2023‐001: Allowable Costs and Allowable Activities – Internal Controls Over Non‐Payroll Disbursements –
Significant Deficiency
Criteria: Federal award recipients must establish internal control procedures over compliance with provisions
of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles,
and Audit Requirements for Federal Awards (Uniform Guidance) that require, among other things, that direct
charges to federal awards be for allowable costs. To be an allowable cost, charges must be supported by
appropriate documentation and be properly approved. The specific requirements for allowable activities are
unique to each Federal Program and are found in the law, regulations, and the provisions for each contract or
grant agreement pertaining to the federal program.
Condition and Context: As part of our tests of internal controls over compliance, we selected a sample of
forty (40) non‐payroll disbursement transactions to test controls of disbursement costs charged to the major
program. The items selected in this sample were also used as a dual‐purpose test for purposes of testing
compliance. In our control sample, we noted there was no evidence of management approval prior to the
purchase for one (1) of the forty (40) transactions tested. In this instance, the payment was made via ACH but
no documentation to evidence the approval was maintained other than reliance on the bank’s automated
system which will not execute an ACH without double approval.
Questioned Costs: None.
Cause: The primary factor that contributed to the deficiency was the lack of sufficient controls
implemented to retain supporting documentation for ACH payments. To strengthen internal controls over
disbursements, it is recommended that appropriate support be maintained for all disbursements, including
ACH payments.
Repeat Finding: This finding is not a repeat finding.
Effect: Non‐payroll disbursement transactions were being processed without retaining evidence of approval.
Auditor’s Recommendation: In order to ensure non‐payroll disbursement transactions are properly reviewed,
approved, and supporting documentation maintained, we recommend Real Escape from the Sex Trade
ensure controls over these transactions are operating effectively. This control can be accomplished by
implementing a review process over each transaction prior to the purchase and formally documenting the
approval.
Management’s Response: Management agrees with the finding and has prepared correction action as
detailed in its Corrective Action Plan.
2023‐001: Allowable Costs and Allowable Activities – Internal Controls Over Non‐Payroll Disbursements –
Significant Deficiency
Criteria: Federal award recipients must establish internal control procedures over compliance with provisions
of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles,
and Audit Requirements for Federal Awards (Uniform Guidance) that require, among other things, that direct
charges to federal awards be for allowable costs. To be an allowable cost, charges must be supported by
appropriate documentation and be properly approved. The specific requirements for allowable activities are
unique to each Federal Program and are found in the law, regulations, and the provisions for each contract or
grant agreement pertaining to the federal program.
Condition and Context: As part of our tests of internal controls over compliance, we selected a sample of
forty (40) non‐payroll disbursement transactions to test controls of disbursement costs charged to the major
program. The items selected in this sample were also used as a dual‐purpose test for purposes of testing
compliance. In our control sample, we noted there was no evidence of management approval prior to the
purchase for one (1) of the forty (40) transactions tested. In this instance, the payment was made via ACH but
no documentation to evidence the approval was maintained other than reliance on the bank’s automated
system which will not execute an ACH without double approval.
Questioned Costs: None.
Cause: The primary factor that contributed to the deficiency was the lack of sufficient controls
implemented to retain supporting documentation for ACH payments. To strengthen internal controls over
disbursements, it is recommended that appropriate support be maintained for all disbursements, including
ACH payments.
Repeat Finding: This finding is not a repeat finding.
Effect: Non‐payroll disbursement transactions were being processed without retaining evidence of approval.
Auditor’s Recommendation: In order to ensure non‐payroll disbursement transactions are properly reviewed,
approved, and supporting documentation maintained, we recommend Real Escape from the Sex Trade
ensure controls over these transactions are operating effectively. This control can be accomplished by
implementing a review process over each transaction prior to the purchase and formally documenting the
approval.
Management’s Response: Management agrees with the finding and has prepared correction action as
detailed in its Corrective Action Plan.
