific coding for time actually spent on each federally funded program that would support the amount charged to the Federal award.
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for salaries and wages reflect specific time worked or amounts allocated by employee to specific Federal programs. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: We selected 242 salary transactions charged to the Federal programs to test controls over allowable costs. All transactions charged to the Federal programs were based on budgeted Full Time Equivalents (FTE), and not actual hours employees worked for each Federal program. No analysis or true-up was performed to determine the accuracy of employee titles or amounts charged versus actual time and effort incurred. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-005 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls in order to track specific time spent on each Federal program. This can include, time and effort reports completed on a routine basis, such as monthly, and adjust program expenditures as needed to properly reflect actual work performed. Completed time and effort reports should be reviewed and verified by management for accuracy.
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of approval of salary and wage allocations.
Criteria: In accordance with 2 CFR Section 200.431.8(d), fringe benefits may be assigned to cost objectives by identifying specific benefits to specific individuals or by allocating on the basis of entity-wide salaries and wages of the employees receiving the benefits. When the allocation method is used, separate allocations must be made to selective groupings of employees, unless the non-Federal entity demonstrates that costs in relationships to salaries and wages do not differ significantly for different groups of employees.
Condition: During our testing of fringe benefits expenses, we noted that all 242 sampled transactions did not have adequate supporting documentation. Charges to the Federal award for fringe benefits were based on an anticipated fringe benefit cost, for which the Corporation did not maintain an assignment of cost objectives calculation and its related requirements.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for fringe benefits reflect specific time worked or amounts allocated to specific Federal programs, even though the charges are not in excess of amounts approved for the grant period.
Questioned costs: Unknown
Context: We selected 242 fringe benefit transactions charged to the Federal programs to test controls over allowable costs. Each fringe benefit transaction was calculated by applying a fringe benefit cost rate to actual salaries and wages of each employee tested. The fringe benefit cost rate was based on anticipated fringe benefit cost rate which was neither supported by an actual calculation nor analysis of the related group of employees used in such calculation. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-006 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of assignment of cost objectives calculations.
Criteria: Recipients of Federal awards must establish and maintain effective internal controls over reports that are prepared and submitted as required by the Federal programs and maintain evidence that such internal controls were performed.
Condition: We tested 14 sampled reports and noted that the Corporation was unable to provide sufficient and appropriate evidence that programmatic or financial reports required under the Federal programs were reviewed and approved by appropriate personnel prior to submission to the granting agency.
Cause: The Corporation did not have formal policies and procedures over reporting.
Effect or Potential Effect: Programmatic or financial reports submitted to the granting agencies may be incomplete or inaccurate.
Questioned costs: None
Context: Management was not able to produce sufficient and appropriate evidence that programmatic and SF-425 financial reports were reviewed and approved prior to submission to the granting agencies.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-007 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the review and approval of programmatic and financial reports by appropriate personnel who is knowledgeable of such reporting requirements.
View of Responsible Officials: The pandemic and subsequent shift to remote work disrupted the previous workflow of reviewing and approval of Federal programs reports prior to submission to the granting agency. In addition, due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation did not maintain sufficient or appropriate evidence that reviews and approvals were performed for each sampled report.
Criteria: In accordance with 2 CFR Section 200.305, non-Federal entities must minimize the time elapsing between the transfer of funds from the Federal agency or pass-through entity and disbursement by the Corporation for program costs and proportionate share of allowable indirect costs. Additionally, 2 CFR Section 200.302(b)(c) requires non-Federal entities to establish written procedures to implement the requirements 2 CFR Section 200.305. The Federal Acquisition Regulation clause at 48 CFR section 52.216-7(b)(1) requires that the non-Federal entity request reimbursement for only allocable, allowable, and reasonable contract costs that have already been paid or incurred.
Condition: During our testing of reimbursement requests, we noted that 12 out of 34 sampled requests did not have adequate supporting documentation as to evidence of timely review and approval.
Cause: The Corporation did not maintain detailed listings of eligible costs incurred at the time of reimbursement request to support the amount of reimbursement requested in the Payment Management System. Additionally, the Corporation did not maintain documentation of such review or approval that such costs were incurred prior to request for reimbursement, or the amount requested was in accordance with 2 CFR Section 200.305. Eligible cost listings to support amounts drawn during the grant period in total were reconstructed to support annual activity.
Effect or Potential Effect: Requests for reimbursement per the Payment Management System may not have minimized the time elapsing between payment by the Federal agency or pass through and disbursement by the Corporation and the amounts requested for reimbursement may be inaccurate.
Questioned costs: Unknown
Context: We selected 34 reimbursement requests submitted through the Payment Management System and DC Portal during the year ended December 31, 2022. The Corporation was unable to provide evidence of timely review and approval of 12 requests out of 34. Additionally, cost listings were not maintained and were recreated to validate amount of the draw downs during the fiscal year. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-009 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the determination of cash drawn downs and review and approval of drawn downs by appropriate personnel who is knowledgeable of such requirements.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation neither retained support eligible cost listings at the time of reimbursement request nor documented review or approval of such reimbursement request.
Criteria: The Corporation must maintain and adhere to documented procurement procedures that must conform to the procurement standards in 2 CFR Sections 200.317 through 200.327. These sections include policies and procedures related to competition, informal and formal procurement methods and noncompetitive procurement. Additionally, in accordance with 2 CFR Section 200.214, the Corporation must verify that vendors are not suspended or debarred from participating in Federal funds.
Condition: We noted that there was a lack of evidence that policies and procedures were applied as required under the noted 2 CFR Sections in “Criteria”.
Cause: The Corporation did not maintain formal documentation or evidence to support that a competitive price analysis for vendors or that suspension and debarment verifications were performed for vendors, as required by the general procurement standards of the Uniform Guidance.
Effect or Potential Effect: We were unable to determine whether charges relating to vendor services or goods charged to the Federal programs are in accordance with 2 CFR Sections 200.317 through 200.327 or 200.214.
Questioned costs: None
Context: The Corporation was unable to provide evidence of procurement, suspension or debarment verification performed for walkthrough purposes or any samples that would be selected. Additionally, per management, no written documentation can be provided for any sole source procurements.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-010 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating procurement, required price analysis of vendors, and suspension and debarment verifications.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to provide evidence of procurement, suspension or debarment
verification performed as of December 31, 2022.
Criteria: Recipients of Federal awards must establish and maintain effective internal controls over special tests and provisions and maintain evidence that such internal controls were performed.
Condition: During our testing of sliding fee discounts, we noted that 14 out of 40 sampled financial records reflected an incorrect discount.
Cause: Front office staff collect completed income verification forms and any relevant income documentation or Patient Income Self Attestation forms from patients applying for a sliding fee discount. The Corporation did not implement controls to include review and approval by an individual other than the front office staff of the accuracy of provided discounts that were entered into the patient billing system.
Effect or Potential Effect: Sliding fee discounts provided to patients may be inaccurate based on the individual’s or family’s income.
Questioned costs: None
Context: We tested a sample of 40 financial records for controls over patients treated during the audit period to determine whether patient charges were ppropriately adjusted based on income and family size. It was noted the Corporation did not implement controls to review the accuracy of income verification forms and the data entered the patient billing system. As a result, 14 of the 40 financial records selected reflected an incorrect discount. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-011 in the 2021 report.
Recommendation: We recommend the Corporation revise the Sliding Fee Discount Program policy to include a level of review of patient’s income verification forms and related documentation and the accuracy of the applicable discount entered into the patient billing system.
View of Responsible Officials: Due to turnover of several key financial executives and revenue cycle personnel, the Corporation did not perform or document evidence of approval for provided sliding fee discounts to individuals or families.
Criteria: In accordance with 2 CFR Section 200.512(a), the audit must be completed and data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period, adjusted for any extensions permitted by the Office of Management and Budget. Additionally, management is required to prepare a complete and accurate SEFA.
Condition: We noted that the audit, reporting package, and data collection form for the year ended December 31, 2022, were not filed by the deadline of September 30, 2023, to the Federal Audit Clearinghouse. Additionally, the SEFA was not accurately, completely, and timely prepared.
Cause: The Corporation did not have a formal process in place during the year ended December 31, 2022, to accurately, completely, and timely prepare the SEFA.
Effect or Potential Effect: The audit, reporting package, and data collection form for the year ended December 31, 2022, were not accessible to the Federal Audit Clearinghouse in a timely manner and the SEFA was not timely, accurately, or completely prepared.
Questioned costs: None
Context: The audit, reporting package, and data collection form for the year ended December 31, 2022, was filed untimely to the Federal Audit Clearinghouse.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-004 in the 2021 report.
Recommendation: We recommend the Corporation adopt policies and procedures, including tracking and monitoring of reporting requirements, to ensure that the SEFA is timely, accurately, and completely prepare and that the audit, reporting package, and data collection form are electronically filed with the Federal Audit Clearinghouse within the applicable deadline.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to timely prepare the SEFA and related audit documentation.
Criteria: In accordance with 2 CFR Section 200.430.8(i), charges to Federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity. In addition, 2 CFR Section 200.430.8(i)(viii) states that budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting, provided certain additional internal controls are implemented.
Condition: During our testing of salaries and wages, we noted that all 242 sampled transactions did not have adequate supporting documentation and necessary approvals. Charges to Federal awards for salaries and wages were based on estimated allocations, rather than use of a system of internal controls that accounts for actual time and effort allocations. Allocation schedules, which included calculation and position title errors, were not prepared timely and documentation of approval by individuals knowledgeable of the Federal program was not retained.
Cause: While there is a time keeping system implemented to track daily hours worked by employees, the Corporation’s current internal control system does not allow for specific coding for time actually spent on each federally funded program that would support the amount charged to the Federal award.
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for salaries and wages reflect specific time worked or amounts allocated by employee to specific Federal programs. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: We selected 242 salary transactions charged to the Federal programs to test controls over allowable costs. All transactions charged to the Federal programs were based on budgeted Full Time Equivalents (FTE), and not actual hours employees worked for each Federal program. No analysis or true-up was performed to determine the accuracy of employee titles or amounts charged versus actual time and effort incurred. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-005 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls in order to track specific time spent on each Federal program. This can include, time and effort reports completed on a routine basis, such as monthly, and adjust program expenditures as needed to properly reflect actual work performed. Completed time and effort reports should be reviewed and verified by management for accuracy.
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of approval of salary and wage allocations.
Criteria: In accordance with 2 CFR Section 200.431.8(d), fringe benefits may be assigned to cost objectives by identifying specific benefits to specific individuals or by allocating on the basis of entity-wide salaries and wages of the employees receiving the benefits. When the allocation method is used, separate allocations must be made to selective groupings of employees, unless the non-Federal entity demonstrates that costs in relationships to salaries and wages do not differ significantly for different groups of employees.
Condition: During our testing of fringe benefits expenses, we noted that all 242 sampled transactions did not have adequate supporting documentation. Charges to the Federal award for fringe benefits were based on an anticipated fringe benefit cost, for which the Corporation did not maintain an assignment of cost objectives calculation and its related requirements.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for fringe benefits reflect specific time worked or amounts allocated to specific Federal programs, even though the charges are not in excess of amounts approved for the grant period.
Questioned costs: Unknown
Context: We selected 242 fringe benefit transactions charged to the Federal programs to test controls over allowable costs. Each fringe benefit transaction was calculated by applying a fringe benefit cost rate to actual salaries and wages of each employee tested. The fringe benefit cost rate was based on anticipated fringe benefit cost rate which was neither supported by an actual calculation nor analysis of the related group of employees used in such calculation. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-006 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of assignment of cost objectives calculations.
Criteria: Recipients of Federal awards must establish and maintain effective internal controls over reports that are prepared and submitted as required by the Federal programs and maintain evidence that such internal controls were performed.
