Condition and Criteria: Misstatements were identified relating to retained earnings, accrued expenses and deferred revenue for which we proposed adjusting journal entries. These adjustments had not been identified by the Organization’s internal control. Cause: The Organization had several changes of personnel in the accounting department. Effect: The Organization’s reported year-end balances were not accurate. Auditor’s Recommendation: The Organization should retain the services of someone with the proper skill, knowledge and experience to ensure that the Organization’s reported numbers are accurate at all times. Views of Responsible Officials and Planned Corrective Action: While Quincy Asian Resources, Inc. concurs with the ultimate outcome identified in the finding, we want to emphasize our review indicates all transactions were handled with appropriate intent. The identified adjustments were primarily due to timing of personnel transitions on our accounting department. To further strengthen our financial reporting processes, we have subsequently hired a new controller with extensive nonprofit accounting experience. This addition to our team will help ensure continued accuracy in financial reporting while maintaining strong internal controls.
Condition and Criteria: A monthly journal entry was recorded for nine months that allocated additional payroll to the grant which was based on management’s estimates and not on approved time sheets. Management identified the time sheets were not being accurately filled out and, on a monthly basis estimated the additional time they believed was spent on the grant but not recorded in the approved time sheets. Questioned Cost: $75,000. Cause: The employees improperly completed their time sheets and those responsible for reviewing and approving the time sheets did not detect and correct the improperly recorded time. Effect: It cannot be verified that the employees worked these additional hours that were billed to the grant. Auditor’s Recommendation: The Organization should develop and implement policies and procedures to ensure that only actual hours spent working on the grant are charged to the grant as direct labor.
Condition and Criteria: If an employee was designated as part of the “CDC department”, all of their sick, holiday and vacation hours were charged to the grant as direct labor. Questioned Cost: $28,145. Cause: The Organization was unaware that only actual hours worked on the grant should be charged to the grant as direct labor and that “indirect” labor is captured in the fringe benefit rate. Effect: Sick, holiday and vacation wages were incorrectly charged to the grant. Auditor’s Recommendation: The Organization should develop and implement policies and procedures to ensure that only actual hours spent working on the grant are charged to the grant as direct labor. Views of Responsible Officials and Planned Corrective Action: Quincy Asian Resources, Inc. agrees with the finding and will develop and implement policies and procedures to ensure that only actual hours spent working on the grant are charged to the grant as direct labor. The Organization is transitioning to a new Time & Attendance system, which will address these issues.
Material Weakness: As discussed at Finding 2024-02, a monthly journal entry was recorded for nine months that allocated additional payroll to the grant which was based on management’s estimates and not on approved time sheets. Management determined that the time sheets were not being properly completed and estimated, on a monthly basis, the additional amount time they believed was incurred on the grant and not captured in the approved time sheets. The Organization should ensure that all employees working on federal grants and those charged with the responsibility of approving the time sheets, have the appropriate training to understand how to accurately record time and the importance of doing so.
Significant Deficiency: As discussed at Finding 2024-03, if an employee was designated as part of the “CDC department”, all of their sick, holiday and vacation hours were charged to the grant as direct labor. Policies and procedures should be developed and implemented to ensure that only actual hours spent working on the grant are charged to the grant as direct labor.
Condition and Criteria: Federal funds deposits were not immediately (within three days of the request) disbursed. Federal funds deposits must be disbursed for immediate obligations of the Federal programs within three days of requesting the Federal funds. Cause: Oversight by the Organization. Effect: Failure to disburse Federal funds promptly could result the Company having excess Federal funds on hand and being required to remit excess interest. Auditor’s Recommendation: The Company should develop and implement policies and procedures to verify that the Federal funds drawn down are only for immediate Federal program cash needs. Views of Responsible Officials and Planned Corrective Action: Quincy Asian Resources, Inc. agrees with the finding and will implement policies and procedures to draw down Federal funds only for its immediate Federal program cash needs.
Condition and Criteria: The Office of Management and Budget’s (“OMB”) Uniform Guidance (“UG”) requires entities to have written policies and procedures surrounding the management of their award funds. It was noted that the Company did not have written policies and procedures surrounding job descriptions, procurement and contracts (micro purchases, small purchases and simplified acquisitions), suspension and debarment, conflict of interest statement, cash management (including disbursing Federal funds within three days of request) and eligibility. Cause: The Organization has many policies and procedures in place however, they were unaware they were required to be documented in writing. Effect: The Organization is not in compliance with the UG requirements. Auditor’s Recommendation: The Organization should document in writing all policies and procedures relating to the Federal grants. Views of Responsible Officials and Planned Corrective Action: Quincy Asian Resources, Inc. agrees with the finding and has developed written documentation of the policies and procedures surrounding the Federal grants.
