Type of Finding: Material Weakness in Internal Control over Compliance and Other Matters
Criteria or Specific Requirement: Key controls should be clearly documented as they occur throughout
the year. The organization should have key controls in place requiring that all journal entries be reviewed
and approved throughout the year. Entries should be reviewed by someone with the proper skills,
knowledge, and experience to know if the journal entries are correct
Condition/Context: It was noted during the audit that journal entries are not being reviewed and approved
by someone who has access to and is reviewing all of the underlying information to determine if the journal
entry is accurate and reasonable. Support for journal entries was also unable to be provided for the entries
we were testing.
Cause: The cause of this issue is the absence of a formalized and consistently applied journal entry review
process related to all grant program. The organization lacks clear procedures to ensure that all journal
entries are properly reviewed, approved, and documented before posting.
Effect: The lack of a formal review process for journal entries increases the risk of errors or misstatements
in the financial records of the SSVF program. Without proper oversight, there is also a heightened risk of
misclassification or improper allocation of expenses, which could lead to financial discrepancies or noncompliance
with federal regulations, potentially leading to disallowed costs or inaccuracies in reporting the
use of federal funds.
Recommendation: We recommend that the organization implement a formal journal entry review process
to ensure that all journal entries related to all programs are reviewed and approved by authorized personnel
before being posted. The process should include clear documentation of the review and approval steps to
maintain the integrity and accuracy of the financial records.
Repeat Finding: This is not a repeat finding.
Corrective Action Plan (CAP)
Explanation of Disagreement with Audit Findings:
There is no disagreement with the audit finding.
Actions Planned in Response to Finding:
In response to the finding, the organization will establish and implement a formal journal entry review
process. All journal entries will be reviewed and approved by authorized personnel before being posted to
the financial system. Additionally, clear documentation of the review and approval process will be
maintained to ensure accuracy and compliance.
Official Responsible for Ensuring CAP:
The Interim ED will be responsible for overseeing the implementation of corrective actions. Planned Completion Date for CAP:
The planned completion date is June 30, 2025.
Plan to Monitor Completion of CAP:
The Board of Directors will monitor the completion of the CAP through reviews of journal entries to
ensure the review process is being followed and all necessary documentation is maintained.
Federal Agency: U.S. Department of Veterans Affairs
Federal Program Name: VA Supportive Services for Veteran Families (SSVF)
Assistance Listing Number: 64.033
Federal Award Identification Number: 20-ZZ-026
Award Period: 10/01/2023 – 09/30/2024
Type of Finding: Material Weakness in Internal Control over Compliance
Compliance Requirement: Allowable Costs
Criteria or Specific Requirement: Payment of SSVF grant funds up to the amount specified in the SSVF
grant agreement will be made only for appropriately documented eligible expenses that are allowable,
allocable, and reasonable costs of operating a program under the Supportive Services grant. Eligible
expenses must be in accordance with the applicable Federal Cost Principles set forth in OMB Circular A-
122, Cost Principles for Non-Profit Organizations, codified at 2 CFR Part 235, 2 CFR 200 Subpart E Cost
Principles. Additionally, expenses must be eligible per the grantee’s approved SSVF budget.
Condition/Context: During the course of the audit and review of the SSVF monitoring report there were
identified expenses that related to travel and development of an application. There is insufficient
documentation to verify the allowability, reasonableness, and allocability of these expenses. Additionally,
there was no clear review process for administrative expenses to ensure that they were reasonable and
allowable under federal guidelines.
Cause: The internal controls related to the monitoring and approval of administrative expenses are
insufficient, leading to potential non-compliance with federal requirements. The organization has not
implemented a systematic review and approval process for these expenses, leading to inadequate
documentation and non-compliance with federal guidelines.
Effect: The lack of proper oversight and documentation of administrative expenses resulted in noncompliant/
unallowable charges to the federal program, increasing the risk of questioned costs or disallowed
expenditures. The failure to allocate and support administrative costs properly also hinder the program’s
ability to demonstrate that funds were used effectively and in accordance with federal regulations.
