Finding 2022-004: Internal Controls over Compliance and Other Matters M. Subrecipient Monitoring U.S. DEPARTMENT OF JUSTICE Children Exposed to Violence ? Assistance Listing No. 16.818 U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES COVID-19 ? Community Services Block Grant? Assistance Listing No. 93.569 Criteria: The Uniform Guidance requires program participants who are pass-through entities to monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.331(d) through (f)). All pass-through entities must also ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following specific required information: federal award identification information, all requirements imposed by the pass-through entity, any additional requirements to meet the pass-through entity?s responsibilities, information on the indirect cost rate, requirements to permit access to subrecipients? records and statements, and appropriate closeout terms and conditions (2 CFR section 200.332). Condition: The U.S. Department of Justice?s (DOJ) EDPR of Youthprise?s Children Exposed to Violence Program (re. 2020-CV-FX-K007) noted compliance issues over Youthprise?s subrecipient monitoring. Deficiencies included the budget, risk assessments, determination of suitability, lobbying forms, and missing documentation as it related to its subrecipient grants. A formal letter was issued to Youthprise dated November 8, 2022, detailing the compliance issues noted. In addition, the subgrant agreements awarded for the COVID-19 ? Community Services Block Grant program did not include the required information per 2 CFR section 200.332. Cause: Internal controls were not in place to ensure Youthprise followed the subrecipient monitoring requirements outlined in 2 CFR section 200.331 and 200.332. Effect: The conditions noted above resulted in noncompliance over subrecipient monitoring by Youthprise. Context: The DOJ completed a EDPR of Youthprise?s Children Exposed to Violence Program (re. 2020-CV-FX-K007) during 2022. The DOJ outlined specific recommendations in its EPDR letter dated November 22, 2022 to address the conditions noted above and requested resolution to the conditions noted in its EPDR within 20 calendar days. DOJ completed a follow-up site visit at Youthprise on July 10, 2023 and determined all compliance issues to have been adequately resolved. The original agreement from Community Action Partnership of Hennepin County for the COVID-19 ? Community Services Block Grant program did not specify that Youthprise was considered a subrecipient of these federal funds, nor did it contain the required information under 2 CFR section 200.332. Youthprise originally considered themselves a contractor under the agreement and therefore the required subaward information per 2 CFR section 200.332 was not included in the subgrant agreements. Subsequently, it was verified with the pass-through entity that Youthprise is considered a subrecipient for this program. Questioned Costs: $0 Identification of Repeat Finding: Not a repeat finding. Recommendation: We recommend that Youthprise review procedures to ensure adequate subrecipient monitoring is being performed over all subrecipient agreements, that meet the requirements of 2 CFR 200.331 and 2 CFR 200.332. Views of Responsible Officials and Corrective Action Plan: Management agrees with this finding and is in the process of developing internal controls to ensure timely and appropriate actions are made on the deficiency noted. Additional details can be found in Youthprise?s Corrective Action Plan.
Finding 2022-005: Internal Controls over Compliance and Other Matters L. Reporting U.S. DEPARTMENT OF JUSTICE Children Exposed to Violence ? Assistance Listing No. 16.818 Criteria: Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) codified in 2 CFR Part 170, direct recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR 200.303, a non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non- Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The U.S. Department of Justice?s (DOJ) EDPR of Youthprise?s Children Exposed to Violence Program (re. 2020-CV-FX-K007) noted compliance issues over Youthprise?s Federal Funding Accountability and Transparency Act Subaward Reporting. A formal letter was issued to Youthprise dated November 8, 2022, detailing the compliance issue noted. During our evaluation of controls over financial and performance reporting, it was discovered that evidence to document reports are reviewed and approved prior to submittal is not maintained by Youthprise. Additionally, 2 of the 7 reports selected for testing did not document the date of report submission. Per COSO, segregation of duties should exist between those preparing and those reviewing and filing required reports. Best practices would include ensuring adequate supporting evidence exists to substantiate controls are being followed. Cause: Internal controls were not in place to ensure Youthprise followed the FFATA reporting requirements outlined in 2 CFR Part 170. Internal controls were not in place to document internal controls over reporting were in place and being followed. Effect: The condition noted above resulted in noncompliance over reporting by Youthprise. Context: DOJ completed a EDPR of Youthprise?s Children Exposed to Violence Program (re. 2020-CV-FX-K007) during 2022 and noted Youthprise did not complete the required FFATA reporting as required. The DOJ outlined specific recommendations in its EPDR letter dated November 22, 2022 to address this condition noted and requested resolution to the condition within 20 calendar days. DOJ completed a follow-up site visit at Youthprise on July 10, 2023 and determined the FFATA reporting compliance issue had been adequately resolved. During our audit, Youthprise had described its internal controls in place over reporting, however the auditor was unable to substantiate statements made due to lack of supporting evidence and due to staff turnover at the organization. Questioned Costs: $0 Identification of Repeat Finding: Not a repeat finding. Recommendation: We recommend that Youthprise review its internal control procedures to ensure FFATA reporting is completed as required by 2 CFR Part 170. Additionally, we recommend Youthprise document its review and approval process over reports and document report submission dates. Views of Responsible Officials and Corrective Action Plan: Management agrees with this finding and is in the process of developing internal controls to ensure timely and appropriate actions are made on the deficiency noted. Additional details can be found in Youthprise?s Corrective Action Plan.
