Audit 367814

Criteria: Non-Federal entities other than States, including those operating Federal programs as subrecipients of States, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable Federal statutes and the procurement requirements identified in 2 CFR part 200. Condition: The Organization was not able to provide a procurement policy for the year ended December 31, 2024. Cause: The Organization does not have internal controls in place surrounding procurement policies and procedures. Effect: The lack of internal controls surrounding the procurement policies and procedures could lead to potential funding issues in the future. Questioned Costs: None. Recommendation: We recommend that management prepare a procurement policy that aligns with the Uniform Guidance and continue to implement additional control processes in order to ensure proper controls are in place and followed. Organization Response: Management agrees with this finding.

Criteria: In accordance with the Uniform Guidance (2 CFR §200.305), when entities are funded on a reimbursement basis, they must disburse funds for program purposes prior to requesting reimbursement. The grant for IBBG allowed a 3 day grace period where the Organization could request funds in advance if they spend them within 3 days. Condition: During our testing of cash management, we noted that the Organization requested and received reimbursement of federal funds prior to expending the related program costs. In a certain instance the entity also requested funds in advance and did not spend them within the 3 day window. Cause: The Organization did not have adequate procedures in place to ensure reimbursement requests were timed in accordance with federal cash management requirements. Effect: Requesting federal funds in advance of need results in noncompliance with cash management requirements and creates a risk of the Organization holding federal funds for unallowable purposes, or earning interest that would need to be remitted to the Federal government. Questioned Costs: None. Recommendation: We recommend that the Organization strengthen its cash management procedures to ensure that reimbursement requests are made only after expenditures have been incurred, and that advance requests, if any, are timed so that funds are disbursed within the required three-day window. Organization Response: Management agrees with this finding.