Condition: We tested 14 sampled reports and noted that the Corporation was unable to provide sufficient and appropriate evidence that programmatic or financial reports required under the Federal programs were reviewed and approved by appropriate personnel prior to submission to the granting agency.
Cause: The Corporation did not have formal policies and procedures over reporting.
Effect or Potential Effect: Programmatic or financial reports submitted to the granting agencies may be incomplete or inaccurate.
Questioned costs: None
Context: Management was not able to produce sufficient and appropriate evidence that programmatic and SF-425 financial reports were reviewed and approved prior to submission to the granting agencies.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-007 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the review and approval of programmatic and financial reports by appropriate personnel who is knowledgeable of such reporting requirements.
View of Responsible Officials: The pandemic and subsequent shift to remote work disrupted the previous workflow of reviewing and approval of Federal programs reports prior to submission to the granting agency. In addition, due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation did not maintain sufficient or appropriate evidence that reviews and approvals were performed for each sampled report.
Criteria: Recipients of Federal awards must establish and maintain effective internal controls over reports that are prepared and submitted as required by the Federal programs and maintain evidence that such internal controls were performed.
Condition: During our testing, the Corporation was unable to provide sufficient and appropriate evidence that Federal Funding Accountability and Transparency Act (FFATA) required under the Federal programs were submitted to the granting agency.
Cause: The Corporation did not have formal policies and procedures over FFATA reporting.
Effect or Potential Effect: FFATA required reports were not submitted to the granting agency.
Questioned costs: None
Context: Management was not able to produce sufficient and appropriate evidence that FFATA reports were submitted to the granting agency.
Repeat finding: No
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the submission of the FFATA reporting requirements.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation did not maintain sufficient or appropriate evidence that the reports were submitted.
Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the Federal award that provides assurance that the entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 2 CFR 200.322 identifies the requirements for all pass‐through entities which including monitoring the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statues, regulations, and the terms and conditions of the subaward; and that the subaward performance goals are achieved.
Condition: During our testing, the Corporation was unable to provide sufficient and appropriate evidence to substantiate a secondary review was completed over the monitoring activities of the subrecipient.
Cause: The Corporation did not have formal policies and procedures over subrecipient monitoring.
Effect or Potential Effect: Insufficient monitoring of subrecipients could result in Federal noncompliance by a subrecipient.
Questioned costs: None
Context: Management was not able to produce sufficient and appropriate evidence that monitoring activities of subrecipients were reviewed.
Repeat finding: No
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the monitoring of subrecipients.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation did not maintain sufficient or appropriate evidence that the monitoring activities of the subrecipients were reviewed.
Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the Federal award that provides assurance that the entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Additionally, 2 CFR Appendix IV to Part 200 Section B.2(b) requires that both the direct costs and the indirect costs must exclude capital expenditures and unallowable costs.
Per Compliance Supplement, these indirect costs must conform to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement.
Condition: During our testing of indirect costs, we noted that the Corporation charges the Federally approved rate of 28.7% on specific grant awards based on direct salaries and wages. However, the Corporation did not maintain supporting indirect cost pools and related documentation.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the allowability requirements of indirect costs in accordance with 2 CFR Appendix IV to Part 200 Section B.2(b).
Effect or Potential Effect: We were unable to determine whether indirect costs charged to Federal awards conform to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: Management was not able to provide sufficient and appropriate evidence that the reported indirect costs conformed to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement.
Repeat finding: No
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the allowability requirements of indirect costs in accordance with 2 CFR Appendix IV to Part 200 Section B.2(b).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain any supporting indirect cost pools and related documentation.
Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the Federal award that provides assurance that the entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 2 CFR 200.306(b) identifies the requirements for all Federal awards that any shared costs or matching funds and all contributions, including cash and third-party in-kind contributions, must be accepted as part of the non-
Federal entity's cost sharing or matching when such contributions meet all of the following criteria:
(1) Are verifiable from the non-Federal entity's records;
(2) Are not included as contributions for any other Federal award;
(3) Are necessary and reasonable for accomplishment of project or program objectives;
(4) Are allowable under 2 CFR 200 Subpart E;
(5) Are not paid by the Federal Government under another Federal award, except where the Federal statute authorizing a program specifically provides that Federal funds made available for such program can be applied to matching or cost sharing requirements of other Federal programs;
(6) Are provided for in the approved budget when required by the Federal awarding agency; and
(7) Conform to other provisions of this part, as applicable.
Condition: During our testing, the Corporation was unable to provide sufficient and appropriate evidence to substantiate that the matched or shared cost were received and accepted in conformance with the criteria listed above or award agreement.
Cause: The Corporation did not have formal policies and procedures over matching or cost sharing.
Effect or Potential Effect: Without proper internal controls and policies and procedures in place to monitor and review the matching requirements could result in Federal noncompliance.
Questioned costs: None
Context: This is a condition identified per review of the Corporation’s compliance with specified requirements over matching or cost sharing.
Repeat finding: No
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the matching requirements of the related grant award.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation did not maintain sufficient or appropriate evidence to substantiate that the matched or shared cost were spent in conformance with the criteria listed above or award agreement.
Criteria: In accordance with 2 CFR Section 200.512(a), the audit must be completed and data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period, adjusted for any extensions permitted by the Office of Management and Budget. Additionally, management is required to prepare a complete and accurate SEFA.
Condition: We noted that the audit, reporting package, and data collection form for the year ended December 31, 2022, were not filed by the deadline of September 30, 2023, to the Federal Audit Clearinghouse. Additionally, the SEFA was not accurately, completely, and timely prepared.
Cause: The Corporation did not have a formal process in place during the year ended December 31, 2022, to accurately, completely, and timely prepare the SEFA.
Effect or Potential Effect: The audit, reporting package, and data collection form for the year ended December 31, 2022, were not accessible to the Federal Audit Clearinghouse in a timely manner and the SEFA was not timely, accurately, or completely prepared.
Questioned costs: None
Context: The audit, reporting package, and data collection form for the year ended December 31, 2022, was filed untimely to the Federal Audit Clearinghouse.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-004 in the 2021 report.
Recommendation: We recommend the Corporation adopt policies and procedures, including tracking and monitoring of reporting requirements, to ensure that the SEFA is timely, accurately, and completely prepare and that the audit, reporting package, and data collection form are electronically filed with the Federal Audit Clearinghouse within the applicable deadline.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to timely prepare the SEFA and related audit documentation.
Criteria: In accordance with 2 CFR Section 200.430.8(i), charges to Federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity. In addition, 2 CFR Section 200.430.8(i)(viii) states that budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting, provided certain additional internal controls are implemented.
Condition: During our testing of salaries and wages, we noted that all 242 sampled transactions did not have adequate supporting documentation and necessary approvals. Charges to Federal awards for salaries and wages were based on estimated allocations, rather than use of a system of internal controls that accounts for actual time and effort allocations. Allocation schedules, which included calculation and position title errors, were not prepared timely and documentation of approval by individuals knowledgeable of the Federal program was not retained.
Cause: While there is a time keeping system implemented to track daily hours worked by employees, the Corporation’s current internal control system does not allow for specific coding for time actually spent on each federally funded program that would support the amount charged to the Federal award.
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for salaries and wages reflect specific time worked or amounts allocated by employee to specific Federal programs. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: We selected 242 salary transactions charged to the Federal programs to test controls over allowable costs. All transactions charged to the Federal programs were based on budgeted Full Time Equivalents (FTE), and not actual hours employees worked for each Federal program. No analysis or true-up was performed to determine the accuracy of employee titles or amounts charged versus actual time and effort incurred. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-005 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls in order to track specific time spent on each Federal program. This can include, time and effort reports completed on a routine basis, such as monthly, and adjust program expenditures as needed to properly reflect actual work performed. Completed time and effort reports should be reviewed and verified by management for accuracy.
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of approval of salary and wage allocations.
Criteria: In accordance with 2 CFR Section 200.431.8(d), fringe benefits may be assigned to cost objectives by identifying specific benefits to specific individuals or by allocating on the basis of entity-wide salaries and wages of the employees receiving the benefits. When the allocation method is used, separate allocations must be made to selective groupings of employees, unless the non-Federal entity demonstrates that costs in relationships to salaries and wages do not differ significantly for different groups of employees.
Condition: During our testing of fringe benefits expenses, we noted that all 242 sampled transactions did not have adequate supporting documentation. Charges to the Federal award for fringe benefits were based on an anticipated fringe benefit cost, for which the Corporation did not maintain an assignment of cost objectives calculation and its related requirements.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for fringe benefits reflect specific time worked or amounts allocated to specific Federal programs, even though the charges are not in excess of amounts approved for the grant period.
Questioned costs: Unknown
Context: We selected 242 fringe benefit transactions charged to the Federal programs to test controls over allowable costs. Each fringe benefit transaction was calculated by applying a fringe benefit cost rate to actual salaries and wages of each employee tested. The fringe benefit cost rate was based on anticipated fringe benefit cost rate which was neither supported by an actual calculation nor analysis of the related group of employees used in such calculation. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-006 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of assignment of cost objectives calculations.
Criteria: Recipients of Federal awards must establish and maintain effective internal controls over program income and maintain evidence that such internal controls were performed. Amounts reported as program income on the SF-425 Federal Financial Report are to be in accordance with the HIV/AIDS Bureau Policy Clarification Notice #15-03.
Condition: The Corporation was unable to provide evidence of review and approval of the calculation of reported program income on the SF-425 Federal Financial Report for the reporting period end date of December 31, 2022.
Cause: The Corporation did not have formal policies and procedures over program income reported on the SF-425 Federal Financial Report.
Effect or Potential Effect: The amount of program income on the SF-425 Federal Financial Report for the reporting period end date of December 31, 2022, submitted to the granting agencies may be inaccurate.
Questioned costs: Unknown
Context: Management was not able to provide sufficient and appropriate evidence that the reported program income on the SF-425 Federal Financial was reviewed and approved, prior to submission to the granting agencies.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-008 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the calculation and review and approval of program income by appropriate personnel who is knowledgeable of such requirements and calculations.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to provide evidence of review and approval of the calculation of reported program income on the SF-425 Federal Financial Report for the reporting period end date of December 31, 2022.
Criteria: In accordance with 2 CFR Section 200.305, non-Federal entities must minimize the time elapsing between the transfer of funds from the Federal agency or pass-through entity and disbursement by the Corporation for program costs and proportionate share of allowable indirect costs. Additionally, 2 CFR Section 200.302(b)(c) requires non-Federal entities to establish written procedures to implement the requirements 2 CFR Section 200.305. The Federal Acquisition Regulation clause at 48 CFR section 52.216-7(b)(1) requires that the non-Federal entity request reimbursement for only allocable, allowable, and reasonable contract costs that have already been paid or incurred.
Condition: During our testing of reimbursement requests, we noted that 12 out of 34 sampled requests did not have adequate supporting documentation as to evidence of timely review and approval.
Cause: The Corporation did not maintain detailed listings of eligible costs incurred at the time of reimbursement request to support the amount of reimbursement requested in the Payment Management System. Additionally, the Corporation did not maintain documentation of such review or approval that such costs were incurred prior to request for reimbursement, or the amount requested was in accordance with 2 CFR Section 200.305. Eligible cost listings to support amounts drawn during the grant period in total were reconstructed to support annual activity.
Effect or Potential Effect: Requests for reimbursement per the Payment Management System may not have minimized the time elapsing between payment by the Federal agency or pass through and disbursement by the Corporation and the amounts requested for reimbursement may be inaccurate.
