Audit 321803

2022-001 – Reporting – Submission of the Reporting Package and Data Collection Form Federal Agency: U.S. Department of the Interior; U.S. Fish & Wildlife Service Federal program title: Endangered Species Conservation Recovery Implementation Funds Assistance Listing Number: 15.657 Award Period: 09/30/2020 – 09/30/2026 Type of Finding: Compliance and material weakness in internal control over compliance and Federal Agency: U.S. Environmental Protection Agency Federal program title: Gulf Coast Ecosystem Restoration Council Comprehensive Plan Assistance Listing Number: 66.130 Award Period: 10/01/2021 – 12/31/2024 Type of Finding: Compliance and material weakness in internal control over compliance Criteria: In accordance with 2 CFR Section 200.512(a), the audit must be completed and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report or nine months after the end of the audit period. Condition: The reporting package and data collection form for the year ended December 31, 2022 was not filed into the reporting portal by the deadline. Questioned Costs: None noted. Context: This was a condition noted per review of the Organization’s compliance with the reporting requirements. Cause: The Garden’s Uniform Guidance Audit for the year ended December 31, 2022 was delayed as Garden management was unaware that that their federal expenditures exceeded the audit requirement threshold for the first time. Effect: Untimely reporting could affect future funding from government agencies.   Recommendation: We recommend the Garden adopt policies and procedures, including tracking and monitoring of reporting requirements, to ensure that the audit, reporting package, and data collection form are electronically submitted within the applicable deadline. Management’s Response Refer to the Correction Action Plan.

2022-002 – Allowable Costs/Cost Principles (Allocation of Payroll) Federal Agency: U.S. Department of the Interior; U.S. Fish & Wildlife Service Federal program title: Endangered Species Conservation Recovery Implementation Funds Assistance Listing Number: 15.657 Award Period: 09/30/2020 – 09/30/2026 Type of Finding: Compliance and material weakness in internal control over compliance and Federal Agency: U.S. Environmental Protection Agency Federal program title: Gulf Coast Ecosystem Restoration Council Comprehensive Plan Assistance Listing Number: 66.130 Award Period: 10/01/2021 – 12/31/2024 Type of Finding: Compliance and material weakness Criteria: Uniform Guidance section 200.430(h)(8)(i) indicates that the standards for documentation of personnel expenses are such that (1) Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must:(i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the nonfederal entity and(iii) Reasonably reflect the total activity for which the employee is compensated by the nonfederal entity, not exceeding 100% of compensated activities. Furthermore, subsection (viii) indicates: Budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity are identified and entered into the records in a timely manner and (C) The nonfederal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a federal awards based on budget estimates.   Condition: The Garden is allocating payroll costs to grants based upon budgeted amounts/percentages submitted to the funding agency and does not currently have a system for ensuring that the estimates used produce reasonable approximations of the activity actually performed. Questioned Costs: Unknown. Context: This condition occurred in all payroll transactions selected for testing. Cause: The Garden has a tracking system in place to monitor the wages by employee charged to federal grants to avoid over-allocation of individual employee wages per the grant budget, but this tracking system does not contain a process for identifying and allocating wages based on submitted time records. Effect: Inaccurate payroll costs may be charged to federal programs if the Garden does not have procedures in place to monitor and record employee time devoted to federal programs. Recommendation: Management should develop a process whereby payroll costs allocated to federal grants are supported by a system of internal controls which provides reasonable assurance that the charges are accurate allowable and properly allocated, reasonably reflect the total activity for which the employee is compensated, and support the distribution of the employee’s wages among specific activities or cost objectives if the employee works on more than one federal award. Management’s Response Refer to the Correction Action Plan.

