2022-001 Federal Agency: U.S. Department of Agriculture Federal Program Title: Supplemental Nutrition Assistance Program CFDA Number: 10.561 Award Period: December 1, 2019 through September 30, 2023 Type of Finding: ? Material Weakness in Internal Control over Financial Reporting and Compliance Criteria or specific requirement: The Code of Federal Regulations 2 CFR 200.413(a) requires that direct costs be identified specifically with a particular final cost objective, such as a federal award, or other internally or externally funded activity, or be directly assigned to such activities relatively easily with a high degree of accuracy. Condition: During our testing, we noted reimbursement requests were prepared using grant budgets rather than direct costs incurred. Management was unable to determine direct costs related to general and payroll disbursements. As a result, proper revenue recognition could not be determined for financial reporting purposes. Questioned Costs: None Cause: Internal controls have not been implemented to specifically track direct costs incurred under specific grant agreements. Effect: The Organization cannot determine direct costs incurred under the grant with a high degree of accuracy. Reimbursement requests do not accurately reflect direct costs incurred by the Organization. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Organization develop procedures to track expenditures of federal awards using the class system within their ERP. All invoices for general disbursements paid with federal awards should be reviewed and approved by a grants manager prior to payment and coded to the general ledger by the accounting department. In addition, we recommend implementing procedures to ensure that payroll expenses charged to the grant are based on actual time and effort. Timesheets should be prepared by staff performing grant functions, reviewed and approved by a grants manager, and coded to the general ledger by the accounting department. Views of responsible officials: Management agrees with the finding.
2022-002 Federal Agency: U.S. Department of Agriculture Federal Program Title: Supplemental Nutrition Assistance Program CFDA Number: 10.561 Award Period: December 1, 2019 through September 30, 2023 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: The Code of Federal Regulations 2 CFR 200.318(a) states, ?the non-Federal entity must have and use document procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward.? In addition, per the Code of Federal Regulations 2 CFR 200.214, non-Federal entities are subject to the non-procurement debarment and suspension regulations. The regulations restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition: During our testing, we noted the Organization had not adopted a procurement policy and no procurement procedures were performed in selecting contractors. Questioned Costs: None Cause: Procurement policies and procedures were not adopted by the Organization. Effect: The Organization may not have received a competitive bid for services, and may have engaged a suspended or debarred contractor. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Organization implement necessary internal controls to ensure a competitive bid process is performed, and all vendors are reviewed for suspension and debarment, prior to entering into contracts utilizing federal awards. These internal controls should also include a conflict-of-interest clause with all vendors within contract language. Views of responsible officials: Management agrees with the finding.
2022-003 Federal Agency: U.S. Department of the Treasury Federal Program Title: Coronavirus State and Local Fiscal Recovery Funds CFDA Number: 21.027 Award Period: June 23, 2022 through June 22, 2023 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: The Code of Federal Regulations 2 CFR 200.318(a) states, ?the non-Federal entity must have and use document procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward.? In addition, per the Code of Federal Regulations 2 CFR 200.214, non-Federal entities are subject to the non-procurement debarment and suspension regulations. The regulations restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition: During our testing, we noted the Organization had not adopted a procurement policy and no procurement procedures were performed in selecting contractors. Questioned Costs: None Cause: Procurement policies and procedures were not adopted by the Organization. Effect: The Organization may not have received a competitive bid for services, and may have engaged a suspended or debarred contractor. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Organization implement necessary internal controls to ensure a competitive bid process is performed, and all vendors are reviewed for suspension and debarment, prior to entering into contracts utilizing federal awards. These internal controls should also include a conflict-of-interest clause with all vendors within contract language. Views of responsible officials: Management agrees with the finding.
2022-001 Federal Agency: U.S. Department of Agriculture Federal Program Title: Supplemental Nutrition Assistance Program CFDA Number: 10.561 Award Period: December 1, 2019 through September 30, 2023 Type of Finding: ? Material Weakness in Internal Control over Financial Reporting and Compliance Criteria or specific requirement: The Code of Federal Regulations 2 CFR 200.413(a) requires that direct costs be identified specifically with a particular final cost objective, such as a federal award, or other internally or externally funded activity, or be directly assigned to such activities relatively easily with a high degree of accuracy. Condition: During our testing, we noted reimbursement requests were prepared using grant budgets rather than direct costs incurred. Management was unable to determine direct costs related to general and payroll disbursements. As a result, proper revenue recognition could not be determined for financial reporting purposes. Questioned Costs: None Cause: Internal controls have not been implemented to specifically track direct costs incurred under specific grant agreements. Effect: The Organization cannot determine direct costs incurred under the grant with a high degree of accuracy. Reimbursement requests do not accurately reflect direct costs incurred by the Organization. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Organization develop procedures to track expenditures of federal awards using the class system within their ERP. All invoices for general disbursements paid with federal awards should be reviewed and approved by a grants manager prior to payment and coded to the general ledger by the accounting department. In addition, we recommend implementing procedures to ensure that payroll expenses charged to the grant are based on actual time and effort. Timesheets should be prepared by staff performing grant functions, reviewed and approved by a grants manager, and coded to the general ledger by the accounting department. Views of responsible officials: Management agrees with the finding.
2022-002 Federal Agency: U.S. Department of Agriculture Federal Program Title: Supplemental Nutrition Assistance Program CFDA Number: 10.561 Award Period: December 1, 2019 through September 30, 2023 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: The Code of Federal Regulations 2 CFR 200.318(a) states, ?the non-Federal entity must have and use document procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward.? In addition, per the Code of Federal Regulations 2 CFR 200.214, non-Federal entities are subject to the non-procurement debarment and suspension regulations. The regulations restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition: During our testing, we noted the Organization had not adopted a procurement policy and no procurement procedures were performed in selecting contractors. Questioned Costs: None Cause: Procurement policies and procedures were not adopted by the Organization. Effect: The Organization may not have received a competitive bid for services, and may have engaged a suspended or debarred contractor. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Organization implement necessary internal controls to ensure a competitive bid process is performed, and all vendors are reviewed for suspension and debarment, prior to entering into contracts utilizing federal awards. These internal controls should also include a conflict-of-interest clause with all vendors within contract language. Views of responsible officials: Management agrees with the finding.
2022-003 Federal Agency: U.S. Department of the Treasury Federal Program Title: Coronavirus State and Local Fiscal Recovery Funds CFDA Number: 21.027 Award Period: June 23, 2022 through June 22, 2023 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: The Code of Federal Regulations 2 CFR 200.318(a) states, ?the non-Federal entity must have and use document procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward.? In addition, per the Code of Federal Regulations 2 CFR 200.214, non-Federal entities are subject to the non-procurement debarment and suspension regulations. The regulations restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition: During our testing, we noted the Organization had not adopted a procurement policy and no procurement procedures were performed in selecting contractors. Questioned Costs: None Cause: Procurement policies and procedures were not adopted by the Organization. Effect: The Organization may not have received a competitive bid for services, and may have engaged a suspended or debarred contractor. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Organization implement necessary internal controls to ensure a competitive bid process is performed, and all vendors are reviewed for suspension and debarment, prior to entering into contracts utilizing federal awards. These internal controls should also include a conflict-of-interest clause with all vendors within contract language. Views of responsible officials: Management agrees with the finding.