Audit 368886

Finding 2024-002: Cash Management/Matching/Interest Earned Foster Care – ALN 93.658 and County Children & Youth Agency Programs Criteria: Pursuant to 2 CFR part 200 section 302, an entity’s financial management systems must be sufficient to permit the tracing of funds to a level of expenditures adequate to establish that such funds have been used in accordance with the Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: As a result of our testing of Cash Management, we noted that County Children & Youth Agency Programs funds are included in the operating funds of the County. Cause: The accounting system is not configured for the tracking of separate funding streams. Effect: The County is not in compliance with the Cash Management, Matching, or Interest Earned requirements and internal controls are not functioning as designed. The funding streams are being commingled and could be used to fund expenditures not related to the grant programs. In addition, the County was unable to clearly demonstrate their match to the County Children & Youth Agency Programs. The finding was a repeat of Finding 2023-002. Questioned Costs: The amount of questioned costs, if any, is indeterminable. Recommendation: The County should establish a separate fund to account for the activity of the County Children & Youth Agency Programs. Management’s Response: The County agrees with the finding and will continue to work to match the various revenue and expense sources for County Children & Youth Agency Programs account maintained in the County accounting system to ensure that the proper starting fund balance is generated. Additionally, the County has worked with the fiscal manager for its Children and Youth Agency to provide better compatibility between the accounting system utilized through the County Children & Youth Agency Programs with its corresponding accounting system utilized through the County’s financial department; this effort assists with establishing the fund balance necessary to maintain a separate fund to better track the restricted funds associated with the County Children & Youth Agency Programs.

Finding 2024-003: Reporting Emergency Rental Assistance Program (ERAP)– ALN 21.023 Criteria: Pursuant to 2 CFR part 200 section 303 indicates that the County is responsible for establishing and maintaining effective internal control over the Federal award that provides reasonable assurance that the County is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition: All of the four reports selected for testing did not have sufficient audit evidence to demonstrate they were approved prior to submission. Cause: The department prepared the reports collaboratively, and review steps were not documented. Effect: The County’s internal controls over this requirement were not operating effectively. The finding was a repeat of Finding 2023-003. Questioned Costs: None noted. Recommendation: The County should establish internal controls procedures over reporting requirements. Management’s Response: The County concurs with the finding and will implement reporting procedures that require multiple signatures and approvals over reports including the initials of the County Director of Fiscal Affairs prior to submission of grant reports.