2024-001: Lack of Documentation for Procurement, Suspension and Debarment Testing
Federal Department: Department of Labor
Assistance Listing #: 17.274
Material Weakness in Internal Controls and Noncompliance
Category of Finding – Procurement, Suspension, and Debarment
Criteria - Uniform Guidance and CFR sections 200.318 through 200.326 set forth the procurement standards non‐federal entities other than states must follow when operating federal programs and the procurement procedures required depending on the amount of the transaction.
Condition - There was no documentation maintained related to the search for price comparisons or suspension and debarment testing performed on vendors.
Context – It was communicated by management during audit fieldwork that there was no documentation maintained related to the search for price comparisons or suspension and debarment testing performed on vendors.
Cause – Management was in the process of implementing the draft procurement policy as of June 30, 2024. The policy is properly designed and follows the Uniform Guidance. However, the policy was just not implemented during the period under audit.
Effect - Increased overall risk that Change Inc. is contracting and awarding contracts to suspended or debarred vendors or is not obtaining the best possible prices for goods or services.
Recommendation - We recommend that management implement a process to perform price comparisons and suspension and debarment testing as required by their procurement policy, and that as part of this process they maintain adequate supporting documentation and records to document history and methods of procurement, suspension, and debarment and the procedures performed to comply with these CFR sections. This could include the use of standard forms and templates for purchase orders, contracts, cost/price analyses, bid evaluation, and suspension & debarment testing.
Auditee’s comments and response – Management is in agreement with this finding. The Executive Director and Controller developed an updated procurement policy. This policy went into effect on July 1, 2024, and has been implemented throughout the organizational system.
Responsible party for corrective action: Jill Johnson, Executive Director
Repeat Finding: 2023-002
2024-002: Lack of Documentation for Review of Participant Files
Federal Departments: Corporation for National and Community Service
Assistance Listing #: 94.006
Federal Departments: Department of Labor
Assistance Listing #: 17.274
Internal Controls Significant Deficiency
Category of Finding – Eligibility
Criteria – Uniform Guidance requires that nonprofit organizations establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.
Condition – Personnel at Change Inc. were unable to produce documentation supporting the review of participant files for participant eligibility.
Cause – Change Inc. has an informal process around participant file review and did not properly maintain documentation.
Effect – A participant’s eligibility could be incorrectly determined and not be caught as a file review was not completed, or the review is not properly completed and no one would know since there was no documentation of the review or lack of review.
Recommendation – We recommend that management create written participant file review policies and procedures which include a requirement that the review process be documented when reviews are completed.
Auditee’s comments and response – Management is in agreement with this finding. Change Inc. is working to formalize this process by creating a written participant file review policy and procedure. It will be implemented by February 1, 2025.
Responsible party for corrective action: Jill Johnson, Executive Director
Repeat Finding: 2023-003
2024-002: Lack of Documentation for Review of Participant Files
Federal Departments: Corporation for National and Community Service
Assistance Listing #: 94.006
Federal Departments: Department of Labor
Assistance Listing #: 17.274
Internal Controls Significant Deficiency
Category of Finding – Eligibility
Criteria – Uniform Guidance requires that nonprofit organizations establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.
Condition – Personnel at Change Inc. were unable to produce documentation supporting the review of participant files for participant eligibility.
Cause – Change Inc. has an informal process around participant file review and did not properly maintain documentation.
Effect – A participant’s eligibility could be incorrectly determined and not be caught as a file review was not completed, or the review is not properly completed and no one would know since there was no documentation of the review or lack of review.
Recommendation – We recommend that management create written participant file review policies and procedures which include a requirement that the review process be documented when reviews are completed.
Auditee’s comments and response – Management is in agreement with this finding. Change Inc. is working to formalize this process by creating a written participant file review policy and procedure. It will be implemented by February 1, 2025.
Responsible party for corrective action: Jill Johnson, Executive Director
Repeat Finding: 2023-003
2024-002: Lack of Documentation for Review of Participant Files
Federal Departments: Corporation for National and Community Service
Assistance Listing #: 94.006
Federal Departments: Department of Labor
Assistance Listing #: 17.274
Internal Controls Significant Deficiency
Category of Finding – Eligibility
Criteria – Uniform Guidance requires that nonprofit organizations establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.
Condition – Personnel at Change Inc. were unable to produce documentation supporting the review of participant files for participant eligibility.
Cause – Change Inc. has an informal process around participant file review and did not properly maintain documentation.
Effect – A participant’s eligibility could be incorrectly determined and not be caught as a file review was not completed, or the review is not properly completed and no one would know since there was no documentation of the review or lack of review.
Recommendation – We recommend that management create written participant file review policies and procedures which include a requirement that the review process be documented when reviews are completed.
Auditee’s comments and response – Management is in agreement with this finding. Change Inc. is working to formalize this process by creating a written participant file review policy and procedure. It will be implemented by February 1, 2025.
