Audit 6460

CRITERIA: Supporting documents are to be maintained to support federal award expenditures for a period of 3 years from the date of submission of the final expenditure report. STATEMENT OF CONDITION:Management was unable to provide supporting documentation for amounts included on expense reports during the year for the Refugee Entrant Assistance Program. Every month an expense report is prepared by the program manager and their fiscal assistant. The process of preparing this expense report involves the use of an Excel sheet that summarizes the individual transactions for the month into the categories that they will be grouped into on the final expense report. This Excel file was not maintained in the client’s records and was deleted after the process was completed. Without the Excel file, we were unable to obtain a complete and accurate listing of all expenses that were reimbursed. STATEMENT OF CAUSE:Financial and program staff did not maintain all workpapers that were part of the grant expense report creation workflow process. This was likely due to inexperience with compliance with large federal assistance programs. EFFECT: Expenses may have been reimbursed which did not qualify for the program. QUESTIONED COSTS: $ 18,263 of expenditures. CONTEXT: The failure to maintain all relevant records pertaining to the grant program was consistent throughout the period ending December 31, 2022. REPEST FINDING: No RECOMMENDATION:Management of the organization needs to maintain complete accounting records to support the grant expenditures claimed during the year which identifies them to a particular program. VIEW OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION 1. Enhanced Documentation Process: Starting immediately, every grant expenditure will be accompanied by detailed documentation that clearly identifies its relation to a particular program. This will ensure transparency and ease of traceability. 2. Training & Awareness: We will provide additional training to our accounting and program teams to ensure that they are fully aware of the new documentation requirements and understand their importance. 3. Regular Review: We will conduct periodic internal reviews of our grant expenditure records to ensure that the new procedures are being consistently followed and that there are no gaps in documentation.

CRITERIA: Refugee Entrant and Assistance Program grant funds can only be used to cover expenses related to the operation of this program. Allowable grant activities include providing eligible refugees with employability and other essential services as outRefugee Entrant and Assistance Program grant funds can only be used to cover expenses related to the operation of this program. Allowable grant activities include providing eligible refugees with employability and other essential services as outlined in the Refugee Entrant and Assistance Program compliance supplement. STATEMENT OF CONDITION: During the performance of the audit, two (2) transportation transactions had been authorized by management for reimbursement under the Refugee Entrant and Assistance Program for expenses incurred in another grant program. STATEMENT OF CAUSE: Management mistakenly grouped these expenses together with the Refugee Entrant and Assistance Program. EFFECT: Costs not allowable under the terms of the grant were reimbursed to the Pennsylvania Department of Human Services. QUESTIONED COSTS: $1,012 CONTEXT: Given that 69 transactions were tested out of a total 415 (16.55% Coverage) and only two transactions were found to have exceptions. Extrapolating the error rate out to the whole population would give an estimated 12 transactions made in error (2.9% error rate). REPEAT FINDING: No RECOMMENDATION: We recommends management implement controls to document better the grant programs for which invoices were incurred. VIES OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS: ISC will draft clear guidelines for the correct categorization of expenses on expense reports. These reports will be stored securely for a period of 3 years. Furthermore, relevant staff members will undergo training to understand and execute these procedures accurately. We are exploring software alternatives to QuickBooks to improve our record-keeping for research expenditures. We target to complete this analysis by 12/31/23 and will share the results with you thereafter. The Program Manager will train the Administrative Assistant and Fiscal Assistant on proper accounting procedures adhering to accounting standards.

CRITERIA: The organization should have written procedures and policies in place to ensure compliance with federal awards. STATEMENT OF CONDITION: The organization does not have written procedures related to compliance with federal award requirements. STATEMENT OF CAUSE: The organization was not aware of the requirement to maintain written procedures related to compliance with programs requirements. EFFECT: The organization’s federal programs could be out of compliance with the federal award requirements. QUESTIONED COSTS: None CONTEXT: The organization needs written procedures to help ensure compliance with federal award requirements. REPEAT FINDING: No RECOMMENDATION: Management of the organization needs to develop written procedures related to federal award requirements. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS: The Program Manager, alongside the Executive Director, will work on updating the ISC's Government Contracts Management Procedures. It will include detailed written procedures that encompass key areas of federal grants. We will develop a reimbursement policy consistent with federal guidelines for our staff and volunteers. We aim to finalize this by 12/31/23. Starting the new year, we will also train all staff and volunteers involved with federal grants to ensure compliance.

