Key Insights from the 2024 Federal Single Audit of Red Cloud Renewable

In 2024, Red Cloud Renewable, a non-profit organization based in Pine Ridge, SD, underwent a federal single audit conducted by Ketel Thorstenson, LLP. The audit focused on the organization’s compliance with federal grant programs, particularly in the areas of procurement and allowable costs.

Financial Snapshot

• Total Expenditures: $850,522
• Major Programs:
• Weatherization Assistance for Low-Income Persons (ALN #81.042): $531,250
• Energy Efficiency and Renewable Energy Information Dissemination (ALN #81.117): $319,272

Key Findings

Material Weakness Identified

The audit revealed a significant material weakness in internal controls related to compliance testing for the Weatherization Assistance program. Key issues included: - Lack of Review: The Bookkeeper managed invoices and payments without additional oversight. - Missing Approvals: Out of 29 federal expenditures tested, 9 lacked necessary approvals from the grant manager. - Insufficient Documentation: 6 of the 29 expenditures tested had no supporting documentation, leading to questioned costs totaling $14,764.

Risks and Implications

The findings indicate potential risks in financial management and compliance, which could affect future funding and operational integrity. The lack of adequate internal controls raises concerns about the organization’s ability to manage federal funds effectively.

Auditor Performance

Ketel Thorstenson, LLP conducted a thorough audit, identifying critical areas for improvement. Their findings serve as a roadmap for Red Cloud Renewable to enhance its financial practices and compliance measures.

Organizational Impact

Addressing these findings is crucial for Red Cloud Renewable to maintain its eligibility for federal funding and ensure the effective use of resources. Implementing stronger internal controls and documentation practices will not only mitigate risks but also bolster the organization’s reputation in the community.

Conclusion

The 2024 audit serves as a pivotal moment for Red Cloud Renewable, highlighting the importance of compliance and financial oversight. By taking proactive steps to address the identified weaknesses, the organization can strengthen its operations and continue to serve its mission effectively.