U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Reporting
Finding 2024-002 – Repeat Finding
Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must 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: For all ten (10) reports tested, the Organization did not have formal documentation that the report was reviewed by a separate individual from the one that prepared it prior to submission.
Additionally, for five (5) out of ten (10) reports tested, the Organization did not submit the required report per the contract.
Questioned Costs: None noted.
Effect: Without the documentation being retained, the Organization cannot demonstrate they have appropriate controls in place to ensure accuracy of the information reported. Without submitting the required reports, the Organization could be considered noncompliant with the grantor.
Cause: The Organization does not have a formal policy in place to document approval of reports and ensure proper submission.
Recommendation: We recommend the Organization implement a policy for formal documentation of review of required reports prior to submission.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Procurement
Finding 2024-003
Criteria: Per Sections 200.318 – 200.327 of the Uniform Grant Guidance, a non-federal entity must have and use documented procurement procedures, consistent with Uniform Grant Guidance Title 2 CFR Section 200.318 for the acquisition of property or services required under a Federal award or subaward. Furthermore, a contract award must not be made to a suspended or debarred party listed on the System for Award Management.
Condition: There was one (1) instance in which a sole source provider was utilized rather than going through the bidding process that was not documented in line with the Uniform Grant Guidance requirements. There was another vendor where only one informal quote was obtained and the rationale for their selection was not documented. The same vendor was also not verified as not being on the suspended or debarred party list on the System for Award Management prior to procuring their services.
Questioned Costs: None noted.
Effect: By not having sufficient documentation, the Organization may not be able to evidence compliance with Uniform Grant Guidance and could have improperly contracted with a vendor.
Cause: The Organization did not obtain quotes from more than one vendor nor document sole source justification for the contracts tested.
Recommendation: The Organization should consider implementing a procurement policy in line with Uniform Grant Guidance and ensure proper documentation of the procurement process for all vendors utilized with federal funding.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Reporting
Finding 2024-002 – Repeat Finding
Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must 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: For all ten (10) reports tested, the Organization did not have formal documentation that the report was reviewed by a separate individual from the one that prepared it prior to submission.
Additionally, for five (5) out of ten (10) reports tested, the Organization did not submit the required report per the contract.
Questioned Costs: None noted.
Effect: Without the documentation being retained, the Organization cannot demonstrate they have appropriate controls in place to ensure accuracy of the information reported. Without submitting the required reports, the Organization could be considered noncompliant with the grantor.
Cause: The Organization does not have a formal policy in place to document approval of reports and ensure proper submission.
Recommendation: We recommend the Organization implement a policy for formal documentation of review of required reports prior to submission.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Procurement
Finding 2024-003
Criteria: Per Sections 200.318 – 200.327 of the Uniform Grant Guidance, a non-federal entity must have and use documented procurement procedures, consistent with Uniform Grant Guidance Title 2 CFR Section 200.318 for the acquisition of property or services required under a Federal award or subaward. Furthermore, a contract award must not be made to a suspended or debarred party listed on the System for Award Management.
Condition: There was one (1) instance in which a sole source provider was utilized rather than going through the bidding process that was not documented in line with the Uniform Grant Guidance requirements. There was another vendor where only one informal quote was obtained and the rationale for their selection was not documented. The same vendor was also not verified as not being on the suspended or debarred party list on the System for Award Management prior to procuring their services.
Questioned Costs: None noted.
Effect: By not having sufficient documentation, the Organization may not be able to evidence compliance with Uniform Grant Guidance and could have improperly contracted with a vendor.
Cause: The Organization did not obtain quotes from more than one vendor nor document sole source justification for the contracts tested.
Recommendation: The Organization should consider implementing a procurement policy in line with Uniform Grant Guidance and ensure proper documentation of the procurement process for all vendors utilized with federal funding.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Reporting
Finding 2024-002 – Repeat Finding
Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must 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: For all ten (10) reports tested, the Organization did not have formal documentation that the report was reviewed by a separate individual from the one that prepared it prior to submission.
