FAC Explorer

Audit 359805

FY End
2024-12-31
Total Expended
$3.00M
Findings
4
Programs
2
Organization: Giving Youth A Chance Initiative (TN)
Year: 2024 Accepted: 2025-06-25
Auditor: Watkins Uiberall PLLC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
566933 2024-002 Significant Deficiency Yes A
566934 2024-003 Significant Deficiency Yes E
1143375 2024-002 Significant Deficiency Yes A
1143376 2024-003 Significant Deficiency Yes E

Programs

ALN Program Spent Major Findings
10.558 Child and Adult Care Food Program $2.55M Yes 2
10.559 Summer Food Service Program for Children $447,388 - 0

Contacts

Name Title Type
CBU8QW2476E4 Rosman Randle Auditee
9015737238 Clark Province Auditor
No contacts on file

Notes to SEFA

Title: NOTE 1 – BASIS OF PRESENTATION Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. 2) Pass-through entity identifying numbers are presented where available. 3) GYAC has elected not to use the de minimis indirect cost rate as allowed under the Uniform Guidance. 4) There were no federal awards passed through to subrecipients. 5) The grant revenue amounts received and expended (eligible for reimbursement) are subject to audit adjustment. If any expenses are disallowed by the grantor as a result of such audit, any claim for reimbursement to the grantor would become a liability to the GYAC. In the opinion of management, all grant expenses (eligible for reimbursement) are in compliance with the terms of the grant agreement and applicable federal and state laws and regulations. De Minimis Rate Used: N Rate Explanation: GYAC has elected not to use the de minimis indirect cost rate as allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal grant activity of Giving Youth a Chance Initiative, Inc. (GYAC) under programs of the federal government for the year ended December 31, 2024. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations for GYAC, it is not intended to and does not present the financial position, changes in net assets, or cash flows of GYAC.
Title: NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. 2) Pass-through entity identifying numbers are presented where available. 3) GYAC has elected not to use the de minimis indirect cost rate as allowed under the Uniform Guidance. 4) There were no federal awards passed through to subrecipients. 5) The grant revenue amounts received and expended (eligible for reimbursement) are subject to audit adjustment. If any expenses are disallowed by the grantor as a result of such audit, any claim for reimbursement to the grantor would become a liability to the GYAC. In the opinion of management, all grant expenses (eligible for reimbursement) are in compliance with the terms of the grant agreement and applicable federal and state laws and regulations. De Minimis Rate Used: N Rate Explanation: GYAC has elected not to use the de minimis indirect cost rate as allowed under the Uniform Guidance. 1) Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. 2) Pass-through entity identifying numbers are presented where available. 3) GYAC has elected not to use the de minimis indirect cost rate as allowed under the Uniform Guidance. 4) There were no federal awards passed through to subrecipients. 5) The grant revenue amounts received and expended (eligible for reimbursement) are subject to audit adjustment. If any expenses are disallowed by the grantor as a result of such audit, any claim for reimbursement to the grantor would become a liability to the GYAC. In the opinion of management, all grant expenses (eligible for reimbursement) are in compliance with the terms of the grant agreement and applicable federal and state laws and regulations.

