Audit 351859

Finding Number: 2024-003 Significant Deficiency in Internal Control and Compliance over Allowable Cost and Activities Related to Payroll Expenditures Repeat Finding: Yes Cause - The Organization did not maintain proper adherence to internal controls over the federal program as it relates to tracking and allocating the expenditures of federal awards. This includes allocating costs incurred outside of the contract period to the federal program and requesting reimbursement from the agency. The pass-through agency allows the Organization to report expenditures on both a cash and accrual basis, if reimbursement requests of those expenditures are not duplicated. This could lead to confusion when requesting reimbursements for expenditures that may fall outside of the period of performance covered by the award contract. Effect - Noncompliance with the allowable costs and activities of the federal award as described in both the award contract and OMB Circular A-122, Cost Principles for Non-Profit Organizations, could result in reimbursement denials and ultimately lead to the payback of costs or loss of future funding. Questioned Costs - Immaterial amount. Context - As part of our audit procedures, we tested payroll expenditures incurred in order to test internal controls over compliance and compliance with the allowable costs and activities of federal awards. During our testing of payroll expenditures, we noted the following deviations: For ten of twenty-nine payroll selections from our statistically valid sample, costs included amounts incurred outside of the period of performance covered by the award contract. Upon further examination, we identified that all employees at the Solis-Cohen site included five days' worth of payroll expenditures incurred prior to the award contract period beginning July 2023, but were submitted for reimbursement under that contract Repeat Finding - This is a repeat finding from the prior year. See prior year finding 2022-002. Recommendations - We strongly recommend the Organization choose one basis of reporting (cash or accrual) and apply consistently to expenditures submitted for reimbursement. Additionally, procedures should be implemented by the Organization to track and report expenditures eligible for reimbursement based on when it is incurred and retain all related supporting documentation. View of Responsible Officials - The questioned costs were immaterial and relate to a pay period that was split across the fiscal year (6/26/23 to 7/9/23, with a pay date of 7/14/23). Reports to the funder for the year ending 6/30/23 were due on 7/10/23, before all payroll information and supporting documentation for this pay period was available. Therefore, the full pay period was included in the July reimbursement report. This practice was approved by the funder and the funder will not seek to recoup out of period costs. Moving forward, the Organization will be more cognizant of accrual dates for payroll reporting and submit a true-up as needed to ensure that payroll costs are correctly allocated at the end of the fiscal year. Questioned Costs: None Funding Agency: Department of Health and Human Services Title: Temporary Assistance for Needy Families Cluster AL Numbers: 93.558 Award Year: 8/1/2023 - 7/31/2024 Condition - During our testing of payroll expenditures, we identified expenditures that were incurred outside of the award contract period of performance and included in reimbursement requests submitted to the pass-through agency. Criteria - OMB Circular A-122, Cost Principles for Non-Profit Organizations requires specific compliance with the provisions of allowable costs and activities. The Organization is responsible for having internal controls designed to ensure compliance with this provision. Additionally, the Organization may only charge to the federal award, allowable costs incurred during the period of performance.

Finding Number: 2024-003 Significant Deficiency in Internal Control and Compliance over Allowable Cost and Activities Related to Payroll Expenditures Repeat Finding: Yes Cause - The Organization did not maintain proper adherence to internal controls over the federal program as it relates to tracking and allocating the expenditures of federal awards. This includes allocating costs incurred outside of the contract period to the federal program and requesting reimbursement from the agency. The pass-through agency allows the Organization to report expenditures on both a cash and accrual basis, if reimbursement requests of those expenditures are not duplicated. This could lead to confusion when requesting reimbursements for expenditures that may fall outside of the period of performance covered by the award contract. Effect - Noncompliance with the allowable costs and activities of the federal award as described in both the award contract and OMB Circular A-122, Cost Principles for Non-Profit Organizations, could result in reimbursement denials and ultimately lead to the payback of costs or loss of future funding. Questioned Costs - Immaterial amount. Context - As part of our audit procedures, we tested payroll expenditures incurred in order to test internal controls over compliance and compliance with the allowable costs and activities of federal awards. During our testing of payroll expenditures, we noted the following deviations: For ten of twenty-nine payroll selections from our statistically valid sample, costs included amounts incurred outside of the period of performance covered by the award contract. Upon further examination, we identified that all employees at the Solis-Cohen site included five days' worth of payroll expenditures incurred prior to the award contract period beginning July 2023, but were submitted for reimbursement under that contract Repeat Finding - This is a repeat finding from the prior year. See