2023‐001: Allowable Costs and Allowable Activities – Internal Controls Over Non‐Payroll Disbursements –
Significant Deficiency
Criteria: Federal award recipients must establish internal control procedures over compliance with provisions
of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles,
and Audit Requirements for Federal Awards (Uniform Guidance) that require, among other things, that direct
charges to federal awards be for allowable costs. To be an allowable cost, charges must be supported by
appropriate documentation and be properly approved. The specific requirements for allowable activities are
unique to each Federal Program and are found in the law, regulations, and the provisions for each contract or
grant agreement pertaining to the federal program.
Condition and Context: As part of our tests of internal controls over compliance, we selected a sample of
forty (40) non‐payroll disbursement transactions to test controls of disbursement costs charged to the major
program. The items selected in this sample were also used as a dual‐purpose test for purposes of testing
compliance. In our control sample, we noted there was no evidence of management approval prior to the
purchase for one (1) of the forty (40) transactions tested. In this instance, the payment was made via ACH but
no documentation to evidence the approval was maintained other than reliance on the bank’s automated
system which will not execute an ACH without double approval.
Questioned Costs: None.
Cause: The primary factor that contributed to the deficiency was the lack of sufficient controls
implemented to retain supporting documentation for ACH payments. To strengthen internal controls over
disbursements, it is recommended that appropriate support be maintained for all disbursements, including
ACH payments.
Repeat Finding: This finding is not a repeat finding.
Effect: Non‐payroll disbursement transactions were being processed without retaining evidence of approval.
Auditor’s Recommendation: In order to ensure non‐payroll disbursement transactions are properly reviewed,
approved, and supporting documentation maintained, we recommend Real Escape from the Sex Trade
ensure controls over these transactions are operating effectively. This control can be accomplished by
implementing a review process over each transaction prior to the purchase and formally documenting the
approval.
Management’s Response: Management agrees with the finding and has prepared correction action as
detailed in its Corrective Action Plan.
2023‐001: Allowable Costs and Allowable Activities – Internal Controls Over Non‐Payroll Disbursements –
Significant Deficiency
Criteria: Federal award recipients must establish internal control procedures over compliance with provisions
of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles,
and Audit Requirements for Federal Awards (Uniform Guidance) that require, among other things, that direct
charges to federal awards be for allowable costs. To be an allowable cost, charges must be supported by
appropriate documentation and be properly approved. The specific requirements for allowable activities are
unique to each Federal Program and are found in the law, regulations, and the provisions for each contract or
grant agreement pertaining to the federal program.
Condition and Context: As part of our tests of internal controls over compliance, we selected a sample of
forty (40) non‐payroll disbursement transactions to test controls of disbursement costs charged to the major
program. The items selected in this sample were also used as a dual‐purpose test for purposes of testing
compliance. In our control sample, we noted there was no evidence of management approval prior to the
purchase for one (1) of the forty (40) transactions tested. In this instance, the payment was made via ACH but
no documentation to evidence the approval was maintained other than reliance on the bank’s automated
system which will not execute an ACH without double approval.
Questioned Costs: None.
Cause: The primary factor that contributed to the deficiency was the lack of sufficient controls
implemented to retain supporting documentation for ACH payments. To strengthen internal controls over
disbursements, it is recommended that appropriate support be maintained for all disbursements, including
ACH payments.
Repeat Finding: This finding is not a repeat finding.
Effect: Non‐payroll disbursement transactions were being processed without retaining evidence of approval.
Auditor’s Recommendation: In order to ensure non‐payroll disbursement transactions are properly reviewed,
approved, and supporting documentation maintained, we recommend Real Escape from the Sex Trade
ensure controls over these transactions are operating effectively. This control can be accomplished by
implementing a review process over each transaction prior to the purchase and formally documenting the
approval.
Management’s Response: Management agrees with the finding and has prepared correction action as
detailed in its Corrective Action Plan.
