2024-001 – Fiscal Policies and Procedures Not Fully Aligned with Uniform Guidance Federal Program: Temporary Assistance for Needy Families, Family Violence Prevention Services Act, ARP Supplemental and ARP Covid-19 Federal Assistance Listing Number: 93.558 and 93.671 Pass-Through Agency: Texas Health and Human Services Commission Pass-Through Grantor Number: HHS000380000040 Criteria: Non-federal entities are required under 2 CFR §200.303 to establish and maintain effective internal controls over federal awards that provide reasonable assurance of compliance with federal statutes, regulations, and terms and conditions of the award. Adequate written policies and procedures are a critical component of an effective internal control system. Condition: During our review of the Center’s fiscal policies and procedures, we noted that several key elements required for compliance with 2 CFR Part 200 were either missing or lacked sufficient detail. Specifically, the following areas were underdeveloped: Conflict of interest policies were not clearly defined or aligned with 2 CFR § 200.112. Procedures for determining allowable costs under 2 CFR §200.403–§200.405 were not well documented. Subrecipient monitoring procedures required by 2 CFR §200.331 were not adequately addressed. Record retention and access policies under 2 CFR §200.333–§200.338 were not clearly outlined. While some general policies were in place, they do not currently meet the level of specificity and comprehensiveness required under the Uniform Guidance. Cause: The Center is in the process of updating its financial policies and procedures to comply with Uniform Guidance requirements. A consultant has been engaged to assist with this process, and updates are expected to be finalized and approved by the Board of Directors in August 2025. Effect: The lack of complete and detailed policies increases the risk of noncompliance with federal requirements, especially in areas such as cost allowability, subrecipient oversight, and recordkeeping. It also creates challenges in ensuring consistent and compliant financial practices across the Center. Questioned Costs: $0 – No noncompliant expenditures were identified; however, the absence of sufficient policies represents a control deficiency. Recommendation: We recommend for the Center to prioritize the completion and formal adoption of revised fiscal policies and procedures, ensuring they fully align with the requirements of 2 CFR Part 200. These should include detailed written policies on conflict of interest, allowable costs, subrecipient monitoring, and record retention. Finalizing and implementing these policies ahead of the new fiscal year, as planned, will strengthen internal controls and help ensure compliance moving forward. Management’s Views and Corrective Action Plan: Management agrees with the finding. The Center is currently in the process of updating its fiscal policies and procedures to align with the requirements of 2 CFR Part 200. The Finance Committee is leading this effort and is reviewing each policy area identified, including conflict of interest, allowable costs, subrecipient monitoring, and record retention. Updated policies and procedures will be finalized and presented for Board approval by August 30, 2025. Once approved, the Center will ensure implementation across all departments and provide internal guidance to promote consistent application. Anticipated Completion Date: August 30, 2025 Responsible Party: Finance Committee, with support from Executive Director, Nichole Henry.
2025-002 – Questioned or Unsupported Costs Information on Federal Program United States Department of Homeland Security - Federal Emergency Management Agency (FEMA). Federal Assistance Listing Number 97.036 – Disaster Grants – Public Assistance. Compliance Requirements Activities Allowed or Unallowed / Allowable Costs and Cost Principles Criteria In accordance with 2 CFR §200.403, costs charged to a federal award must be necessary, reasonable, and allocable to the award. Additionally, costs must be adequately documented to be allowable under federal awards. Condition During our testing of activities and allowable costs for the year ended December 31, 2024, we identified seven (7) instances where the amounts requested for reimbursement were not allowed. Cause No cause could be determined. Effect The City received FEMA grant reimbursements for unallowable or unsupported costs, potentially reducing available federal funds for future emergencies. The City may also be at risk of noncompliance with FEMA cost-sharing (matching) requirements. Questioned Costs $54,366 (Federal share $40,775). Context Forty-two (42) disbursements totaling $410,854 were randomly selected for testing. We identified seven (7) exceptions. These exceptions included unsupported equipment and labor charges, duplicate payroll, duplicate material costs, and unsupported payroll. Recommendation We recommend the City review the identified transactions and consult with FEMA regarding resolution of the questioned costs. The City should also take steps to ensure that only allowable, adequately documented costs are submitted for reimbursement in the future. Management’s Response Responsible Official’s Response and Corrective Action Planned: We have reached out to FEMA and was provided this summarized response: “The project was obligated as a small project. FEMA does not adjust the funding amount unless specific conditions are met. If the applicant was stating that the actual cost for the small project was more than FEMA obligated, we would have to request what is called a New Small Project Overrun Appeal Request. But in this case, the actual cost resulted in an underrun based on the small project obligated amount. FEMA only asks for the applicants to apply the underrun amount back into the community." Management has also implemented a process to include financial oversight and review of all documents prior to submission to FEMA for reimbursement going forward. We will meet with all leadership staff to discuss documentation requirements necessary for FEMA reimbursements. Lastly, Management will only sign off on reimbursed costs after all changes to FEMA requests have been adequately documented. Implementation Date: Immediate Person Responsible for Corrective Action Plan: Chief Financial Officer, Ashley Cason
Federal Agency: United States Department of Commerce Federal Program Name: Office for Coastal Management Assistance Listing Number: 11.473 Federal Award Identification Year: 2020 Pass-Through Agency: National Fish and Wildlife Grant Agreement Award Period: 9/1/20-08/02/24 Compliance Requirement Affected: Subrecipient Suspension & Debarment Type of Finding: Material Weakness in Internal Control over Compliance and Material Noncompliance (Modified Opinion) Criteria: 2 CFR 200.403(a) - When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition: For two subrecipient samples that were selected, verification of subrecipient's suspension or debarment status was not verified. Context: A nonstatistical sample of 2 of 4 subrecipients were selected for testing for the Office for Coastal Management program. Condition noted above was identified during our procedures over subrecipients. Effect: CFSC did not verify suspension or debarment status, which could result in naming a subrecipient as an award recipient, which is potentially suspended or debarred. Cause: CFSC did not consistently ensure that Suspension or Debarment status was verified before naming the subrecipients tested as award recipients. Repeat Finding: The finding is a repeat finding. Recommendation: We recommend that CFSC strengthen its current policies and procedures to ensure that Suspension and Debarment Status is verified for each subrecipient applicant during its pre-award subrecipient screening process. Management’s Views: See separate corrective action plan.