Additionally, for five (5) out of ten (10) reports tested, the Organization did not submit the required report per the contract.
Questioned Costs: None noted.
Effect: Without the documentation being retained, the Organization cannot demonstrate they have appropriate controls in place to ensure accuracy of the information reported. Without submitting the required reports, the Organization could be considered noncompliant with the grantor.
Cause: The Organization does not have a formal policy in place to document approval of reports and ensure proper submission.
Recommendation: We recommend the Organization implement a policy for formal documentation of review of required reports prior to submission.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Procurement
Finding 2024-003
Criteria: Per Sections 200.318 – 200.327 of the Uniform Grant Guidance, a non-federal entity must have and use documented procurement procedures, consistent with Uniform Grant Guidance Title 2 CFR Section 200.318 for the acquisition of property or services required under a Federal award or subaward. Furthermore, a contract award must not be made to a suspended or debarred party listed on the System for Award Management.
Condition: There was one (1) instance in which a sole source provider was utilized rather than going through the bidding process that was not documented in line with the Uniform Grant Guidance requirements. There was another vendor where only one informal quote was obtained and the rationale for their selection was not documented. The same vendor was also not verified as not being on the suspended or debarred party list on the System for Award Management prior to procuring their services.
Questioned Costs: None noted.
Effect: By not having sufficient documentation, the Organization may not be able to evidence compliance with Uniform Grant Guidance and could have improperly contracted with a vendor.
Cause: The Organization did not obtain quotes from more than one vendor nor document sole source justification for the contracts tested.
Recommendation: The Organization should consider implementing a procurement policy in line with Uniform Grant Guidance and ensure proper documentation of the procurement process for all vendors utilized with federal funding.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Material Weakness and Material Noncompliance – Allowable Costs and Activities
Finding 2024-004
Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must 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: There were 22 out of 40 samples tested related to one single site housing location where clear and consistent documentation of a control over allowable costs and activities was not present. There were five (5) individuals from those samples whose salaries were allocated to the grant based on the contracts budgeted amount for each position rather than based on their actual time and effort and salary paid during the year for each employee. Additionally, there was one (1) instance of our 40 samples tested where the employee was charged to the incorrect department and therefore incorrectly charged to the grant.
Questioned Costs: $74,000 – The majority of questioned costs were related to a subset of allocated employees. Each allocated employee was recalculated in total to determine the known questioned costs for the period under audit. There was one other instance that related to one employee that should not have been reported that appears to be an isolated incident. The sample was selected using a non-statistical method.
Effect: By not having a clearly documented review process, unallowable costs and activities may go undetected prior to filing a request for reimbursement with the grantor. The Organization should further evaluate their process for documenting the allocation of time by employee for those that do not work 100% of their time on one program to ensure proper documentation and approval of the allocation of time is based on actual time spent in determining allowable costs and activities.
Cause: The Organization does not have a formal policy in place to review expenditures to ensure allowability prior to reimbursement requests being filed.
Recommendation: The Organization should consider implementing a formal policy to ensure all costs are reviewed and approved prior to recording to the grant.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Reporting
Finding 2024-002 – Repeat Finding
Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must 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: For all ten (10) reports tested, the Organization did not have formal documentation that the report was reviewed by a separate individual from the one that prepared it prior to submission.
Additionally, for five (5) out of ten (10) reports tested, the Organization did not submit the required report per the contract.
Questioned Costs: None noted.
Effect: Without the documentation being retained, the Organization cannot demonstrate they have appropriate controls in place to ensure accuracy of the information reported. Without submitting the required reports, the Organization could be considered noncompliant with the grantor.
Cause: The Organization does not have a formal policy in place to document approval of reports and ensure proper submission.
Recommendation: We recommend the Organization implement a policy for formal documentation of review of required reports prior to submission.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Procurement
Finding 2024-003
Criteria: Per Sections 200.318 – 200.327 of the Uniform Grant Guidance, a non-federal entity must have and use documented procurement procedures, consistent with Uniform Grant Guidance Title 2 CFR Section 200.318 for the acquisition of property or services required under a Federal award or subaward. Furthermore, a contract award must not be made to a suspended or debarred party listed on the System for Award Management.
