Audit 398809

Finding 2023-002 Department: United States Department of Housing and Urban Development Program Name: Emergency Solutions Grant Program Federal Assistance Listing Number: 14.231 Significant deficiency: Financial Reporting Timeliness (Uniform Guidance compliance) Criteria: In accordance with 2 CFR section 200.512 of the Uniform Guidance, the data collection form and reporting package must be submitted to the Federal Audit Clearinghouse within the earlier of 30 calendar days after receipt of the auditor's report(s), or nine months after the end of the audit period. Condition: The June 30, 2023 and 2024 Single Audit reporting packages and data collection forms have not been submitted to the Federal Audit Clearinghouse by the deadline. Cause: Since the year ended June 30, 2022 was the first year the Organization was required to have an audit performed by an independent CPA and conducted under the rules of the Uniform Guidance; unfamiliarity with the requirements and a learning curve has caused a delay in the financial audits. Effect: The failure to submit single audits within the time frame prescribed by Uniform Guidance causes the Organization to be considered a high-risk auditee. In addition, the Organization is required to adhere to strict reporting deadlines set by government agencies. Failure to meet these deadlines can result in compliance issues, penalties, and jeopardize the renewal of funding. Questioned costs: None Repeat Finding: Previously reported as 2022-001 Recommendation: Employ the necessary management and accounting personnel to have the resources to ensure the audit is completed within nine months of year end. Views of Responsible Officials: We agree with this finding and the delinquent audits are being completed as efficiently as possible.

Finding 2023-003 Department: United States Department of Housing and Urban Development Program Name: Emergency Solutions Grant Program Federal Assistance Listing Number: 14.231 Significant deficiency: Reliance on auditor to prepare the Schedule of Expenditures and Federal Awards (SEFA) Criteria: Uniform Guidance state that the Organization being audited is responsible for preparation of the Schedule of Expenditures of Federal Awards. Condition: The Organization relies on the auditors to draft for approval the schedule of expenditure of federal awards in accordance with Uniform Guidance. Cause: Due to time constraints and delinquency of the audit, the Organization decided to have the external auditors prepare the SEFA. Effect: By relying on the external auditors to prepare the SEFA, the Organization is considering the external auditors a part of its internal controls over financial reporting. Questioned Costs: None. Repeat Finding: Previously reported as finding 2022-002. Recommendation: Since the Organization has the knowledge and capability, we recommend the Schedule of Federal Expenditures be prepared prior to the audit. Views of Responsible Officials: We agree with this finding and will prepare a complete SEFA prior to future audits.

Finding 2023-004 Department: United States Department of Housing and Urban Development Program Name: Emergency Solutions Grant Program Federal Assistance Listing Number: 14.231 Significant deficiency: Subrecipient monitoring Criteria: A pass-through entity must clearly identify to the subrecipient certain key information at the time of the subaward. These items include, but are not limited to, subrecipient name, subrecipient’s unique entity identifier, Federal Award Identification Number, federal award date, subaward period of performance start and end date, name of Federal awarding agency, and Assistance Listings number and title. Condition: While performing our audit of the Organization’s subrecipient monitoring, we noted not all required elements were included in the subaward agreement. Cause: The Organization included the majority of these required elements in the subaward and believed the information provided was adequate. Effect: Noncompliance may cause subrecipients to fail to report the federal funds received as required by the Uniform Guidance. Questioned Costs: None. Repeat Finding: Previously reported as finding 2022-003 Recommendation: We recommend the Organization develop agreements with subrecipients to properly reflect each of the required elements included in Part 2 CFR Part 200, Subpart D, section 200.332. View of Responsible Official: We agree with this finding and will include the relevant information in our subawards in the future.

Finding 2023-005 Department: United States Department of Housing and Urban Development Program Name: Emergency Solutions Grant Program Federal Assistance Listing Number: 14.231 Significant deficiency: Subrecipient monitoring Criteria: Any amendment to the budget in the subgrantee agreement greater than 10% must be approved in writing by the Organization and the subgrantee. Condition: While performing our audit of the Organization’s subrecipient monitoring, we noted three instances where the budget was increased with no formal written documentation. Cause: Due to the tight timeframe of expenditure deadlines at the state, several subgrantees relinquished funds to other subgrantees changing the amount of the subgrants but not the amount of the State grant to the Organization. Effect: Noncompliance may impact future funding from federal and state awarding agencies. Questioned Costs: None. Repeat Finding: Previously reported as finding 2022-004 Recommendation: We recommend the Organization ensure they have written documentation and approval of any changes in the subgrantee budgets. View of Responsible Official: We agree with this finding and will document approval for changes in budgets with subgrantees.

Finding 2023-006 Department: United States Department of Housing and Urban Development Program Name: Emergency Solutions Grant Program Federal Assistance Listing Number: 14.231 Material Weakness: Insufficient documentation Criteria: In accordance with Uniform Guidance, all federal grant expenditures must be adequately documented. The Organization should have internal controls designed to ensure (1) subrecipient documents supporting reimbursable expenditures and (2) reimbursement requests sent to grantors are maintained in an organized manner in a shared location. Condition: Not all documents requested were available for our review during the audit. Cause: Documents submitted by subrecipients to the Organization and reimbursement requests submitted to the grantor from the Organization were maintained by an employee that was subsequently terminated and the location of some files is unknown. Effect: There is a risk that pursuant to an audit performed by the grantor, costs without appropriate documentation could be disallowed. Questions Costs: Unknown Repeat Finding: No Recommendation: We recommend the Organization implement procedures to ensure sufficient supporting records are maintained for all grant expenses submitted for reimbursement. Response: The Organization agrees with the audit finding. There were gaps in information flow due to staff turnover. The Organization already has a process in place to maintain documentation in a logical manner with adequate access.