Additionally, disallowed costs identified during the review will be paid back with interest.
Recommendation: We recommend implementing stronger controls and a formal periodic review process
for administrative expenses, ensuring that all expenditures are properly documented, allocated, and
compliant with federal regulations.
Repeat Finding: This is not a repeat finding.
Questioned Costs: $128,262Explanation of Disagreement with Audit Findings:
There is no disagreement with the audit finding.
Actions Planned in Response to Finding:
In response to the finding, the organization will implement a formal review and approval process for
administrative expenses, enhance documentation practices, conduct regular internal audits and train staff
on federal cost principles. New management acknowledges that intentional collusion and failure to follow
procedures contributed to the issue; corrective action has been taken and safeguards are being put in place
to ensure accountability and prevent recurrence.
Official Responsible for Ensuring CAP:
The interim ED will be responsible for overseeing the implementation of corrective actions.
Planned Completion Date for CAP:
The planned completion date is June 06, 2024.
Plan to Monitor Completion of CAP:
The board will monitor the completion of the CAP through meeting at least quarterly with Director,
Finance and Compliance personnel.
Federal Agency: U.S. Department of Veterans Affairs
Federal Program Name: VA Supportive Services for Veteran Families (SSVF)
Assistance Listing Number: 64.033
Federal Award Identification Number: 20-ZZ-026
Award Period: 10/01/2023 – 09/30/2024
Type of Finding: Material Weakness in Internal Control over Compliance and Other Matters
Compliance Requirement: Allowable Costs
Criteria or Specific Requirement: The program requires that all expenses charged to the federal award
are reasonable, allowable, and properly reconciled with documentation. Questioned costs must be
adequately documented and reconciled to ensure they are allocable and compliant with the approved budget
and travel policies.
Condition/Context: During the audit, we found the organization did not comply with the budget
requirements and grant requirements. The organization reimbursed an officer’s husband travel expenses
which was not allowable as it did not have a direct service benefit. The reimbursement claimed was
ineligible.
Cause: The organization’s internal controls over travel expenditures are insufficient, and there is no
systematic process in place to reconcile travel costs with the documented allowable amounts. This lack of
reconciliation may lead to discrepancies between the actual travel costs and the allowable amounts.
Effect: Failure to reconcile questioned costs with allowable travel costs increases the risk of improper
payments and non-compliance with federal requirements. This can result in disallowed costs or adjustments
to the federal program, affecting the program's financial integrity.
Recommendation: We recommend implementing a process to ensure all travel costs are reconciled with
the allowable amounts and that discrepancies are addressed promptly. The organization should also
strengthen internal controls to verify that travel expenditures are in compliance with federal policies and
properly documented.
Repeat Finding: This is not a repeat finding.
Questioned Costs: $647
Corrective Action Plan (CAP)
Explanation of Disagreement with Audit Findings:
There is no disagreement with the audit finding.Actions Planned in Response to Finding:
The organization will implement a reconciliation process to verify that all travel costs align with the
allowable amounts under the SSVF program’s policies. Additionally, relevant staff will be trained to
ensure full compliance with federal travel regulations and documentation requirements.
Official Responsible for Ensuring CAP:
The Interim ED will be responsible for overseeing the implementation of corrective actions.
Planned Completion Date for CAP:
The planned completion date was October 10, 2024.
Plan to Monitor Completion of CAP:
The Board of Directors monitored the completion of the CAP as new policy at Board Meeting.
Federal Agency: U.S. Department of Veterans Affairs
Federal Program Name: VA Supportive Services for Veteran Families (SSVF)
Assistance Listing Number: 64.033
Federal Award Identification Number: 20-ZZ-026
Award Period: 10/01/2023 – 09/30/2024
Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters
Compliance Requirement: Cash Management
Criteria or Specific Requirement: The organization is required to ensure that all drawdowns are properly
reconciled to the financial records to maintain accurate accounting and compliance with federal regulations.