CRITERIA: Supporting documents are to be maintained to support federal award expenditures for a period of 3 years from the date of submission of the final expenditure report. STATEMENT OF CONDITION:Management was unable to provide supporting documentation for amounts included on expense reports during the year for the Refugee Entrant Assistance Program. Every month an expense report is prepared by the program manager and their fiscal assistant. The process of preparing this expense report involves the use of an Excel sheet that summarizes the individual transactions for the month into the categories that they will be grouped into on the final expense report. This Excel file was not maintained in the client’s records and was deleted after the process was completed. Without the Excel file, we were unable to obtain a complete and accurate listing of all expenses that were reimbursed. STATEMENT OF CAUSE:Financial and program staff did not maintain all workpapers that were part of the grant expense report creation workflow process. This was likely due to inexperience with compliance with large federal assistance programs. EFFECT: Expenses may have been reimbursed which did not qualify for the program. QUESTIONED COSTS: $ 18,263 of expenditures. CONTEXT: The failure to maintain all relevant records pertaining to the grant program was consistent throughout the period ending December 31, 2022. REPEST FINDING: No RECOMMENDATION:Management of the organization needs to maintain complete accounting records to support the grant expenditures claimed during the year which identifies them to a particular program. VIEW OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION 1. Enhanced Documentation Process: Starting immediately, every grant expenditure will be accompanied by detailed documentation that clearly identifies its relation to a particular program. This will ensure transparency and ease of traceability. 2. Training & Awareness: We will provide additional training to our accounting and program teams to ensure that they are fully aware of the new documentation requirements and understand their importance. 3. Regular Review: We will conduct periodic internal reviews of our grant expenditure records to ensure that the new procedures are being consistently followed and that there are no gaps in documentation.

CRITERIA: Refugee Entrant and Assistance Program grant funds can only be used to cover expenses related to the operation of this program. Allowable grant activities include providing eligible refugees with employability and other essential services as outRefugee Entrant and Assistance Program grant funds can only be used to cover expenses related to the operation of this program. Allowable grant activities include providing eligible refugees with employability and other essential services as outlined in the Refugee Entrant and Assistance Program compliance supplement. STATEMENT OF CONDITION: During the performance of the audit, two (2) transportation transactions had been authorized by management for reimbursement under the Refugee Entrant and Assistance Program for expenses incurred in another grant program. STATEMENT OF CAUSE: Management mistakenly grouped these expenses together with the Refugee Entrant and Assistance Program. EFFECT: Costs not allowable under the terms of the grant were reimbursed to the Pennsylvania Department of Human Services. QUESTIONED COSTS: $1,012 CONTEXT: Given that 69 transactions were tested out of a total 415 (16.55% Coverage) and only two transactions were found to have exceptions. Extrapolating the error rate out to the whole population would give an estimated 12 transactions made in error (2.9% error rate). REPEAT FINDING: No RECOMMENDATION: We recommends management implement controls to document better the grant programs for which invoices were incurred. VIES OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS: ISC will draft clear guidelines for the correct categorization of expenses on expense reports. These reports will be stored securely for a period of 3 years. Furthermore, relevant staff members will undergo training to understand and execute these procedures accurately. We are exploring software alternatives to QuickBooks to improve our record-keeping for research expenditures. We target to complete this analysis by 12/31/23 and will share the results with you thereafter. The Program Manager will train the Administrative Assistant and Fiscal Assistant on proper accounting procedures adhering to accounting standards.

CRITERIA: The organization should have written procedures and policies in place to ensure compliance with federal awards. STATEMENT OF CONDITION: The organization does not have written procedures related to compliance with federal award requirements. STATEMENT OF CAUSE: The organization was not aware of the requirement to maintain written procedures related to compliance with programs requirements. EFFECT: The organization’s federal programs could be out of compliance with the federal award requirements. QUESTIONED COSTS: None CONTEXT: The organization needs written procedures to help ensure compliance with federal award requirements. REPEAT FINDING: No RECOMMENDATION: Management of the organization needs to develop written procedures related to federal award requirements. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS: The Program Manager, alongside the Executive Director, will work on updating the ISC's Government Contracts Management Procedures. It will include detailed written procedures that encompass key areas of federal grants. We will develop a reimbursement policy consistent with federal guidelines for our staff and volunteers. We aim to finalize this by 12/31/23. Starting the new year, we will also train all staff and volunteers involved with federal grants to ensure compliance.