Questioned costs: Unknown
Context: We selected 34 reimbursement requests submitted through the Payment Management System and DC Portal during the year ended December 31, 2022. The Corporation was unable to provide evidence of timely review and approval of 12 requests out of 34. Additionally, cost listings were not maintained and were recreated to validate amount of the draw downs during the fiscal year. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-009 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the determination of cash drawn downs and review and approval of drawn downs by appropriate personnel who is knowledgeable of such requirements.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation neither retained support eligible cost listings at the time of reimbursement request nor documented review or approval of such reimbursement request.
Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the Federal award that provides assurance that the entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Additionally, 2 CFR Appendix IV to Part 200 Section B.2(b) requires that both the direct costs and the indirect costs must exclude capital expenditures and unallowable costs.
Per Compliance Supplement, these indirect costs must conform to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement.
Condition: During our testing of indirect costs, we noted that the Corporation charges the Federally approved rate of 28.7% on specific grant awards based on direct salaries and wages. However, the Corporation did not maintain supporting indirect cost pools and related documentation.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the allowability requirements of indirect costs in accordance with 2 CFR Appendix IV to Part 200 Section B.2(b).
Effect or Potential Effect: We were unable to determine whether indirect costs charged to Federal awards conform to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: Management was not able to provide sufficient and appropriate evidence that the reported indirect costs conformed to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement.
Repeat finding: No
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the allowability requirements of indirect costs in accordance with 2 CFR Appendix IV to Part 200 Section B.2(b).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain any supporting indirect cost pools and related documentation.
Criteria: In accordance with 2 CFR Section 200.512(a), the audit must be completed and data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period, adjusted for any extensions permitted by the Office of Management and Budget. Additionally, management is required to prepare a complete and accurate SEFA.
Condition: We noted that the audit, reporting package, and data collection form for the year ended December 31, 2022, were not filed by the deadline of September 30, 2023, to the Federal Audit Clearinghouse. Additionally, the SEFA was not accurately, completely, and timely prepared.
Cause: The Corporation did not have a formal process in place during the year ended December 31, 2022, to accurately, completely, and timely prepare the SEFA.
Effect or Potential Effect: The audit, reporting package, and data collection form for the year ended December 31, 2022, were not accessible to the Federal Audit Clearinghouse in a timely manner and the SEFA was not timely, accurately, or completely prepared.
Questioned costs: None
Context: The audit, reporting package, and data collection form for the year ended December 31, 2022, was filed untimely to the Federal Audit Clearinghouse.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-004 in the 2021 report.
Recommendation: We recommend the Corporation adopt policies and procedures, including tracking and monitoring of reporting requirements, to ensure that the SEFA is timely, accurately, and completely prepare and that the audit, reporting package, and data collection form are electronically filed with the Federal Audit Clearinghouse within the applicable deadline.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to timely prepare the SEFA and related audit documentation.
Criteria: In accordance with 2 CFR Section 200.430.8(i), charges to Federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity. In addition, 2 CFR Section 200.430.8(i)(viii) states that budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting, provided certain additional internal controls are implemented.
Condition: During our testing of salaries and wages, we noted that all 242 sampled transactions did not have adequate supporting documentation and necessary approvals. Charges to Federal awards for salaries and wages were based on estimated allocations, rather than use of a system of internal controls that accounts for actual time and effort allocations. Allocation schedules, which included calculation and position title errors, were not prepared timely and documentation of approval by individuals knowledgeable of the Federal program was not retained.
Cause: While there is a time keeping system implemented to track daily hours worked by employees, the Corporation’s current internal control system does not allow for specific coding for time actually spent on each federally funded program that would support the amount charged to the Federal award.
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for salaries and wages reflect specific time worked or amounts allocated by employee to specific Federal programs. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: We selected 242 salary transactions charged to the Federal programs to test controls over allowable costs. All transactions charged to the Federal programs were based on budgeted Full Time Equivalents (FTE), and not actual hours employees worked for each Federal program. No analysis or true-up was performed to determine the accuracy of employee titles or amounts charged versus actual time and effort incurred. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-005 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls in order to track specific time spent on each Federal program. This can include, time and effort reports completed on a routine basis, such as monthly, and adjust program expenditures as needed to properly reflect actual work performed. Completed time and effort reports should be reviewed and verified by management for accuracy.
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of approval of salary and wage allocations.
Criteria: In accordance with 2 CFR Section 200.431.8(d), fringe benefits may be assigned to cost objectives by identifying specific benefits to specific individuals or by allocating on the basis of entity-wide salaries and wages of the employees receiving the benefits. When the allocation method is used, separate allocations must be made to selective groupings of employees, unless the non-Federal entity demonstrates that costs in relationships to salaries and wages do not differ significantly for different groups of employees.
Condition: During our testing of fringe benefits expenses, we noted that all 242 sampled transactions did not have adequate supporting documentation. Charges to the Federal award for fringe benefits were based on an anticipated fringe benefit cost, for which the Corporation did not maintain an assignment of cost objectives calculation and its related requirements.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for fringe benefits reflect specific time worked or amounts allocated to specific Federal programs, even though the charges are not in excess of amounts approved for the grant period.
Questioned costs: Unknown
Context: We selected 242 fringe benefit transactions charged to the Federal programs to test controls over allowable costs. Each fringe benefit transaction was calculated by applying a fringe benefit cost rate to actual salaries and wages of each employee tested. The fringe benefit cost rate was based on anticipated fringe benefit cost rate which was neither supported by an actual calculation nor analysis of the related group of employees used in such calculation. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-006 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of assignment of cost objectives calculations.
Criteria: Recipients of Federal awards must establish and maintain effective internal controls over reports that are prepared and submitted as required by the Federal programs and maintain evidence that such internal controls were performed.
Condition: We tested 14 sampled reports and noted that the Corporation was unable to provide sufficient and appropriate evidence that programmatic or financial reports required under the Federal programs were reviewed and approved by appropriate personnel prior to submission to the granting agency.
Cause: The Corporation did not have formal policies and procedures over reporting.
Effect or Potential Effect: Programmatic or financial reports submitted to the granting agencies may be incomplete or inaccurate.
Questioned costs: None
Context: Management was not able to produce sufficient and appropriate evidence that programmatic and SF-425 financial reports were reviewed and approved prior to submission to the granting agencies.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-007 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the review and approval of programmatic and financial reports by appropriate personnel who is knowledgeable of such reporting requirements.
View of Responsible Officials: The pandemic and subsequent shift to remote work disrupted the previous workflow of reviewing and approval of Federal programs reports prior to submission to the granting agency. In addition, due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation did not maintain sufficient or appropriate evidence that reviews and approvals were performed for each sampled report.
Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the Federal award that provides assurance that the entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Additionally, 2 CFR Appendix IV to Part 200 Section B.2(b) requires that both the direct costs and the indirect costs must exclude capital expenditures and unallowable costs.
Per Compliance Supplement, these indirect costs must conform to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement.
Condition: During our testing of indirect costs, we noted that the Corporation charges the Federally approved rate of 28.7% on specific grant awards based on direct salaries and wages. However, the Corporation did not maintain supporting indirect cost pools and related documentation.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the allowability requirements of indirect costs in accordance with 2 CFR Appendix IV to Part 200 Section B.2(b).
Effect or Potential Effect: We were unable to determine whether indirect costs charged to Federal awards conform to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: Management was not able to provide sufficient and appropriate evidence that the reported indirect costs conformed to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement.
Repeat finding: No
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the allowability requirements of indirect costs in accordance with 2 CFR Appendix IV to Part 200 Section B.2(b).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain any supporting indirect cost pools and related documentation.
Criteria: In accordance with 2 CFR Section 200.512(a), the audit must be completed and data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period, adjusted for any extensions permitted by the Office of Management and Budget. Additionally, management is required to prepare a complete and accurate SEFA.
Condition: We noted that the audit, reporting package, and data collection form for the year ended December 31, 2022, were not filed by the deadline of September 30, 2023, to the Federal Audit Clearinghouse. Additionally, the SEFA was not accurately, completely, and timely prepared.
Cause: The Corporation did not have a formal process in place during the year ended December 31, 2022, to accurately, completely, and timely prepare the SEFA.
Effect or Potential Effect: The audit, reporting package, and data collection form for the year ended December 31, 2022, were not accessible to the Federal Audit Clearinghouse in a timely manner and the SEFA was not timely, accurately, or completely prepared.
Questioned costs: None
Context: The audit, reporting package, and data collection form for the year ended December 31, 2022, was filed untimely to the Federal Audit Clearinghouse.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-004 in the 2021 report.
Recommendation: We recommend the Corporation adopt policies and procedures, including tracking and monitoring of reporting requirements, to ensure that the SEFA is timely, accurately, and completely prepare and that the audit, reporting package, and data collection form are electronically filed with the Federal Audit Clearinghouse within the applicable deadline.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to timely prepare the SEFA and related audit documentation.
Criteria: In accordance with 2 CFR Section 200.430.8(i), charges to Federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity. In addition, 2 CFR Section 200.430.8(i)(viii) states that budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting, provided certain additional internal controls are implemented.
Condition: During our testing of salaries and wages, we noted that all 242 sampled transactions did not have adequate supporting documentation and necessary approvals. Charges to Federal awards for salaries and wages were based on estimated allocations, rather than use of a system of internal controls that accounts for actual time and effort allocations. Allocation schedules, which included calculation and position title errors, were not prepared timely and documentation of approval by individuals knowledgeable of the Federal program was not retained.
Cause: While there is a time keeping system implemented to track daily hours worked by employees, the Corporation’s current internal control system does not allow for specific coding for time actually spent on each federally funded program that would support the amount charged to the Federal award.
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for salaries and wages reflect specific time worked or amounts allocated by employee to specific Federal programs. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: We selected 242 salary transactions charged to the Federal programs to test controls over allowable costs. All transactions charged to the Federal programs were based on budgeted Full Time Equivalents (FTE), and not actual hours employees worked for each Federal program. No analysis or true-up was performed to determine the accuracy of employee titles or amounts charged versus actual time and effort incurred. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-005 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls in order to track specific time spent on each Federal program. This can include, time and effort reports completed on a routine basis, such as monthly, and adjust program expenditures as needed to properly reflect actual work performed. Completed time and effort reports should be reviewed and verified by management for accuracy.
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of approval of salary and wage allocations.
Criteria: In accordance with 2 CFR Section 200.431.8(d), fringe benefits may be assigned to cost objectives by identifying specific benefits to specific individuals or by allocating on the basis of entity-wide salaries and wages of the employees receiving the benefits. When the allocation method is used, separate allocations must be made to selective groupings of employees, unless the non-Federal entity demonstrates that costs in relationships to salaries and wages do not differ significantly for different groups of employees.
Condition: During our testing of fringe benefits expenses, we noted that all 242 sampled transactions did not have adequate supporting documentation. Charges to the Federal award for fringe benefits were based on an anticipated fringe benefit cost, for which the Corporation did not maintain an assignment of cost objectives calculation and its related requirements.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for fringe benefits reflect specific time worked or amounts allocated to specific Federal programs, even though the charges are not in excess of amounts approved for the grant period.
Questioned costs: Unknown
Context: We selected 242 fringe benefit transactions charged to the Federal programs to test controls over allowable costs. Each fringe benefit transaction was calculated by applying a fringe benefit cost rate to actual salaries and wages of each employee tested. The fringe benefit cost rate was based on anticipated fringe benefit cost rate which was neither supported by an actual calculation nor analysis of the related group of employees used in such calculation. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-006 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of assignment of cost objectives calculations.
Criteria: The Corporation must maintain and adhere to documented procurement procedures that must conform to the procurement standards in 2 CFR Sections 200.317 through 200.327. These sections include policies and procedures related to competition, informal and formal procurement methods and noncompetitive procurement. Additionally, in accordance with 2 CFR Section 200.214, the Corporation must verify that vendors are not suspended or debarred from participating in Federal funds.