2023‐001: Allowable Costs and Allowable Activities – Internal Controls Over Non‐Payroll Disbursements –
Significant Deficiency
Criteria: Federal award recipients must establish internal control procedures over compliance with provisions
of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles,
and Audit Requirements for Federal Awards (Uniform Guidance) that require, among other things, that direct
charges to federal awards be for allowable costs. To be an allowable cost, charges must be supported by
appropriate documentation and be properly approved. The specific requirements for allowable activities are
unique to each Federal Program and are found in the law, regulations, and the provisions for each contract or
grant agreement pertaining to the federal program.
Condition and Context: As part of our tests of internal controls over compliance, we selected a sample of
forty (40) non‐payroll disbursement transactions to test controls of disbursement costs charged to the major
program. The items selected in this sample were also used as a dual‐purpose test for purposes of testing
compliance. In our control sample, we noted there was no evidence of management approval prior to the
purchase for one (1) of the forty (40) transactions tested. In this instance, the payment was made via ACH but
no documentation to evidence the approval was maintained other than reliance on the bank’s automated
system which will not execute an ACH without double approval.
Questioned Costs: None.
Cause: The primary factor that contributed to the deficiency was the lack of sufficient controls
implemented to retain supporting documentation for ACH payments. To strengthen internal controls over
disbursements, it is recommended that appropriate support be maintained for all disbursements, including
ACH payments.
Repeat Finding: This finding is not a repeat finding.
Effect: Non‐payroll disbursement transactions were being processed without retaining evidence of approval.
Auditor’s Recommendation: In order to ensure non‐payroll disbursement transactions are properly reviewed,
approved, and supporting documentation maintained, we recommend Real Escape from the Sex Trade
ensure controls over these transactions are operating effectively. This control can be accomplished by
implementing a review process over each transaction prior to the purchase and formally documenting the
approval.
Management’s Response: Management agrees with the finding and has prepared correction action as
detailed in its Corrective Action Plan.
2023‐001: Allowable Costs and Allowable Activities – Internal Controls Over Non‐Payroll Disbursements –
Significant Deficiency
Criteria: Federal award recipients must establish internal control procedures over compliance with provisions
of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles,
and Audit Requirements for Federal Awards (Uniform Guidance) that require, among other things, that direct
charges to federal awards be for allowable costs. To be an allowable cost, charges must be supported by
appropriate documentation and be properly approved. The specific requirements for allowable activities are
unique to each Federal Program and are found in the law, regulations, and the provisions for each contract or
grant agreement pertaining to the federal program.
Condition and Context: As part of our tests of internal controls over compliance, we selected a sample of
forty (40) non‐payroll disbursement transactions to test controls of disbursement costs charged to the major
program. The items selected in this sample were also used as a dual‐purpose test for purposes of testing
compliance. In our control sample, we noted there was no evidence of management approval prior to the
purchase for one (1) of the forty (40) transactions tested. In this instance, the payment was made via ACH but
no documentation to evidence the approval was maintained other than reliance on the bank’s automated
system which will not execute an ACH without double approval.
Questioned Costs: None.
Cause: The primary factor that contributed to the deficiency was the lack of sufficient controls
implemented to retain supporting documentation for ACH payments. To strengthen internal controls over
disbursements, it is recommended that appropriate support be maintained for all disbursements, including
ACH payments.
Repeat Finding: This finding is not a repeat finding.
Effect: Non‐payroll disbursement transactions were being processed without retaining evidence of approval.
Auditor’s Recommendation: In order to ensure non‐payroll disbursement transactions are properly reviewed,
approved, and supporting documentation maintained, we recommend Real Escape from the Sex Trade
ensure controls over these transactions are operating effectively. This control can be accomplished by
implementing a review process over each transaction prior to the purchase and formally documenting the
approval.
Management’s Response: Management agrees with the finding and has prepared correction action as
detailed in its Corrective Action Plan.