Finding 2022-006: Internal Controls over Compliance B. Allowable Costs/Cost Principles related to the Payroll Process U.S. DEPARTMENT OF JUSTICE Children Exposed to Violence ? Assistance Listing No. 16.818 Criteria: Controls over payroll processes should be in place to allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements in a timely manner. Per CFR Part 200.403, factors affecting allowability of costs, costs must be consistent with policies and procedures that apply uniformly to both federally financed and other activities of the non-federal entity and be adequately documented in order to be allowable under federal awards. Condition: During 2022, there was a general lack of controls over payroll processes noted for direct payroll costs charged to the Children Exposed to Violence federal program: ? For one employee, the pay rate used to calculate payroll charged to the federal program for one pay period selected for testing did not match the authorized pay rate included in the employee?s human resources records. ? Timecards were not available for any employees for one pay period selected for testing. ? Payroll was not properly allocated to the federal program based on supporting employee timecards between July 10, 2022 and December 31, 2022. Cause: This condition was caused by a combination of a lack of staffs? physically present at the Youthprise office during the year, a lack of staff and oversight of finance department activities, and due to the turnover of finance staff during 2022, as discussed in finding 2022- 002 above. Additionally, during 2022 Youthprise switched payroll processing providers. The one pay period tested which lacked timecards occurred during the payroll provider transition. The improper allocation of time occurred after the new payroll processing provider transition was complete. Effect: By not having effective internal controls over payroll processes, there is a risk that misstatements and unallowable costs charged to federal programs could occur and not be detected in a timely manner. Context: A sample of four pay periods totaling $12,889 was selected for audit from a population of twenty six pay periods totaling $107,968. Although there was a lack of internal controls over the payroll process as noted above, Youthprise was able to substantiate that the total payroll costs charged to the program were allowable and that no overcharges to the federal program occurred. Our sample was a statistically valid sample. Questioned Costs: $0 Identification of Repeat Finding: Not a repeat finding. Recommendation: We recommend Youthprise develop and implement internal controls to ensure sufficient oversight is maintained over its payroll processes to prevent or detect and correct misstatements on a timely basis. Views of Responsible Officials and Corrective Action Plan: The discrepancies in payroll reporting were identified by Youthprise during 2023. Management discovered that reports downloaded from the third-party processor were not accurately coding salary based on timecard reports submitted by some of its employees. Youthprise is working with its Human Resources consultant, who is working with the 3rd party payroll processor, to correct the reporting issues going forward. Youthprise will review its internal controls going forward to ensure sufficient oversight is maintained over its payroll processes to prevent or detect and correct misstatements on a timely basis.