Condition: We noted that there was a lack of evidence that policies and procedures were applied as required under the noted 2 CFR Sections in “Criteria”.
Cause: The Corporation did not maintain formal documentation or evidence to support that a competitive price analysis for vendors or that suspension and debarment verifications were performed for vendors, as required by the general procurement standards of the Uniform Guidance.
Effect or Potential Effect: We were unable to determine whether charges relating to vendor services or goods charged to the Federal programs are in accordance with 2 CFR Sections 200.317 through 200.327 or 200.214.
Questioned costs: None
Context: The Corporation was unable to provide evidence of procurement, suspension or debarment verification performed for walkthrough purposes or any samples that would be selected. Additionally, per management, no written documentation can be provided for any sole source procurements.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-010 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating procurement, required price analysis of vendors, and suspension and debarment verifications.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to provide evidence of procurement, suspension or debarment
verification performed as of December 31, 2022.
Criteria: Applicants for WIC program benefits are screened at WIC clinic sites to determine their WIC eligibility. To be certified eligible, they must meet the eligibility criteria defined at 7 CFR sections 246.7(c), (d), (e), (g), and (l) related to Category, Identity and Residency, Income, and Nutritional Risk.
Condition: During our testing of eligibility, the Corporation was unable to provide eligibility data for the period January 1, 2022 through March 31, 2022 and therefore we were unable to assess eligibility compliance requirements during that period. In addition, the Corporation was unable to provide support that eligibility assessments performed were reviewed. Below is a summary of our findings:
• For 6 of the 40 samples, proper segregation of duties was not maintained as the staff person who determined income eligibility was the same staff person who completed the medical risk assessment.
• For 23 of the 40 samples, the Corporation was unable to provide support to verify the applicant signed the Rights and Obligations statement.
• For 3 out of the 40 samples, the Corporation was unable to provide documentation that the applicant met the residency eligibility requirement.
• For 27 out of the 40 samples, the Corporation was unable to provide documentation that the applicant met the income eligibility requirement.
• For 14 out of the 40 samples, the Corporation was unable to provide documentation that the applicant met the category eligibility requirement.
• For 9 out of the 40 samples, the Corporation was unable to provide documentation that the applicant met the nutritional risk eligibility requirement.
• For 1 out of the 40 samples, it was noted the certified applicant did not provide documentation to support the required residency requirement. Participants who do not provide residency documentation are required to provide residency documentation within 30 days. The Corporation was unable to provide evidence the participant provided residency support within 30 days.
• For all 40 samples, the Corporation was unable to provide support that the eligibility assessments performed were reviewed.
Cause: The Corporation did not have formal policies and procedures over subrecipient monitoring.
Effect or Potential Effect: Lack of strict adherence to documentation requirements may have resulted in the Organization providing benefits to ineligible beneficiaries.
Questioned costs: None
Context: We tested a sample of 40 participants determined to be eligible and noted the Corporation was not able to produce sufficient and appropriate evidence that eligibility assessments performed were reviewed, and found exceptions as noted in the condition. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: No
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to assessing eligibility of participants.
View of Responsible Officials: Due to a change in reporting systems used to assess eligibility, the Corporation did not have access to the eligibility data for the period January 1, 2022 through March 31, 2022. Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation did not maintain sufficient or appropriate evidence that eligibility assessments performed were reviewed.
Criteria: Local agencies are required to submit policies and procedures regarding food benefit security and separation of duties with their work plan each year, and quarterly reporting requirements in compliance with the DC WIC program and maintain evidence that these reports are reviewed and approved by appropriate personnel prior to submission to the granting agency.
Condition: During our testing, the Corporation was unable to provide sufficient and appropriate evidence that additional reporting requirements required under the WIC program were reviewed and approved by appropriate personnel prior to submission, and evidence of timely submission to the granting agency.
Cause: The Corporation did not have formal policies and procedures over reporting requirements required under the WIC program.
Effect or Potential Effect: Additional reporting requirements submitted to the granting agencies may be incomplete or inaccurate.
Questioned costs: None
Context: Management does not have documentation over its policies and procedures regarding food benefit security and separation of duties as required under the WIC program. Management was not able to produce sufficient and appropriate evidence that additional reporting requirements were reviewed and approved prior to submission, and evidence of timely submission to the granting agency.
Repeat finding: No
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the review and approval of reports by appropriate personnel who is knowledgeable of such reporting requirements.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation did not maintain sufficient and appropriate evidence that reviews and approvals were performed for each additional reporting requirements and could not verify that these reports were submitted in a timely manner.
Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the Federal award that provides assurance that the entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Additionally, 2 CFR Appendix IV to Part 200 Section B.2(b) requires that both the direct costs and the indirect costs must exclude capital expenditures and unallowable costs.
Per Compliance Supplement, these indirect costs must conform to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement.
Condition: During our testing of indirect costs, we noted that the Corporation charges the Federally approved rate of 28.7% on specific grant awards based on direct salaries and wages. However, the Corporation did not maintain supporting indirect cost pools and related documentation.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the allowability requirements of indirect costs in accordance with 2 CFR Appendix IV to Part 200 Section B.2(b).
Effect or Potential Effect: We were unable to determine whether indirect costs charged to Federal awards conform to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: Management was not able to provide sufficient and appropriate evidence that the reported indirect costs conformed to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement.
Repeat finding: No
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the allowability requirements of indirect costs in accordance with 2 CFR Appendix IV to Part 200 Section B.2(b).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain any supporting indirect cost pools and related documentation.
Criteria: In accordance with 2 CFR Section 200.512(a), the audit must be completed and data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period, adjusted for any extensions permitted by the Office of Management and Budget. Additionally, management is required to prepare a complete and accurate SEFA.
Condition: We noted that the audit, reporting package, and data collection form for the year ended December 31, 2022, were not filed by the deadline of September 30, 2023, to the Federal Audit Clearinghouse. Additionally, the SEFA was not accurately, completely, and timely prepared.
Cause: The Corporation did not have a formal process in place during the year ended December 31, 2022, to accurately, completely, and timely prepare the SEFA.
Effect or Potential Effect: The audit, reporting package, and data collection form for the year ended December 31, 2022, were not accessible to the Federal Audit Clearinghouse in a timely manner and the SEFA was not timely, accurately, or completely prepared.
Questioned costs: None
Context: The audit, reporting package, and data collection form for the year ended December 31, 2022, was filed untimely to the Federal Audit Clearinghouse.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-004 in the 2021 report.
Recommendation: We recommend the Corporation adopt policies and procedures, including tracking and monitoring of reporting requirements, to ensure that the SEFA is timely, accurately, and completely prepare and that the audit, reporting package, and data collection form are electronically filed with the Federal Audit Clearinghouse within the applicable deadline.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to timely prepare the SEFA and related audit documentation.
Criteria: In accordance with 2 CFR Section 200.430.8(i), charges to Federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity. In addition, 2 CFR Section 200.430.8(i)(viii) states that budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting, provided certain additional internal controls are implemented.
Condition: During our testing of salaries and wages, we noted that all 242 sampled transactions did not have adequate supporting documentation and necessary approvals. Charges to Federal awards for salaries and wages were based on estimated allocations, rather than use of a system of internal controls that accounts for actual time and effort allocations. Allocation schedules, which included calculation and position title errors, were not prepared timely and documentation of approval by individuals knowledgeable of the Federal program was not retained.
Cause: While there is a time keeping system implemented to track daily hours worked by employees, the Corporation’s current internal control system does not allow for specific coding for time actually spent on each federally funded program that would support the amount charged to the Federal award.
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for salaries and wages reflect specific time worked or amounts allocated by employee to specific Federal programs. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: We selected 242 salary transactions charged to the Federal programs to test controls over allowable costs. All transactions charged to the Federal programs were based on budgeted Full Time Equivalents (FTE), and not actual hours employees worked for each Federal program. No analysis or true-up was performed to determine the accuracy of employee titles or amounts charged versus actual time and effort incurred. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-005 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls in order to track specific time spent on each Federal program. This can include, time and effort reports completed on a routine basis, such as monthly, and adjust program expenditures as needed to properly reflect actual work performed. Completed time and effort reports should be reviewed and verified by management for accuracy.
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of approval of salary and wage allocations.
Criteria: In accordance with 2 CFR Section 200.431.8(d), fringe benefits may be assigned to cost objectives by identifying specific benefits to specific individuals or by allocating on the basis of entity-wide salaries and wages of the employees receiving the benefits. When the allocation method is used, separate allocations must be made to selective groupings of employees, unless the non-Federal entity demonstrates that costs in relationships to salaries and wages do not differ significantly for different groups of employees.
Condition: During our testing of fringe benefits expenses, we noted that all 242 sampled transactions did not have adequate supporting documentation. Charges to the Federal award for fringe benefits were based on an anticipated fringe benefit cost, for which the Corporation did not maintain an assignment of cost objectives calculation and its related requirements.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for fringe benefits reflect specific time worked or amounts allocated to specific Federal programs, even though the charges are not in excess of amounts approved for the grant period.
Questioned costs: Unknown
Context: We selected 242 fringe benefit transactions charged to the Federal programs to test controls over allowable costs. Each fringe benefit transaction was calculated by applying a fringe benefit cost rate to actual salaries and wages of each employee tested. The fringe benefit cost rate was based on anticipated fringe benefit cost rate which was neither supported by an actual calculation nor analysis of the related group of employees used in such calculation. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-006 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of assignment of cost objectives calculations.
Criteria: Recipients of Federal awards must establish and maintain effective internal controls over reports that are prepared and submitted as required by the Federal programs and maintain evidence that such internal controls were performed.
Condition: We tested 14 sampled reports and noted that the Corporation was unable to provide sufficient and appropriate evidence that programmatic or financial reports required under the Federal programs were reviewed and approved by appropriate personnel prior to submission to the granting agency.
Cause: The Corporation did not have formal policies and procedures over reporting.
Effect or Potential Effect: Programmatic or financial reports submitted to the granting agencies may be incomplete or inaccurate.
Questioned costs: None
Context: Management was not able to produce sufficient and appropriate evidence that programmatic and SF-425 financial reports were reviewed and approved prior to submission to the granting agencies.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-007 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the review and approval of programmatic and financial reports by appropriate personnel who is knowledgeable of such reporting requirements.
View of Responsible Officials: The pandemic and subsequent shift to remote work disrupted the previous workflow of reviewing and approval of Federal programs reports prior to submission to the granting agency. In addition, due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation did not maintain sufficient or appropriate evidence that reviews and approvals were performed for each sampled report.
Criteria: In accordance with 2 CFR Section 200.305, non-Federal entities must minimize the time elapsing between the transfer of funds from the Federal agency or pass-through entity and disbursement by the Corporation for program costs and proportionate share of allowable indirect costs. Additionally, 2 CFR Section 200.302(b)(c) requires non-Federal entities to establish written procedures to implement the requirements 2 CFR Section 200.305. The Federal Acquisition Regulation clause at 48 CFR section 52.216-7(b)(1) requires that the non-Federal entity request reimbursement for only allocable, allowable, and reasonable contract costs that have already been paid or incurred.
Condition: During our testing of reimbursement requests, we noted that 12 out of 34 sampled requests did not have adequate supporting documentation as to evidence of timely review and approval.
Cause: The Corporation did not maintain detailed listings of eligible costs incurred at the time of reimbursement request to support the amount of reimbursement requested in the Payment Management System. Additionally, the Corporation did not maintain documentation of such review or approval that such costs were incurred prior to request for reimbursement, or the amount requested was in accordance with 2 CFR Section 200.305. Eligible cost listings to support amounts drawn during the grant period in total were reconstructed to support annual activity.
Effect or Potential Effect: Requests for reimbursement per the Payment Management System may not have minimized the time elapsing between payment by the Federal agency or pass through and disbursement by the Corporation and the amounts requested for reimbursement may be inaccurate.