Responsible party for corrective action: Jill Johnson, Executive Director
Repeat Finding: 2023-003
2024-001: Lack of Documentation for Procurement, Suspension and Debarment Testing
Federal Department: Department of Labor
Assistance Listing #: 17.274
Material Weakness in Internal Controls and Noncompliance
Category of Finding – Procurement, Suspension, and Debarment
Criteria - Uniform Guidance and CFR sections 200.318 through 200.326 set forth the procurement standards non‐federal entities other than states must follow when operating federal programs and the procurement procedures required depending on the amount of the transaction.
Condition - There was no documentation maintained related to the search for price comparisons or suspension and debarment testing performed on vendors.
Context – It was communicated by management during audit fieldwork that there was no documentation maintained related to the search for price comparisons or suspension and debarment testing performed on vendors.
Cause – Management was in the process of implementing the draft procurement policy as of June 30, 2024. The policy is properly designed and follows the Uniform Guidance. However, the policy was just not implemented during the period under audit.
Effect - Increased overall risk that Change Inc. is contracting and awarding contracts to suspended or debarred vendors or is not obtaining the best possible prices for goods or services.
Recommendation - We recommend that management implement a process to perform price comparisons and suspension and debarment testing as required by their procurement policy, and that as part of this process they maintain adequate supporting documentation and records to document history and methods of procurement, suspension, and debarment and the procedures performed to comply with these CFR sections. This could include the use of standard forms and templates for purchase orders, contracts, cost/price analyses, bid evaluation, and suspension & debarment testing.
Auditee’s comments and response – Management is in agreement with this finding. The Executive Director and Controller developed an updated procurement policy. This policy went into effect on July 1, 2024, and has been implemented throughout the organizational system.
Responsible party for corrective action: Jill Johnson, Executive Director
Repeat Finding: 2023-002
2024-002: Lack of Documentation for Review of Participant Files
Federal Departments: Corporation for National and Community Service
Assistance Listing #: 94.006
Federal Departments: Department of Labor
Assistance Listing #: 17.274
Internal Controls Significant Deficiency
Category of Finding – Eligibility
Criteria – Uniform Guidance requires that nonprofit organizations establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.
Condition – Personnel at Change Inc. were unable to produce documentation supporting the review of participant files for participant eligibility.
Cause – Change Inc. has an informal process around participant file review and did not properly maintain documentation.
Effect – A participant’s eligibility could be incorrectly determined and not be caught as a file review was not completed, or the review is not properly completed and no one would know since there was no documentation of the review or lack of review.
Recommendation – We recommend that management create written participant file review policies and procedures which include a requirement that the review process be documented when reviews are completed.
Auditee’s comments and response – Management is in agreement with this finding. Change Inc. is working to formalize this process by creating a written participant file review policy and procedure. It will be implemented by February 1, 2025.
Responsible party for corrective action: Jill Johnson, Executive Director
Repeat Finding: 2023-003
2024-002: Lack of Documentation for Review of Participant Files
Federal Departments: Corporation for National and Community Service
Assistance Listing #: 94.006
Federal Departments: Department of Labor
Assistance Listing #: 17.274
Internal Controls Significant Deficiency
Category of Finding – Eligibility
Criteria – Uniform Guidance requires that nonprofit organizations establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.
Condition – Personnel at Change Inc. were unable to produce documentation supporting the review of participant files for participant eligibility.
Cause – Change Inc. has an informal process around participant file review and did not properly maintain documentation.
Effect – A participant’s eligibility could be incorrectly determined and not be caught as a file review was not completed, or the review is not properly completed and no one would know since there was no documentation of the review or lack of review.
Recommendation – We recommend that management create written participant file review policies and procedures which include a requirement that the review process be documented when reviews are completed.
Auditee’s comments and response – Management is in agreement with this finding. Change Inc. is working to formalize this process by creating a written participant file review policy and procedure. It will be implemented by February 1, 2025.
Responsible party for corrective action: Jill Johnson, Executive Director
Repeat Finding: 2023-003
2024-002: Lack of Documentation for Review of Participant Files
Federal Departments: Corporation for National and Community Service
Assistance Listing #: 94.006
Federal Departments: Department of Labor
Assistance Listing #: 17.274
Internal Controls Significant Deficiency
Category of Finding – Eligibility
Criteria – Uniform Guidance requires that nonprofit organizations establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.
Condition – Personnel at Change Inc. were unable to produce documentation supporting the review of participant files for participant eligibility.
Cause – Change Inc. has an informal process around participant file review and did not properly maintain documentation.
Effect – A participant’s eligibility could be incorrectly determined and not be caught as a file review was not completed, or the review is not properly completed and no one would know since there was no documentation of the review or lack of review.
Recommendation – We recommend that management create written participant file review policies and procedures which include a requirement that the review process be documented when reviews are completed.
Auditee’s comments and response – Management is in agreement with this finding. Change Inc. is working to formalize this process by creating a written participant file review policy and procedure. It will be implemented by February 1, 2025.
Responsible party for corrective action: Jill Johnson, Executive Director
Repeat Finding: 2023-003