This includes verifying that expenditures are correctly matched with drawdowns and that all necessary
documentation supports these transactions.
Condition/Context: During the audit, it was observed that the organization did not consistently reconcile
drawdowns with actual expenditures for the SSVF program. This lack of reconciliation increases the risk
of financial discrepancies, misstatements, or non-compliance with federal requirements.
Effect: The lack of a formal reconciliation process increases the risk of financial errors or misstatements
in the SSVF program's records. Without adequate reconciliation, there is a heightened risk of misreporting
expenditures, which could lead to financial discrepancies, non-compliance with federal regulations, or
disallowed costs.
Cause: The cause of this issue is the absence of a formalized and consistently applied drawdown
reconciliation process for the SSVF program.
Recommendation: We recommend that the organization implement a formal drawdown reconciliation
process to ensure that all drawdowns related to the SSVF program are accurately reconciled with actual
expenditures. The process should include maintaining clear documentation of reconciliation steps to
enhance the integrity and accuracy of financial records.
Repeat Finding: This is not a repeat finding.
Corrective Action Plan (CAP)
Explanation of Disagreement with Audit Findings:
There is no disagreement with the audit finding.
Actions Planned in Response to Finding:
The organization will establish and implement a formal drawdown reconciliation process. This will include
developing written procedures, training staff on reconciliation requirements, and maintaining clear
documentation for each reconciliation. Executive personnel will conduct monthly reviews to verify
compliance and address any discrepancies promptly prior to drawdown. Official Responsible for Ensuring CAP:
The Interim ED will be responsible for overseeing the implementation of corrective actions.
Planned Completion Date for CAP:
The planned completion date is March 1, 2025.
Plan to Monitor Completion of CAP:
The Board of Directors meet with the Executive team at least quarterly to review financials.
Type of Finding: Material Weakness in Internal Control over Compliance and Other Matters
Criteria or Specific Requirement: Key controls should be clearly documented as they occur throughout
the year. The organization should have key controls in place requiring that all journal entries be reviewed
and approved throughout the year. Entries should be reviewed by someone with the proper skills,
knowledge, and experience to know if the journal entries are correct
Condition/Context: It was noted during the audit that journal entries are not being reviewed and approved
by someone who has access to and is reviewing all of the underlying information to determine if the journal
entry is accurate and reasonable. Support for journal entries was also unable to be provided for the entries
we were testing.
Cause: The cause of this issue is the absence of a formalized and consistently applied journal entry review
process related to all grant program. The organization lacks clear procedures to ensure that all journal
entries are properly reviewed, approved, and documented before posting.
Effect: The lack of a formal review process for journal entries increases the risk of errors or misstatements
in the financial records of the SSVF program. Without proper oversight, there is also a heightened risk of
misclassification or improper allocation of expenses, which could lead to financial discrepancies or noncompliance
with federal regulations, potentially leading to disallowed costs or inaccuracies in reporting the
use of federal funds.
Recommendation: We recommend that the organization implement a formal journal entry review process
to ensure that all journal entries related to all programs are reviewed and approved by authorized personnel
before being posted. The process should include clear documentation of the review and approval steps to
maintain the integrity and accuracy of the financial records.
Repeat Finding: This is not a repeat finding.
Corrective Action Plan (CAP)
Explanation of Disagreement with Audit Findings:
There is no disagreement with the audit finding.
Actions Planned in Response to Finding:
In response to the finding, the organization will establish and implement a formal journal entry review
process. All journal entries will be reviewed and approved by authorized personnel before being posted to
the financial system. Additionally, clear documentation of the review and approval process will be
maintained to ensure accuracy and compliance.