Condition: There was one (1) instance in which a sole source provider was utilized rather than going through the bidding process that was not documented in line with the Uniform Grant Guidance requirements. There was another vendor where only one informal quote was obtained and the rationale for their selection was not documented. The same vendor was also not verified as not being on the suspended or debarred party list on the System for Award Management prior to procuring their services.
Questioned Costs: None noted.
Effect: By not having sufficient documentation, the Organization may not be able to evidence compliance with Uniform Grant Guidance and could have improperly contracted with a vendor.
Cause: The Organization did not obtain quotes from more than one vendor nor document sole source justification for the contracts tested.
Recommendation: The Organization should consider implementing a procurement policy in line with Uniform Grant Guidance and ensure proper documentation of the procurement process for all vendors utilized with federal funding.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Material Weakness and Material Noncompliance – Allowable Costs and Activities
Finding 2024-004
Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must 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: There were 22 out of 40 samples tested related to one single site housing location where clear and consistent documentation of a control over allowable costs and activities was not present. There were five (5) individuals from those samples whose salaries were allocated to the grant based on the contracts budgeted amount for each position rather than based on their actual time and effort and salary paid during the year for each employee. Additionally, there was one (1) instance of our 40 samples tested where the employee was charged to the incorrect department and therefore incorrectly charged to the grant.
Questioned Costs: $74,000 – The majority of questioned costs were related to a subset of allocated employees. Each allocated employee was recalculated in total to determine the known questioned costs for the period under audit. There was one other instance that related to one employee that should not have been reported that appears to be an isolated incident. The sample was selected using a non-statistical method.
Effect: By not having a clearly documented review process, unallowable costs and activities may go undetected prior to filing a request for reimbursement with the grantor. The Organization should further evaluate their process for documenting the allocation of time by employee for those that do not work 100% of their time on one program to ensure proper documentation and approval of the allocation of time is based on actual time spent in determining allowable costs and activities.
Cause: The Organization does not have a formal policy in place to review expenditures to ensure allowability prior to reimbursement requests being filed.
Recommendation: The Organization should consider implementing a formal policy to ensure all costs are reviewed and approved prior to recording to the grant.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Reporting
Finding 2024-002 – Repeat Finding
Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must 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: For all ten (10) reports tested, the Organization did not have formal documentation that the report was reviewed by a separate individual from the one that prepared it prior to submission.
Additionally, for five (5) out of ten (10) reports tested, the Organization did not submit the required report per the contract.
Questioned Costs: None noted.
Effect: Without the documentation being retained, the Organization cannot demonstrate they have appropriate controls in place to ensure accuracy of the information reported. Without submitting the required reports, the Organization could be considered noncompliant with the grantor.
Cause: The Organization does not have a formal policy in place to document approval of reports and ensure proper submission.
Recommendation: We recommend the Organization implement a policy for formal documentation of review of required reports prior to submission.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Procurement
Finding 2024-003
Criteria: Per Sections 200.318 – 200.327 of the Uniform Grant Guidance, a non-federal entity must have and use documented procurement procedures, consistent with Uniform Grant Guidance Title 2 CFR Section 200.318 for the acquisition of property or services required under a Federal award or subaward. Furthermore, a contract award must not be made to a suspended or debarred party listed on the System for Award Management.
Condition: There was one (1) instance in which a sole source provider was utilized rather than going through the bidding process that was not documented in line with the Uniform Grant Guidance requirements. There was another vendor where only one informal quote was obtained and the rationale for their selection was not documented. The same vendor was also not verified as not being on the suspended or debarred party list on the System for Award Management prior to procuring their services.
Questioned Costs: None noted.
Effect: By not having sufficient documentation, the Organization may not be able to evidence compliance with Uniform Grant Guidance and could have improperly contracted with a vendor.
