2024-001: Internal Controls over Compliance for Allowable Costs
Federal Grantor: U.S. Department of Health and Human Services
Pass-Through Grantor: Missouri Department of Health and Senior Services
Federal Assistance Listing Number: 93.044/93.045/93.053
Program Title: Aging Cluster
Pass-through Entity Identifying Number: ERS1052004
Award Year: 2024
Questioned Costs: None
Criteria: 2 CFR 200.303 states, “The recipient and subrecipient must: (a) Establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.”
Condition: During our audit, we noted instances of deviations from documented internal control policies and management override of internal controls:
• The former Executive Director implemented a 36-hour work week policy by closing the administrative offices at noon every Friday effective January 1, 2024. However, the Agency’s Personnel Policies and Administrative Procedures, Guidelines and Benefits manual was not updated to reflect this change from a 40-hour to a 36-hour work week. Employees recorded 4 hours of “Other Paid Leave” on their timesheets every Friday for the time the offices were closed. We also noted that employees recorded “Other Paid Leave” for the Friday after Thanksgiving during the fiscal year. This was not one of the officially recognized paid holidays in the adopted policy manual.
• The Agency did not follow the prescribed procedures for reviewing and paying credit card charges during the year. The Agency’s Accounting Manual calls for all receipts for credit card charges to be submitted to the CFO to verify the charges on the monthly statement prior to paying the credit card bill. However, during the fiscal year there were instances noted where the former Executive Director made credit card payments online, circumventing the Agency’s accounts payable process. The Accounting Manual also prohibits unauthorized charges to the company credit card, such as personal expenditures. We noted $3,171 of personal charges made by the former Executive Director to the company credit card in the general ledger. These charges were recorded as prepaid expenses in the accounting system and therefore were not charged to federal awards. The former CFO would reduce the Executive Director’s paycheck to reimburse the company for any personal charges noted on the credit card.
Cause: The November 2023 Board minutes mention the Executive Director’s plan for going to a 36-hour work week effective January 1, 2024, however, the Board did not approve the policy at that time and the Agency’s personnel policy manual was not updated and approved by the Board. The June 2024 Board minutes reflect an approved motion by the Board to approve the 36-hour work week and the policy manual was updated to reflect the 36-hour work week in October 2024. The revised policy manual also reflects 14 paid holidays, which was increased from the 11 paid holidays noted in the prior version of the manual.
During the fiscal year, there was management override of the prescribed internal controls regarding charges to the company credit card.
Effect: Internal controls over compliance that can prevent and detect noncompliance with federal statutes, regulations and the terms and conditions of the Agency’s federal awards are necessary to ensure that only allowable and authorized expenses are charged to federal awards.
Recommendation: We recommend that the Agency implement procedures to ensure that the prescribed internal controls, policies and procedures officially adopted by the Board of Directors are implemented and consistently followed.
2024-001: Internal Controls over Compliance for Allowable Costs
Federal Grantor: U.S. Department of Health and Human Services
Pass-Through Grantor: Missouri Department of Health and Senior Services
Federal Assistance Listing Number: 93.044/93.045/93.053
Program Title: Aging Cluster
Pass-through Entity Identifying Number: ERS1052004
Award Year: 2024
Questioned Costs: None
Criteria: 2 CFR 200.303 states, “The recipient and subrecipient must: (a) Establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.”
Condition: During our audit, we noted instances of deviations from documented internal control policies and management override of internal controls:
• The former Executive Director implemented a 36-hour work week policy by closing the administrative offices at noon every Friday effective January 1, 2024. However, the Agency’s Personnel Policies and Administrative Procedures, Guidelines and Benefits manual was not updated to reflect this change from a 40-hour to a 36-hour work week. Employees recorded 4 hours of “Other Paid Leave” on their timesheets every Friday for the time the offices were closed. We also noted that employees recorded “Other Paid Leave” for the Friday after Thanksgiving during the fiscal year. This was not one of the officially recognized paid holidays in the adopted policy manual.