Questioned costs: Unknown
Context: We selected 34 reimbursement requests submitted through the Payment Management System and DC Portal during the year ended December 31, 2022. The Corporation was unable to provide evidence of timely review and approval of 12 requests out of 34. Additionally, cost listings were not maintained and were recreated to validate amount of the draw downs during the fiscal year. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-009 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the determination of cash drawn downs and review and approval of drawn downs by appropriate personnel who is knowledgeable of such requirements.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation neither retained support eligible cost listings at the time of reimbursement request nor documented review or approval of such reimbursement request.
Criteria: The Corporation must maintain and adhere to documented procurement procedures that must conform to the procurement standards in 2 CFR Sections 200.317 through 200.327. These sections include policies and procedures related to competition, informal and formal procurement methods and noncompetitive procurement. Additionally, in accordance with 2 CFR Section 200.214, the Corporation must verify that vendors are not suspended or debarred from participating in Federal funds.
Condition: We noted that there was a lack of evidence that policies and procedures were applied as required under the noted 2 CFR Sections in “Criteria”.
Cause: The Corporation did not maintain formal documentation or evidence to support that a competitive price analysis for vendors or that suspension and debarment verifications were performed for vendors, as required by the general procurement standards of the Uniform Guidance.
Effect or Potential Effect: We were unable to determine whether charges relating to vendor services or goods charged to the Federal programs are in accordance with 2 CFR Sections 200.317 through 200.327 or 200.214.
Questioned costs: None
Context: The Corporation was unable to provide evidence of procurement, suspension or debarment verification performed for walkthrough purposes or any samples that would be selected. Additionally, per management, no written documentation can be provided for any sole source procurements.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-010 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating procurement, required price analysis of vendors, and suspension and debarment verifications.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to provide evidence of procurement, suspension or debarment
verification performed as of December 31, 2022.
Criteria: Recipients of Federal awards must establish and maintain effective internal controls over special tests and provisions and maintain evidence that such internal controls were performed.
Condition: During our testing of sliding fee discounts, we noted that 14 out of 40 sampled financial records reflected an incorrect discount.
Cause: Front office staff collect completed income verification forms and any relevant income documentation or Patient Income Self Attestation forms from patients applying for a sliding fee discount. The Corporation did not implement controls to include review and approval by an individual other than the front office staff of the accuracy of provided discounts that were entered into the patient billing system.
Effect or Potential Effect: Sliding fee discounts provided to patients may be inaccurate based on the individual’s or family’s income.
Questioned costs: None
Context: We tested a sample of 40 financial records for controls over patients treated during the audit period to determine whether patient charges were ppropriately adjusted based on income and family size. It was noted the Corporation did not implement controls to review the accuracy of income verification forms and the data entered the patient billing system. As a result, 14 of the 40 financial records selected reflected an incorrect discount. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-011 in the 2021 report.
Recommendation: We recommend the Corporation revise the Sliding Fee Discount Program policy to include a level of review of patient’s income verification forms and related documentation and the accuracy of the applicable discount entered into the patient billing system.
View of Responsible Officials: Due to turnover of several key financial executives and revenue cycle personnel, the Corporation did not perform or document evidence of approval for provided sliding fee discounts to individuals or families.
Criteria: In accordance with 2 CFR Section 200.512(a), the audit must be completed and data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period, adjusted for any extensions permitted by the Office of Management and Budget. Additionally, management is required to prepare a complete and accurate SEFA.
Condition: We noted that the audit, reporting package, and data collection form for the year ended December 31, 2022, were not filed by the deadline of September 30, 2023, to the Federal Audit Clearinghouse. Additionally, the SEFA was not accurately, completely, and timely prepared.
Cause: The Corporation did not have a formal process in place during the year ended December 31, 2022, to accurately, completely, and timely prepare the SEFA.
Effect or Potential Effect: The audit, reporting package, and data collection form for the year ended December 31, 2022, were not accessible to the Federal Audit Clearinghouse in a timely manner and the SEFA was not timely, accurately, or completely prepared.
Questioned costs: None
Context: The audit, reporting package, and data collection form for the year ended December 31, 2022, was filed untimely to the Federal Audit Clearinghouse.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-004 in the 2021 report.
Recommendation: We recommend the Corporation adopt policies and procedures, including tracking and monitoring of reporting requirements, to ensure that the SEFA is timely, accurately, and completely prepare and that the audit, reporting package, and data collection form are electronically filed with the Federal Audit Clearinghouse within the applicable deadline.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to timely prepare the SEFA and related audit documentation.
Criteria: In accordance with 2 CFR Section 200.430.8(i), charges to Federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity. In addition, 2 CFR Section 200.430.8(i)(viii) states that budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting, provided certain additional internal controls are implemented.
Condition: During our testing of salaries and wages, we noted that all 242 sampled transactions did not have adequate supporting documentation and necessary approvals. Charges to Federal awards for salaries and wages were based on estimated allocations, rather than use of a system of internal controls that accounts for actual time and effort allocations. Allocation schedules, which included calculation and position title errors, were not prepared timely and documentation of approval by individuals knowledgeable of the Federal program was not retained.
Cause: While there is a time keeping system implemented to track daily hours worked by employees, the Corporation’s current internal control system does not allow for specific coding for time actually spent on each federally funded program that would support the amount charged to the Federal award.
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for salaries and wages reflect specific time worked or amounts allocated by employee to specific Federal programs. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: We selected 242 salary transactions charged to the Federal programs to test controls over allowable costs. All transactions charged to the Federal programs were based on budgeted Full Time Equivalents (FTE), and not actual hours employees worked for each Federal program. No analysis or true-up was performed to determine the accuracy of employee titles or amounts charged versus actual time and effort incurred. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-005 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls in order to track specific time spent on each Federal program. This can include, time and effort reports completed on a routine basis, such as monthly, and adjust program expenditures as needed to properly reflect actual work performed. Completed time and effort reports should be reviewed and verified by management for accuracy.
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of approval of salary and wage allocations.
Criteria: In accordance with 2 CFR Section 200.431.8(d), fringe benefits may be assigned to cost objectives by identifying specific benefits to specific individuals or by allocating on the basis of entity-wide salaries and wages of the employees receiving the benefits. When the allocation method is used, separate allocations must be made to selective groupings of employees, unless the non-Federal entity demonstrates that costs in relationships to salaries and wages do not differ significantly for different groups of employees.
Condition: During our testing of fringe benefits expenses, we noted that all 242 sampled transactions did not have adequate supporting documentation. Charges to the Federal award for fringe benefits were based on an anticipated fringe benefit cost, for which the Corporation did not maintain an assignment of cost objectives calculation and its related requirements.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for fringe benefits reflect specific time worked or amounts allocated to specific Federal programs, even though the charges are not in excess of amounts approved for the grant period.
Questioned costs: Unknown
Context: We selected 242 fringe benefit transactions charged to the Federal programs to test controls over allowable costs. Each fringe benefit transaction was calculated by applying a fringe benefit cost rate to actual salaries and wages of each employee tested. The fringe benefit cost rate was based on anticipated fringe benefit cost rate which was neither supported by an actual calculation nor analysis of the related group of employees used in such calculation. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-006 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of assignment of cost objectives calculations.
Criteria: Recipients of Federal awards must establish and maintain effective internal controls over reports that are prepared and submitted as required by the Federal programs and maintain evidence that such internal controls were performed.
Condition: We tested 14 sampled reports and noted that the Corporation was unable to provide sufficient and appropriate evidence that programmatic or financial reports required under the Federal programs were reviewed and approved by appropriate personnel prior to submission to the granting agency.
Cause: The Corporation did not have formal policies and procedures over reporting.
Effect or Potential Effect: Programmatic or financial reports submitted to the granting agencies may be incomplete or inaccurate.
Questioned costs: None
Context: Management was not able to produce sufficient and appropriate evidence that programmatic and SF-425 financial reports were reviewed and approved prior to submission to the granting agencies.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-007 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the review and approval of programmatic and financial reports by appropriate personnel who is knowledgeable of such reporting requirements.
View of Responsible Officials: The pandemic and subsequent shift to remote work disrupted the previous workflow of reviewing and approval of Federal programs reports prior to submission to the granting agency. In addition, due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation did not maintain sufficient or appropriate evidence that reviews and approvals were performed for each sampled report.
Criteria: In accordance with 2 CFR Section 200.305, non-Federal entities must minimize the time elapsing between the transfer of funds from the Federal agency or pass-through entity and disbursement by the Corporation for program costs and proportionate share of allowable indirect costs. Additionally, 2 CFR Section 200.302(b)(c) requires non-Federal entities to establish written procedures to implement the requirements 2 CFR Section 200.305. The Federal Acquisition Regulation clause at 48 CFR section 52.216-7(b)(1) requires that the non-Federal entity request reimbursement for only allocable, allowable, and reasonable contract costs that have already been paid or incurred.
Condition: During our testing of reimbursement requests, we noted that 12 out of 34 sampled requests did not have adequate supporting documentation as to evidence of timely review and approval.
Cause: The Corporation did not maintain detailed listings of eligible costs incurred at the time of reimbursement request to support the amount of reimbursement requested in the Payment Management System. Additionally, the Corporation did not maintain documentation of such review or approval that such costs were incurred prior to request for reimbursement, or the amount requested was in accordance with 2 CFR Section 200.305. Eligible cost listings to support amounts drawn during the grant period in total were reconstructed to support annual activity.
Effect or Potential Effect: Requests for reimbursement per the Payment Management System may not have minimized the time elapsing between payment by the Federal agency or pass through and disbursement by the Corporation and the amounts requested for reimbursement may be inaccurate.
Questioned costs: Unknown
Context: We selected 34 reimbursement requests submitted through the Payment Management System and DC Portal during the year ended December 31, 2022. The Corporation was unable to provide evidence of timely review and approval of 12 requests out of 34. Additionally, cost listings were not maintained and were recreated to validate amount of the draw downs during the fiscal year. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-009 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the determination of cash drawn downs and review and approval of drawn downs by appropriate personnel who is knowledgeable of such requirements.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation neither retained support eligible cost listings at the time of reimbursement request nor documented review or approval of such reimbursement request.
Criteria: The Corporation must maintain and adhere to documented procurement procedures that must conform to the procurement standards in 2 CFR Sections 200.317 through 200.327. These sections include policies and procedures related to competition, informal and formal procurement methods and noncompetitive procurement. Additionally, in accordance with 2 CFR Section 200.214, the Corporation must verify that vendors are not suspended or debarred from participating in Federal funds.
Condition: We noted that there was a lack of evidence that policies and procedures were applied as required under the noted 2 CFR Sections in “Criteria”.
Cause: The Corporation did not maintain formal documentation or evidence to support that a competitive price analysis for vendors or that suspension and debarment verifications were performed for vendors, as required by the general procurement standards of the Uniform Guidance.
Effect or Potential Effect: We were unable to determine whether charges relating to vendor services or goods charged to the Federal programs are in accordance with 2 CFR Sections 200.317 through 200.327 or 200.214.
Questioned costs: None
Context: The Corporation was unable to provide evidence of procurement, suspension or debarment verification performed for walkthrough purposes or any samples that would be selected. Additionally, per management, no written documentation can be provided for any sole source procurements.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-010 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating procurement, required price analysis of vendors, and suspension and debarment verifications.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to provide evidence of procurement, suspension or debarment
verification performed as of December 31, 2022.
Criteria: Recipients of Federal awards must establish and maintain effective internal controls over special tests and provisions and maintain evidence that such internal controls were performed.
Condition: During our testing of sliding fee discounts, we noted that 14 out of 40 sampled financial records reflected an incorrect discount.
