Audit 400659

Finding 2025-003 – Internal Controls over Federal Awards (Significant Deficiency) Information on the Federal Program: U.S. Department of Health and Human Services, Assistance Listing #93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance and Assistance Listing #93.959 Block Grants for Prevention and Treatment of Substance Abuse. Criteria: 2 CFR section 200.303 establishes the requirements for non‑federal entities to establish and maintain effective internal control over federal awards to provide reasonable assurance that transactions are properly authorized. Condition: The Council’s Grant Management Policies & Procedures Manual requires credit card purchase requests be submitted on the Council's approval form at least two weeks prior to the date needed and must have the signed approval of the Executive Director. In three of the 35 transactions tested, the credit card purchase approval form was dated after the date of purchase. Cause: Purchase requests were not consistently submitted and approved in advance of the purchase date, indicating a breakdown in adherence to established procurement timelines. . Effect: Although the transactions were ultimately approved and the costs were otherwise allowable, allocated, and properly charged to the program, failure to obtain timely approval increases the risk that purchases may be made without appropriate prior authorization. Questioned Costs: None Recommendation: We recommend management reinforce procurement procedures to ensure purchase requests are submitted and approved in accordance with the established policy requiring approval at least two weeks prior to the date needed, thereby strengthening internal controls over procurement and disbursements. Views of Responsible Officials: See Management’s View and Corrective Action Plan at the end of the report.