2022-1 Criteria or Specific Requirement - The Uniform Guidance Section 200.332(d) requires a pass-through entity to monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statues, regulations and the terms and conditions of the subaward; and that subaward performance goals are achieved. Condition and Context - The Organization did not perform adequate subrecipient monitoring. Effect - Inadequate subrecipient monitoring puts the Organization at risk that subawards are not used for authorized purposes and are not in compliance with Federal statutes, regulations and the terms and conditions of the subaward; and that subaward performance goals are not achieved. In addition, the Organization has not determined whether there are subaward dollars that should be returned to the Federal agency for the reporting period, thus creating a risk that the expenditures and revenue reported in the Organization's basic financial statements and the Schedule of Expenditures of Federal Awards are overstated. During the audit period, the Organization disbursed approximately $164,000 to subrecipients that remained unspent through the end of the budget period, resulting in unallowable costs. Cause - The Organization has not yet designed or implemented its subrecipient monitoring program. Recommendation - The Organization should adopt and implement a subrecipient monitoring program that complies with the requirements of Uniform Guidance Section 200.332(d). The Organization should recoup the unallowable costs and return the funds to the granting agency. Views of Responsible Officials and Planned Corrective Action - Management agrees with the finding. The Organization is in the process of implementing a new compliance monitoring process: ? Subrecipients will receive their awards on a cost reimbursement basis. ? Subrecipient payments will be disbursed quarterly. ? Subrecipient payments will only be issued after submission, review, and approval of required financial and performance reports. Moving to a cost reimbursement model will reduce the risk of overstating the Organization?s revenue and expenditures and motivate subrecipients to record and submit detailed data on a quarterly basis. This new model will be effective for the grant year beginning April 1, 2023 and a memo of change is being distributed to subrecipients under contract. The Organization will work with the granting agency to determine whether the Organization will pay back the funds or will be allowed to carry them forward to the next period.
2022-2 Criteria or Specific Requirement - The Uniform Guidance Section 200.303 requires non-Federal entities to establish and maintain effective internal control over the Federal awards that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations and the terms and conditions of the Federal award. Management is responsible for establishing and maintaining processes and internal control over financial reporting. Processes and internal control should allow management or employees, in the normal course of performing their assigned functions to prevent or detect misstatements. Condition and Context - The Organization did not maintain internal reporting sufficient to substantiate the funds requested through the Payment Management Services ("PMS") portal. Effect - The lack of internal reporting to substantiate the Organization's periodic drawdown requests puts the Organization at risk for errors in its submissions that could result in an incorrect drawdown. During the audit period, the Organization requested and received approximately $140,000 more in reimbursements through PMS than was expended, resulting in unallowable costs. Cause - Lack of experienced and knowledgeable staff to implement sufficient internal control. Recommendation - The Organization should consider hiring more experienced and knowledgeable accounting staff. We believe that due to the size and complexity of the Organization, more experienced and knowledgeable staff is warranted. Views of Responsible Officials and Planned Corrective Action - Management agrees with the finding. The Organization has implemented a new reporting and approval process for submissions through the Payment Management System: ? A Detailed Statement of Activity is generated by the Director of Finance as soon as it is determined all revenues and expenditures have been recorded for the month. ? Report is reviewed and approved by Co-Executive Director. ? Director of Finance submits the reports in PMS and requests reimbursement. The Organization has hired a new Director of Finance with extensive experience in non-profit accounting.