Condition and Criteria: The OMB’s UG provides that an entity must have and use documented procurement procedures. The methods of procurement differ based on the amount of the procurement (micro-purchase, small purchase, or a simplified acquisition). In addition, UG prohibits the purchase of goods or services with any debarred or suspended party. The Organization does not have procurement procedures in place that are in compliance with the UG requirements including procedures to verify that vendors providing goods and services to the Federal grants have not been suspended or debarred from Federal procurements or contracts. Cause: The Organization was unaware of these requirements. Effect: The Organization is not in compliance with the UG requirements. In addition, any costs associated with a suspended or debarred party could be unallowable. Auditor’s Recommendation: The Organization should develop and implement policies and procedures relating to the different levels of procurement as well as prohibiting procurement with a debarred or suspended party(including verifying that vendors are not included on System for Award Management (SAM) site as ineligible). Views of Responsible Officials and Planned Corrective Action: Quincy Asian Resources, Inc. acknowledges the finding and will create, implement, and document policies and procedures to ensure all procurement activities comply with UG requirements. This will include written documentation of the policies and procedures related to the federal grants.
Condition and Criteria: Quincy Asian Resources, Inc. is required to enroll participants according to specific requirements. The original participant’s paperwork detailing these specific requirements was not retained by the Organization, therefore, we could not test that the submitted information was accurate. In addition, the eligibility determinations are not periodically reviewed by management to ensure eligibility information is properly obtained and only eligible participants are admitted into the program. Cause: Oversight by the Organization. Effect: The lack of retention of participant paperwork and the absence of periodic reviews of eligibility determinations may lead to incorrect information being recorded and the admission of ineligible participants into the program. Auditor’s Recommendation: The Organization should develop and implement policies and procedures to ensure that original information is retained and that management performs periodic reviews of the eligibility determinations to ensure only eligible participants are admitted to the program.
Views of Responsible Officials and Planned Corrective Action: Quincy Asian Resources, Inc. agrees with the finding and will develop and implement policies and procedures to ensure that all participant information is retained and for management to perform and document periodic reviews of eligibility determinations. As required to maintain the Organization’s Pending Recognition status with the Diabetes Prevention Recognition Program (DPRP), Quincy Asian Resources, Inc. has complied with all data collection and reporting requirements.
Condition and Criteria: Misstatements were identified relating to retained earnings, accrued expenses and deferred revenue for which we proposed adjusting journal entries. These adjustments had not been identified by the Organization’s internal control. Cause: The Organization had several changes of personnel in the accounting department. Effect: The Organization’s reported year-end balances were not accurate. Auditor’s Recommendation: The Organization should retain the services of someone with the proper skill, knowledge and experience to ensure that the Organization’s reported numbers are accurate at all times. Views of Responsible Officials and Planned Corrective Action: While Quincy Asian Resources, Inc. concurs with the ultimate outcome identified in the finding, we want to emphasize our review indicates all transactions were handled with appropriate intent. The identified adjustments were primarily due to timing of personnel transitions on our accounting department. To further strengthen our financial reporting processes, we have subsequently hired a new controller with extensive nonprofit accounting experience. This addition to our team will help ensure continued accuracy in financial reporting while maintaining strong internal controls.
Condition and Criteria: A monthly journal entry was recorded for nine months that allocated additional payroll to the grant which was based on management’s estimates and not on approved time sheets. Management identified the time sheets were not being accurately filled out and, on a monthly basis estimated the additional time they believed was spent on the grant but not recorded in the approved time sheets. Questioned Cost: $75,000. Cause: The employees improperly completed their time sheets and those responsible for reviewing and approving the time sheets did not detect and correct the improperly recorded time. Effect: It cannot be verified that the employees worked these additional hours that were billed to the grant. Auditor’s Recommendation: The Organization should develop and implement policies and procedures to ensure that only actual hours spent working on the grant are charged to the grant as direct labor.
Condition and Criteria: If an employee was designated as part of the “CDC department”, all of their sick, holiday and vacation hours were charged to the grant as direct labor. Questioned Cost: $28,145. Cause: The Organization was unaware that only actual hours worked on the grant should be charged to the grant as direct labor and that “indirect” labor is captured in the fringe benefit rate. Effect: Sick, holiday and vacation wages were incorrectly charged to the grant. Auditor’s Recommendation: The Organization should develop and implement policies and procedures to ensure that only actual hours spent working on the grant are charged to the grant as direct labor. Views of Responsible Officials and Planned Corrective Action: Quincy Asian Resources, Inc. agrees with the finding and will develop and implement policies and procedures to ensure that only actual hours spent working on the grant are charged to the grant as direct labor. The Organization is transitioning to a new Time & Attendance system, which will address these issues.
