Audit 369464

2024-001- Significant Deficiency: Activities Allowed or Unallowable Costs/Cost Principles Criteria: According to federal regulations, expenditures charged to federal grants must follow the allowable cost principles found in 2 CFR Part 200, subpart E. Additionally, 2 CFR.200.303 requires nonfederal entities to, among other things, establish and maintain effective internal control over the Federal award 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. Condition: During our testing of federal expenditures, we noted that certain expenses were not allowable activities under the Uniform Guidance. Cause: Internal controls surrounding the review of supporting documentation of expenditures charged to grants are not properly implemented to detect and correct errors. Effect: The Organization received reimbursement for unallowable expenditures. Questioned Costs: ALN 84.215J - $18,603 Recommendation: We recommend that management of the Organization review internal controls over compliance and ensure they are properly designed and implemented to ensure that expenditures are allowable under federal regulations. Views of Responsible Officials: Management agrees with this finding and their response is included in the corrective action plan.

2024-002: Significant Deficiency: Activities Allowed or Unallowable Costs/Cost Principles Criteria: In accordance with federal regulations, expenditures charged to federal awards must comply with the allowable cost principles outlined in 2 CFR Part 200, Subpart E. Furthermore, recipients and subrecipients are required to operate within the parameters of the approved budget as specified in the grant agreement. Any budgetary revisions must receive prior written approval from the awarding federal agency or pass-through entity, pursuant to 2 CFR § 200.308. Section III: Federal Award Findings and Questioned Costs (Continued) 2024-002: Significant Deficiency: Activities Allowed or Unallowable Costs/Cost Principles (Continued) Condition: During our audit procedures, we noted that the Organization incurred expenditures in excess of the approved amounts within certain budget categories. The reallocation of funds between these categories exceeded the allowable threshold of 10%, as stipulated in the grant agreement, without obtaining the required prior approval. Cause: The Organization’s internal controls over compliance related to the review and reconciliation of budgeted amounts against actual expenditures charged to the grant were not adequately designed or implemented to detect and prevent variances. Effect: As a result, costs submitted for reimbursement exceeded the approved budgetary limits for certain budget line items established in the grant agreement, rendering a portion of the expenditures unallowable under federal regulations. Questioned Costs: None Recommendation: We recommend that the Organization’s management evaluate and strengthen internal control over compliance procedures to ensure expenditures consistently comply with federal cost principles and remain within approved budget line items. Views of Responsible Officials: Management agrees with this finding and their response is included in the corrective action plan.

2024-003: Significant Deficiency: Reporting Criteria: The Code of Federal Regulations (CFR) section 200.510 (b) states that the audit, the data collection form, and the reporting package must be submitted within 30 calendar days after the auditee receives the auditor's report(s) or nine months after the end of the audit period (whichever is earlier) to the Federal Audit Clearinghouse (FAC). Condition: During the audit the Organization submitted the December 31, 2023 required reporting package to the FAC 167 days past the deadline without an approved extension from the oversight agency. Cause: The Organization had not implemented policies or procedures, to the degree necessary, to ensure that the audit, data collection form, and reporting package was complete, accurate, and submitted within the required time frame. Effect: The Organization was not in compliance with federal regulations. Section III: Federal Award Findings and Questioned Costs (Continued) 2024-003: Significant Deficiency: Reporting (Continued) Recommendation: We recommend that management of the Organization implement policies, procedures, and internal controls over compliance to ensure that required federal reporting is timely and in accordance with federal regulations. Views of Responsible Officials: Management agrees with this finding and their response is included in the corrective action plan.