2022-3 Criteria or Specific Requirement - The Uniform Guidance Section 200.303 requires non-Federal entities to establish and maintain effective internal control over the Federal awards that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations and the terms and conditions of the Federal award. Management is responsible for establishing and maintaining processes and internal control over financial reporting. Processes and internal control should allow management or employees, in the normal course of performing their assigned functions to prevent or detect misstatements. Condition and Context - The Organization's process and internal controls over the recording of cash disbursements were not sufficient to ensure that a federal expenditure of a subaward was recorded in the correct period. Effect - The lack of sufficient processes and internal controls puts the Organization at risk for misstatement due to error or fraud. Cause - Lack of experienced and knowledgeable staff to implement sufficient internal control. Recommendation - The Organization should consider hiring more experienced and knowledgeable personnel to administer and account for federal grants. We believe that due to the size and complexity of the Organization's federal grants, more experienced and knowledgeable staff is warranted. Views of Responsible Officials and Planned Corrective Action - Management agrees with the finding. The Organization has hired knowledgeable staff and has implemented a process to record a receivable in the corresponding period of expenditures submitted to the federal PMS portal.
2022-4 Criteria or Specific Requirement - The Uniform Guidance Section 200.303 requires non-Federal entities to establish and maintain effective internal control over the Federal awards that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations and the terms and conditions of the Federal award. Management is responsible for establishing and maintaining processes and internal control over financial reporting. Processes and internal control should allow management or employees, in the normal course of performing their assigned functions to prevent or detect misstatements. Condition and Context - The Organization's processes and internal controls over ACH disbursements during the reporting period did not provide appropriate segregation of duties. ACH disbursements were initiated, executed and recorded in the general ledger by a single individual. Effect - The lack of sufficient segregation of duties puts the Organization at risk for misstatement due to error or fraud. Cause - Lack of experienced and knowledgeable staff to implement sufficient internal control. Recommendation - The Organization should consider hiring more experienced and knowledgeable accounting staff. We believe that due to the size and complexity of the Organization, more experienced and knowledgeable staff is warranted. Views of Responsible Officials and Planned Corrective Action - Management agrees with the finding. The Organization has hired a new Director of Finance and has implemented an ACH approval process with segregated duties as follows: ? External Bookkeeper initiates (and is not able to approve or process). ? Executive Director reviews, approves and processes. ? Director of Finance records.
2022-5 Criteria or Specific Requirement - The Uniform Guidance Section 200.430(i)(1) requires that charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable and properly allocated. Condition and Context - The Organization did not charge its Federal award for salaries and wages based on actual time reporting. Effect - While the Organization does utilize a time tracking tool, the Organization did not utilize the reporting from the tool to determine its salary and wages allocation to its Federal awards. This deficiency puts the Organization at risk of drawdowns for salaries and wages that do not accurately reflect the work performed. Cause - The Organization did not utilize the reporting from its time tracking tool to determine its salaries and wages allocation to its Federal awards. Recommendation - The Organization should utilize the reporting from its time tracking tool to determine its salaries and wages allocation to its Federal awards and drawdown based on the allocation. Views of Responsible Officials and Planned Corrective Action - Management agrees with the finding. The Organization is implementing a new Payroll and Human Resources system. This single system will house the data for both time allocations and payroll data, giving the Organization the ability to run reports with accurate hours and compensation allocated to specific grants for any period. This system will report in real time and account for salary increases as well.
2022-6 Criteria or Specific Requirement - The Converge Title X Mississippi Family Planning Network Proposal Notice of Award states the Organization must report each action that obligates $30,000 or more in Federal funds that does not include Recover Act funds for a first-tier subaward to an entity. The Organization should report no later than the end of the month following the month in which the obligation was made. Condition and Context - The Organization did not report its first-tier subawards in accordance with the requirement in the Converge Title X Mississippi Family Planning Network Proposal Notice of Award. Effect - The failure to timely and accurately report its first-tier awards is not in compliance with the reporting requirements in the Notice of Award. Cause - The Organization was not aware of the reporting requirements regarding first-tier subawards. Recommendation - The Organization should timely and accurately report its first-tier subaward in accordance with the requirements of the Notice of Award. In addition the Organization should assign an individual overall responsibility for compliance with federal award requirements. Views of Responsible Officials and Planned Corrective Action - Management agrees with the finding. The Organization has registered in the FSRS system and will begin meeting this reporting requirement immediately.