• The Agency did not follow the prescribed procedures for reviewing and paying credit card charges during the year. The Agency’s Accounting Manual calls for all receipts for credit card charges to be submitted to the CFO to verify the charges on the monthly statement prior to paying the credit card bill. However, during the fiscal year there were instances noted where the former Executive Director made credit card payments online, circumventing the Agency’s accounts payable process. The Accounting Manual also prohibits unauthorized charges to the company credit card, such as personal expenditures. We noted $3,171 of personal charges made by the former Executive Director to the company credit card in the general ledger. These charges were recorded as prepaid expenses in the accounting system and therefore were not charged to federal awards. The former CFO would reduce the Executive Director’s paycheck to reimburse the company for any personal charges noted on the credit card.
Cause: The November 2023 Board minutes mention the Executive Director’s plan for going to a 36-hour work week effective January 1, 2024, however, the Board did not approve the policy at that time and the Agency’s personnel policy manual was not updated and approved by the Board. The June 2024 Board minutes reflect an approved motion by the Board to approve the 36-hour work week and the policy manual was updated to reflect the 36-hour work week in October 2024. The revised policy manual also reflects 14 paid holidays, which was increased from the 11 paid holidays noted in the prior version of the manual.
During the fiscal year, there was management override of the prescribed internal controls regarding charges to the company credit card.
Effect: Internal controls over compliance that can prevent and detect noncompliance with federal statutes, regulations and the terms and conditions of the Agency’s federal awards are necessary to ensure that only allowable and authorized expenses are charged to federal awards.
Recommendation: We recommend that the Agency implement procedures to ensure that the prescribed internal controls, policies and procedures officially adopted by the Board of Directors are implemented and consistently followed.
2024-001: Internal Controls over Compliance for Allowable Costs
Federal Grantor: U.S. Department of Health and Human Services
Pass-Through Grantor: Missouri Department of Health and Senior Services
Federal Assistance Listing Number: 93.044/93.045/93.053
Program Title: Aging Cluster
Pass-through Entity Identifying Number: ERS1052004
Award Year: 2024
Questioned Costs: None
Criteria: 2 CFR 200.303 states, “The recipient and subrecipient must: (a) Establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.”
Condition: During our audit, we noted instances of deviations from documented internal control policies and management override of internal controls:
• The former Executive Director implemented a 36-hour work week policy by closing the administrative offices at noon every Friday effective January 1, 2024. However, the Agency’s Personnel Policies and Administrative Procedures, Guidelines and Benefits manual was not updated to reflect this change from a 40-hour to a 36-hour work week. Employees recorded 4 hours of “Other Paid Leave” on their timesheets every Friday for the time the offices were closed. We also noted that employees recorded “Other Paid Leave” for the Friday after Thanksgiving during the fiscal year. This was not one of the officially recognized paid holidays in the adopted policy manual.
• The Agency did not follow the prescribed procedures for reviewing and paying credit card charges during the year. The Agency’s Accounting Manual calls for all receipts for credit card charges to be submitted to the CFO to verify the charges on the monthly statement prior to paying the credit card bill. However, during the fiscal year there were instances noted where the former Executive Director made credit card payments online, circumventing the Agency’s accounts payable process. The Accounting Manual also prohibits unauthorized charges to the company credit card, such as personal expenditures. We noted $3,171 of personal charges made by the former Executive Director to the company credit card in the general ledger. These charges were recorded as prepaid expenses in the accounting system and therefore were not charged to federal awards. The former CFO would reduce the Executive Director’s paycheck to reimburse the company for any personal charges noted on the credit card.
Cause: The November 2023 Board minutes mention the Executive Director’s plan for going to a 36-hour work week effective January 1, 2024, however, the Board did not approve the policy at that time and the Agency’s personnel policy manual was not updated and approved by the Board. The June 2024 Board minutes reflect an approved motion by the Board to approve the 36-hour work week and the policy manual was updated to reflect the 36-hour work week in October 2024. The revised policy manual also reflects 14 paid holidays, which was increased from the 11 paid holidays noted in the prior version of the manual.
During the fiscal year, there was management override of the prescribed internal controls regarding charges to the company credit card.