2023‐001: Allowable Costs and Allowable Activities – Internal Controls Over Non‐Payroll Disbursements –
Significant Deficiency
Criteria: Federal award recipients must establish internal control procedures over compliance with provisions
of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles,
and Audit Requirements for Federal Awards (Uniform Guidance) that require, among other things, that direct
charges to federal awards be for allowable costs. To be an allowable cost, charges must be supported by
appropriate documentation and be properly approved. The specific requirements for allowable activities are
unique to each Federal Program and are found in the law, regulations, and the provisions for each contract or
grant agreement pertaining to the federal program.
Condition and Context: As part of our tests of internal controls over compliance, we selected a sample of
forty (40) non‐payroll disbursement transactions to test controls of disbursement costs charged to the major
program. The items selected in this sample were also used as a dual‐purpose test for purposes of testing
compliance. In our control sample, we noted there was no evidence of management approval prior to the
purchase for one (1) of the forty (40) transactions tested. In this instance, the payment was made via ACH but
no documentation to evidence the approval was maintained other than reliance on the bank’s automated
system which will not execute an ACH without double approval.
Questioned Costs: None.
Cause: The primary factor that contributed to the deficiency was the lack of sufficient controls
implemented to retain supporting documentation for ACH payments. To strengthen internal controls over
disbursements, it is recommended that appropriate support be maintained for all disbursements, including
ACH payments.
Repeat Finding: This finding is not a repeat finding.
Effect: Non‐payroll disbursement transactions were being processed without retaining evidence of approval.
Auditor’s Recommendation: In order to ensure non‐payroll disbursement transactions are properly reviewed,
approved, and supporting documentation maintained, we recommend Real Escape from the Sex Trade
ensure controls over these transactions are operating effectively. This control can be accomplished by
implementing a review process over each transaction prior to the purchase and formally documenting the
approval.
Management’s Response: Management agrees with the finding and has prepared correction action as
detailed in its Corrective Action Plan.
2023‐001: Allowable Costs and Allowable Activities – Internal Controls Over Non‐Payroll Disbursements –
Significant Deficiency
Criteria: Federal award recipients must establish internal control procedures over compliance with provisions
of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles,
and Audit Requirements for Federal Awards (Uniform Guidance) that require, among other things, that direct
charges to federal awards be for allowable costs. To be an allowable cost, charges must be supported by
appropriate documentation and be properly approved. The specific requirements for allowable activities are
unique to each Federal Program and are found in the law, regulations, and the provisions for each contract or
grant agreement pertaining to the federal program.
Condition and Context: As part of our tests of internal controls over compliance, we selected a sample of
forty (40) non‐payroll disbursement transactions to test controls of disbursement costs charged to the major
program. The items selected in this sample were also used as a dual‐purpose test for purposes of testing
compliance. In our control sample, we noted there was no evidence of management approval prior to the
purchase for one (1) of the forty (40) transactions tested. In this instance, the payment was made via ACH but
no documentation to evidence the approval was maintained other than reliance on the bank’s automated
system which will not execute an ACH without double approval.
Questioned Costs: None.
Cause: The primary factor that contributed to the deficiency was the lack of sufficient controls
implemented to retain supporting documentation for ACH payments. To strengthen internal controls over
disbursements, it is recommended that appropriate support be maintained for all disbursements, including
ACH payments.
Repeat Finding: This finding is not a repeat finding.
Effect: Non‐payroll disbursement transactions were being processed without retaining evidence of approval.
Auditor’s Recommendation: In order to ensure non‐payroll disbursement transactions are properly reviewed,
approved, and supporting documentation maintained, we recommend Real Escape from the Sex Trade
ensure controls over these transactions are operating effectively. This control can be accomplished by
implementing a review process over each transaction prior to the purchase and formally documenting the
approval.
Management’s Response: Management agrees with the finding and has prepared correction action as
detailed in its Corrective Action Plan.