2022-1 Criteria or Specific Requirement - The Uniform Guidance Section 200.332(d) requires a pass-through entity to monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with Federal statues, regulations and the terms and conditions of the subaward; and that subaward performance goals are achieved. Condition and Context - The Organization did not perform adequate subrecipient monitoring. Effect - Inadequate subrecipient monitoring puts the Organization at risk that subawards are not used for authorized purposes and are not in compliance with Federal statutes, regulations and the terms and conditions of the subaward; and that subaward performance goals are not achieved. In addition, the Organization has not determined whether there are subaward dollars that should be returned to the Federal agency for the reporting period, thus creating a risk that the expenditures and revenue reported in the Organization's basic financial statements and the Schedule of Expenditures of Federal Awards are overstated. During the audit period, the Organization disbursed approximately $164,000 to subrecipients that remained unspent through the end of the budget period, resulting in unallowable costs. Cause - The Organization has not yet designed or implemented its subrecipient monitoring program. Recommendation - The Organization should adopt and implement a subrecipient monitoring program that complies with the requirements of Uniform Guidance Section 200.332(d). The Organization should recoup the unallowable costs and return the funds to the granting agency. Views of Responsible Officials and Planned Corrective Action - Management agrees with the finding. The Organization is in the process of implementing a new compliance monitoring process: ? Subrecipients will receive their awards on a cost reimbursement basis. ? Subrecipient payments will be disbursed quarterly. ? Subrecipient payments will only be issued after submission, review, and approval of required financial and performance reports. Moving to a cost reimbursement model will reduce the risk of overstating the Organization?s revenue and expenditures and motivate subrecipients to record and submit detailed data on a quarterly basis. This new model will be effective for the grant year beginning April 1, 2023 and a memo of change is being distributed to subrecipients under contract. The Organization will work with the granting agency to determine whether the Organization will pay back the funds or will be allowed to carry them forward to the next period.
2022-2 Criteria or Specific Requirement - The Uniform Guidance Section 200.303 requires non-Federal entities to establish and maintain effective internal control over the Federal awards that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations and the terms and conditions of the Federal award. Management is responsible for establishing and maintaining processes and internal control over financial reporting. Processes and internal control should allow management or employees, in the normal course of performing their assigned functions to prevent or detect misstatements. Condition and Context - The Organization did not maintain internal reporting sufficient to substantiate the funds requested through the Payment Management Services ("PMS") portal. Effect - The lack of internal reporting to substantiate the Organization's periodic drawdown requests puts the Organization at risk for errors in its submissions that could result in an incorrect drawdown. During the audit period, the Organization requested and received approximately $140,000 more in reimbursements through PMS than was expended, resulting in unallowable costs. Cause - Lack of experienced and knowledgeable staff to implement sufficient internal control. Recommendation - The Organization should consider hiring more experienced and knowledgeable accounting staff. We believe that due to the size and complexity of the Organization, more experienced and knowledgeable staff is warranted. Views of Responsible Officials and Planned Corrective Action - Management agrees with the finding. The Organization has implemented a new reporting and approval process for submissions through the Payment Management System: ? A Detailed Statement of Activity is generated by the Director of Finance as soon as it is determined all revenues and expenditures have been recorded for the month. ? Report is reviewed and approved by Co-Executive Director. ? Director of Finance submits the reports in PMS and requests reimbursement. The Organization has hired a new Director of Finance with extensive experience in non-profit accounting.