Finding 2022-004: Internal Controls over Compliance and Other Matters M. Subrecipient Monitoring U.S. DEPARTMENT OF JUSTICE Children Exposed to Violence ? Assistance Listing No. 16.818 U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES COVID-19 ? Community Services Block Grant? Assistance Listing No. 93.569 Criteria: The Uniform Guidance requires program participants who are pass-through entities to monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.331(d) through (f)). All pass-through entities must also ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following specific required information: federal award identification information, all requirements imposed by the pass-through entity, any additional requirements to meet the pass-through entity?s responsibilities, information on the indirect cost rate, requirements to permit access to subrecipients? records and statements, and appropriate closeout terms and conditions (2 CFR section 200.332). Condition: The U.S. Department of Justice?s (DOJ) EDPR of Youthprise?s Children Exposed to Violence Program (re. 2020-CV-FX-K007) noted compliance issues over Youthprise?s subrecipient monitoring. Deficiencies included the budget, risk assessments, determination of suitability, lobbying forms, and missing documentation as it related to its subrecipient grants. A formal letter was issued to Youthprise dated November 8, 2022, detailing the compliance issues noted. In addition, the subgrant agreements awarded for the COVID-19 ? Community Services Block Grant program did not include the required information per 2 CFR section 200.332. Cause: Internal controls were not in place to ensure Youthprise followed the subrecipient monitoring requirements outlined in 2 CFR section 200.331 and 200.332. Effect: The conditions noted above resulted in noncompliance over subrecipient monitoring by Youthprise. Context: The DOJ completed a EDPR of Youthprise?s Children Exposed to Violence Program (re. 2020-CV-FX-K007) during 2022. The DOJ outlined specific recommendations in its EPDR letter dated November 22, 2022 to address the conditions noted above and requested resolution to the conditions noted in its EPDR within 20 calendar days. DOJ completed a follow-up site visit at Youthprise on July 10, 2023 and determined all compliance issues to have been adequately resolved. The original agreement from Community Action Partnership of Hennepin County for the COVID-19 ? Community Services Block Grant program did not specify that Youthprise was considered a subrecipient of these federal funds, nor did it contain the required information under 2 CFR section 200.332. Youthprise originally considered themselves a contractor under the agreement and therefore the required subaward information per 2 CFR section 200.332 was not included in the subgrant agreements. Subsequently, it was verified with the pass-through entity that Youthprise is considered a subrecipient for this program. Questioned Costs: $0 Identification of Repeat Finding: Not a repeat finding. Recommendation: We recommend that Youthprise review procedures to ensure adequate subrecipient monitoring is being performed over all subrecipient agreements, that meet the requirements of 2 CFR 200.331 and 2 CFR 200.332. Views of Responsible Officials and Corrective Action Plan: Management agrees with this finding and is in the process of developing internal controls to ensure timely and appropriate actions are made on the deficiency noted. Additional details can be found in Youthprise?s Corrective Action Plan.
Finding 2022-003: Internal Controls over Compliance and Other Matters Identification of Federal Funds for Purposes of Assembling the Schedule of Expenditures of Federal Awards (SEFA) ? Other U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES COVID-19 ? Community Services Block Grant? Assistance Listing No. 93.569 Criteria: Per 2 CFR 200.510(b) Schedule of expenditures of Federal awards, ?the auditee must prepare a schedule of expenditures of Federal awards for the period covered by the auditee's financial statements which must include the total Federal awards expended as determined in accordance with 2 CFR 200.502, Basis for determining Federal awards expended. Condition: Federal expenses were not correctly identified on Youthprise?s 2022 SEFA. During our audit, it was determined that a $300,000 grant from Community Action Partnership of Hennepin County under the COVID-19 ? Community Services Block Grant program was not included on the audittee prepared SEFA. Additionally, it was determined that a $3.5 million grant originally included in the SEFA was a contractor payment not a subreceipient award. Cause: Internal controls were not in place to ensure all relevant contract and grant agreement information received by Youthprise staff were passed along to the individual responsible for overseeing the audit, financial statement, and SEFA preparation. Effect: By not having proper controls over SEFA preparation, there is a risk that the SEFA will not reflect all the federal awards subject to the Uniform Guidance. Context: The original agreement from Community Action Partnership of Hennepin County did not specify that Youthprise was considered a subrecipient federal funds. Youthprise originally considered themselves a contractor under the agreement and therefore these funds were excluded from the SEFA. Subsequently, it was verified with the pass-through entity that Youthprise is considered a subrecipient for this program. During the financial audit, it was determined Youthprise was a contractor/fiscal agent related to the $3.5 million program and therefore these funds were removed from the SEFA. Refer to Finding 2022-001 for additional context. Questioned Costs: $0 Identification of Repeat Finding: Not a repeat finding. Recommendation: We recommend that Youthprise review procedures to ensure timely identification of federal funds, including the clear distinction between subrecipient and contractor relationships for all contract and grant agreements involving federal funds. Views of Responsible Officials and Corrective Action Plan: Management agrees with this finding and is in the process of developing internal controls to ensure timely and appropriate actions are made on the deficiency noted. Additional details can be found in Youthprise?s Corrective Action Plan.