Cause: The Organization did not obtain quotes from more than one vendor nor document sole source justification for the contracts tested.
Recommendation: The Organization should consider implementing a procurement policy in line with Uniform Grant Guidance and ensure proper documentation of the procurement process for all vendors utilized with federal funding.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Material Weakness and Material Noncompliance – Allowable Costs and Activities
Finding 2024-004
Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must 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: There were 22 out of 40 samples tested related to one single site housing location where clear and consistent documentation of a control over allowable costs and activities was not present. There were five (5) individuals from those samples whose salaries were allocated to the grant based on the contracts budgeted amount for each position rather than based on their actual time and effort and salary paid during the year for each employee. Additionally, there was one (1) instance of our 40 samples tested where the employee was charged to the incorrect department and therefore incorrectly charged to the grant.
Questioned Costs: $74,000 – The majority of questioned costs were related to a subset of allocated employees. Each allocated employee was recalculated in total to determine the known questioned costs for the period under audit. There was one other instance that related to one employee that should not have been reported that appears to be an isolated incident. The sample was selected using a non-statistical method.
Effect: By not having a clearly documented review process, unallowable costs and activities may go undetected prior to filing a request for reimbursement with the grantor. The Organization should further evaluate their process for documenting the allocation of time by employee for those that do not work 100% of their time on one program to ensure proper documentation and approval of the allocation of time is based on actual time spent in determining allowable costs and activities.
Cause: The Organization does not have a formal policy in place to review expenditures to ensure allowability prior to reimbursement requests being filed.
Recommendation: The Organization should consider implementing a formal policy to ensure all costs are reviewed and approved prior to recording to the grant.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Reporting
Finding 2024-002 – Repeat Finding
Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must 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: For all ten (10) reports tested, the Organization did not have formal documentation that the report was reviewed by a separate individual from the one that prepared it prior to submission.
Additionally, for five (5) out of ten (10) reports tested, the Organization did not submit the required report per the contract.
Questioned Costs: None noted.
Effect: Without the documentation being retained, the Organization cannot demonstrate they have appropriate controls in place to ensure accuracy of the information reported. Without submitting the required reports, the Organization could be considered noncompliant with the grantor.
Cause: The Organization does not have a formal policy in place to document approval of reports and ensure proper submission.
Recommendation: We recommend the Organization implement a policy for formal documentation of review of required reports prior to submission.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Procurement
Finding 2024-003
Criteria: Per Sections 200.318 – 200.327 of the Uniform Grant Guidance, a non-federal entity must have and use documented procurement procedures, consistent with Uniform Grant Guidance Title 2 CFR Section 200.318 for the acquisition of property or services required under a Federal award or subaward. Furthermore, a contract award must not be made to a suspended or debarred party listed on the System for Award Management.
Condition: There was one (1) instance in which a sole source provider was utilized rather than going through the bidding process that was not documented in line with the Uniform Grant Guidance requirements. There was another vendor where only one informal quote was obtained and the rationale for their selection was not documented. The same vendor was also not verified as not being on the suspended or debarred party list on the System for Award Management prior to procuring their services.
Questioned Costs: None noted.
Effect: By not having sufficient documentation, the Organization may not be able to evidence compliance with Uniform Grant Guidance and could have improperly contracted with a vendor.
Cause: The Organization did not obtain quotes from more than one vendor nor document sole source justification for the contracts tested.
Recommendation: The Organization should consider implementing a procurement policy in line with Uniform Grant Guidance and ensure proper documentation of the procurement process for all vendors utilized with federal funding.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Reporting
Finding 2024-002 – Repeat Finding
Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must 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: For all ten (10) reports tested, the Organization did not have formal documentation that the report was reviewed by a separate individual from the one that prepared it prior to submission.
Additionally, for five (5) out of ten (10) reports tested, the Organization did not submit the required report per the contract.
Questioned Costs: None noted.
Effect: Without the documentation being retained, the Organization cannot demonstrate they have appropriate controls in place to ensure accuracy of the information reported. Without submitting the required reports, the Organization could be considered noncompliant with the grantor.
