Audit 369640

2024-001 MISSING DOCUMENTATION AND DUPLICATE INVOICE SUBMISSION - MATERIAL WEAKNESS Federal Program Economic Development Initiative, Community Project Funding and Miscellaneous Grants - ALN 14.251 Criteria In order to be allowable under federal awards, costs must meet general criteria, which includes adequate documentation. Under OMB guidance, Public Law (Pub. L) No. 116-117, Payments Integrity Information Act of 2019, and Executive Order 13520 on reducing improper payments, federal agencies are required to take actions to prevent improper payments, review federal awards for such payments, and as applicable, recover improper payments, including any duplicate payment. Condition While performing tests over activities allowed or unallowed and allowable costs/cost principles, we noted documentation for one invoice charged to the grant could not be located. As a result, we were unable to determine that the cost was allowable per the terms of the grant award. We also noted that a second invoice charged to the grant was submitted for reimbursement twice. Cause This is a new grant in the current year to cover the portion of the cost for a new building. While management submitted invoices to the Department of Housing and Urban Development for review and approval prior to reimbursement, they did not maintain a record of the costs submitted for each reimbursement request by either listing the invoices and amounts charged or other means. Effect The Organization was unable to provide documentation for one of the invoices charged to the program, and a second invoice was charged to the program twice. Questioned Costs $54,461 Context The grant was for a portion of construction costs with the difference coming from donations or other assets of Veterans Place of Washington Boulevard, Inc. In order to receive reimbursement for expenses, the Organization was required to submit invoices to the Department of Housing and Urban Development (HUD) for approval prior to uploading the invoices for reimbursement. The expenses in question were approved by HUD prior to requesting or receiving reimbursement. Furthermore, there were approximately $96,000 of construction costs that were incurred but not reimbursed by HUD that appear to meet the terms and conditions of the grant. Repeat Finding No Recommendation We recommend that Veterans Place of Washington Boulevard, Inc. establish a system of internal control related to the costs charged to Federal programs. The process should establish procedures and responsibilities for the documentation and review of costs incurred and charged to Federal awards. This process should include a file, such as a spreadsheet, that shows the costs incurred, invoiced, and paid. The supporting invoices should also be maintained with the file. Review and approval of this documentation should be performed by a person other than the preparer prior to submission to the Federal agency. Management Response See corrective action plan included in this report package.