Audit 402221

Finding 2025‐001: Allowable Cost – Significant deficiency in internal controls over compliance. Block Grants for Prevention and Treatment of Substance Abuse ALN 93.959 Criteria: Section 200 of the Code of Federal Regulations requires recipients to implement robust internal controls to ensure compliance with cost principles for all transactions charged to the grant. The Organization’s control policies state that all Brex credit card charges are to be reviewed by the supervisor prior to being uploaded into the system. Condition: During allowable cost testing for federal grants, 2 out of the 25 sample items tested did not have documented approval from the supervisor. Cause: Due to oversight, a supervisor missed approving the charges. Effect: The Organization’s reporting of allowable costs is not fully documented in accordance with its internal control procedures over compliance. Questioned Cost: None Recommendation: Management should implement trainings with supervisors to reiterate the importance of the controls related to documentation of approval for all transactions prior to the expense being paid.

Finding 2025‐002: Reporting – Significant deficiency in internal controls over compliance. Block Grants for Prevention and Treatment of Substance Abuse ALN 93.959 and SMART Innovation Program Criteria: Section 200 of the Code of Federal Regulations requires recipients to implement robust internal controls to ensure compliance for all required reporting submissions. Condition: Although the Organization has compensating controls in other compliance areas that helped prevent noncompliance over reporting, there were no specific controls regarding the review and approval of the required reporting submissions. Cause: The Organization did not have a standard procedure in place to review and approve the required reporting submissions prior to them being submitted to the grantor. Effect: The Organization’s required reporting submissions were not being reviewed and approved prior to submission in accordance with internal control procedures over compliance. Questioned Cost: None Recommendation: Management should implement controls to ensure documentation of review and approval prior to submission for all required reporting submissions is completed and retained.