Audit 397204

Criteria: Program requirements state that the organization is required to submit quarterly reconciliations to the West Virginia Department of Health and Human Resources by the 15th of the month following the close of the quarter. Condition: For the year ended June 30, 2022, we reviewed the quarterly submitted schedules of payment program reconciliation reports provided by the Organization. The Organization could not produce documentation supporting their review of the reconciliations. Additionally, the reconciliations in total were arithmetically inaccurate and did not agree to the total expenditure for the period by a difference $4,910. Cause: Program staff maintained documentation separate from the accounting function and did not reconcile the information from their records to the accounting function’s records on a timely basis. Effect or Potential Effect: The number of expenditures for this program as reported by the Organization to the West Virginia Department of Health and Human Resources was less than the actual expenditures by $9,989. Questioned Costs: $0. Context: The organization reported an amount to the State of West Virginia that differed from the actual expenditures. The total expenditure was $364,874 with $4,910 being underreported. Recommendation: The Organization should implement policies and procedures which require programmatic invoices to be recorded consistently in the accounting records. Then, the Organization should develop review control procedures that require reconciliation of grant expenditures prepared by the program employees to the accounting records prepared by the accounting function. The review control procedures should be documented, and the documentation should be retained.

Criteria: According to 2 CFR 200.512, the Single Audit report must be submitted to the Federal Audit Clearinghouse within 30 days of the completion of the audit, but no later than nine months after the end of the audit period. The failure to comply with this requirement constitutes noncompliance with federal regulations. Condition: For the year ended June 30, 2022, it was noted that the Uniform Guidance report, specifically the Single Audit report, was not filed within the required time frame. The report, which was due on March 31, 2023 was filed on March 27, 2026. Cause: The organization was experiencing rapid programmatic growth and was unable to fully staff the relevant administrative functions required to service an audit. Effect or Potential Effect: The late submission of the report resulted in noncompliance with federal reporting requirements under the Uniform Guidance, which could have implications for future funding, as well as increased risk of audit scrutiny. This delay also impacted the timeliness of the Federal Audit Clearinghouse’s ability to review and process the report, potentially delaying subsequent funding releases or audits. Recommendation: The Organization should implement internal controls to ensure that reporting deadlines are effectively monitored and met. These controls may include the development of a reporting calendar with clearly defined deadlines as well as the assignment of responsibility for tracking and ensuring timely submission of reports. Views of Responsible Official: Management of the Kanawha Valley Collective concurs with the audit finding. The Organization is actively working to rectify the matter and has engaged a Certified Public Accounting firm to complete the required audit procedures.