2022-003 – Approval of Expenditures Federal Agency: U.S. Department of the Interior; U.S. Fish & Wildlife Service Federal program title: Endangered Species Conservation Recovery Implementation Funds Assistance Listing Number: 15.657 Award Period: 09/30/2020 – 09/30/2026 Type of Finding: Compliance and significant deficiency in internal control over compliance 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 statues, regulations, and conditions of the federal award.  Condition: During our review of charges to federal programs, many charges were incurred on employees’ credit cards. While most credit statements and related receipts and invoices are reviewed by either the Vice President of Conservation and Research or the Director of Applied Conservation, we noted instances of no employee reviewing the Vice President of Conservation and Research, the Director of Applied Conservation, or certain department heads’ credit card charges. Questioned Costs: None noted. Context: We noted one instance from the sample of twenty-six credit charges that did not have documentation of proper approval. Cause: There was no evidence of the Garden’s formal process of ensuring all expenditures are appropriated documented and approved. Effect: For transactions related to federal grants, without the appropriate supporting documentation, charges may be disallowed. Recommendation: We recommend that management establish controls and implement policies to ensure that support is obtained and maintained for all expense transactions. Management’s Response: Refer to the Correction Action Plan.

2022-001 – Reporting – Submission of the Reporting Package and Data Collection Form Federal Agency: U.S. Department of the Interior; U.S. Fish & Wildlife Service Federal program title: Endangered Species Conservation Recovery Implementation Funds Assistance Listing Number: 15.657 Award Period: 09/30/2020 – 09/30/2026 Type of Finding: Compliance and material weakness in internal control over compliance and Federal Agency: U.S. Environmental Protection Agency Federal program title: Gulf Coast Ecosystem Restoration Council Comprehensive Plan Assistance Listing Number: 66.130 Award Period: 10/01/2021 – 12/31/2024 Type of Finding: Compliance and material weakness in internal control over compliance Criteria: In accordance with 2 CFR Section 200.512(a), the audit must be completed and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report or nine months after the end of the audit period. Condition: The reporting package and data collection form for the year ended December 31, 2022 was not filed into the reporting portal by the deadline. Questioned Costs: None noted. Context: This was a condition noted per review of the Organization’s compliance with the reporting requirements. Cause: The Garden’s Uniform Guidance Audit for the year ended December 31, 2022 was delayed as Garden management was unaware that that their federal expenditures exceeded the audit requirement threshold for the first time. Effect: Untimely reporting could affect future funding from government agencies.   Recommendation: We recommend the Garden adopt policies and procedures, including tracking and monitoring of reporting requirements, to ensure that the audit, reporting package, and data collection form are electronically submitted within the applicable deadline. Management’s Response Refer to the Correction Action Plan.

2022-002 – Allowable Costs/Cost Principles (Allocation of Payroll) Federal Agency: U.S. Department of the Interior; U.S. Fish & Wildlife Service Federal program title: Endangered Species Conservation Recovery Implementation Funds Assistance Listing Number: 15.657 Award Period: 09/30/2020 – 09/30/2026 Type of Finding: Compliance and material weakness in internal control over compliance and Federal Agency: U.S. Environmental Protection Agency Federal program title: Gulf Coast Ecosystem Restoration Council Comprehensive Plan Assistance Listing Number: 66.130 Award Period: 10/01/2021 – 12/31/2024 Type of Finding: Compliance and material weakness Criteria: Uniform Guidance section 200.430(h)(8)(i) indicates that the standards for documentation of personnel expenses are such that (1) Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must:(i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the nonfederal entity and(iii) Reasonably reflect the total activity for which the employee is compensated by the nonfederal entity, not exceeding 100% of compensated activities. Furthermore, subsection (viii) indicates: Budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity are identified and entered into the records in a timely manner and (C) The nonfederal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a federal awards based on budget estimates.   Condition: The Garden is allocating payroll costs to grants based upon budgeted amounts/percentages submitted to the funding agency and does not currently have a system for ensuring that the estimates used produce reasonable approximations of the activity actually performed. Questioned Costs: Unknown. Context: This condition occurred in all payroll transactions selected for testing. Cause: The Garden has a tracking system in place to monitor the wages by employee charged to federal grants to avoid over-allocation of individual employee wages per the grant budget, but this tracking system does not contain a process for identifying and allocating wages based on submitted time records. Effect: Inaccurate payroll costs may be charged to federal programs if the Garden does not have procedures in place to monitor and record employee time devoted to federal programs. Recommendation: Management should develop a process whereby payroll costs allocated to federal grants are supported by a system of internal controls which provides reasonable assurance that the charges are accurate allowable and properly allocated, reasonably reflect the total activity for which the employee is compensated, and support the distribution of the employee’s wages among specific activities or cost objectives if the employee works on more than one federal award. Management’s Response Refer to the Correction Action Plan.