Cause: Front office staff collect completed income verification forms and any relevant income documentation or Patient Income Self Attestation forms from patients applying for a sliding fee discount. The Corporation did not implement controls to include review and approval by an individual other than the front office staff of the accuracy of provided discounts that were entered into the patient billing system.
Effect or Potential Effect: Sliding fee discounts provided to patients may be inaccurate based on the individual’s or family’s income.
Questioned costs: None
Context: We tested a sample of 40 financial records for controls over patients treated during the audit period to determine whether patient charges were ppropriately adjusted based on income and family size. It was noted the Corporation did not implement controls to review the accuracy of income verification forms and the data entered the patient billing system. As a result, 14 of the 40 financial records selected reflected an incorrect discount. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-011 in the 2021 report.
Recommendation: We recommend the Corporation revise the Sliding Fee Discount Program policy to include a level of review of patient’s income verification forms and related documentation and the accuracy of the applicable discount entered into the patient billing system.
View of Responsible Officials: Due to turnover of several key financial executives and revenue cycle personnel, the Corporation did not perform or document evidence of approval for provided sliding fee discounts to individuals or families.
Criteria: In accordance with 2 CFR Section 200.512(a), the audit must be completed and data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period, adjusted for any extensions permitted by the Office of Management and Budget. Additionally, management is required to prepare a complete and accurate SEFA.
Condition: We noted that the audit, reporting package, and data collection form for the year ended December 31, 2022, were not filed by the deadline of September 30, 2023, to the Federal Audit Clearinghouse. Additionally, the SEFA was not accurately, completely, and timely prepared.
Cause: The Corporation did not have a formal process in place during the year ended December 31, 2022, to accurately, completely, and timely prepare the SEFA.
Effect or Potential Effect: The audit, reporting package, and data collection form for the year ended December 31, 2022, were not accessible to the Federal Audit Clearinghouse in a timely manner and the SEFA was not timely, accurately, or completely prepared.
Questioned costs: None
Context: The audit, reporting package, and data collection form for the year ended December 31, 2022, was filed untimely to the Federal Audit Clearinghouse.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-004 in the 2021 report.
Recommendation: We recommend the Corporation adopt policies and procedures, including tracking and monitoring of reporting requirements, to ensure that the SEFA is timely, accurately, and completely prepare and that the audit, reporting package, and data collection form are electronically filed with the Federal Audit Clearinghouse within the applicable deadline.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to timely prepare the SEFA and related audit documentation.
Criteria: In accordance with 2 CFR Section 200.430.8(i), charges to Federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity. In addition, 2 CFR Section 200.430.8(i)(viii) states that budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting, provided certain additional internal controls are implemented.
Condition: During our testing of salaries and wages, we noted that all 242 sampled transactions did not have adequate supporting documentation and necessary approvals. Charges to Federal awards for salaries and wages were based on estimated allocations, rather than use of a system of internal controls that accounts for actual time and effort allocations. Allocation schedules, which included calculation and position title errors, were not prepared timely and documentation of approval by individuals knowledgeable of the Federal program was not retained.
Cause: While there is a time keeping system implemented to track daily hours worked by employees, the Corporation’s current internal control system does not allow for specific coding for time actually spent on each federally funded program that would support the amount charged to the Federal award.
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for salaries and wages reflect specific time worked or amounts allocated by employee to specific Federal programs. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: We selected 242 salary transactions charged to the Federal programs to test controls over allowable costs. All transactions charged to the Federal programs were based on budgeted Full Time Equivalents (FTE), and not actual hours employees worked for each Federal program. No analysis or true-up was performed to determine the accuracy of employee titles or amounts charged versus actual time and effort incurred. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-005 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls in order to track specific time spent on each Federal program. This can include, time and effort reports completed on a routine basis, such as monthly, and adjust program expenditures as needed to properly reflect actual work performed. Completed time and effort reports should be reviewed and verified by management for accuracy.
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of approval of salary and wage allocations.
Criteria: In accordance with 2 CFR Section 200.431.8(d), fringe benefits may be assigned to cost objectives by identifying specific benefits to specific individuals or by allocating on the basis of entity-wide salaries and wages of the employees receiving the benefits. When the allocation method is used, separate allocations must be made to selective groupings of employees, unless the non-Federal entity demonstrates that costs in relationships to salaries and wages do not differ significantly for different groups of employees.
Condition: During our testing of fringe benefits expenses, we noted that all 242 sampled transactions did not have adequate supporting documentation. Charges to the Federal award for fringe benefits were based on an anticipated fringe benefit cost, for which the Corporation did not maintain an assignment of cost objectives calculation and its related requirements.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for fringe benefits reflect specific time worked or amounts allocated to specific Federal programs, even though the charges are not in excess of amounts approved for the grant period.
Questioned costs: Unknown
Context: We selected 242 fringe benefit transactions charged to the Federal programs to test controls over allowable costs. Each fringe benefit transaction was calculated by applying a fringe benefit cost rate to actual salaries and wages of each employee tested. The fringe benefit cost rate was based on anticipated fringe benefit cost rate which was neither supported by an actual calculation nor analysis of the related group of employees used in such calculation. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-006 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of assignment of cost objectives calculations.
Criteria: Recipients of Federal awards must establish and maintain effective internal controls over reports that are prepared and submitted as required by the Federal programs and maintain evidence that such internal controls were performed.
Condition: We tested 14 sampled reports and noted that the Corporation was unable to provide sufficient and appropriate evidence that programmatic or financial reports required under the Federal programs were reviewed and approved by appropriate personnel prior to submission to the granting agency.
Cause: The Corporation did not have formal policies and procedures over reporting.
Effect or Potential Effect: Programmatic or financial reports submitted to the granting agencies may be incomplete or inaccurate.
Questioned costs: None
Context: Management was not able to produce sufficient and appropriate evidence that programmatic and SF-425 financial reports were reviewed and approved prior to submission to the granting agencies.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-007 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the review and approval of programmatic and financial reports by appropriate personnel who is knowledgeable of such reporting requirements.
View of Responsible Officials: The pandemic and subsequent shift to remote work disrupted the previous workflow of reviewing and approval of Federal programs reports prior to submission to the granting agency. In addition, due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation did not maintain sufficient or appropriate evidence that reviews and approvals were performed for each sampled report.
Criteria: Recipients of Federal awards must establish and maintain effective internal controls over reports that are prepared and submitted as required by the Federal programs and maintain evidence that such internal controls were performed.
Condition: During our testing, the Corporation was unable to provide sufficient and appropriate evidence that Federal Funding Accountability and Transparency Act (FFATA) required under the Federal programs were submitted to the granting agency.
Cause: The Corporation did not have formal policies and procedures over FFATA reporting.
Effect or Potential Effect: FFATA required reports were not submitted to the granting agency.
Questioned costs: None
Context: Management was not able to produce sufficient and appropriate evidence that FFATA reports were submitted to the granting agency.
Repeat finding: No
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the submission of the FFATA reporting requirements.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation did not maintain sufficient or appropriate evidence that the reports were submitted.
Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the Federal award that provides assurance that the entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 2 CFR 200.322 identifies the requirements for all pass‐through entities which including monitoring the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statues, regulations, and the terms and conditions of the subaward; and that the subaward performance goals are achieved.
Condition: During our testing, the Corporation was unable to provide sufficient and appropriate evidence to substantiate a secondary review was completed over the monitoring activities of the subrecipient.
Cause: The Corporation did not have formal policies and procedures over subrecipient monitoring.
Effect or Potential Effect: Insufficient monitoring of subrecipients could result in Federal noncompliance by a subrecipient.
Questioned costs: None
Context: Management was not able to produce sufficient and appropriate evidence that monitoring activities of subrecipients were reviewed.
Repeat finding: No
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the monitoring of subrecipients.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation did not maintain sufficient or appropriate evidence that the monitoring activities of the subrecipients were reviewed.
Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the Federal award that provides assurance that the entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Additionally, 2 CFR Appendix IV to Part 200 Section B.2(b) requires that both the direct costs and the indirect costs must exclude capital expenditures and unallowable costs.
Per Compliance Supplement, these indirect costs must conform to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement.
Condition: During our testing of indirect costs, we noted that the Corporation charges the Federally approved rate of 28.7% on specific grant awards based on direct salaries and wages. However, the Corporation did not maintain supporting indirect cost pools and related documentation.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the allowability requirements of indirect costs in accordance with 2 CFR Appendix IV to Part 200 Section B.2(b).
Effect or Potential Effect: We were unable to determine whether indirect costs charged to Federal awards conform to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: Management was not able to provide sufficient and appropriate evidence that the reported indirect costs conformed to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement.
Repeat finding: No
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the allowability requirements of indirect costs in accordance with 2 CFR Appendix IV to Part 200 Section B.2(b).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain any supporting indirect cost pools and related documentation.
Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the Federal award that provides assurance that the entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 2 CFR 200.306(b) identifies the requirements for all Federal awards that any shared costs or matching funds and all contributions, including cash and third-party in-kind contributions, must be accepted as part of the non-
Federal entity's cost sharing or matching when such contributions meet all of the following criteria:
(1) Are verifiable from the non-Federal entity's records;
(2) Are not included as contributions for any other Federal award;
(3) Are necessary and reasonable for accomplishment of project or program objectives;
(4) Are allowable under 2 CFR 200 Subpart E;
(5) Are not paid by the Federal Government under another Federal award, except where the Federal statute authorizing a program specifically provides that Federal funds made available for such program can be applied to matching or cost sharing requirements of other Federal programs;
(6) Are provided for in the approved budget when required by the Federal awarding agency; and
(7) Conform to other provisions of this part, as applicable.
Condition: During our testing, the Corporation was unable to provide sufficient and appropriate evidence to substantiate that the matched or shared cost were received and accepted in conformance with the criteria listed above or award agreement.
Cause: The Corporation did not have formal policies and procedures over matching or cost sharing.
Effect or Potential Effect: Without proper internal controls and policies and procedures in place to monitor and review the matching requirements could result in Federal noncompliance.
Questioned costs: None
Context: This is a condition identified per review of the Corporation’s compliance with specified requirements over matching or cost sharing.
Repeat finding: No
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the matching requirements of the related grant award.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation did not maintain sufficient or appropriate evidence to substantiate that the matched or shared cost were spent in conformance with the criteria listed above or award agreement.
Criteria: In accordance with 2 CFR Section 200.512(a), the audit must be completed and data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period, adjusted for any extensions permitted by the Office of Management and Budget. Additionally, management is required to prepare a complete and accurate SEFA.
Condition: We noted that the audit, reporting package, and data collection form for the year ended December 31, 2022, were not filed by the deadline of September 30, 2023, to the Federal Audit Clearinghouse. Additionally, the SEFA was not accurately, completely, and timely prepared.
Cause: The Corporation did not have a formal process in place during the year ended December 31, 2022, to accurately, completely, and timely prepare the SEFA.
Effect or Potential Effect: The audit, reporting package, and data collection form for the year ended December 31, 2022, were not accessible to the Federal Audit Clearinghouse in a timely manner and the SEFA was not timely, accurately, or completely prepared.
Questioned costs: None
Context: The audit, reporting package, and data collection form for the year ended December 31, 2022, was filed untimely to the Federal Audit Clearinghouse.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-004 in the 2021 report.
Recommendation: We recommend the Corporation adopt policies and procedures, including tracking and monitoring of reporting requirements, to ensure that the SEFA is timely, accurately, and completely prepare and that the audit, reporting package, and data collection form are electronically filed with the Federal Audit Clearinghouse within the applicable deadline.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to timely prepare the SEFA and related audit documentation.
Criteria: In accordance with 2 CFR Section 200.430.8(i), charges to Federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity. In addition, 2 CFR Section 200.430.8(i)(viii) states that budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting, provided certain additional internal controls are implemented.