Material Weakness: As discussed at Finding 2024-02, a monthly journal entry was recorded for nine months that allocated additional payroll to the grant which was based on management’s estimates and not on approved time sheets. Management determined that the time sheets were not being properly completed and estimated, on a monthly basis, the additional amount time they believed was incurred on the grant and not captured in the approved time sheets. The Organization should ensure that all employees working on federal grants and those charged with the responsibility of approving the time sheets, have the appropriate training to understand how to accurately record time and the importance of doing so.
Significant Deficiency: As discussed at Finding 2024-03, if an employee was designated as part of the “CDC department”, all of their sick, holiday and vacation hours were charged to the grant as direct labor. Policies and procedures should be developed and implemented to ensure that only actual hours spent working on the grant are charged to the grant as direct labor.
Condition and Criteria: Federal funds deposits were not immediately (within three days of the request) disbursed. Federal funds deposits must be disbursed for immediate obligations of the Federal programs within three days of requesting the Federal funds. Cause: Oversight by the Organization. Effect: Failure to disburse Federal funds promptly could result the Company having excess Federal funds on hand and being required to remit excess interest. Auditor’s Recommendation: The Company should develop and implement policies and procedures to verify that the Federal funds drawn down are only for immediate Federal program cash needs. Views of Responsible Officials and Planned Corrective Action: Quincy Asian Resources, Inc. agrees with the finding and will implement policies and procedures to draw down Federal funds only for its immediate Federal program cash needs.
Condition and Criteria: The Office of Management and Budget’s (“OMB”) Uniform Guidance (“UG”) requires entities to have written policies and procedures surrounding the management of their award funds. It was noted that the Company did not have written policies and procedures surrounding job descriptions, procurement and contracts (micro purchases, small purchases and simplified acquisitions), suspension and debarment, conflict of interest statement, cash management (including disbursing Federal funds within three days of request) and eligibility. Cause: The Organization has many policies and procedures in place however, they were unaware they were required to be documented in writing. Effect: The Organization is not in compliance with the UG requirements. Auditor’s Recommendation: The Organization should document in writing all policies and procedures relating to the Federal grants. Views of Responsible Officials and Planned Corrective Action: Quincy Asian Resources, Inc. agrees with the finding and has developed written documentation of the policies and procedures surrounding the Federal grants.
Condition and Criteria: The OMB’s UG provides that an entity must have and use documented procurement procedures. The methods of procurement differ based on the amount of the procurement (micro-purchase, small purchase, or a simplified acquisition). In addition, UG prohibits the purchase of goods or services with any debarred or suspended party. The Organization does not have procurement procedures in place that are in compliance with the UG requirements including procedures to verify that vendors providing goods and services to the Federal grants have not been suspended or debarred from Federal procurements or contracts. Cause: The Organization was unaware of these requirements. Effect: The Organization is not in compliance with the UG requirements. In addition, any costs associated with a suspended or debarred party could be unallowable. Auditor’s Recommendation: The Organization should develop and implement policies and procedures relating to the different levels of procurement as well as prohibiting procurement with a debarred or suspended party(including verifying that vendors are not included on System for Award Management (SAM) site as ineligible). Views of Responsible Officials and Planned Corrective Action: Quincy Asian Resources, Inc. acknowledges the finding and will create, implement, and document policies and procedures to ensure all procurement activities comply with UG requirements. This will include written documentation of the policies and procedures related to the federal grants.
Condition and Criteria: Quincy Asian Resources, Inc. is required to enroll participants according to specific requirements. The original participant’s paperwork detailing these specific requirements was not retained by the Organization, therefore, we could not test that the submitted information was accurate. In addition, the eligibility determinations are not periodically reviewed by management to ensure eligibility information is properly obtained and only eligible participants are admitted into the program. Cause: Oversight by the Organization. Effect: The lack of retention of participant paperwork and the absence of periodic reviews of eligibility determinations may lead to incorrect information being recorded and the admission of ineligible participants into the program. Auditor’s Recommendation: The Organization should develop and implement policies and procedures to ensure that original information is retained and that management performs periodic reviews of the eligibility determinations to ensure only eligible participants are admitted to the program.
Views of Responsible Officials and Planned Corrective Action: Quincy Asian Resources, Inc. agrees with the finding and will develop and implement policies and procedures to ensure that all participant information is retained and for management to perform and document periodic reviews of eligibility determinations. As required to maintain the Organization’s Pending Recognition status with the Diabetes Prevention Recognition Program (DPRP), Quincy Asian Resources, Inc. has complied with all data collection and reporting requirements.