2023‐001: Allowable Costs and Allowable Activities – Internal Controls Over Non‐Payroll Disbursements –
Significant Deficiency
Criteria: Federal award recipients must establish internal control procedures over compliance with provisions
of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles,
and Audit Requirements for Federal Awards (Uniform Guidance) that require, among other things, that direct
charges to federal awards be for allowable costs. To be an allowable cost, charges must be supported by
appropriate documentation and be properly approved. The specific requirements for allowable activities are
unique to each Federal Program and are found in the law, regulations, and the provisions for each contract or
grant agreement pertaining to the federal program.
Condition and Context: As part of our tests of internal controls over compliance, we selected a sample of
forty (40) non‐payroll disbursement transactions to test controls of disbursement costs charged to the major
program. The items selected in this sample were also used as a dual‐purpose test for purposes of testing
compliance. In our control sample, we noted there was no evidence of management approval prior to the
purchase for one (1) of the forty (40) transactions tested. In this instance, the payment was made via ACH but
no documentation to evidence the approval was maintained other than reliance on the bank’s automated
system which will not execute an ACH without double approval.
Questioned Costs: None.
Cause: The primary factor that contributed to the deficiency was the lack of sufficient controls
implemented to retain supporting documentation for ACH payments. To strengthen internal controls over
disbursements, it is recommended that appropriate support be maintained for all disbursements, including
ACH payments.
Repeat Finding: This finding is not a repeat finding.
Effect: Non‐payroll disbursement transactions were being processed without retaining evidence of approval.
Auditor’s Recommendation: In order to ensure non‐payroll disbursement transactions are properly reviewed,
approved, and supporting documentation maintained, we recommend Real Escape from the Sex Trade
ensure controls over these transactions are operating effectively. This control can be accomplished by
implementing a review process over each transaction prior to the purchase and formally documenting the
approval.
Management’s Response: Management agrees with the finding and has prepared correction action as
detailed in its Corrective Action Plan.
2023‐001: Allowable Costs and Allowable Activities – Internal Controls Over Non‐Payroll Disbursements –
Significant Deficiency
Criteria: Federal award recipients must establish internal control procedures over compliance with provisions
of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles,
and Audit Requirements for Federal Awards (Uniform Guidance) that require, among other things, that direct
charges to federal awards be for allowable costs. To be an allowable cost, charges must be supported by
appropriate documentation and be properly approved. The specific requirements for allowable activities are
unique to each Federal Program and are found in the law, regulations, and the provisions for each contract or
grant agreement pertaining to the federal program.
Condition and Context: As part of our tests of internal controls over compliance, we selected a sample of
forty (40) non‐payroll disbursement transactions to test controls of disbursement costs charged to the major
program. The items selected in this sample were also used as a dual‐purpose test for purposes of testing
compliance. In our control sample, we noted there was no evidence of management approval prior to the
purchase for one (1) of the forty (40) transactions tested. In this instance, the payment was made via ACH but
no documentation to evidence the approval was maintained other than reliance on the bank’s automated
system which will not execute an ACH without double approval.
Questioned Costs: None.
Cause: The primary factor that contributed to the deficiency was the lack of sufficient controls
implemented to retain supporting documentation for ACH payments. To strengthen internal controls over
disbursements, it is recommended that appropriate support be maintained for all disbursements, including
ACH payments.
Repeat Finding: This finding is not a repeat finding.
Effect: Non‐payroll disbursement transactions were being processed without retaining evidence of approval.
Auditor’s Recommendation: In order to ensure non‐payroll disbursement transactions are properly reviewed,
approved, and supporting documentation maintained, we recommend Real Escape from the Sex Trade
ensure controls over these transactions are operating effectively. This control can be accomplished by
implementing a review process over each transaction prior to the purchase and formally documenting the
approval.
Management’s Response: Management agrees with the finding and has prepared correction action as
detailed in its Corrective Action Plan.