prior year finding 2022-002. Recommendations - We strongly recommend the Organization choose one basis of reporting (cash or accrual) and apply consistently to expenditures submitted for reimbursement. Additionally, procedures should be implemented by the Organization to track and report expenditures eligible for reimbursement based on when it is incurred and retain all related supporting documentation. View of Responsible Officials - The questioned costs were immaterial and relate to a pay period that was split across the fiscal year (6/26/23 to 7/9/23, with a pay date of 7/14/23). Reports to the funder for the year ending 6/30/23 were due on 7/10/23, before all payroll information and supporting documentation for this pay period was available. Therefore, the full pay period was included in the July reimbursement report. This practice was approved by the funder and the funder will not seek to recoup out of period costs. Moving forward, the Organization will be more cognizant of accrual dates for payroll reporting and submit a true-up as needed to ensure that payroll costs are correctly allocated at the end of the fiscal year. Questioned Costs: None Funding Agency: Department of Health and Human Services Title: Temporary Assistance for Needy Families Cluster AL Numbers: 93.558 Award Year: 8/1/2023 - 7/31/2024 Condition - During our testing of payroll expenditures, we identified expenditures that were incurred outside of the award contract period of performance and included in reimbursement requests submitted to the pass-through agency. Criteria - OMB Circular A-122, Cost Principles for Non-Profit Organizations requires specific compliance with the provisions of allowable costs and activities. The Organization is responsible for having internal controls designed to ensure compliance with this provision. Additionally, the Organization may only charge to the federal award, allowable costs incurred during the period of performance.

Finding Number: 2024-003 Significant Deficiency in Internal Control and Compliance over Allowable Cost and Activities Related to Payroll Expenditures Repeat Finding: Yes Cause - The Organization did not maintain proper adherence to internal controls over the federal program as it relates to tracking and allocating the expenditures of federal awards. This includes allocating costs incurred outside of the contract period to the federal program and requesting reimbursement from the agency. The pass-through agency allows the Organization to report expenditures on both a cash and accrual basis, if reimbursement requests of those expenditures are not duplicated. This could lead to confusion when requesting reimbursements for expenditures that may fall outside of the period of performance covered by the award contract. Effect - Noncompliance with the allowable costs and activities of the federal award as described in both the award contract and OMB Circular A-122, Cost Principles for Non-Profit Organizations, could result in reimbursement denials and ultimately lead to the payback of costs or loss of future funding. Questioned Costs - Immaterial amount. Context - As part of our audit procedures, we tested payroll expenditures incurred in order to test internal controls over compliance and compliance with the allowable costs and activities of federal awards. During our testing of payroll expenditures, we noted the following deviations: For ten of twenty-nine payroll selections from our statistically valid sample, costs included amounts incurred outside of the period of performance covered by the award contract. Upon further examination, we identified that all employees at the Solis-Cohen site included five days' worth of payroll expenditures incurred prior to the award contract period beginning July 2023, but were submitted for reimbursement under that contract Repeat Finding - This is a repeat finding from the prior year. See prior year finding 2022-002. Recommendations - We strongly recommend the Organization choose one basis of reporting (cash or accrual) and apply consistently to expenditures submitted for reimbursement. Additionally, procedures should be implemented by the Organization to track and report expenditures eligible for reimbursement based on when it is incurred and retain all related supporting documentation. View of Responsible Officials - The questioned costs were immaterial and relate to a pay period that was split across the fiscal year (6/26/23 to 7/9/23, with a pay date of 7/14/23). Reports to the funder for the year ending 6/30/23 were due on 7/10/23, before all payroll information and supporting documentation for this pay period was available. Therefore, the full pay period was included in the July reimbursement report. This practice was approved by the funder and the funder will not seek to recoup out of period costs. Moving forward, the Organization will be more cognizant of accrual dates for payroll reporting and submit a true-up as needed to ensure that payroll costs are correctly allocated at the end of the fiscal year. Questioned Costs: None Funding Agency: Department of Health and Human Services Title: Temporary Assistance for Needy Families Cluster AL Numbers: 93.558 Award Year: 8/1/2023 - 7/31/2024 Condition - During our testing of payroll expenditures, we identified expenditures that were incurred outside of the award contract period of performance and included in reimbursement requests submitted to the pass-through agency. Criteria - OMB Circular A-122, Cost Principles for Non-Profit Organizations requires specific compliance with the provisions of allowable costs and activities. The Organization is responsible for having internal controls designed to ensure compliance with this provision. Additionally, the Organization may only charge to the federal award, allowable costs incurred during the period of performance.

