Audit 323035

Program Name – Continuum of Care Assistance Listing Number – 14.267 Pass-through Entity – N/A Finding Type – Material Weakness and Noncompliance Criteria – A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance. Any costs drawn down prior to the operating start date of the grant are ineligible expenditures. Condition and Description – For 4 grants the Organization drew funds prior to the period of performance. Questioned Costs – None. Identification of a Repeat Finding – This is a repeat finding and was identified as Finding 2022-003 in the prior year single audit. Cause/Effect The Organization drew funds prior to the operating start date of the grant. Although the expenses were for a period subsequent to the operating start of the grant, the draws were outside of the period of performance. As a result, the funds were required to be returned to the US Department of Housing and Urban Development. As these grants were still active grants and funds had yet to expire, the Organization was able to redraw these funds during the period of performance and was made whole under the grants’ appropriation year. Recommendation – The Organization should ensure that grant funds are not drawn until after the operating start date of the grant. View of Responsible Official and Corrective Action Plan – We agree with the auditors' comments, and the following action has been taken to improve the situation. We have adjusted the agency’s Accounting Policies & Procedure Manual to include a detailed review of the General Ledger detail supporting each draw request. Accounting personnel will ensure the agency’s General Ledger specifically details the month of rent and utility allowance being provided so eligible costs are clearly delineated. Someone other than the preparer will perform a review of each drawdown request to ensure that costs are not being drawn down prior to the operating start date of each individual grant. This issue was discussed with HUD in March 2024 at which time procedural changes were implemented. Additionally, as noted above, our agency was able to repay and redraw the funds drawn outside of the aforementioned period of performance without further penalty. Effective March 2024 the preparer is required to include the month of rent and utility allowance being provided in the General Ledger detail. A review of the General Ledger detail supporting each draw request will be performed by someone other than the preparer to ensure that costs are not being drawn down prior to the operating start date of each individual grant.

Program Name – Continuum of Care Assistance Listing Number – 14.267 Pass-through Entity – N/A Finding Type – Material Weakness and Noncompliance Criteria – A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance. Any costs drawn down prior to the operating start date of the grant are ineligible expenditures. Condition and Description – For 4 grants the Organization drew funds prior to the period of performance. Questioned Costs – None. Identification of a Repeat Finding – This is a repeat finding and was identified as Finding 2022-003 in the prior year single audit. Cause/Effect The Organization drew funds prior to the operating start date of the grant. Although the expenses were for a period subsequent to the operating start of the grant, the draws were outside of the period of performance. As a result, the funds were required to be returned to the US Department of Housing and Urban Development. As these grants were still active grants and funds had yet to expire, the Organization was able to redraw these funds during the period of performance and was made whole under the grants’ appropriation year. Recommendation – The Organization should ensure that grant funds are not drawn until after the operating start date of the grant. View of Responsible Official and Corrective Action Plan – We agree with the auditors' comments, and the following action has been taken to improve the situation. We have adjusted the agency’s Accounting Policies & Procedure Manual to include a detailed review of the General Ledger detail supporting each draw request. Accounting personnel will ensure the agency’s General Ledger specifically details the month of rent and utility allowance being provided so eligible costs are clearly delineated. Someone other than the preparer will perform a review of each drawdown request to ensure that costs are not being drawn down prior to the operating start date of each individual grant. This issue was discussed with HUD in March 2024 at which time procedural changes were implemented. Additionally, as noted above, our agency was able to repay and redraw the funds drawn outside of the aforementioned period of performance without further penalty. Effective March 2024 the preparer is required to include the month of rent and utility allowance being provided in the General Ledger detail. A review of the General Ledger detail supporting each draw request will be performed by someone other than the preparer to ensure that costs are not being drawn down prior to the operating start date of each individual grant.