Condition: During our testing of salaries and wages, we noted that all 242 sampled transactions did not have adequate supporting documentation and necessary approvals. Charges to Federal awards for salaries and wages were based on estimated allocations, rather than use of a system of internal controls that accounts for actual time and effort allocations. Allocation schedules, which included calculation and position title errors, were not prepared timely and documentation of approval by individuals knowledgeable of the Federal program was not retained.
Cause: While there is a time keeping system implemented to track daily hours worked by employees, the Corporation’s current internal control system does not allow for specific coding for time actually spent on each federally funded program that would support the amount charged to the Federal award.
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for salaries and wages reflect specific time worked or amounts allocated by employee to specific Federal programs. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: We selected 242 salary transactions charged to the Federal programs to test controls over allowable costs. All transactions charged to the Federal programs were based on budgeted Full Time Equivalents (FTE), and not actual hours employees worked for each Federal program. No analysis or true-up was performed to determine the accuracy of employee titles or amounts charged versus actual time and effort incurred. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-005 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls in order to track specific time spent on each Federal program. This can include, time and effort reports completed on a routine basis, such as monthly, and adjust program expenditures as needed to properly reflect actual work performed. Completed time and effort reports should be reviewed and verified by management for accuracy.
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of approval of salary and wage allocations.
Criteria: In accordance with 2 CFR Section 200.431.8(d), fringe benefits may be assigned to cost objectives by identifying specific benefits to specific individuals or by allocating on the basis of entity-wide salaries and wages of the employees receiving the benefits. When the allocation method is used, separate allocations must be made to selective groupings of employees, unless the non-Federal entity demonstrates that costs in relationships to salaries and wages do not differ significantly for different groups of employees.
Condition: During our testing of fringe benefits expenses, we noted that all 242 sampled transactions did not have adequate supporting documentation. Charges to the Federal award for fringe benefits were based on an anticipated fringe benefit cost, for which the Corporation did not maintain an assignment of cost objectives calculation and its related requirements.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for fringe benefits reflect specific time worked or amounts allocated to specific Federal programs, even though the charges are not in excess of amounts approved for the grant period.
Questioned costs: Unknown
Context: We selected 242 fringe benefit transactions charged to the Federal programs to test controls over allowable costs. Each fringe benefit transaction was calculated by applying a fringe benefit cost rate to actual salaries and wages of each employee tested. The fringe benefit cost rate was based on anticipated fringe benefit cost rate which was neither supported by an actual calculation nor analysis of the related group of employees used in such calculation. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-006 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of assignment of cost objectives calculations.
Criteria: Recipients of Federal awards must establish and maintain effective internal controls over program income and maintain evidence that such internal controls were performed. Amounts reported as program income on the SF-425 Federal Financial Report are to be in accordance with the HIV/AIDS Bureau Policy Clarification Notice #15-03.
Condition: The Corporation was unable to provide evidence of review and approval of the calculation of reported program income on the SF-425 Federal Financial Report for the reporting period end date of December 31, 2022.
Cause: The Corporation did not have formal policies and procedures over program income reported on the SF-425 Federal Financial Report.
Effect or Potential Effect: The amount of program income on the SF-425 Federal Financial Report for the reporting period end date of December 31, 2022, submitted to the granting agencies may be inaccurate.
Questioned costs: Unknown
Context: Management was not able to provide sufficient and appropriate evidence that the reported program income on the SF-425 Federal Financial was reviewed and approved, prior to submission to the granting agencies.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-008 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the calculation and review and approval of program income by appropriate personnel who is knowledgeable of such requirements and calculations.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to provide evidence of review and approval of the calculation of reported program income on the SF-425 Federal Financial Report for the reporting period end date of December 31, 2022.
Criteria: In accordance with 2 CFR Section 200.305, non-Federal entities must minimize the time elapsing between the transfer of funds from the Federal agency or pass-through entity and disbursement by the Corporation for program costs and proportionate share of allowable indirect costs. Additionally, 2 CFR Section 200.302(b)(c) requires non-Federal entities to establish written procedures to implement the requirements 2 CFR Section 200.305. The Federal Acquisition Regulation clause at 48 CFR section 52.216-7(b)(1) requires that the non-Federal entity request reimbursement for only allocable, allowable, and reasonable contract costs that have already been paid or incurred.
Condition: During our testing of reimbursement requests, we noted that 12 out of 34 sampled requests did not have adequate supporting documentation as to evidence of timely review and approval.
Cause: The Corporation did not maintain detailed listings of eligible costs incurred at the time of reimbursement request to support the amount of reimbursement requested in the Payment Management System. Additionally, the Corporation did not maintain documentation of such review or approval that such costs were incurred prior to request for reimbursement, or the amount requested was in accordance with 2 CFR Section 200.305. Eligible cost listings to support amounts drawn during the grant period in total were reconstructed to support annual activity.
Effect or Potential Effect: Requests for reimbursement per the Payment Management System may not have minimized the time elapsing between payment by the Federal agency or pass through and disbursement by the Corporation and the amounts requested for reimbursement may be inaccurate.
Questioned costs: Unknown
Context: We selected 34 reimbursement requests submitted through the Payment Management System and DC Portal during the year ended December 31, 2022. The Corporation was unable to provide evidence of timely review and approval of 12 requests out of 34. Additionally, cost listings were not maintained and were recreated to validate amount of the draw downs during the fiscal year. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-009 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the determination of cash drawn downs and review and approval of drawn downs by appropriate personnel who is knowledgeable of such requirements.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation neither retained support eligible cost listings at the time of reimbursement request nor documented review or approval of such reimbursement request.
Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the Federal award that provides assurance that the entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Additionally, 2 CFR Appendix IV to Part 200 Section B.2(b) requires that both the direct costs and the indirect costs must exclude capital expenditures and unallowable costs.
Per Compliance Supplement, these indirect costs must conform to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement.
Condition: During our testing of indirect costs, we noted that the Corporation charges the Federally approved rate of 28.7% on specific grant awards based on direct salaries and wages. However, the Corporation did not maintain supporting indirect cost pools and related documentation.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the allowability requirements of indirect costs in accordance with 2 CFR Appendix IV to Part 200 Section B.2(b).
Effect or Potential Effect: We were unable to determine whether indirect costs charged to Federal awards conform to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: Management was not able to provide sufficient and appropriate evidence that the reported indirect costs conformed to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement.
Repeat finding: No
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the allowability requirements of indirect costs in accordance with 2 CFR Appendix IV to Part 200 Section B.2(b).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain any supporting indirect cost pools and related documentation.
Criteria: In accordance with 2 CFR Section 200.512(a), the audit must be completed and data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period, adjusted for any extensions permitted by the Office of Management and Budget. Additionally, management is required to prepare a complete and accurate SEFA.
Condition: We noted that the audit, reporting package, and data collection form for the year ended December 31, 2022, were not filed by the deadline of September 30, 2023, to the Federal Audit Clearinghouse. Additionally, the SEFA was not accurately, completely, and timely prepared.
Cause: The Corporation did not have a formal process in place during the year ended December 31, 2022, to accurately, completely, and timely prepare the SEFA.
Effect or Potential Effect: The audit, reporting package, and data collection form for the year ended December 31, 2022, were not accessible to the Federal Audit Clearinghouse in a timely manner and the SEFA was not timely, accurately, or completely prepared.
Questioned costs: None
Context: The audit, reporting package, and data collection form for the year ended December 31, 2022, was filed untimely to the Federal Audit Clearinghouse.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-004 in the 2021 report.
Recommendation: We recommend the Corporation adopt policies and procedures, including tracking and monitoring of reporting requirements, to ensure that the SEFA is timely, accurately, and completely prepare and that the audit, reporting package, and data collection form are electronically filed with the Federal Audit Clearinghouse within the applicable deadline.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to timely prepare the SEFA and related audit documentation.
Criteria: In accordance with 2 CFR Section 200.430.8(i), charges to Federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity. In addition, 2 CFR Section 200.430.8(i)(viii) states that budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting, provided certain additional internal controls are implemented.
Condition: During our testing of salaries and wages, we noted that all 242 sampled transactions did not have adequate supporting documentation and necessary approvals. Charges to Federal awards for salaries and wages were based on estimated allocations, rather than use of a system of internal controls that accounts for actual time and effort allocations. Allocation schedules, which included calculation and position title errors, were not prepared timely and documentation of approval by individuals knowledgeable of the Federal program was not retained.
Cause: While there is a time keeping system implemented to track daily hours worked by employees, the Corporation’s current internal control system does not allow for specific coding for time actually spent on each federally funded program that would support the amount charged to the Federal award.
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for salaries and wages reflect specific time worked or amounts allocated by employee to specific Federal programs. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: We selected 242 salary transactions charged to the Federal programs to test controls over allowable costs. All transactions charged to the Federal programs were based on budgeted Full Time Equivalents (FTE), and not actual hours employees worked for each Federal program. No analysis or true-up was performed to determine the accuracy of employee titles or amounts charged versus actual time and effort incurred. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-005 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls in order to track specific time spent on each Federal program. This can include, time and effort reports completed on a routine basis, such as monthly, and adjust program expenditures as needed to properly reflect actual work performed. Completed time and effort reports should be reviewed and verified by management for accuracy.
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of approval of salary and wage allocations.
Criteria: In accordance with 2 CFR Section 200.431.8(d), fringe benefits may be assigned to cost objectives by identifying specific benefits to specific individuals or by allocating on the basis of entity-wide salaries and wages of the employees receiving the benefits. When the allocation method is used, separate allocations must be made to selective groupings of employees, unless the non-Federal entity demonstrates that costs in relationships to salaries and wages do not differ significantly for different groups of employees.
Condition: During our testing of fringe benefits expenses, we noted that all 242 sampled transactions did not have adequate supporting documentation. Charges to the Federal award for fringe benefits were based on an anticipated fringe benefit cost, for which the Corporation did not maintain an assignment of cost objectives calculation and its related requirements.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for fringe benefits reflect specific time worked or amounts allocated to specific Federal programs, even though the charges are not in excess of amounts approved for the grant period.
Questioned costs: Unknown
Context: We selected 242 fringe benefit transactions charged to the Federal programs to test controls over allowable costs. Each fringe benefit transaction was calculated by applying a fringe benefit cost rate to actual salaries and wages of each employee tested. The fringe benefit cost rate was based on anticipated fringe benefit cost rate which was neither supported by an actual calculation nor analysis of the related group of employees used in such calculation. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-006 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of assignment of cost objectives calculations.
Criteria: Recipients of Federal awards must establish and maintain effective internal controls over reports that are prepared and submitted as required by the Federal programs and maintain evidence that such internal controls were performed.
Condition: We tested 14 sampled reports and noted that the Corporation was unable to provide sufficient and appropriate evidence that programmatic or financial reports required under the Federal programs were reviewed and approved by appropriate personnel prior to submission to the granting agency.
Cause: The Corporation did not have formal policies and procedures over reporting.
Effect or Potential Effect: Programmatic or financial reports submitted to the granting agencies may be incomplete or inaccurate.
Questioned costs: None
Context: Management was not able to produce sufficient and appropriate evidence that programmatic and SF-425 financial reports were reviewed and approved prior to submission to the granting agencies.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-007 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the review and approval of programmatic and financial reports by appropriate personnel who is knowledgeable of such reporting requirements.
View of Responsible Officials: The pandemic and subsequent shift to remote work disrupted the previous workflow of reviewing and approval of Federal programs reports prior to submission to the granting agency. In addition, due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation did not maintain sufficient or appropriate evidence that reviews and approvals were performed for each sampled report.
Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the Federal award that provides assurance that the entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Additionally, 2 CFR Appendix IV to Part 200 Section B.2(b) requires that both the direct costs and the indirect costs must exclude capital expenditures and unallowable costs.