Finding Number: 2024-003 Significant Deficiency in Internal Control and Compliance over Allowable Cost and Activities Related to Payroll Expenditures Repeat Finding: Yes Cause - The Organization did not maintain proper adherence to internal controls over the federal program as it relates to tracking and allocating the expenditures of federal awards. This includes allocating costs incurred outside of the contract period to the federal program and requesting reimbursement from the agency. The pass-through agency allows the Organization to report expenditures on both a cash and accrual basis, if reimbursement requests of those expenditures are not duplicated. This could lead to confusion when requesting reimbursements for expenditures that may fall outside of the period of performance covered by the award contract. Effect - Noncompliance with the allowable costs and activities of the federal award as described in both the award contract and OMB Circular A-122, Cost Principles for Non-Profit Organizations, could result in reimbursement denials and ultimately lead to the payback of costs or loss of future funding. Questioned Costs - Immaterial amount. Context - As part of our audit procedures, we tested payroll expenditures incurred in order to test internal controls over compliance and compliance with the allowable costs and activities of federal awards. During our testing of payroll expenditures, we noted the following deviations: For ten of twenty-nine payroll selections from our statistically valid sample, costs included amounts incurred outside of the period of performance covered by the award contract. Upon further examination, we identified that all employees at the Solis-Cohen site included five days' worth of payroll expenditures incurred prior to the award contract period beginning July 2023, but were submitted for reimbursement under that contract Repeat Finding - This is a repeat finding from the prior year. See prior year finding 2022-002. Recommendations - We strongly recommend the Organization choose one basis of reporting (cash or accrual) and apply consistently to expenditures submitted for reimbursement. Additionally, procedures should be implemented by the Organization to track and report expenditures eligible for reimbursement based on when it is incurred and retain all related supporting documentation. View of Responsible Officials - The questioned costs were immaterial and relate to a pay period that was split across the fiscal year (6/26/23 to 7/9/23, with a pay date of 7/14/23). Reports to the funder for the year ending 6/30/23 were due on 7/10/23, before all payroll information and supporting documentation for this pay period was available. Therefore, the full pay period was included in the July reimbursement report. This practice was approved by the funder and the funder will not seek to recoup out of period costs. Moving forward, the Organization will be more cognizant of accrual dates for payroll reporting and submit a true-up as needed to ensure that payroll costs are correctly allocated at the end of the fiscal year. Questioned Costs: None Funding Agency: Department of Health and Human Services Title: Temporary Assistance for Needy Families Cluster AL Numbers: 93.558 Award Year: 8/1/2023 - 7/31/2024 Condition - During our testing of payroll expenditures, we identified expenditures that were incurred outside of the award contract period of performance and included in reimbursement requests submitted to the pass-through agency. Criteria - OMB Circular A-122, Cost Principles for Non-Profit Organizations requires specific compliance with the provisions of allowable costs and activities. The Organization is responsible for having internal controls designed to ensure compliance with this provision. Additionally, the Organization may only charge to the federal award, allowable costs incurred during the period of performance.

Finding Number: 2024-003 Significant Deficiency in Internal Control and Compliance over Allowable Cost and Activities Related to Payroll Expenditures Repeat Finding: Yes Cause - The Organization did not maintain proper adherence to internal controls over the federal program as it relates to tracking and allocating the expenditures of federal awards. This includes allocating costs incurred outside of the contract period to the federal program and requesting reimbursement from the agency. The pass-through agency allows the Organization to report expenditures on both a cash and accrual basis, if reimbursement requests of those expenditures are not duplicated. This could lead to confusion when requesting reimbursements for expenditures that may fall outside of the period of performance covered by the award contract. Effect - Noncompliance with the allowable costs and activities of the federal award as described in both the award contract and OMB Circular A-122, Cost Principles for Non-Profit Organizations, could result in reimbursement denials and ultimately lead to the payback of costs or loss of future funding. Questioned Costs - Immaterial amount. Context - As part of our audit procedures, we tested payroll expenditures incurred in order to test internal controls over compliance and compliance with the allowable costs and activities of federal awards. During our testing of payroll expenditures, we noted the following deviations: For ten of twenty-nine payroll selections from our statistically valid sample, costs included amounts incurred outside of the period of performance covered by the award contract. Upon further examination, we identified that all employees at the Solis-Cohen site included five days' worth of payroll expenditures incurred prior to the award contract period beginning July 2023, but were submitted for reimbursement under that contract Repeat Finding - This is a repeat finding from the prior year. See prior