2023‐001: Allowable Costs and Allowable Activities – Internal Controls Over Non‐Payroll Disbursements –
Significant Deficiency
Criteria: Federal award recipients must establish internal control procedures over compliance with provisions
of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles,
and Audit Requirements for Federal Awards (Uniform Guidance) that require, among other things, that direct
charges to federal awards be for allowable costs. To be an allowable cost, charges must be supported by
appropriate documentation and be properly approved. The specific requirements for allowable activities are
unique to each Federal Program and are found in the law, regulations, and the provisions for each contract or
grant agreement pertaining to the federal program.
Condition and Context: As part of our tests of internal controls over compliance, we selected a sample of
forty (40) non‐payroll disbursement transactions to test controls of disbursement costs charged to the major
program. The items selected in this sample were also used as a dual‐purpose test for purposes of testing
compliance. In our control sample, we noted there was no evidence of management approval prior to the
purchase for one (1) of the forty (40) transactions tested. In this instance, the payment was made via ACH but
no documentation to evidence the approval was maintained other than reliance on the bank’s automated
system which will not execute an ACH without double approval.
Questioned Costs: None.
Cause: The primary factor that contributed to the deficiency was the lack of sufficient controls
implemented to retain supporting documentation for ACH payments. To strengthen internal controls over
disbursements, it is recommended that appropriate support be maintained for all disbursements, including
ACH payments.
Repeat Finding: This finding is not a repeat finding.
Effect: Non‐payroll disbursement transactions were being processed without retaining evidence of approval.
Auditor’s Recommendation: In order to ensure non‐payroll disbursement transactions are properly reviewed,
approved, and supporting documentation maintained, we recommend Real Escape from the Sex Trade
ensure controls over these transactions are operating effectively. This control can be accomplished by
implementing a review process over each transaction prior to the purchase and formally documenting the
approval.
Management’s Response: Management agrees with the finding and has prepared correction action as
detailed in its Corrective Action Plan.
2023‐001: Allowable Costs and Allowable Activities – Internal Controls Over Non‐Payroll Disbursements –
Significant Deficiency
Criteria: Federal award recipients must establish internal control procedures over compliance with provisions
of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles,
and Audit Requirements for Federal Awards (Uniform Guidance) that require, among other things, that direct
charges to federal awards be for allowable costs. To be an allowable cost, charges must be supported by
appropriate documentation and be properly approved. The specific requirements for allowable activities are
unique to each Federal Program and are found in the law, regulations, and the provisions for each contract or
grant agreement pertaining to the federal program.
Condition and Context: As part of our tests of internal controls over compliance, we selected a sample of
forty (40) non‐payroll disbursement transactions to test controls of disbursement costs charged to the major
program. The items selected in this sample were also used as a dual‐purpose test for purposes of testing
compliance. In our control sample, we noted there was no evidence of management approval prior to the
purchase for one (1) of the forty (40) transactions tested. In this instance, the payment was made via ACH but
no documentation to evidence the approval was maintained other than reliance on the bank’s automated
system which will not execute an ACH without double approval.
Questioned Costs: None.
Cause: The primary factor that contributed to the deficiency was the lack of sufficient controls
implemented to retain supporting documentation for ACH payments. To strengthen internal controls over
disbursements, it is recommended that appropriate support be maintained for all disbursements, including
ACH payments.
Repeat Finding: This finding is not a repeat finding.
Effect: Non‐payroll disbursement transactions were being processed without retaining evidence of approval.
Auditor’s Recommendation: In order to ensure non‐payroll disbursement transactions are properly reviewed,
approved, and supporting documentation maintained, we recommend Real Escape from the Sex Trade
ensure controls over these transactions are operating effectively. This control can be accomplished by
implementing a review process over each transaction prior to the purchase and formally documenting the
approval.
Management’s Response: Management agrees with the finding and has prepared correction action as
detailed in its Corrective Action Plan.
