Audit 393341

Federal Agency: United States Department of Health and Human Services Federal Program: Head Start Federal Assistance Listing Number 93.600 Federal Award Year: 2021 to 2022 Criteria or Specific Requirement – Financial Reporting (2 CFR 200.328) and Monitoring and Reporting Program Performance (2 CFR 200.329) – Management is responsible for implementing controls to provide reasonable assurance that reports of federal awards submitted to the federal awarding agency or pass-through entity include all activity of the reporting period, are supported by underlying accounting or performance records, and are fairly presented in accordance with governing requirements. Management's control policies require segregation of duties between those preparing and those reviewing and filing required reports. Condition – Required reports were not separately reviewed for completeness and accuracy by an individual in management at the appropriate level other than the preparer as required by the Organization’s policy. Questioned Costs – None Context – Three of the twelve reports submitted during the year were selected for testing. Each of the three reports tested were not reviewed as required. The sampling methodology is not and is not intended to be statistically valid. Effect – Misstated reports may cause inaccurate information be submitted to the award agency and could impact future funding. Cause – The Organization’s internal controls were not adequate to ensure reports submitted were reviewed by a separate individual in management for completeness and accuracy prior to filing. Identification as a Repeat Finding – Not a repeat finding. Recommendation – We recommend management evaluate the need to implement additional procedures and policies to strengthen internal controls to ensure all required reports are reviewed for completeness and accuracy by a separate individual prior to filing. Views of Responsible Officials and Planned Corrective Actions – Management concurs with the finding. The Organization has implemented a process where a staff accountant will prepare the necessary reports, and the chief financial officer will review such reports. Alternatively, if the chief financial officer must prepare such reports, the review will be performed by the executive director.