Audit 415233

Finding 2025-003: Information on the Federal Program: Assistance Listing Number 93.568 - Low-Income Home Energy Assistance Program (LIHEAP) Award Number : 2402SCLIEA Compliance Requirements : Period of Performance. Type of Finding : Noncompliance and Significant Deficiency in Internal Control over Compliance. Criteria: Under 2 CFR §200.405 (Allocable Costs) and §200.403 (Factors Affecting Allowability of Costs), costs charged to a federal award must be allocable to the period in which the benefit is received and treated consistently in accordance with generally accepted accounting principles. Costs that benefit multiple periods must be allocated proportionately to the periods benefited. Condition: Management charged the full annual DocuSign subscription expense during the grant period January 1, 2025 through December 31, 2025. However, the subscription term extended beyond the grant’s period of performance and crossed both fiscal and grant years. The expense was not allocated between the benefiting periods. Cause: Management did not implement procedures to identify and allocate prepaid or multi-period expenses in accordance with federal cost principles and GAAP. Effect or Potential Effect: Grant expenditures were overstated during the current grant period and understated in subsequent periods. This resulted in noncompliance with federal cost principles related to allocability and proper period recognition. Context: During our testing of LIHEAP expenditures for the year ended December 31, 2025, we identified expenditures totaling $25,641, that were charged to the program year January 1, 2025 through December 31, 2025; however, the related benefit approval or service period extended beyond the grant’s period of performance. Specifically, the subscription related expense was recorded in the current grant year even though the services benefited a subsequent period. This occurred because expenditures were not reviewed to ensure proper allocation between grant periods. As a result, costs were not properly aligned with the applicable grant year, which could result in expenditures in the amount of $15,385 being charged outside the authorized period of performance. Repeat Finding: Repeat finding of 2024-004. Recommendation: We recommend management implement procedures to review subscription and other multi-period service contracts to ensure costs are properly allocated to the benefiting periods. Prepaid expenses should be recorded and expensed monthly over the term of the subscription in accordance with GAAP and federal cost principles. Views of Responsible Official: Management concurs with the recommendation that prepaid subscriptions and other multi-period expenditures be allocated to the periods receiving the benefit and charged only to eligible award periods.

Finding 2025-004: Information on the Federal Program: Assistance Listing Number 93.568 - Low-Income Home Energy Assistance Program (LIHEAP) and 81.042 Weatherization Assistance Program Compliance Requirements: Reporting. Type of Finding: Noncompliance and Significant Deficiency in Internal Control over Compliance. Criteria: The Office of Economic Opportunity (OEO) requires monthly Financial Status Reports (FSRs) to be submitted by the 15th day of the month following the reporting period in accordance with LIHEAP and Weatherization reporting requirements. Condition: During our review of compliance with reporting requirements under LIHEAP and weatherization, we noted that monthly FSRs were submitted late to OEO for multiple months during the fiscal year. Cause: Management did not have sufficient procedures in place to ensure timely preparation, review, and submission of monthly FSRs across all LIHEAP funding sources. Effect or Potential Effect: Late submission of required financial reports results in noncompliance with pass-through reporting requirements and may increase oversight or monitoring by the pass-through entity. Context: For Fund 200 LIHEAP, 350 LWAP, 300 Weatherization DOE, and 360 Weatherization BIL, there were multiple months that were submitted late. OEO requires FSRs to be submitted by the 15th of the month following the reporting period; however, these reports were submitted after the required deadline. Repeat Finding: Repeat finding or 2024-005. Recommendation: We recommend management implement procedures to track reporting deadlines for all LIHEAP funding sources and ensure monthly FSRs are prepared, reviewed, and submitted timely in accordance with OEO requirements. Views of Responsible Official: Management concurs that all required reports must be submitted by established deadlines, including when a delay is only one day.

Finding 2025-005: Information on the Federal Program: All federal programs. Compliance Requirements: Report Submission. Type of Finding: Other Noncompliance (not tied to a major program) and Significant Deficiency in Internal Control Over Compliance. Criteria: Federal reporting requirements require that financial and compliance reports, including the Single Audit reporting package, be submitted within the timeframe established under 2 CFR §200.512.Condition: The Organization did not submit its Single Audit reporting package for the fiscal year ended December 31, 2024, within the required timeframe. The nine-month submission deadline was September 30, 2025. Cause: Delays in issuance of the 2023 audit and completion of the 2024 trial balance delayed completion of the 2024 audit. The completed 2024 trial balance was not available until after the September 30, 2025, submission deadline. The Organization’s procedures did not ensure that financial records were finalized in sufficient time to complete the audit and submit the required reporting package. Effect or Potential Effect: The Organization did not comply with federal audit submission requirements. The delay limited the timely availability of audited financial and compliance information to federal awarding agencies and pass-through entities and may result in additional oversight or monitoring. Context: This finding relates to the Organization’s annual Single Audit submission for the fiscal year ended December 31, 2024. The reporting package was submitted after the September 30, 2025, deadline. Repeat Finding: Repeat finding of 2024-006. Recommendation: We recommend that management establish and monitor a year-end closing and audit submission schedule, including deadlines for completing reconciliations, finalizing the trial balance, providing supporting documentation, and submitting the data collection form and reporting package. Management should assign responsibility for monitoring these deadlines and promptly address delays with the independent auditors and those charged with governance. Views of Responsible Official: Management acknowledges that the FY2024 Single Audit reporting package was submitted after the applicable deadline and accepts the recommendation to strengthen audit coordination and submission tracking. Management reports that a change in independent auditors contributed to the delay: the predecessor auditor did not provide documentation requested by the successor auditor in a timely manner, delaying commencement of the FY2024 audit. This delay subsequently affected the scheduling and progress of the FY2025 audit. WCAI recognizes its responsibility for monitoring audit completion and federal submission deadlines notwithstanding delays involving external auditors.