Effect: Internal controls over compliance that can prevent and detect noncompliance with federal statutes, regulations and the terms and conditions of the Agency’s federal awards are necessary to ensure that only allowable and authorized expenses are charged to federal awards.
Recommendation: We recommend that the Agency implement procedures to ensure that the prescribed internal controls, policies and procedures officially adopted by the Board of Directors are implemented and consistently followed.
2024-001: Internal Controls over Compliance for Allowable Costs
Federal Grantor: U.S. Department of Health and Human Services
Pass-Through Grantor: Missouri Department of Health and Senior Services
Federal Assistance Listing Number: 93.044/93.045/93.053
Program Title: Aging Cluster
Pass-through Entity Identifying Number: ERS1052004
Award Year: 2024
Questioned Costs: None
Criteria: 2 CFR 200.303 states, “The recipient and subrecipient must: (a) Establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.”
Condition: During our audit, we noted instances of deviations from documented internal control policies and management override of internal controls:
• The former Executive Director implemented a 36-hour work week policy by closing the administrative offices at noon every Friday effective January 1, 2024. However, the Agency’s Personnel Policies and Administrative Procedures, Guidelines and Benefits manual was not updated to reflect this change from a 40-hour to a 36-hour work week. Employees recorded 4 hours of “Other Paid Leave” on their timesheets every Friday for the time the offices were closed. We also noted that employees recorded “Other Paid Leave” for the Friday after Thanksgiving during the fiscal year. This was not one of the officially recognized paid holidays in the adopted policy manual.
• The Agency did not follow the prescribed procedures for reviewing and paying credit card charges during the year. The Agency’s Accounting Manual calls for all receipts for credit card charges to be submitted to the CFO to verify the charges on the monthly statement prior to paying the credit card bill. However, during the fiscal year there were instances noted where the former Executive Director made credit card payments online, circumventing the Agency’s accounts payable process. The Accounting Manual also prohibits unauthorized charges to the company credit card, such as personal expenditures. We noted $3,171 of personal charges made by the former Executive Director to the company credit card in the general ledger. These charges were recorded as prepaid expenses in the accounting system and therefore were not charged to federal awards. The former CFO would reduce the Executive Director’s paycheck to reimburse the company for any personal charges noted on the credit card.
Cause: The November 2023 Board minutes mention the Executive Director’s plan for going to a 36-hour work week effective January 1, 2024, however, the Board did not approve the policy at that time and the Agency’s personnel policy manual was not updated and approved by the Board. The June 2024 Board minutes reflect an approved motion by the Board to approve the 36-hour work week and the policy manual was updated to reflect the 36-hour work week in October 2024. The revised policy manual also reflects 14 paid holidays, which was increased from the 11 paid holidays noted in the prior version of the manual.
During the fiscal year, there was management override of the prescribed internal controls regarding charges to the company credit card.
Effect: Internal controls over compliance that can prevent and detect noncompliance with federal statutes, regulations and the terms and conditions of the Agency’s federal awards are necessary to ensure that only allowable and authorized expenses are charged to federal awards.
Recommendation: We recommend that the Agency implement procedures to ensure that the prescribed internal controls, policies and procedures officially adopted by the Board of Directors are implemented and consistently followed.
2024-001: Internal Controls over Compliance for Allowable Costs
Federal Grantor: U.S. Department of Health and Human Services
Pass-Through Grantor: Missouri Department of Health and Senior Services
Federal Assistance Listing Number: 93.044/93.045/93.053
Program Title: Aging Cluster
Pass-through Entity Identifying Number: ERS1052004
Award Year: 2024
Questioned Costs: None
Criteria: 2 CFR 200.303 states, “The recipient and subrecipient must: (a) Establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.”
