Audit 406001

2025-003 – INTERNAL CONTROLS OVER PAYROLL AND BENEFITS ALLOCATIONS Federal Agency: U.S. Department of Justice Federal Program: Victim of Crimes Act (VOCA) Assistance Listing Number(s): 16.575 Pass-through Agency: Michigan Department of Health and Human Services Grant Number(s): E20252997, E20254232, and E20252320 Condition: The Organization utilized PARs to allocate employee time between programs. During the payroll testing some minor variances were noted between the hours reported on the PARs and the hours recorded in the payroll system. Additionally, some minor variances were noted in charges for benefits compared to supporting documents. Criteria: Organizations must have proper internal control over allocations regarding salaries and wages and fringe benefits. In addition, allocations must be based on records that accurately reflect the work performed. It is the Organization’s procedure to utilize personnel activity reports (PARs) for its records to accurately reflect the work performed. Cause: Due to limited staffing, the Organization does not have a procedure in place to review manual inputs into the accounting system. Effect: The Organization did not follow proper internal controls due to reported hours having minor differences compared to actual timesheets and fringe benefits not matching supporting documentation. Questioned Costs: Not applicable. Perspective: Of the sixty (60) transactions selected for review, twelve (12) had errors in total hours, hours allocations, or benefit allocations. Repeat Finding: No. Recommendation: The Organization should have a review process to ensure the payroll system matches the PARs and benefits match the supporting documents. Views of Responsible Officials: Management agrees with the finding. See separate Corrective Action Plan.

2025-004 – COMPLIANCE AND CONTROLS OVER REPORTING Federal Agency: U.S. Department of Justice Federal Program: Victim of Crimes Act (VOCA) Assistance Listing Number(s): 16.575 Pass-through Agency: Michigan Department of Health and Human Services Grant Number(s): E20252997, E20254232, and E20252320 Condition: The Organization does have a reporting calendar to ensure all reports are completed and filed by the specified due dates. However, due to staff turnover, the calendar was not properly utilized by staff. As a result, the Michigan Department of Health and Human Services Fiscal Questionnaire was filed late. Criteria: The Organization is required to file numerous reports in relation to its grants, including but not limited to Financial Status Reports, Work Progress Reports, and Fiscal Questionnaires. In addition, all these reports have specific due dates that need to be followed. Cause: The Organization does have a process for identifying and tracking reporting deadlines for its grants. However, due to turnover in the Finance Director position this was not properly communicated. As a result, the incoming Finance Director was not aware of all applicable reporting requirements and due dates. Effect: The Organization did not file the Michigan Department of Health and Human Services Fiscal Questionnaire until informed by the pass-through agency that the report was past due. Until procedures are updated and communicated, the Organization may miss other reporting deadlines in the future. Questioned Costs: Not applicable. Perspective: The Michigan Department of Health and Human Services Fiscal Questionnaire was only completed after the pass-through agency made the Organization aware of the requirement. Repeat Finding: No. Recommendation: The Organization should update procedures to ensure timely compliance with grant reporting requirements. These procedures should include communicating and maintaining a reporting calendar that identifies all required reports and their respective due dates. Grant-related documents should be maintained in a centralized location to support consistent access, oversight, and monitoring of reporting obligations. To facilitate timely completion and review, the reporting calendar should include internal deadlines established in advance of external due dates, typically ranging from three days to two weeks. These internal deadlines would help reduce last-minute revisions and allow sufficient time for final review and approval prior to submission. Views of Responsible Officials: Management agrees with the finding. See separate Corrective Action Plan.