Official Responsible for Ensuring CAP:
The Interim ED will be responsible for overseeing the implementation of corrective actions. Planned Completion Date for CAP:
The planned completion date is June 30, 2025.
Plan to Monitor Completion of CAP:
The Board of Directors will monitor the completion of the CAP through reviews of journal entries to
ensure the review process is being followed and all necessary documentation is maintained.
Federal Agency: U.S. Department of Veterans Affairs
Federal Program Name: VA Supportive Services for Veteran Families (SSVF)
Assistance Listing Number: 64.033
Federal Award Identification Number: 20-ZZ-026
Award Period: 10/01/2023 – 09/30/2024
Type of Finding: Material Weakness in Internal Control over Compliance
Compliance Requirement: Allowable Costs
Criteria or Specific Requirement: Payment of SSVF grant funds up to the amount specified in the SSVF
grant agreement will be made only for appropriately documented eligible expenses that are allowable,
allocable, and reasonable costs of operating a program under the Supportive Services grant. Eligible
expenses must be in accordance with the applicable Federal Cost Principles set forth in OMB Circular A-
122, Cost Principles for Non-Profit Organizations, codified at 2 CFR Part 235, 2 CFR 200 Subpart E Cost
Principles. Additionally, expenses must be eligible per the grantee’s approved SSVF budget.
Condition/Context: During the course of the audit and review of the SSVF monitoring report there were
identified expenses that related to travel and development of an application. There is insufficient
documentation to verify the allowability, reasonableness, and allocability of these expenses. Additionally,
there was no clear review process for administrative expenses to ensure that they were reasonable and
allowable under federal guidelines.
Cause: The internal controls related to the monitoring and approval of administrative expenses are
insufficient, leading to potential non-compliance with federal requirements. The organization has not
implemented a systematic review and approval process for these expenses, leading to inadequate
documentation and non-compliance with federal guidelines.
Effect: The lack of proper oversight and documentation of administrative expenses resulted in noncompliant/
unallowable charges to the federal program, increasing the risk of questioned costs or disallowed
expenditures. The failure to allocate and support administrative costs properly also hinder the program’s
ability to demonstrate that funds were used effectively and in accordance with federal regulations.
Additionally, disallowed costs identified during the review will be paid back with interest.
Recommendation: We recommend implementing stronger controls and a formal periodic review process
for administrative expenses, ensuring that all expenditures are properly documented, allocated, and
compliant with federal regulations.
Repeat Finding: This is not a repeat finding.
Questioned Costs: $128,262Explanation of Disagreement with Audit Findings:
There is no disagreement with the audit finding.
Actions Planned in Response to Finding:
In response to the finding, the organization will implement a formal review and approval process for
administrative expenses, enhance documentation practices, conduct regular internal audits and train staff
on federal cost principles. New management acknowledges that intentional collusion and failure to follow
procedures contributed to the issue; corrective action has been taken and safeguards are being put in place
to ensure accountability and prevent recurrence.
Official Responsible for Ensuring CAP:
The interim ED will be responsible for overseeing the implementation of corrective actions.
Planned Completion Date for CAP:
The planned completion date is June 06, 2024.
Plan to Monitor Completion of CAP:
The board will monitor the completion of the CAP through meeting at least quarterly with Director,
Finance and Compliance personnel.
Federal Agency: U.S. Department of Veterans Affairs
Federal Program Name: VA Supportive Services for Veteran Families (SSVF)
Assistance Listing Number: 64.033
Federal Award Identification Number: 20-ZZ-026
Award Period: 10/01/2023 – 09/30/2024
Type of Finding: Material Weakness in Internal Control over Compliance and Other Matters
Compliance Requirement: Allowable Costs
Criteria or Specific Requirement: The program requires that all expenses charged to the federal award
are reasonable, allowable, and properly reconciled with documentation. Questioned costs must be
adequately documented and reconciled to ensure they are allocable and compliant with the approved budget
and travel policies.