Finding 2022-004: Internal Controls over Compliance and Other Matters M. Subrecipient Monitoring U.S. DEPARTMENT OF JUSTICE Children Exposed to Violence ? Assistance Listing No. 16.818 U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES COVID-19 ? Community Services Block Grant? Assistance Listing No. 93.569 Criteria: The Uniform Guidance requires program participants who are pass-through entities to monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.331(d) through (f)). All pass-through entities must also ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following specific required information: federal award identification information, all requirements imposed by the pass-through entity, any additional requirements to meet the pass-through entity?s responsibilities, information on the indirect cost rate, requirements to permit access to subrecipients? records and statements, and appropriate closeout terms and conditions (2 CFR section 200.332). Condition: The U.S. Department of Justice?s (DOJ) EDPR of Youthprise?s Children Exposed to Violence Program (re. 2020-CV-FX-K007) noted compliance issues over Youthprise?s subrecipient monitoring. Deficiencies included the budget, risk assessments, determination of suitability, lobbying forms, and missing documentation as it related to its subrecipient grants. A formal letter was issued to Youthprise dated November 8, 2022, detailing the compliance issues noted. In addition, the subgrant agreements awarded for the COVID-19 ? Community Services Block Grant program did not include the required information per 2 CFR section 200.332. Cause: Internal controls were not in place to ensure Youthprise followed the subrecipient monitoring requirements outlined in 2 CFR section 200.331 and 200.332. Effect: The conditions noted above resulted in noncompliance over subrecipient monitoring by Youthprise. Context: The DOJ completed a EDPR of Youthprise?s Children Exposed to Violence Program (re. 2020-CV-FX-K007) during 2022. The DOJ outlined specific recommendations in its EPDR letter dated November 22, 2022 to address the conditions noted above and requested resolution to the conditions noted in its EPDR within 20 calendar days. DOJ completed a follow-up site visit at Youthprise on July 10, 2023 and determined all compliance issues to have been adequately resolved. The original agreement from Community Action Partnership of Hennepin County for the COVID-19 ? Community Services Block Grant program did not specify that Youthprise was considered a subrecipient of these federal funds, nor did it contain the required information under 2 CFR section 200.332. Youthprise originally considered themselves a contractor under the agreement and therefore the required subaward information per 2 CFR section 200.332 was not included in the subgrant agreements. Subsequently, it was verified with the pass-through entity that Youthprise is considered a subrecipient for this program. Questioned Costs: $0 Identification of Repeat Finding: Not a repeat finding. Recommendation: We recommend that Youthprise review procedures to ensure adequate subrecipient monitoring is being performed over all subrecipient agreements, that meet the requirements of 2 CFR 200.331 and 2 CFR 200.332. Views of Responsible Officials and Corrective Action Plan: Management agrees with this finding and is in the process of developing internal controls to ensure timely and appropriate actions are made on the deficiency noted. Additional details can be found in Youthprise?s Corrective Action Plan.
Finding 2022-005: Internal Controls over Compliance and Other Matters L. Reporting U.S. DEPARTMENT OF JUSTICE Children Exposed to Violence ? Assistance Listing No. 16.818 Criteria: Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) codified in 2 CFR Part 170, direct recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Additionally, per 2 CFR 200.303, a non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non- Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the award. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The U.S. Department of Justice?s (DOJ) EDPR of Youthprise?s Children Exposed to Violence Program (re. 2020-CV-FX-K007) noted compliance issues over Youthprise?s Federal Funding Accountability and Transparency Act Subaward Reporting. A formal letter was issued to Youthprise dated November 8, 2022, detailing the compliance issue noted. During our evaluation of controls over financial and performance reporting, it was discovered that evidence to document reports are reviewed and approved prior to submittal is not maintained by Youthprise. Additionally, 2 of the 7 reports selected for testing did not document the date of report submission. Per COSO, segregation of duties should exist between those preparing and those reviewing and filing required reports. Best practices would include ensuring adequate supporting evidence exists to substantiate controls are being followed. Cause: Internal controls were not in place to ensure Youthprise followed the FFATA reporting requirements outlined in 2 CFR Part 170. Internal controls were not in place to document internal controls over reporting were in place and being followed. Effect: The condition noted above resulted in noncompliance over reporting by Youthprise. Context: DOJ completed a EDPR of Youthprise?s Children Exposed to Violence Program (re. 2020-CV-FX-K007) during 2022 and noted Youthprise did not complete the required FFATA reporting as required. The DOJ outlined specific recommendations in its EPDR letter dated November 22, 2022 to address this condition noted and requested resolution to the condition within 20 calendar days. DOJ completed a follow-up site visit at Youthprise on July 10, 2023 and determined the FFATA reporting compliance issue had been adequately resolved. During our audit, Youthprise had described its internal controls in place over reporting, however the auditor was unable to substantiate statements made due to lack of supporting evidence and due to staff turnover at the organization. Questioned Costs: $0 Identification of Repeat Finding: Not a repeat finding. Recommendation: We recommend that Youthprise review its internal control procedures to ensure FFATA reporting is completed as required by 2 CFR Part 170. Additionally, we recommend Youthprise document its review and approval process over reports and document report submission dates. Views of Responsible Officials and Corrective Action Plan: Management agrees with this finding and is in the process of developing internal controls to ensure timely and appropriate actions are made on the deficiency noted. Additional details can be found in Youthprise?s Corrective Action Plan.