Condition: During our audit, we noted instances of deviations from documented internal control policies and management override of internal controls:
• The former Executive Director implemented a 36-hour work week policy by closing the administrative offices at noon every Friday effective January 1, 2024. However, the Agency’s Personnel Policies and Administrative Procedures, Guidelines and Benefits manual was not updated to reflect this change from a 40-hour to a 36-hour work week. Employees recorded 4 hours of “Other Paid Leave” on their timesheets every Friday for the time the offices were closed. We also noted that employees recorded “Other Paid Leave” for the Friday after Thanksgiving during the fiscal year. This was not one of the officially recognized paid holidays in the adopted policy manual.
• The Agency did not follow the prescribed procedures for reviewing and paying credit card charges during the year. The Agency’s Accounting Manual calls for all receipts for credit card charges to be submitted to the CFO to verify the charges on the monthly statement prior to paying the credit card bill. However, during the fiscal year there were instances noted where the former Executive Director made credit card payments online, circumventing the Agency’s accounts payable process. The Accounting Manual also prohibits unauthorized charges to the company credit card, such as personal expenditures. We noted $3,171 of personal charges made by the former Executive Director to the company credit card in the general ledger. These charges were recorded as prepaid expenses in the accounting system and therefore were not charged to federal awards. The former CFO would reduce the Executive Director’s paycheck to reimburse the company for any personal charges noted on the credit card.
Cause: The November 2023 Board minutes mention the Executive Director’s plan for going to a 36-hour work week effective January 1, 2024, however, the Board did not approve the policy at that time and the Agency’s personnel policy manual was not updated and approved by the Board. The June 2024 Board minutes reflect an approved motion by the Board to approve the 36-hour work week and the policy manual was updated to reflect the 36-hour work week in October 2024. The revised policy manual also reflects 14 paid holidays, which was increased from the 11 paid holidays noted in the prior version of the manual.
During the fiscal year, there was management override of the prescribed internal controls regarding charges to the company credit card.
Effect: Internal controls over compliance that can prevent and detect noncompliance with federal statutes, regulations and the terms and conditions of the Agency’s federal awards are necessary to ensure that only allowable and authorized expenses are charged to federal awards.
Recommendation: We recommend that the Agency implement procedures to ensure that the prescribed internal controls, policies and procedures officially adopted by the Board of Directors are implemented and consistently followed.
2024-001: Internal Controls over Compliance for Allowable Costs
Federal Grantor: U.S. Department of Health and Human Services
Pass-Through Grantor: Missouri Department of Health and Senior Services
Federal Assistance Listing Number: 93.044/93.045/93.053
Program Title: Aging Cluster
Pass-through Entity Identifying Number: ERS1052004
Award Year: 2024
Questioned Costs: None
Criteria: 2 CFR 200.303 states, “The recipient and subrecipient must: (a) Establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.”
Condition: During our audit, we noted instances of deviations from documented internal control policies and management override of internal controls:
• The former Executive Director implemented a 36-hour work week policy by closing the administrative offices at noon every Friday effective January 1, 2024. However, the Agency’s Personnel Policies and Administrative Procedures, Guidelines and Benefits manual was not updated to reflect this change from a 40-hour to a 36-hour work week. Employees recorded 4 hours of “Other Paid Leave” on their timesheets every Friday for the time the offices were closed. We also noted that employees recorded “Other Paid Leave” for the Friday after Thanksgiving during the fiscal year. This was not one of the officially recognized paid holidays in the adopted policy manual.
• The Agency did not follow the prescribed procedures for reviewing and paying credit card charges during the year. The Agency’s Accounting Manual calls for all receipts for credit card charges to be submitted to the CFO to verify the charges on the monthly statement prior to paying the credit card bill. However, during the fiscal year there were instances noted where the former Executive Director made credit card payments online, circumventing the Agency’s accounts payable process. The Accounting Manual also prohibits unauthorized charges to the company credit card, such as personal expenditures. We noted $3,171 of personal charges made by the former Executive Director to the company credit card in the general ledger. These charges were recorded as prepaid expenses in the accounting system and therefore were not charged to federal awards. The former CFO would reduce the Executive Director’s paycheck to reimburse the company for any personal charges noted on the credit card.