2022-003 – Approval of Expenditures Federal Agency: U.S. Department of the Interior; U.S. Fish & Wildlife Service Federal program title: Endangered Species Conservation Recovery Implementation Funds Assistance Listing Number: 15.657 Award Period: 09/30/2020 – 09/30/2026 Type of Finding: Compliance and significant deficiency in internal control over compliance 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 statues, regulations, and conditions of the federal award.  Condition: During our review of charges to federal programs, many charges were incurred on employees’ credit cards. While most credit statements and related receipts and invoices are reviewed by either the Vice President of Conservation and Research or the Director of Applied Conservation, we noted instances of no employee reviewing the Vice President of Conservation and Research, the Director of Applied Conservation, or certain department heads’ credit card charges. Questioned Costs: None noted. Context: We noted one instance from the sample of twenty-six credit charges that did not have documentation of proper approval. Cause: There was no evidence of the Garden’s formal process of ensuring all expenditures are appropriated documented and approved. Effect: For transactions related to federal grants, without the appropriate supporting documentation, charges may be disallowed. Recommendation: We recommend that management establish controls and implement policies to ensure that support is obtained and maintained for all expense transactions. Management’s Response: Refer to the Correction Action Plan.

2022-001 – Reporting – Submission of the Reporting Package and Data Collection Form Federal Agency: U.S. Department of the Interior; U.S. Fish & Wildlife Service Federal program title: Endangered Species Conservation Recovery Implementation Funds Assistance Listing Number: 15.657 Award Period: 09/30/2020 – 09/30/2026 Type of Finding: Compliance and material weakness in internal control over compliance and Federal Agency: U.S. Environmental Protection Agency Federal program title: Gulf Coast Ecosystem Restoration Council Comprehensive Plan Assistance Listing Number: 66.130 Award Period: 10/01/2021 – 12/31/2024 Type of Finding: Compliance and material weakness in internal control over compliance Criteria: In accordance with 2 CFR Section 200.512(a), the audit must be completed and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report or nine months after the end of the audit period. Condition: The reporting package and data collection form for the year ended December 31, 2022 was not filed into the reporting portal by the deadline. Questioned Costs: None noted. Context: This was a condition noted per review of the Organization’s compliance with the reporting requirements. Cause: The Garden’s Uniform Guidance Audit for the year ended December 31, 2022 was delayed as Garden management was unaware that that their federal expenditures exceeded the audit requirement threshold for the first time. Effect: Untimely reporting could affect future funding from government agencies.   Recommendation: We recommend the Garden adopt policies and procedures, including tracking and monitoring of reporting requirements, to ensure that the audit, reporting package, and data collection form are electronically submitted within the applicable deadline. Management’s Response Refer to the Correction Action Plan.