Finding 2022-006: Internal Controls over Compliance B. Allowable Costs/Cost Principles related to the Payroll Process U.S. DEPARTMENT OF JUSTICE Children Exposed to Violence ? Assistance Listing No. 16.818 Criteria: Controls over payroll processes should be in place to allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements in a timely manner. Per CFR Part 200.403, factors affecting allowability of costs, costs must be consistent with policies and procedures that apply uniformly to both federally financed and other activities of the non-federal entity and be adequately documented in order to be allowable under federal awards. Condition: During 2022, there was a general lack of controls over payroll processes noted for direct payroll costs charged to the Children Exposed to Violence federal program: ? For one employee, the pay rate used to calculate payroll charged to the federal program for one pay period selected for testing did not match the authorized pay rate included in the employee?s human resources records. ? Timecards were not available for any employees for one pay period selected for testing. ? Payroll was not properly allocated to the federal program based on supporting employee timecards between July 10, 2022 and December 31, 2022. Cause: This condition was caused by a combination of a lack of staffs? physically present at the Youthprise office during the year, a lack of staff and oversight of finance department activities, and due to the turnover of finance staff during 2022, as discussed in finding 2022- 002 above. Additionally, during 2022 Youthprise switched payroll processing providers. The one pay period tested which lacked timecards occurred during the payroll provider transition. The improper allocation of time occurred after the new payroll processing provider transition was complete. Effect: By not having effective internal controls over payroll processes, there is a risk that misstatements and unallowable costs charged to federal programs could occur and not be detected in a timely manner. Context: A sample of four pay periods totaling $12,889 was selected for audit from a population of twenty six pay periods totaling $107,968. Although there was a lack of internal controls over the payroll process as noted above, Youthprise was able to substantiate that the total payroll costs charged to the program were allowable and that no overcharges to the federal program occurred. Our sample was a statistically valid sample. Questioned Costs: $0 Identification of Repeat Finding: Not a repeat finding. Recommendation: We recommend Youthprise develop and implement internal controls to ensure sufficient oversight is maintained over its payroll processes to prevent or detect and correct misstatements on a timely basis. Views of Responsible Officials and Corrective Action Plan: The discrepancies in payroll reporting were identified by Youthprise during 2023. Management discovered that reports downloaded from the third-party processor were not accurately coding salary based on timecard reports submitted by some of its employees. Youthprise is working with its Human Resources consultant, who is working with the 3rd party payroll processor, to correct the reporting issues going forward. Youthprise will review its internal controls going forward to ensure sufficient oversight is maintained over its payroll processes to prevent or detect and correct misstatements on a timely basis.