2023‐001: Allowable Costs and Allowable Activities – Internal Controls Over Non‐Payroll Disbursements –
Significant Deficiency
Criteria: Federal award recipients must establish internal control procedures over compliance with provisions
of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles,
and Audit Requirements for Federal Awards (Uniform Guidance) that require, among other things, that direct
charges to federal awards be for allowable costs. To be an allowable cost, charges must be supported by
appropriate documentation and be properly approved. The specific requirements for allowable activities are
unique to each Federal Program and are found in the law, regulations, and the provisions for each contract or
grant agreement pertaining to the federal program.
Condition and Context: As part of our tests of internal controls over compliance, we selected a sample of
forty (40) non‐payroll disbursement transactions to test controls of disbursement costs charged to the major
program. The items selected in this sample were also used as a dual‐purpose test for purposes of testing
compliance. In our control sample, we noted there was no evidence of management approval prior to the
purchase for one (1) of the forty (40) transactions tested. In this instance, the payment was made via ACH but
no documentation to evidence the approval was maintained other than reliance on the bank’s automated
system which will not execute an ACH without double approval.
Questioned Costs: None.
Cause: The primary factor that contributed to the deficiency was the lack of sufficient controls
implemented to retain supporting documentation for ACH payments. To strengthen internal controls over
disbursements, it is recommended that appropriate support be maintained for all disbursements, including
ACH payments.
Repeat Finding: This finding is not a repeat finding.
Effect: Non‐payroll disbursement transactions were being processed without retaining evidence of approval.
Auditor’s Recommendation: In order to ensure non‐payroll disbursement transactions are properly reviewed,
approved, and supporting documentation maintained, we recommend Real Escape from the Sex Trade
ensure controls over these transactions are operating effectively. This control can be accomplished by
implementing a review process over each transaction prior to the purchase and formally documenting the
approval.
Management’s Response: Management agrees with the finding and has prepared correction action as
detailed in its Corrective Action Plan.
2023‐001: Allowable Costs and Allowable Activities – Internal Controls Over Non‐Payroll Disbursements –
Significant Deficiency
Criteria: Federal award recipients must establish internal control procedures over compliance with provisions
of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles,
and Audit Requirements for Federal Awards (Uniform Guidance) that require, among other things, that direct
charges to federal awards be for allowable costs. To be an allowable cost, charges must be supported by
appropriate documentation and be properly approved. The specific requirements for allowable activities are
unique to each Federal Program and are found in the law, regulations, and the provisions for each contract or
grant agreement pertaining to the federal program.
Condition and Context: As part of our tests of internal controls over compliance, we selected a sample of
forty (40) non‐payroll disbursement transactions to test controls of disbursement costs charged to the major
program. The items selected in this sample were also used as a dual‐purpose test for purposes of testing
compliance. In our control sample, we noted there was no evidence of management approval prior to the
purchase for one (1) of the forty (40) transactions tested. In this instance, the payment was made via ACH but
no documentation to evidence the approval was maintained other than reliance on the bank’s automated
system which will not execute an ACH without double approval.
Questioned Costs: None.
Cause: The primary factor that contributed to the deficiency was the lack of sufficient controls
implemented to retain supporting documentation for ACH payments. To strengthen internal controls over
disbursements, it is recommended that appropriate support be maintained for all disbursements, including
ACH payments.
Repeat Finding: This finding is not a repeat finding.
Effect: Non‐payroll disbursement transactions were being processed without retaining evidence of approval.
Auditor’s Recommendation: In order to ensure non‐payroll disbursement transactions are properly reviewed,
approved, and supporting documentation maintained, we recommend Real Escape from the Sex Trade
ensure controls over these transactions are operating effectively. This control can be accomplished by
implementing a review process over each transaction prior to the purchase and formally documenting the
approval.
Management’s Response: Management agrees with the finding and has prepared correction action as
detailed in its Corrective Action Plan.
