Audit 405913

Finding 2025-003: Reporting Review Process Information on the Federal Programs: Assistance Listing Number 93.550 - Transitional Living Program, U.S. Department of Health and Human Services. Award Number: 90CX7428-03-00 Compliance Requirements: Reporting Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria Uniform Guidance (2 CFR 200.303) requires non-Federal entities to establish and maintain effective internal control over federal awards to provide reasonable assurance of compliance with reporting requirements. This includes controls to ensure required reports are prepared accurately, reviewed, approved by an authorized individual, and submitted timely. Condition The submission process for federal financial reports requires that report data be entered into the applicable federal reporting system and certified by an authorized individual who performs a final review prior to submission. During the audit, we noted that certain required SF-425 Federal Financial Reports had been prepared, but were not certified by an authorized signer and, as a result, were not submitted by the applicable due dates. The reports were subsequently reviewed, certified, and submitted. Cause During the year, the Organization experienced transitions in financial leadership and in personnel responsible for federal reporting. As a result of these transitions, the responsibility for certifying required federal financial reports was not formally reassigned, which contributed to the reports not being timely certified and submitted. Effect Reports were not certified or submitted in accordance with reporting requirements. Although subsequently corrected, this reflects a deficiency in internal control over compliance that increases the risk of noncompliance from delinquent or inaccurate reporting. Questioned Costs None. Recommendation The Organization should implement formal controls over federal reporting, including a documented review by a qualified individual independent of preparation prior to submission, and procedures to track and monitor reporting deadlines.