year finding 2022-002. Recommendations - We strongly recommend the Organization choose one basis of reporting (cash or accrual) and apply consistently to expenditures submitted for reimbursement. Additionally, procedures should be implemented by the Organization to track and report expenditures eligible for reimbursement based on when it is incurred and retain all related supporting documentation. View of Responsible Officials - The questioned costs were immaterial and relate to a pay period that was split across the fiscal year (6/26/23 to 7/9/23, with a pay date of 7/14/23). Reports to the funder for the year ending 6/30/23 were due on 7/10/23, before all payroll information and supporting documentation for this pay period was available. Therefore, the full pay period was included in the July reimbursement report. This practice was approved by the funder and the funder will not seek to recoup out of period costs. Moving forward, the Organization will be more cognizant of accrual dates for payroll reporting and submit a true-up as needed to ensure that payroll costs are correctly allocated at the end of the fiscal year. Questioned Costs: None Funding Agency: Department of Health and Human Services Title: Temporary Assistance for Needy Families Cluster AL Numbers: 93.558 Award Year: 8/1/2023 - 7/31/2024 Condition - During our testing of payroll expenditures, we identified expenditures that were incurred outside of the award contract period of performance and included in reimbursement requests submitted to the pass-through agency. Criteria - OMB Circular A-122, Cost Principles for Non-Profit Organizations requires specific compliance with the provisions of allowable costs and activities. The Organization is responsible for having internal controls designed to ensure compliance with this provision. Additionally, the Organization may only charge to the federal award, allowable costs incurred during the period of performance.

Finding Number: 2024-003 Significant Deficiency in Internal Control and Compliance over Allowable Cost and Activities Related to Payroll Expenditures Repeat Finding: Yes Cause - The Organization did not maintain proper adherence to internal controls over the federal program as it relates to tracking and allocating the expenditures of federal awards. This includes allocating costs incurred outside of the contract period to the federal program and requesting reimbursement from the agency. The pass-through agency allows the Organization to report expenditures on both a cash and accrual basis, if reimbursement requests of those expenditures are not duplicated. This could lead to confusion when requesting reimbursements for expenditures that may fall outside of the period of performance covered by the award contract. Effect - Noncompliance with the allowable costs and activities of the federal award as described in both the award contract and OMB Circular A-122, Cost Principles for Non-Profit Organizations, could result in reimbursement denials and ultimately lead to the payback of costs or loss of future funding. Questioned Costs - Immaterial amount. Context - As part of our audit procedures, we tested payroll expenditures incurred in order to test internal controls over compliance and compliance with the allowable costs and activities of federal awards. During our testing of payroll expenditures, we noted the following deviations: For ten of twenty-nine payroll selections from our statistically valid sample, costs included amounts incurred outside of the period of performance covered by the award contract. Upon further examination, we identified that all employees at the Solis-Cohen site included five days' worth of payroll expenditures incurred prior to the award contract period beginning July 2023, but were submitted for reimbursement under that contract Repeat Finding - This is a repeat finding from the prior year. See prior year finding 2022-002. Recommendations - We strongly recommend the Organization choose one basis of reporting (cash or accrual) and apply consistently to expenditures submitted for reimbursement. Additionally, procedures should be implemented by the Organization to track and report expenditures eligible for reimbursement based on when it is incurred and retain all related supporting documentation. View of Responsible Officials - The questioned costs were immaterial and relate to a pay period that was split across the fiscal year (6/26/23 to 7/9/23, with a pay date of 7/14/23). Reports to the funder for the year ending 6/30/23 were due on 7/10/23, before all payroll information and supporting documentation for this pay period was available. Therefore, the full pay period was included in the July reimbursement report. This practice was approved by the funder and the funder will not seek to recoup out of period costs. Moving forward, the Organization will be more cognizant of accrual dates for payroll reporting and submit a true-up as needed to ensure that payroll costs are correctly allocated at the end of the fiscal year. Questioned Costs: None Funding Agency: Department of Health and Human Services Title: Temporary Assistance for Needy Families Cluster AL Numbers: 93.558 Award Year: 8/1/2023 - 7/31/2024 Condition - During our testing of payroll expenditures, we identified expenditures that were incurred outside of the award contract period of performance and included in reimbursement requests submitted to the pass-through agency. Criteria - OMB Circular A-122, Cost Principles for Non-Profit Organizations requires specific compliance with the provisions of allowable costs and activities. The Organization is responsible for having internal controls designed to ensure compliance with this provision. Additionally, the Organization may only charge to the federal award, allowable costs incurred during the period of performance.