Per Compliance Supplement, these indirect costs must conform to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement.
Condition: During our testing of indirect costs, we noted that the Corporation charges the Federally approved rate of 28.7% on specific grant awards based on direct salaries and wages. However, the Corporation did not maintain supporting indirect cost pools and related documentation.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the allowability requirements of indirect costs in accordance with 2 CFR Appendix IV to Part 200 Section B.2(b).
Effect or Potential Effect: We were unable to determine whether indirect costs charged to Federal awards conform to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: Management was not able to provide sufficient and appropriate evidence that the reported indirect costs conformed to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement.
Repeat finding: No
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the allowability requirements of indirect costs in accordance with 2 CFR Appendix IV to Part 200 Section B.2(b).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain any supporting indirect cost pools and related documentation.
Criteria: In accordance with 2 CFR Section 200.512(a), the audit must be completed and data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period, adjusted for any extensions permitted by the Office of Management and Budget. Additionally, management is required to prepare a complete and accurate SEFA.
Condition: We noted that the audit, reporting package, and data collection form for the year ended December 31, 2022, were not filed by the deadline of September 30, 2023, to the Federal Audit Clearinghouse. Additionally, the SEFA was not accurately, completely, and timely prepared.
Cause: The Corporation did not have a formal process in place during the year ended December 31, 2022, to accurately, completely, and timely prepare the SEFA.
Effect or Potential Effect: The audit, reporting package, and data collection form for the year ended December 31, 2022, were not accessible to the Federal Audit Clearinghouse in a timely manner and the SEFA was not timely, accurately, or completely prepared.
Questioned costs: None
Context: The audit, reporting package, and data collection form for the year ended December 31, 2022, was filed untimely to the Federal Audit Clearinghouse.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-004 in the 2021 report.
Recommendation: We recommend the Corporation adopt policies and procedures, including tracking and monitoring of reporting requirements, to ensure that the SEFA is timely, accurately, and completely prepare and that the audit, reporting package, and data collection form are electronically filed with the Federal Audit Clearinghouse within the applicable deadline.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to timely prepare the SEFA and related audit documentation.
Criteria: In accordance with 2 CFR Section 200.430.8(i), charges to Federal awards for salaries and wages must be based on records that reflect the actual work performed. The charges must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and must be incorporated into the official records of the non-Federal entity. In addition, 2 CFR Section 200.430.8(i)(viii) states that budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting, provided certain additional internal controls are implemented.
Condition: During our testing of salaries and wages, we noted that all 242 sampled transactions did not have adequate supporting documentation and necessary approvals. Charges to Federal awards for salaries and wages were based on estimated allocations, rather than use of a system of internal controls that accounts for actual time and effort allocations. Allocation schedules, which included calculation and position title errors, were not prepared timely and documentation of approval by individuals knowledgeable of the Federal program was not retained.
Cause: While there is a time keeping system implemented to track daily hours worked by employees, the Corporation’s current internal control system does not allow for specific coding for time actually spent on each federally funded program that would support the amount charged to the Federal award.
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for salaries and wages reflect specific time worked or amounts allocated by employee to specific Federal programs. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: We selected 242 salary transactions charged to the Federal programs to test controls over allowable costs. All transactions charged to the Federal programs were based on budgeted Full Time Equivalents (FTE), and not actual hours employees worked for each Federal program. No analysis or true-up was performed to determine the accuracy of employee titles or amounts charged versus actual time and effort incurred. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-005 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls in order to track specific time spent on each Federal program. This can include, time and effort reports completed on a routine basis, such as monthly, and adjust program expenditures as needed to properly reflect actual work performed. Completed time and effort reports should be reviewed and verified by management for accuracy.
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of approval of salary and wage allocations.
Criteria: In accordance with 2 CFR Section 200.431.8(d), fringe benefits may be assigned to cost objectives by identifying specific benefits to specific individuals or by allocating on the basis of entity-wide salaries and wages of the employees receiving the benefits. When the allocation method is used, separate allocations must be made to selective groupings of employees, unless the non-Federal entity demonstrates that costs in relationships to salaries and wages do not differ significantly for different groups of employees.
Condition: During our testing of fringe benefits expenses, we noted that all 242 sampled transactions did not have adequate supporting documentation. Charges to the Federal award for fringe benefits were based on an anticipated fringe benefit cost, for which the Corporation did not maintain an assignment of cost objectives calculation and its related requirements.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
Effect or Potential Effect: We were unable to determine whether charges to Federal awards for fringe benefits reflect specific time worked or amounts allocated to specific Federal programs, even though the charges are not in excess of amounts approved for the grant period.
Questioned costs: Unknown
Context: We selected 242 fringe benefit transactions charged to the Federal programs to test controls over allowable costs. Each fringe benefit transaction was calculated by applying a fringe benefit cost rate to actual salaries and wages of each employee tested. The fringe benefit cost rate was based on anticipated fringe benefit cost rate which was neither supported by an actual calculation nor analysis of the related group of employees used in such calculation. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-006 in the 2021 report.
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the fringe benefits cost objectives of 2 CFR Section 200.431.8(d).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of assignment of cost objectives calculations.
Criteria: The Corporation must maintain and adhere to documented procurement procedures that must conform to the procurement standards in 2 CFR Sections 200.317 through 200.327. These sections include policies and procedures related to competition, informal and formal procurement methods and noncompetitive procurement. Additionally, in accordance with 2 CFR Section 200.214, the Corporation must verify that vendors are not suspended or debarred from participating in Federal funds.
Condition: We noted that there was a lack of evidence that policies and procedures were applied as required under the noted 2 CFR Sections in “Criteria”.
Cause: The Corporation did not maintain formal documentation or evidence to support that a competitive price analysis for vendors or that suspension and debarment verifications were performed for vendors, as required by the general procurement standards of the Uniform Guidance.
Effect or Potential Effect: We were unable to determine whether charges relating to vendor services or goods charged to the Federal programs are in accordance with 2 CFR Sections 200.317 through 200.327 or 200.214.
Questioned costs: None
Context: The Corporation was unable to provide evidence of procurement, suspension or debarment verification performed for walkthrough purposes or any samples that would be selected. Additionally, per management, no written documentation can be provided for any sole source procurements.
Repeat finding: This is a repeat finding from prior year. This was reported as finding 2021-010 in the 2021 report.
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating procurement, required price analysis of vendors, and suspension and debarment verifications.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation was unable to provide evidence of procurement, suspension or debarment
verification performed as of December 31, 2022.
Criteria: Applicants for WIC program benefits are screened at WIC clinic sites to determine their WIC eligibility. To be certified eligible, they must meet the eligibility criteria defined at 7 CFR sections 246.7(c), (d), (e), (g), and (l) related to Category, Identity and Residency, Income, and Nutritional Risk.
Condition: During our testing of eligibility, the Corporation was unable to provide eligibility data for the period January 1, 2022 through March 31, 2022 and therefore we were unable to assess eligibility compliance requirements during that period. In addition, the Corporation was unable to provide support that eligibility assessments performed were reviewed. Below is a summary of our findings:
• For 6 of the 40 samples, proper segregation of duties was not maintained as the staff person who determined income eligibility was the same staff person who completed the medical risk assessment.
• For 23 of the 40 samples, the Corporation was unable to provide support to verify the applicant signed the Rights and Obligations statement.
• For 3 out of the 40 samples, the Corporation was unable to provide documentation that the applicant met the residency eligibility requirement.
• For 27 out of the 40 samples, the Corporation was unable to provide documentation that the applicant met the income eligibility requirement.
• For 14 out of the 40 samples, the Corporation was unable to provide documentation that the applicant met the category eligibility requirement.
• For 9 out of the 40 samples, the Corporation was unable to provide documentation that the applicant met the nutritional risk eligibility requirement.
• For 1 out of the 40 samples, it was noted the certified applicant did not provide documentation to support the required residency requirement. Participants who do not provide residency documentation are required to provide residency documentation within 30 days. The Corporation was unable to provide evidence the participant provided residency support within 30 days.
• For all 40 samples, the Corporation was unable to provide support that the eligibility assessments performed were reviewed.
Cause: The Corporation did not have formal policies and procedures over subrecipient monitoring.
Effect or Potential Effect: Lack of strict adherence to documentation requirements may have resulted in the Organization providing benefits to ineligible beneficiaries.
Questioned costs: None
Context: We tested a sample of 40 participants determined to be eligible and noted the Corporation was not able to produce sufficient and appropriate evidence that eligibility assessments performed were reviewed, and found exceptions as noted in the condition. This is a condition identified per review of the Corporation’s compliance with specified requirements using a statistically valid sample.
Repeat finding: No
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to assessing eligibility of participants.
View of Responsible Officials: Due to a change in reporting systems used to assess eligibility, the Corporation did not have access to the eligibility data for the period January 1, 2022 through March 31, 2022. Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation did not maintain sufficient or appropriate evidence that eligibility assessments performed were reviewed.
Criteria: Local agencies are required to submit policies and procedures regarding food benefit security and separation of duties with their work plan each year, and quarterly reporting requirements in compliance with the DC WIC program and maintain evidence that these reports are reviewed and approved by appropriate personnel prior to submission to the granting agency.
Condition: During our testing, the Corporation was unable to provide sufficient and appropriate evidence that additional reporting requirements required under the WIC program were reviewed and approved by appropriate personnel prior to submission, and evidence of timely submission to the granting agency.
Cause: The Corporation did not have formal policies and procedures over reporting requirements required under the WIC program.
Effect or Potential Effect: Additional reporting requirements submitted to the granting agencies may be incomplete or inaccurate.
Questioned costs: None
Context: Management does not have documentation over its policies and procedures regarding food benefit security and separation of duties as required under the WIC program. Management was not able to produce sufficient and appropriate evidence that additional reporting requirements were reviewed and approved prior to submission, and evidence of timely submission to the granting agency.
Repeat finding: No
Recommendation: We recommend the Corporation establish formal internal controls, and documentation of their performance, relating to the review and approval of reports by appropriate personnel who is knowledgeable of such reporting requirements.
View of Responsible Officials: Due to turnover of several key financial executives and personnel and lack of formal documentation of current policies and procedures, the Corporation did not maintain sufficient and appropriate evidence that reviews and approvals were performed for each additional reporting requirements and could not verify that these reports were submitted in a timely manner.
Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the Federal award that provides assurance that the entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Additionally, 2 CFR Appendix IV to Part 200 Section B.2(b) requires that both the direct costs and the indirect costs must exclude capital expenditures and unallowable costs.
Per Compliance Supplement, these indirect costs must conform to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement.
Condition: During our testing of indirect costs, we noted that the Corporation charges the Federally approved rate of 28.7% on specific grant awards based on direct salaries and wages. However, the Corporation did not maintain supporting indirect cost pools and related documentation.
Cause: The Corporation did not have formal process and policies to demonstrate adherence to the allowability requirements of indirect costs in accordance with 2 CFR Appendix IV to Part 200 Section B.2(b).
Effect or Potential Effect: We were unable to determine whether indirect costs charged to Federal awards conform to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement. Allowable costs incurred by the Corporation exceeded the amount of approved grant funding, therefore no questioned costs are reported.
Questioned costs: Unknown
Context: Management was not able to provide sufficient and appropriate evidence that the reported indirect costs conformed to the allowability of cost provisions in 2 CFR Part 200, Subpart E or award agreement.
Repeat finding: No
Recommendation: We recommend the Corporation develop and incorporate internal controls and policies to demonstrate adherence to the allowability requirements of indirect costs in accordance with 2 CFR Appendix IV to Part 200 Section B.2(b).
View of Responsible Officials: Due to turnover of several key financial executives and personnel, the Corporation did not maintain any supporting indirect cost pools and related documentation.