2022-002 – Allowable Costs/Cost Principles (Allocation of Payroll) Federal Agency: U.S. Department of the Interior; U.S. Fish & Wildlife Service Federal program title: Endangered Species Conservation Recovery Implementation Funds Assistance Listing Number: 15.657 Award Period: 09/30/2020 – 09/30/2026 Type of Finding: Compliance and material weakness in internal control over compliance and Federal Agency: U.S. Environmental Protection Agency Federal program title: Gulf Coast Ecosystem Restoration Council Comprehensive Plan Assistance Listing Number: 66.130 Award Period: 10/01/2021 – 12/31/2024 Type of Finding: Compliance and material weakness Criteria: Uniform Guidance section 200.430(h)(8)(i) indicates that the standards for documentation of personnel expenses are such that (1) Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must:(i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the nonfederal entity and(iii) Reasonably reflect the total activity for which the employee is compensated by the nonfederal entity, not exceeding 100% of compensated activities. Furthermore, subsection (viii) indicates: Budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity are identified and entered into the records in a timely manner and (C) The nonfederal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a federal awards based on budget estimates.   Condition: The Garden is allocating payroll costs to grants based upon budgeted amounts/percentages submitted to the funding agency and does not currently have a system for ensuring that the estimates used produce reasonable approximations of the activity actually performed. Questioned Costs: Unknown. Context: This condition occurred in all payroll transactions selected for testing. Cause: The Garden has a tracking system in place to monitor the wages by employee charged to federal grants to avoid over-allocation of individual employee wages per the grant budget, but this tracking system does not contain a process for identifying and allocating wages based on submitted time records. Effect: Inaccurate payroll costs may be charged to federal programs if the Garden does not have procedures in place to monitor and record employee time devoted to federal programs. Recommendation: Management should develop a process whereby payroll costs allocated to federal grants are supported by a system of internal controls which provides reasonable assurance that the charges are accurate allowable and properly allocated, reasonably reflect the total activity for which the employee is compensated, and support the distribution of the employee’s wages among specific activities or cost objectives if the employee works on more than one federal award. Management’s Response Refer to the Correction Action Plan.

2022-003 – Approval of Expenditures Federal Agency: U.S. Department of the Interior; U.S. Fish & Wildlife Service Federal program title: Endangered Species Conservation Recovery Implementation Funds Assistance Listing Number: 15.657 Award Period: 09/30/2020 – 09/30/2026 Type of Finding: Compliance and significant deficiency in internal control over compliance 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 statues, regulations, and conditions of the federal award.  Condition: During our review of charges to federal programs, many charges were incurred on employees’ credit cards. While most credit statements and related receipts and invoices are reviewed by either the Vice President of Conservation and Research or the Director of Applied Conservation, we noted instances of no employee reviewing the Vice President of Conservation and Research, the Director of Applied Conservation, or certain department heads’ credit card charges. Questioned Costs: None noted. Context: We noted one instance from the sample of twenty-six credit charges that did not have documentation of proper approval. Cause: There was no evidence of the Garden’s formal process of ensuring all expenditures are appropriated documented and approved. Effect: For transactions related to federal grants, without the appropriate supporting documentation, charges may be disallowed. Recommendation: We recommend that management establish controls and implement policies to ensure that support is obtained and maintained for all expense transactions. Management’s Response: Refer to the Correction Action Plan.

2022-001 – Reporting – Submission of the Reporting Package and Data Collection Form Federal Agency: U.S. Department of the Interior; U.S. Fish & Wildlife Service Federal program title: Endangered Species Conservation Recovery Implementation Funds Assistance Listing Number: 15.657 Award Period: 09/30/2020 – 09/30/2026 Type of Finding: Compliance and material weakness in internal control over compliance and Federal Agency: U.S. Environmental Protection Agency Federal program title: Gulf Coast Ecosystem Restoration Council Comprehensive Plan Assistance Listing Number: 66.130 Award Period: 10/01/2021 – 12/31/2024 Type of Finding: Compliance and material weakness in internal control over compliance Criteria: In accordance with 2 CFR Section 200.512(a), the audit must be completed and the data collection form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report or nine months after the end of the audit period. Condition: The reporting package and data collection form for the year ended December 31, 2022 was not filed into the reporting portal by the deadline. Questioned Costs: None noted. Context: This was a condition noted per review of the Organization’s compliance with the reporting requirements. Cause: The Garden’s Uniform Guidance Audit for the year ended December 31, 2022 was delayed as Garden management was unaware that that their federal expenditures exceeded the audit requirement threshold for the first time. Effect: Untimely reporting could affect future funding from government agencies.   Recommendation: We recommend the Garden adopt policies and procedures, including tracking and monitoring of reporting requirements, to ensure that the audit, reporting package, and data collection form are electronically submitted within the applicable deadline. Management’s Response Refer to the Correction Action Plan.