Cause: The November 2023 Board minutes mention the Executive Director’s plan for going to a 36-hour work week effective January 1, 2024, however, the Board did not approve the policy at that time and the Agency’s personnel policy manual was not updated and approved by the Board. The June 2024 Board minutes reflect an approved motion by the Board to approve the 36-hour work week and the policy manual was updated to reflect the 36-hour work week in October 2024. The revised policy manual also reflects 14 paid holidays, which was increased from the 11 paid holidays noted in the prior version of the manual.
During the fiscal year, there was management override of the prescribed internal controls regarding charges to the company credit card.
Effect: Internal controls over compliance that can prevent and detect noncompliance with federal statutes, regulations and the terms and conditions of the Agency’s federal awards are necessary to ensure that only allowable and authorized expenses are charged to federal awards.
Recommendation: We recommend that the Agency implement procedures to ensure that the prescribed internal controls, policies and procedures officially adopted by the Board of Directors are implemented and consistently followed.
2024-001: Internal Controls over Compliance for Allowable Costs
Federal Grantor: U.S. Department of Health and Human Services
Pass-Through Grantor: Missouri Department of Health and Senior Services
Federal Assistance Listing Number: 93.044/93.045/93.053
Program Title: Aging Cluster
Pass-through Entity Identifying Number: ERS1052004
Award Year: 2024
Questioned Costs: None
Criteria: 2 CFR 200.303 states, “The recipient and subrecipient must: (a) Establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.”
Condition: During our audit, we noted instances of deviations from documented internal control policies and management override of internal controls:
• The former Executive Director implemented a 36-hour work week policy by closing the administrative offices at noon every Friday effective January 1, 2024. However, the Agency’s Personnel Policies and Administrative Procedures, Guidelines and Benefits manual was not updated to reflect this change from a 40-hour to a 36-hour work week. Employees recorded 4 hours of “Other Paid Leave” on their timesheets every Friday for the time the offices were closed. We also noted that employees recorded “Other Paid Leave” for the Friday after Thanksgiving during the fiscal year. This was not one of the officially recognized paid holidays in the adopted policy manual.
• The Agency did not follow the prescribed procedures for reviewing and paying credit card charges during the year. The Agency’s Accounting Manual calls for all receipts for credit card charges to be submitted to the CFO to verify the charges on the monthly statement prior to paying the credit card bill. However, during the fiscal year there were instances noted where the former Executive Director made credit card payments online, circumventing the Agency’s accounts payable process. The Accounting Manual also prohibits unauthorized charges to the company credit card, such as personal expenditures. We noted $3,171 of personal charges made by the former Executive Director to the company credit card in the general ledger. These charges were recorded as prepaid expenses in the accounting system and therefore were not charged to federal awards. The former CFO would reduce the Executive Director’s paycheck to reimburse the company for any personal charges noted on the credit card.
Cause: The November 2023 Board minutes mention the Executive Director’s plan for going to a 36-hour work week effective January 1, 2024, however, the Board did not approve the policy at that time and the Agency’s personnel policy manual was not updated and approved by the Board. The June 2024 Board minutes reflect an approved motion by the Board to approve the 36-hour work week and the policy manual was updated to reflect the 36-hour work week in October 2024. The revised policy manual also reflects 14 paid holidays, which was increased from the 11 paid holidays noted in the prior version of the manual.
During the fiscal year, there was management override of the prescribed internal controls regarding charges to the company credit card.
Effect: Internal controls over compliance that can prevent and detect noncompliance with federal statutes, regulations and the terms and conditions of the Agency’s federal awards are necessary to ensure that only allowable and authorized expenses are charged to federal awards.
Recommendation: We recommend that the Agency implement procedures to ensure that the prescribed internal controls, policies and procedures officially adopted by the Board of Directors are implemented and consistently followed.
2024-001: Internal Controls over Compliance for Allowable Costs
Federal Grantor: U.S. Department of Health and Human Services
Pass-Through Grantor: Missouri Department of Health and Senior Services
Federal Assistance Listing Number: 93.044/93.045/93.053
Program Title: Aging Cluster
Pass-through Entity Identifying Number: ERS1052004
Award Year: 2024
Questioned Costs: None
Criteria: 2 CFR 200.303 states, “The recipient and subrecipient must: (a) Establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.”
