Audit 341925

FINDING NO. 2022-03 – Maintenance of Expenditures Supporting Documentation Type of Finding: Material Weakness in Internal Control over Major Programs Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.569 Pass-Through Agency: New Jersey Department of Community Affairs Program Titles: Community Services Block Grant (CSBG) and Community Services Block Grant (CSBG) – COVID 19 CARES Act CSBG ND 2020 Pass-Through Number(s): 2022-05235-0198-03, 2020-05205- 0330-01 Criteria: Expenditures of any nature should be supported by invoices or receipts that pertain to each grant. Statement of Condition: During our testing of expenditures associated with both the CSBG and CSBG COVID-19 CARES Act grants it was noted that there was no support for various expenditures submitted for reimbursement, see questioned costs for the specific grant and amounts. Cause: Lack of internal controls lead to the incorrect information being submitted. Effect: This might result in the cognizant agency disallowing the expenses with no supporting documentation and asking for a return of disallowed funds. Questioned Costs: $126,955, the details are as follows: • COVID19 CARES Act FSR#8/9 (Missing support for $40,000) • 2022 CSBG FSR#3/9 (Missing support due to duplication of expenditures submitted for reimbursements of $86,955) Repeat Finding: 2021-002 Recommendation: The Organization should adopt formal written procedures for expenditures. These procedures should require that all invoices, receipts, and payroll registers be kept and maintained for audit trail and reviewed and approved by an appropriate level of management. Views of Responsible Officials: The Organization concurs with the finding and is in the process of improving the Organization's internal controls including monthly closing procedures, record retention procedures and oversight to prevent the submission of incorrect information in the future. The 2022 CSBG was extended to July 29, 2023 and expenditures were submitted to support the $86,955 prior to that date.

FINDING NO. 2022-04 – Submission of Audited Financial Statements Type of Finding: Material Weakness in Internal Control over Major Programs Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.569 Pass-Through Agency: New Jersey Department of Community Affairs Program Titles: Community Services Block Grant (CSBG) and Community Services Block Grant (CSBG) – COVID 19 CARES Act CSBG ND 2020 Pass-Through Number(s): 2021-05235-0083-03, 2022-05235-0198-03, 2020-05205- 0330-01 Criteria: Per the Uniform Guidance and 15-08-OMB Policy manual: audits generally must be completed and submitted by the recipient within 9 months after the end of the recipient's fiscal year audit period. Shorter submission periods may be designated by a state funding agency. Statement of Condition: The Organization submission of the audited financial statements is late. Cause: Significant delay in closing the books, scheduling for an audit and providing information for the audit process. Effect: This might result in the cognizant agency withholding funds and delay funding. Questioned Costs: N/A Repeat Finding: 2021-005 Recommendation: The Organization should attempt to close their books and aim for audit completion within 9 months after year end to meet the federal audit clearing house reporting requirements. Views of Responsible Officials: The Organization agrees with this finding and has in place an accounting firm to facilitate the updating of accounting records and the preparation of information for the fiscal year ended September 2023 and 2024 audits. The accounting information for the fiscal year ended September 2023 is ready for the audit. The preparation of the accounting records for the September 2024 audit is in progress and will be ready for the auditors review shortly.

FINDING NO. 2022-03 – Maintenance of Expenditures Supporting Documentation Type of Finding: Material Weakness in Internal Control over Major Programs Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.569 Pass-Through Agency: New Jersey Department of Community Affairs Program Titles: Community Services Block Grant (CSBG) and Community Services Block Grant (CSBG) – COVID 19 CARES Act CSBG ND 2020 Pass-Through Number(s): 2022-05235-0198-03, 2020-05205- 0330-01 Criteria: Expenditures of any nature should be supported by invoices or receipts that pertain to each grant. Statement of Condition: During our testing of expenditures associated with both the CSBG and CSBG COVID-19 CARES Act grants it was noted that there was no support for various expenditures submitted for reimbursement, see questioned costs for the specific grant and amounts. Cause: Lack of internal controls lead to the incorrect information being submitted. Effect: This might result in the cognizant agency disallowing the expenses with no supporting documentation and asking for a return of disallowed funds. Questioned Costs: $126,955, the details are as follows: • COVID19 CARES Act FSR#8/9 (Missing support for $40,000) • 2022 CSBG FSR#3/9 (Missing support due to duplication of expenditures submitted for reimbursements of $86,955) Repeat Finding: 2021-002 Recommendation: The Organization should adopt formal written procedures for expenditures. These procedures should require that all invoices, receipts, and payroll registers be kept and maintained for audit trail and reviewed and approved by an appropriate level of management. Views of Responsible Officials: The Organization concurs with the finding and is in the process of improving the Organization's internal controls including monthly closing procedures, record retention procedures and oversight to prevent the submission of incorrect information in the future. The 2022 CSBG was extended to July 29, 2023 and expenditures were submitted to support the $86,955 prior to that date.

FINDING NO. 2022-04 – Submission of Audited Financial Statements Type of Finding: Material Weakness in Internal Control over Major Programs Federal Agency: U.S. Department of Health and Human Services Assistance Listing Number: 93.569 Pass-Through Agency: New Jersey Department of Community Affairs Program Titles: Community Services Block Grant (CSBG) and Community Services Block Grant (CSBG) – COVID 19 CARES Act CSBG ND 2020 Pass-Through Number(s): 2021-05235-0083-03, 2022-05235-0198-03, 2020-05205- 0330-01 Criteria: Per the Uniform Guidance and 15-08-OMB Policy manual: audits generally must be completed and submitted by the recipient within 9 months after the end of the recipient's fiscal year audit period. Shorter submission periods may be designated by a state funding agency. Statement of Condition: The Organization submission of the audited financial statements is late. Cause: Significant delay in closing the books, scheduling for an audit and providing information for the audit process. Effect: This might result in the cognizant agency withholding funds and delay funding. Questioned Costs: N/A Repeat Finding: 2021-005 Recommendation: The Organization should attempt to close their books and aim for audit completion within 9 months after year end to meet the federal audit clearing house reporting requirements. Views of Responsible Officials: The Organization agrees with this finding and has in place an accounting firm to facilitate the updating of accounting records and the preparation of information for the fiscal year ended September 2023 and 2024 audits. The accounting information for the fiscal year ended September 2023 is ready for the audit. The preparation of the accounting records for the September 2024 audit is in progress and will be ready for the auditors review shortly.