Condition/Context: During the audit, we found the organization did not comply with the budget
requirements and grant requirements. The organization reimbursed an officer’s husband travel expenses
which was not allowable as it did not have a direct service benefit. The reimbursement claimed was
ineligible.
Cause: The organization’s internal controls over travel expenditures are insufficient, and there is no
systematic process in place to reconcile travel costs with the documented allowable amounts. This lack of
reconciliation may lead to discrepancies between the actual travel costs and the allowable amounts.
Effect: Failure to reconcile questioned costs with allowable travel costs increases the risk of improper
payments and non-compliance with federal requirements. This can result in disallowed costs or adjustments
to the federal program, affecting the program's financial integrity.
Recommendation: We recommend implementing a process to ensure all travel costs are reconciled with
the allowable amounts and that discrepancies are addressed promptly. The organization should also
strengthen internal controls to verify that travel expenditures are in compliance with federal policies and
properly documented.
Repeat Finding: This is not a repeat finding.
Questioned Costs: $647
Corrective Action Plan (CAP)
Explanation of Disagreement with Audit Findings:
There is no disagreement with the audit finding.Actions Planned in Response to Finding:
The organization will implement a reconciliation process to verify that all travel costs align with the
allowable amounts under the SSVF program’s policies. Additionally, relevant staff will be trained to
ensure full compliance with federal travel regulations and documentation requirements.
Official Responsible for Ensuring CAP:
The Interim ED will be responsible for overseeing the implementation of corrective actions.
Planned Completion Date for CAP:
The planned completion date was October 10, 2024.
Plan to Monitor Completion of CAP:
The Board of Directors monitored the completion of the CAP as new policy at Board Meeting.
Federal Agency: U.S. Department of Veterans Affairs
Federal Program Name: VA Supportive Services for Veteran Families (SSVF)
Assistance Listing Number: 64.033
Federal Award Identification Number: 20-ZZ-026
Award Period: 10/01/2023 – 09/30/2024
Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters
Compliance Requirement: Cash Management
Criteria or Specific Requirement: The organization is required to ensure that all drawdowns are properly
reconciled to the financial records to maintain accurate accounting and compliance with federal regulations.
This includes verifying that expenditures are correctly matched with drawdowns and that all necessary
documentation supports these transactions.
Condition/Context: During the audit, it was observed that the organization did not consistently reconcile
drawdowns with actual expenditures for the SSVF program. This lack of reconciliation increases the risk
of financial discrepancies, misstatements, or non-compliance with federal requirements.
Effect: The lack of a formal reconciliation process increases the risk of financial errors or misstatements
in the SSVF program's records. Without adequate reconciliation, there is a heightened risk of misreporting
expenditures, which could lead to financial discrepancies, non-compliance with federal regulations, or
disallowed costs.
Cause: The cause of this issue is the absence of a formalized and consistently applied drawdown
reconciliation process for the SSVF program.
Recommendation: We recommend that the organization implement a formal drawdown reconciliation
process to ensure that all drawdowns related to the SSVF program are accurately reconciled with actual
expenditures. The process should include maintaining clear documentation of reconciliation steps to
enhance the integrity and accuracy of financial records.
Repeat Finding: This is not a repeat finding.
Corrective Action Plan (CAP)
Explanation of Disagreement with Audit Findings:
There is no disagreement with the audit finding.
Actions Planned in Response to Finding:
The organization will establish and implement a formal drawdown reconciliation process. This will include
developing written procedures, training staff on reconciliation requirements, and maintaining clear
documentation for each reconciliation. Executive personnel will conduct monthly reviews to verify
compliance and address any discrepancies promptly prior to drawdown. Official Responsible for Ensuring CAP:
The Interim ED will be responsible for overseeing the implementation of corrective actions.
Planned Completion Date for CAP:
The planned completion date is March 1, 2025.
Plan to Monitor Completion of CAP:
The Board of Directors meet with the Executive team at least quarterly to review financials.