Cause: The Organization does not have a formal policy in place to document approval of reports and ensure proper submission.
Recommendation: We recommend the Organization implement a policy for formal documentation of review of required reports prior to submission.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Procurement
Finding 2024-003
Criteria: Per Sections 200.318 – 200.327 of the Uniform Grant Guidance, a non-federal entity must have and use documented procurement procedures, consistent with Uniform Grant Guidance Title 2 CFR Section 200.318 for the acquisition of property or services required under a Federal award or subaward. Furthermore, a contract award must not be made to a suspended or debarred party listed on the System for Award Management.
Condition: There was one (1) instance in which a sole source provider was utilized rather than going through the bidding process that was not documented in line with the Uniform Grant Guidance requirements. There was another vendor where only one informal quote was obtained and the rationale for their selection was not documented. The same vendor was also not verified as not being on the suspended or debarred party list on the System for Award Management prior to procuring their services.
Questioned Costs: None noted.
Effect: By not having sufficient documentation, the Organization may not be able to evidence compliance with Uniform Grant Guidance and could have improperly contracted with a vendor.
Cause: The Organization did not obtain quotes from more than one vendor nor document sole source justification for the contracts tested.
Recommendation: The Organization should consider implementing a procurement policy in line with Uniform Grant Guidance and ensure proper documentation of the procurement process for all vendors utilized with federal funding.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Reporting
Finding 2024-002 – Repeat Finding
Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must 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: For all ten (10) reports tested, the Organization did not have formal documentation that the report was reviewed by a separate individual from the one that prepared it prior to submission.
Additionally, for five (5) out of ten (10) reports tested, the Organization did not submit the required report per the contract.
Questioned Costs: None noted.
Effect: Without the documentation being retained, the Organization cannot demonstrate they have appropriate controls in place to ensure accuracy of the information reported. Without submitting the required reports, the Organization could be considered noncompliant with the grantor.
Cause: The Organization does not have a formal policy in place to document approval of reports and ensure proper submission.
Recommendation: We recommend the Organization implement a policy for formal documentation of review of required reports prior to submission.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Procurement
Finding 2024-003
Criteria: Per Sections 200.318 – 200.327 of the Uniform Grant Guidance, a non-federal entity must have and use documented procurement procedures, consistent with Uniform Grant Guidance Title 2 CFR Section 200.318 for the acquisition of property or services required under a Federal award or subaward. Furthermore, a contract award must not be made to a suspended or debarred party listed on the System for Award Management.
Condition: There was one (1) instance in which a sole source provider was utilized rather than going through the bidding process that was not documented in line with the Uniform Grant Guidance requirements. There was another vendor where only one informal quote was obtained and the rationale for their selection was not documented. The same vendor was also not verified as not being on the suspended or debarred party list on the System for Award Management prior to procuring their services.
Questioned Costs: None noted.
Effect: By not having sufficient documentation, the Organization may not be able to evidence compliance with Uniform Grant Guidance and could have improperly contracted with a vendor.
Cause: The Organization did not obtain quotes from more than one vendor nor document sole source justification for the contracts tested.
Recommendation: The Organization should consider implementing a procurement policy in line with Uniform Grant Guidance and ensure proper documentation of the procurement process for all vendors utilized with federal funding.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Material Weakness and Material Noncompliance – Allowable Costs and Activities
Finding 2024-004
Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must 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: There were 22 out of 40 samples tested related to one single site housing location where clear and consistent documentation of a control over allowable costs and activities was not present. There were five (5) individuals from those samples whose salaries were allocated to the grant based on the contracts budgeted amount for each position rather than based on their actual time and effort and salary paid during the year for each employee. Additionally, there was one (1) instance of our 40 samples tested where the employee was charged to the incorrect department and therefore incorrectly charged to the grant.
Questioned Costs: $74,000 – The majority of questioned costs were related to a subset of allocated employees. Each allocated employee was recalculated in total to determine the known questioned costs for the period under audit. There was one other instance that related to one employee that should not have been reported that appears to be an isolated incident. The sample was selected using a non-statistical method.