2022-002 – Allowable Costs/Cost Principles (Allocation of Payroll) Federal Agency: U.S. Department of the Interior; U.S. Fish & Wildlife Service Federal program title: Endangered Species Conservation Recovery Implementation Funds Assistance Listing Number: 15.657 Award Period: 09/30/2020 – 09/30/2026 Type of Finding: Compliance and material weakness in internal control over compliance and Federal Agency: U.S. Environmental Protection Agency Federal program title: Gulf Coast Ecosystem Restoration Council Comprehensive Plan Assistance Listing Number: 66.130 Award Period: 10/01/2021 – 12/31/2024 Type of Finding: Compliance and material weakness Criteria: Uniform Guidance section 200.430(h)(8)(i) indicates that the standards for documentation of personnel expenses are such that (1) Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must:(i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the nonfederal entity and(iii) Reasonably reflect the total activity for which the employee is compensated by the nonfederal entity, not exceeding 100% of compensated activities. Furthermore, subsection (viii) indicates: Budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity are identified and entered into the records in a timely manner and (C) The nonfederal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a federal awards based on budget estimates.   Condition: The Garden is allocating payroll costs to grants based upon budgeted amounts/percentages submitted to the funding agency and does not currently have a system for ensuring that the estimates used produce reasonable approximations of the activity actually performed. Questioned Costs: Unknown. Context: This condition occurred in all payroll transactions selected for testing. Cause: The Garden has a tracking system in place to monitor the wages by employee charged to federal grants to avoid over-allocation of individual employee wages per the grant budget, but this tracking system does not contain a process for identifying and allocating wages based on submitted time records. Effect: Inaccurate payroll costs may be charged to federal programs if the Garden does not have procedures in place to monitor and record employee time devoted to federal programs. Recommendation: Management should develop a process whereby payroll costs allocated to federal grants are supported by a system of internal controls which provides reasonable assurance that the charges are accurate allowable and properly allocated, reasonably reflect the total activity for which the employee is compensated, and support the distribution of the employee’s wages among specific activities or cost objectives if the employee works on more than one federal award. Management’s Response Refer to the Correction Action Plan.

2022-003 – Approval of Expenditures Federal Agency: U.S. Department of the Interior; U.S. Fish & Wildlife Service Federal program title: Endangered Species Conservation Recovery Implementation Funds Assistance Listing Number: 15.657 Award Period: 09/30/2020 – 09/30/2026 Type of Finding: Compliance and significant deficiency in internal control over compliance 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 statues, regulations, and conditions of the federal award.  Condition: During our review of charges to federal programs, many charges were incurred on employees’ credit cards. While most credit statements and related receipts and invoices are reviewed by either the Vice President of Conservation and Research or the Director of Applied Conservation, we noted instances of no employee reviewing the Vice President of Conservation and Research, the Director of Applied Conservation, or certain department heads’ credit card charges. Questioned Costs: None noted. Context: We noted one instance from the sample of twenty-six credit charges that did not have documentation of proper approval. Cause: There was no evidence of the Garden’s formal process of ensuring all expenditures are appropriated documented and approved. Effect: For transactions related to federal grants, without the appropriate supporting documentation, charges may be disallowed. Recommendation: We recommend that management establish controls and implement policies to ensure that support is obtained and maintained for all expense transactions. Management’s Response: Refer to the Correction Action Plan.