Condition: During our audit, we noted instances of deviations from documented internal control policies and management override of internal controls:
• The former Executive Director implemented a 36-hour work week policy by closing the administrative offices at noon every Friday effective January 1, 2024. However, the Agency’s Personnel Policies and Administrative Procedures, Guidelines and Benefits manual was not updated to reflect this change from a 40-hour to a 36-hour work week. Employees recorded 4 hours of “Other Paid Leave” on their timesheets every Friday for the time the offices were closed. We also noted that employees recorded “Other Paid Leave” for the Friday after Thanksgiving during the fiscal year. This was not one of the officially recognized paid holidays in the adopted policy manual.
• The Agency did not follow the prescribed procedures for reviewing and paying credit card charges during the year. The Agency’s Accounting Manual calls for all receipts for credit card charges to be submitted to the CFO to verify the charges on the monthly statement prior to paying the credit card bill. However, during the fiscal year there were instances noted where the former Executive Director made credit card payments online, circumventing the Agency’s accounts payable process. The Accounting Manual also prohibits unauthorized charges to the company credit card, such as personal expenditures. We noted $3,171 of personal charges made by the former Executive Director to the company credit card in the general ledger. These charges were recorded as prepaid expenses in the accounting system and therefore were not charged to federal awards. The former CFO would reduce the Executive Director’s paycheck to reimburse the company for any personal charges noted on the credit card.
Cause: The November 2023 Board minutes mention the Executive Director’s plan for going to a 36-hour work week effective January 1, 2024, however, the Board did not approve the policy at that time and the Agency’s personnel policy manual was not updated and approved by the Board. The June 2024 Board minutes reflect an approved motion by the Board to approve the 36-hour work week and the policy manual was updated to reflect the 36-hour work week in October 2024. The revised policy manual also reflects 14 paid holidays, which was increased from the 11 paid holidays noted in the prior version of the manual.
During the fiscal year, there was management override of the prescribed internal controls regarding charges to the company credit card.
Effect: Internal controls over compliance that can prevent and detect noncompliance with federal statutes, regulations and the terms and conditions of the Agency’s federal awards are necessary to ensure that only allowable and authorized expenses are charged to federal awards.
Recommendation: We recommend that the Agency implement procedures to ensure that the prescribed internal controls, policies and procedures officially adopted by the Board of Directors are implemented and consistently followed.
2024-001: Internal Controls over Compliance for Allowable Costs
Federal Grantor: U.S. Department of Health and Human Services
Pass-Through Grantor: Missouri Department of Health and Senior Services
Federal Assistance Listing Number: 93.044/93.045/93.053
Program Title: Aging Cluster
Pass-through Entity Identifying Number: ERS1052004
Award Year: 2024
Questioned Costs: None
Criteria: 2 CFR 200.303 states, “The recipient and subrecipient must: (a) Establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.”
Condition: During our audit, we noted instances of deviations from documented internal control policies and management override of internal controls:
• The former Executive Director implemented a 36-hour work week policy by closing the administrative offices at noon every Friday effective January 1, 2024. However, the Agency’s Personnel Policies and Administrative Procedures, Guidelines and Benefits manual was not updated to reflect this change from a 40-hour to a 36-hour work week. Employees recorded 4 hours of “Other Paid Leave” on their timesheets every Friday for the time the offices were closed. We also noted that employees recorded “Other Paid Leave” for the Friday after Thanksgiving during the fiscal year. This was not one of the officially recognized paid holidays in the adopted policy manual.
• The Agency did not follow the prescribed procedures for reviewing and paying credit card charges during the year. The Agency’s Accounting Manual calls for all receipts for credit card charges to be submitted to the CFO to verify the charges on the monthly statement prior to paying the credit card bill. However, during the fiscal year there were instances noted where the former Executive Director made credit card payments online, circumventing the Agency’s accounts payable process. The Accounting Manual also prohibits unauthorized charges to the company credit card, such as personal expenditures. We noted $3,171 of personal charges made by the former Executive Director to the company credit card in the general ledger. These charges were recorded as prepaid expenses in the accounting system and therefore were not charged to federal awards. The former CFO would reduce the Executive Director’s paycheck to reimburse the company for any personal charges noted on the credit card.