2022-3 Criteria or Specific Requirement - The Uniform Guidance Section 200.303 requires non-Federal entities to establish and maintain effective internal control over the Federal awards that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations and the terms and conditions of the Federal award. Management is responsible for establishing and maintaining processes and internal control over financial reporting. Processes and internal control should allow management or employees, in the normal course of performing their assigned functions to prevent or detect misstatements. Condition and Context - The Organization's process and internal controls over the recording of cash disbursements were not sufficient to ensure that a federal expenditure of a subaward was recorded in the correct period. Effect - The lack of sufficient processes and internal controls puts the Organization at risk for misstatement due to error or fraud. Cause - Lack of experienced and knowledgeable staff to implement sufficient internal control. Recommendation - The Organization should consider hiring more experienced and knowledgeable personnel to administer and account for federal grants. We believe that due to the size and complexity of the Organization's federal grants, more experienced and knowledgeable staff is warranted. Views of Responsible Officials and Planned Corrective Action - Management agrees with the finding. The Organization has hired knowledgeable staff and has implemented a process to record a receivable in the corresponding period of expenditures submitted to the federal PMS portal.
2022-4 Criteria or Specific Requirement - The Uniform Guidance Section 200.303 requires non-Federal entities to establish and maintain effective internal control over the Federal awards that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations and the terms and conditions of the Federal award. Management is responsible for establishing and maintaining processes and internal control over financial reporting. Processes and internal control should allow management or employees, in the normal course of performing their assigned functions to prevent or detect misstatements. Condition and Context - The Organization's processes and internal controls over ACH disbursements during the reporting period did not provide appropriate segregation of duties. ACH disbursements were initiated, executed and recorded in the general ledger by a single individual. Effect - The lack of sufficient segregation of duties puts the Organization at risk for misstatement due to error or fraud. Cause - Lack of experienced and knowledgeable staff to implement sufficient internal control. Recommendation - The Organization should consider hiring more experienced and knowledgeable accounting staff. We believe that due to the size and complexity of the Organization, more experienced and knowledgeable staff is warranted. Views of Responsible Officials and Planned Corrective Action - Management agrees with the finding. The Organization has hired a new Director of Finance and has implemented an ACH approval process with segregated duties as follows: ? External Bookkeeper initiates (and is not able to approve or process). ? Executive Director reviews, approves and processes. ? Director of Finance records.
2022-5 Criteria or Specific Requirement - The Uniform Guidance Section 200.430(i)(1) requires that charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable and properly allocated. Condition and Context - The Organization did not charge its Federal award for salaries and wages based on actual time reporting. Effect - While the Organization does utilize a time tracking tool, the Organization did not utilize the reporting from the tool to determine its salary and wages allocation to its Federal awards. This deficiency puts the Organization at risk of drawdowns for salaries and wages that do not accurately reflect the work performed. Cause - The Organization did not utilize the reporting from its time tracking tool to determine its salaries and wages allocation to its Federal awards. Recommendation - The Organization should utilize the reporting from its time tracking tool to determine its salaries and wages allocation to its Federal awards and drawdown based on the allocation. Views of Responsible Officials and Planned Corrective Action - Management agrees with the finding. The Organization is implementing a new Payroll and Human Resources system. This single system will house the data for both time allocations and payroll data, giving the Organization the ability to run reports with accurate hours and compensation allocated to specific grants for any period. This system will report in real time and account for salary increases as well.
2022-6 Criteria or Specific Requirement - The Converge Title X Mississippi Family Planning Network Proposal Notice of Award states the Organization must report each action that obligates $30,000 or more in Federal funds that does not include Recover Act funds for a first-tier subaward to an entity. The Organization should report no later than the end of the month following the month in which the obligation was made. Condition and Context - The Organization did not report its first-tier subawards in accordance with the requirement in the Converge Title X Mississippi Family Planning Network Proposal Notice of Award. Effect - The failure to timely and accurately report its first-tier awards is not in compliance with the reporting requirements in the Notice of Award. Cause - The Organization was not aware of the reporting requirements regarding first-tier subawards. Recommendation - The Organization should timely and accurately report its first-tier subaward in accordance with the requirements of the Notice of Award. In addition the Organization should assign an individual overall responsibility for compliance with federal award requirements. Views of Responsible Officials and Planned Corrective Action - Management agrees with the finding. The Organization has registered in the FSRS system and will begin meeting this reporting requirement immediately.