2023‐001: Allowable Costs and Allowable Activities – Internal Controls Over Non‐Payroll Disbursements –
Significant Deficiency
Criteria: Federal award recipients must establish internal control procedures over compliance with provisions
of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles,
and Audit Requirements for Federal Awards (Uniform Guidance) that require, among other things, that direct
charges to federal awards be for allowable costs. To be an allowable cost, charges must be supported by
appropriate documentation and be properly approved. The specific requirements for allowable activities are
unique to each Federal Program and are found in the law, regulations, and the provisions for each contract or
grant agreement pertaining to the federal program.
Condition and Context: As part of our tests of internal controls over compliance, we selected a sample of
forty (40) non‐payroll disbursement transactions to test controls of disbursement costs charged to the major
program. The items selected in this sample were also used as a dual‐purpose test for purposes of testing
compliance. In our control sample, we noted there was no evidence of management approval prior to the
purchase for one (1) of the forty (40) transactions tested. In this instance, the payment was made via ACH but
no documentation to evidence the approval was maintained other than reliance on the bank’s automated
system which will not execute an ACH without double approval.
Questioned Costs: None.
Cause: The primary factor that contributed to the deficiency was the lack of sufficient controls
implemented to retain supporting documentation for ACH payments. To strengthen internal controls over
disbursements, it is recommended that appropriate support be maintained for all disbursements, including
ACH payments.
Repeat Finding: This finding is not a repeat finding.
Effect: Non‐payroll disbursement transactions were being processed without retaining evidence of approval.
Auditor’s Recommendation: In order to ensure non‐payroll disbursement transactions are properly reviewed,
approved, and supporting documentation maintained, we recommend Real Escape from the Sex Trade
ensure controls over these transactions are operating effectively. This control can be accomplished by
implementing a review process over each transaction prior to the purchase and formally documenting the
approval.
Management’s Response: Management agrees with the finding and has prepared correction action as
detailed in its Corrective Action Plan.
2023‐001: Allowable Costs and Allowable Activities – Internal Controls Over Non‐Payroll Disbursements –
Significant Deficiency
Criteria: Federal award recipients must establish internal control procedures over compliance with provisions
of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles,
and Audit Requirements for Federal Awards (Uniform Guidance) that require, among other things, that direct
charges to federal awards be for allowable costs. To be an allowable cost, charges must be supported by
appropriate documentation and be properly approved. The specific requirements for allowable activities are
unique to each Federal Program and are found in the law, regulations, and the provisions for each contract or
grant agreement pertaining to the federal program.
Condition and Context: As part of our tests of internal controls over compliance, we selected a sample of
forty (40) non‐payroll disbursement transactions to test controls of disbursement costs charged to the major
program. The items selected in this sample were also used as a dual‐purpose test for purposes of testing
compliance. In our control sample, we noted there was no evidence of management approval prior to the
purchase for one (1) of the forty (40) transactions tested. In this instance, the payment was made via ACH but
no documentation to evidence the approval was maintained other than reliance on the bank’s automated
system which will not execute an ACH without double approval.
Questioned Costs: None.
Cause: The primary factor that contributed to the deficiency was the lack of sufficient controls
implemented to retain supporting documentation for ACH payments. To strengthen internal controls over
disbursements, it is recommended that appropriate support be maintained for all disbursements, including
ACH payments.
Repeat Finding: This finding is not a repeat finding.
Effect: Non‐payroll disbursement transactions were being processed without retaining evidence of approval.
Auditor’s Recommendation: In order to ensure non‐payroll disbursement transactions are properly reviewed,
approved, and supporting documentation maintained, we recommend Real Escape from the Sex Trade
ensure controls over these transactions are operating effectively. This control can be accomplished by
implementing a review process over each transaction prior to the purchase and formally documenting the
approval.
Management’s Response: Management agrees with the finding and has prepared correction action as
detailed in its Corrective Action Plan.