Effect: By not having a clearly documented review process, unallowable costs and activities may go undetected prior to filing a request for reimbursement with the grantor. The Organization should further evaluate their process for documenting the allocation of time by employee for those that do not work 100% of their time on one program to ensure proper documentation and approval of the allocation of time is based on actual time spent in determining allowable costs and activities.
Cause: The Organization does not have a formal policy in place to review expenditures to ensure allowability prior to reimbursement requests being filed.
Recommendation: The Organization should consider implementing a formal policy to ensure all costs are reviewed and approved prior to recording to the grant.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Reporting
Finding 2024-002 – Repeat Finding
Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must 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: For all ten (10) reports tested, the Organization did not have formal documentation that the report was reviewed by a separate individual from the one that prepared it prior to submission.
Additionally, for five (5) out of ten (10) reports tested, the Organization did not submit the required report per the contract.
Questioned Costs: None noted.
Effect: Without the documentation being retained, the Organization cannot demonstrate they have appropriate controls in place to ensure accuracy of the information reported. Without submitting the required reports, the Organization could be considered noncompliant with the grantor.
Cause: The Organization does not have a formal policy in place to document approval of reports and ensure proper submission.
Recommendation: We recommend the Organization implement a policy for formal documentation of review of required reports prior to submission.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Procurement
Finding 2024-003
Criteria: Per Sections 200.318 – 200.327 of the Uniform Grant Guidance, a non-federal entity must have and use documented procurement procedures, consistent with Uniform Grant Guidance Title 2 CFR Section 200.318 for the acquisition of property or services required under a Federal award or subaward. Furthermore, a contract award must not be made to a suspended or debarred party listed on the System for Award Management.
Condition: There was one (1) instance in which a sole source provider was utilized rather than going through the bidding process that was not documented in line with the Uniform Grant Guidance requirements. There was another vendor where only one informal quote was obtained and the rationale for their selection was not documented. The same vendor was also not verified as not being on the suspended or debarred party list on the System for Award Management prior to procuring their services.
Questioned Costs: None noted.
Effect: By not having sufficient documentation, the Organization may not be able to evidence compliance with Uniform Grant Guidance and could have improperly contracted with a vendor.
Cause: The Organization did not obtain quotes from more than one vendor nor document sole source justification for the contracts tested.
Recommendation: The Organization should consider implementing a procurement policy in line with Uniform Grant Guidance and ensure proper documentation of the procurement process for all vendors utilized with federal funding.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Material Weakness and Material Noncompliance – Allowable Costs and Activities
Finding 2024-004
Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must 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: There were 22 out of 40 samples tested related to one single site housing location where clear and consistent documentation of a control over allowable costs and activities was not present. There were five (5) individuals from those samples whose salaries were allocated to the grant based on the contracts budgeted amount for each position rather than based on their actual time and effort and salary paid during the year for each employee. Additionally, there was one (1) instance of our 40 samples tested where the employee was charged to the incorrect department and therefore incorrectly charged to the grant.
Questioned Costs: $74,000 – The majority of questioned costs were related to a subset of allocated employees. Each allocated employee was recalculated in total to determine the known questioned costs for the period under audit. There was one other instance that related to one employee that should not have been reported that appears to be an isolated incident. The sample was selected using a non-statistical method.
Effect: By not having a clearly documented review process, unallowable costs and activities may go undetected prior to filing a request for reimbursement with the grantor. The Organization should further evaluate their process for documenting the allocation of time by employee for those that do not work 100% of their time on one program to ensure proper documentation and approval of the allocation of time is based on actual time spent in determining allowable costs and activities.
Cause: The Organization does not have a formal policy in place to review expenditures to ensure allowability prior to reimbursement requests being filed.