Finding Details

Finding 2024-002
Condition: During our testing of monthly reimbursement claims, we identified multiple instances where the number of meals claimed for reimbursement exceeded the number documented on daily meal count sheets maintained by site supervisors or participant rosters. These differences indicate that the claims submitted were not fully supported by the required underlying documentation. Criteria: Title 7 CFR §225.9(d)(5) requires that sponsors certify claims for reimbursement are accurate and supported by available records. Claims that are not substantiated by meal count records do not meet this regulatory requirement. Cause: The control process designed to reconcile daily meal count sheets to the monthly internal summaries prior to claim submission was not operating effectively. Although management performs a second review within 60 days of month-end, initial claims were submitted based on unreconciled summaries due to timing pressures. Effect: Claims for reimbursement were submitted that included meal counts not supported by source documentation. This resulted in noncompliance with the Activities Allowed or Unallowed compliance requirement. Known and likely questioned costs related to these discrepancies were below the Uniform Guidance reporting threshold of $25,000. Context: A sample of 60 daily meal count entries was tested. Of those, 20 (33%) reflected discrepancies between the reported meals on the monthly reimbursement claim and the documented meals served per the corresponding daily meal count sheet. Recommendation: We recommend management strengthen and adhere to internal control procedures that ensure all reimbursement claims are fully reconciled to original daily meal count documentation prior to submission. Where timing constraints necessitate early filing, controls should ensure that amendments are consistently and promptly submitted within the allowable revision window. Management’s Response: See accompanying management’s corrective action plan.
Finding 2024-003
Condition: We identified instances in which the number of meals reported as served on the daily meal count forms exceeded the number of participants listed on the daily participant rosters. Since participants must be documented on the roster to be eligible, the number of meals reimbursed exceeded the number of eligible recipients on those days. Criteria: Per 7 CFR §225.9(d)(5), sponsors must certify that claims for reimbursement are accurate and supported by available records. Reimbursement may only be claimed for meals served to eligible participants as documented by daily rosters. Cause: Each site maintains a daily roster to document eligible participants. However, the reconciliation between the roster and meal counts was not functioning effectively, resulting in excess meals reported without adequate participant support. Effect: Reimbursement claims included meals served to individuals not documented as eligible participants on the daily rosters, resulting in noncompliance with the Eligibility requirement. Known and likely questioned costs were below the $25,000 reporting threshold under Uniform Guidance. Context: A sample of 60 daily meal count records was tested. For 9 of those (15%), the number of meals reported exceeded the number of participants documented on the corresponding daily roster. Recommendation: We recommend that management reinforce controls to ensure that daily meal count submissions are reconciled to participant rosters before claims for reimbursement are filed. Specifically, each site should confirm that the number of meals served does not exceed the number of eligible participants recorded for that date. Management’s Response: See accompanying management’s corrective action plan.
Finding 2024-002
Condition: During our testing of monthly reimbursement claims, we identified multiple instances where the number of meals claimed for reimbursement exceeded the number documented on daily meal count sheets maintained by site supervisors or participant rosters. These differences indicate that the claims submitted were not fully supported by the required underlying documentation. Criteria: Title 7 CFR §225.9(d)(5) requires that sponsors certify claims for reimbursement are accurate and supported by available records. Claims that are not substantiated by meal count records do not meet this regulatory requirement. Cause: The control process designed to reconcile daily meal count sheets to the monthly internal summaries prior to claim submission was not operating effectively. Although management performs a second review within 60 days of month-end, initial claims were submitted based on unreconciled summaries due to timing pressures. Effect: Claims for reimbursement were submitted that included meal counts not supported by source documentation. This resulted in noncompliance with the Activities Allowed or Unallowed compliance requirement. Known and likely questioned costs related to these discrepancies were below the Uniform Guidance reporting threshold of $25,000. Context: A sample of 60 daily meal count entries was tested. Of those, 20 (33%) reflected discrepancies between the reported meals on the monthly reimbursement claim and the documented meals served per the corresponding daily meal count sheet. Recommendation: We recommend management strengthen and adhere to internal control procedures that ensure all reimbursement claims are fully reconciled to original daily meal count documentation prior to submission. Where timing constraints necessitate early filing, controls should ensure that amendments are consistently and promptly submitted within the allowable revision window. Management’s Response: See accompanying management’s corrective action plan.
Finding 2024-003
Condition: We identified instances in which the number of meals reported as served on the daily meal count forms exceeded the number of participants listed on the daily participant rosters. Since participants must be documented on the roster to be eligible, the number of meals reimbursed exceeded the number of eligible recipients on those days. Criteria: Per 7 CFR §225.9(d)(5), sponsors must certify that claims for reimbursement are accurate and supported by available records. Reimbursement may only be claimed for meals served to eligible participants as documented by daily rosters. Cause: Each site maintains a daily roster to document eligible participants. However, the reconciliation between the roster and meal counts was not functioning effectively, resulting in excess meals reported without adequate participant support. Effect: Reimbursement claims included meals served to individuals not documented as eligible participants on the daily rosters, resulting in noncompliance with the Eligibility requirement. Known and likely questioned costs were below the $25,000 reporting threshold under Uniform Guidance. Context: A sample of 60 daily meal count records was tested. For 9 of those (15%), the number of meals reported exceeded the number of participants documented on the corresponding daily roster. Recommendation: We recommend that management reinforce controls to ensure that daily meal count submissions are reconciled to participant rosters before claims for reimbursement are filed. Specifically, each site should confirm that the number of meals served does not exceed the number of eligible participants recorded for that date. Management’s Response: See accompanying management’s corrective action plan.