Cause: The November 2023 Board minutes mention the Executive Director’s plan for going to a 36-hour work week effective January 1, 2024, however, the Board did not approve the policy at that time and the Agency’s personnel policy manual was not updated and approved by the Board. The June 2024 Board minutes reflect an approved motion by the Board to approve the 36-hour work week and the policy manual was updated to reflect the 36-hour work week in October 2024. The revised policy manual also reflects 14 paid holidays, which was increased from the 11 paid holidays noted in the prior version of the manual.
During the fiscal year, there was management override of the prescribed internal controls regarding charges to the company credit card.
Effect: Internal controls over compliance that can prevent and detect noncompliance with federal statutes, regulations and the terms and conditions of the Agency’s federal awards are necessary to ensure that only allowable and authorized expenses are charged to federal awards.
Recommendation: We recommend that the Agency implement procedures to ensure that the prescribed internal controls, policies and procedures officially adopted by the Board of Directors are implemented and consistently followed.
2024-001: Internal Controls over Compliance for Allowable Costs
Federal Grantor: U.S. Department of Health and Human Services
Pass-Through Grantor: Missouri Department of Health and Senior Services
Federal Assistance Listing Number: 93.044/93.045/93.053
Program Title: Aging Cluster
Pass-through Entity Identifying Number: ERS1052004
Award Year: 2024
Questioned Costs: None
Criteria: 2 CFR 200.303 states, “The recipient and subrecipient must: (a) Establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award.”
Condition: During our audit, we noted instances of deviations from documented internal control policies and management override of internal controls:
• The former Executive Director implemented a 36-hour work week policy by closing the administrative offices at noon every Friday effective January 1, 2024. However, the Agency’s Personnel Policies and Administrative Procedures, Guidelines and Benefits manual was not updated to reflect this change from a 40-hour to a 36-hour work week. Employees recorded 4 hours of “Other Paid Leave” on their timesheets every Friday for the time the offices were closed. We also noted that employees recorded “Other Paid Leave” for the Friday after Thanksgiving during the fiscal year. This was not one of the officially recognized paid holidays in the adopted policy manual.
• The Agency did not follow the prescribed procedures for reviewing and paying credit card charges during the year. The Agency’s Accounting Manual calls for all receipts for credit card charges to be submitted to the CFO to verify the charges on the monthly statement prior to paying the credit card bill. However, during the fiscal year there were instances noted where the former Executive Director made credit card payments online, circumventing the Agency’s accounts payable process. The Accounting Manual also prohibits unauthorized charges to the company credit card, such as personal expenditures. We noted $3,171 of personal charges made by the former Executive Director to the company credit card in the general ledger. These charges were recorded as prepaid expenses in the accounting system and therefore were not charged to federal awards. The former CFO would reduce the Executive Director’s paycheck to reimburse the company for any personal charges noted on the credit card.
Cause: The November 2023 Board minutes mention the Executive Director’s plan for going to a 36-hour work week effective January 1, 2024, however, the Board did not approve the policy at that time and the Agency’s personnel policy manual was not updated and approved by the Board. The June 2024 Board minutes reflect an approved motion by the Board to approve the 36-hour work week and the policy manual was updated to reflect the 36-hour work week in October 2024. The revised policy manual also reflects 14 paid holidays, which was increased from the 11 paid holidays noted in the prior version of the manual.
During the fiscal year, there was management override of the prescribed internal controls regarding charges to the company credit card.
Effect: Internal controls over compliance that can prevent and detect noncompliance with federal statutes, regulations and the terms and conditions of the Agency’s federal awards are necessary to ensure that only allowable and authorized expenses are charged to federal awards.
Recommendation: We recommend that the Agency implement procedures to ensure that the prescribed internal controls, policies and procedures officially adopted by the Board of Directors are implemented and consistently followed.