Recommendation: The Organization should consider implementing a formal policy to ensure all costs are reviewed and approved prior to recording to the grant.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Reporting
Finding 2024-002 – Repeat Finding
Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must 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: For all ten (10) reports tested, the Organization did not have formal documentation that the report was reviewed by a separate individual from the one that prepared it prior to submission.
Additionally, for five (5) out of ten (10) reports tested, the Organization did not submit the required report per the contract.
Questioned Costs: None noted.
Effect: Without the documentation being retained, the Organization cannot demonstrate they have appropriate controls in place to ensure accuracy of the information reported. Without submitting the required reports, the Organization could be considered noncompliant with the grantor.
Cause: The Organization does not have a formal policy in place to document approval of reports and ensure proper submission.
Recommendation: We recommend the Organization implement a policy for formal documentation of review of required reports prior to submission.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Housing and Urban Development
Pass-through Entity: North Carolina Department of Health and Human Services, Division of Aging and Adult Services and City of Charlotte, North Carolina
Program Name: Emergency Solutions Grant
Federal Assistance Listing Number: 14.231
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Significant Deficiency and Nonmaterial Noncompliance – Procurement
Finding 2024-003
Criteria: Per Sections 200.318 – 200.327 of the Uniform Grant Guidance, a non-federal entity must have and use documented procurement procedures, consistent with Uniform Grant Guidance Title 2 CFR Section 200.318 for the acquisition of property or services required under a Federal award or subaward. Furthermore, a contract award must not be made to a suspended or debarred party listed on the System for Award Management.
Condition: There was one (1) instance in which a sole source provider was utilized rather than going through the bidding process that was not documented in line with the Uniform Grant Guidance requirements. There was another vendor where only one informal quote was obtained and the rationale for their selection was not documented. The same vendor was also not verified as not being on the suspended or debarred party list on the System for Award Management prior to procuring their services.
Questioned Costs: None noted.
Effect: By not having sufficient documentation, the Organization may not be able to evidence compliance with Uniform Grant Guidance and could have improperly contracted with a vendor.
Cause: The Organization did not obtain quotes from more than one vendor nor document sole source justification for the contracts tested.
Recommendation: The Organization should consider implementing a procurement policy in line with Uniform Grant Guidance and ensure proper documentation of the procurement process for all vendors utilized with federal funding.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.
U.S. Department of Treasury
Pass-through Entity: Mecklenburg County, North Carolina
Program Name: Coronavirus State and Local Fiscal Recovery Funds
Federal Assistance Listing Number: 21.027
Material Weakness and Material Noncompliance – Allowable Costs and Activities
Finding 2024-004
Criteria: Per Section 200.303 of the Uniform Grant Guidance, a non-federal entity must 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: There were 22 out of 40 samples tested related to one single site housing location where clear and consistent documentation of a control over allowable costs and activities was not present. There were five (5) individuals from those samples whose salaries were allocated to the grant based on the contracts budgeted amount for each position rather than based on their actual time and effort and salary paid during the year for each employee. Additionally, there was one (1) instance of our 40 samples tested where the employee was charged to the incorrect department and therefore incorrectly charged to the grant.
Questioned Costs: $74,000 – The majority of questioned costs were related to a subset of allocated employees. Each allocated employee was recalculated in total to determine the known questioned costs for the period under audit. There was one other instance that related to one employee that should not have been reported that appears to be an isolated incident. The sample was selected using a non-statistical method.
Effect: By not having a clearly documented review process, unallowable costs and activities may go undetected prior to filing a request for reimbursement with the grantor. The Organization should further evaluate their process for documenting the allocation of time by employee for those that do not work 100% of their time on one program to ensure proper documentation and approval of the allocation of time is based on actual time spent in determining allowable costs and activities.
Cause: The Organization does not have a formal policy in place to review expenditures to ensure allowability prior to reimbursement requests being filed.
Recommendation: The Organization should consider implementing a formal policy to ensure all costs are reviewed and approved prior to recording to the grant.
Views of Management: Management agrees with the finding and is implementing procedures to correct this which are further discussed in the Corrective Action Plan. See Corrective Action Plan for more information.