Finding 2022-004: Internal Controls over Compliance and Other Matters M. Subrecipient Monitoring U.S. DEPARTMENT OF JUSTICE Children Exposed to Violence ? Assistance Listing No. 16.818 U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES COVID-19 ? Community Services Block Grant? Assistance Listing No. 93.569 Criteria: The Uniform Guidance requires program participants who are pass-through entities to monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.331(d) through (f)). All pass-through entities must also ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following specific required information: federal award identification information, all requirements imposed by the pass-through entity, any additional requirements to meet the pass-through entity?s responsibilities, information on the indirect cost rate, requirements to permit access to subrecipients? records and statements, and appropriate closeout terms and conditions (2 CFR section 200.332). Condition: The U.S. Department of Justice?s (DOJ) EDPR of Youthprise?s Children Exposed to Violence Program (re. 2020-CV-FX-K007) noted compliance issues over Youthprise?s subrecipient monitoring. Deficiencies included the budget, risk assessments, determination of suitability, lobbying forms, and missing documentation as it related to its subrecipient grants. A formal letter was issued to Youthprise dated November 8, 2022, detailing the compliance issues noted. In addition, the subgrant agreements awarded for the COVID-19 ? Community Services Block Grant program did not include the required information per 2 CFR section 200.332. Cause: Internal controls were not in place to ensure Youthprise followed the subrecipient monitoring requirements outlined in 2 CFR section 200.331 and 200.332. Effect: The conditions noted above resulted in noncompliance over subrecipient monitoring by Youthprise. Context: The DOJ completed a EDPR of Youthprise?s Children Exposed to Violence Program (re. 2020-CV-FX-K007) during 2022. The DOJ outlined specific recommendations in its EPDR letter dated November 22, 2022 to address the conditions noted above and requested resolution to the conditions noted in its EPDR within 20 calendar days. DOJ completed a follow-up site visit at Youthprise on July 10, 2023 and determined all compliance issues to have been adequately resolved. The original agreement from Community Action Partnership of Hennepin County for the COVID-19 ? Community Services Block Grant program did not specify that Youthprise was considered a subrecipient of these federal funds, nor did it contain the required information under 2 CFR section 200.332. Youthprise originally considered themselves a contractor under the agreement and therefore the required subaward information per 2 CFR section 200.332 was not included in the subgrant agreements. Subsequently, it was verified with the pass-through entity that Youthprise is considered a subrecipient for this program. Questioned Costs: $0 Identification of Repeat Finding: Not a repeat finding. Recommendation: We recommend that Youthprise review procedures to ensure adequate subrecipient monitoring is being performed over all subrecipient agreements, that meet the requirements of 2 CFR 200.331 and 2 CFR 200.332. Views of Responsible Officials and Corrective Action Plan: Management agrees with this finding and is in the process of developing internal controls to ensure timely and appropriate actions are made on the deficiency noted. Additional details can be found in Youthprise?s Corrective Action Plan.
Finding 2022-003: Internal Controls over Compliance and Other Matters Identification of Federal Funds for Purposes of Assembling the Schedule of Expenditures of Federal Awards (SEFA) ? Other U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES COVID-19 ? Community Services Block Grant? Assistance Listing No. 93.569 Criteria: Per 2 CFR 200.510(b) Schedule of expenditures of Federal awards, ?the auditee must prepare a schedule of expenditures of Federal awards for the period covered by the auditee's financial statements which must include the total Federal awards expended as determined in accordance with 2 CFR 200.502, Basis for determining Federal awards expended. Condition: Federal expenses were not correctly identified on Youthprise?s 2022 SEFA. During our audit, it was determined that a $300,000 grant from Community Action Partnership of Hennepin County under the COVID-19 ? Community Services Block Grant program was not included on the audittee prepared SEFA. Additionally, it was determined that a $3.5 million grant originally included in the SEFA was a contractor payment not a subreceipient award. Cause: Internal controls were not in place to ensure all relevant contract and grant agreement information received by Youthprise staff were passed along to the individual responsible for overseeing the audit, financial statement, and SEFA preparation. Effect: By not having proper controls over SEFA preparation, there is a risk that the SEFA will not reflect all the federal awards subject to the Uniform Guidance. Context: The original agreement from Community Action Partnership of Hennepin County did not specify that Youthprise was considered a subrecipient federal funds. Youthprise originally considered themselves a contractor under the agreement and therefore these funds were excluded from the SEFA. Subsequently, it was verified with the pass-through entity that Youthprise is considered a subrecipient for this program. During the financial audit, it was determined Youthprise was a contractor/fiscal agent related to the $3.5 million program and therefore these funds were removed from the SEFA. Refer to Finding 2022-001 for additional context. Questioned Costs: $0 Identification of Repeat Finding: Not a repeat finding. Recommendation: We recommend that Youthprise review procedures to ensure timely identification of federal funds, including the clear distinction between subrecipient and contractor relationships for all contract and grant agreements involving federal funds. Views of Responsible Officials and Corrective Action Plan: Management agrees with this finding and is in the process of developing internal controls to ensure timely and appropriate actions are made on the deficiency noted. Additional details can be found in Youthprise?s Corrective Action Plan.