Federal Agency: United States Department of Agriculture, Forest Service Federal Program Name: Cooperative Forestry Assistance Assistance Listing Number: 10.664 Federal Award Identification Year: 2021 Pass-Through Agency: N/A Award Period: 09/01/21-08/31/26 Compliance Requirement Affected: Subrecipient Suspension & Debarment Type of Finding: Material Weakness in Internal Control over Compliance and Material Noncompliance Criteria: 2 CFR 200.403(a) - When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition: For one subrecipient samples that was selected, verification of subrecipient's suspension or debarment status was not verified. Context: A nonstatistical sample of 5 out of 13 subrecipients were selected for testing for the Office for Coastal Management program. The condition noted above was identified during our procedures over CFSC’s subrecipients. Effect: CFSC did not verify suspension or debarment status, which could result in naming a subrecipient as an award recipient, which is potentially suspended or debarred. Cause: CFSC did not consistently ensure that Suspension or Debarment status was verified before naming the subrecipients tested as award recipients. Repeat Finding: The finding is not a repeat finding. Recommendation: We recommend that CFSC strengthen its current policies and procedures to ensure that Suspension and Debarment Status is verified for each subrecipient applicant during its pre-award subrecipient screening process. Management’s Views: See separate corrective action plan.
Federal Agency: United States Department of Agriculture, Forest Service Federal Program Name: Cooperative Forestry Assistance Assistance Listing Number: 10.664 Federal Award Identification Year: 2021 Pass-Through Agency: N/A Award Period: 09/01/21-08/31/26 Compliance Requirement Affected: Allowable Costs & Activities (Payroll) Type of Finding: Significant Deficiency in Internal Control over Compliance and Nonmaterial Noncompliance Criteria: 2 CFR 200.403(a) - Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Condition: For five hourly employees, CFSC performed a review of payroll discrepancies occurring between 2020- 2024, due to differences when comparing time recorded on time sheets to time recorded to payroll, which resulted in a non-significant payment made to back to the employees. Questioned Costs: The known questioned costs are $8,600. Context: A nonstatistical sample of 60 out of >250 employee pay periods were selected for testing for the Cooperative Forestry Assistance program. The condition noted above was identified during our procedures over CFSC’s payroll disbursements. Effect: CFSC's internal controls did not include thorough review of time entry when processing payroll, which can result in understatement of payroll expense. Cause: CFSC's internal controls did not include thorough review of time entry when processing payroll.
Federal Agency: U.S. Department of Health and Human Services Assistance Listing Numbers: 93.623 Federal Program Titles: Basic Center Grant Type of Finding: • Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: The Code of Federal Regulations 2 CFR 200.303(a), non-federal entities must establish and maintain effective internal controls over federal awards. Furthermore, 2 CFR 200.403(g) requires that costs be adequately documented in order to be allowable under federal awards. Condition: During our testing of expenditures charged to the major program, we noted multiple instances that did not contain documented evidence of review or approval by a supervisor or program manager. Questioned Costs: None. Context: During our testing of ten expenditures charged to the major program, we noted three instances that did not contain documented evidence of review or approval by a supervisor or program manager. Although management stated that expenditures are reviewed before processing, no signatures, initials, timestamps, or electronic workflow logs were retained to demonstrate the review occurred. Effect: Failure to document review and approval increases the risk that unallowable or erroneous expenditures could be charged to the federal award and go undetected. Although no unallowable costs were identified in our testing, the control deficiency could lead to future noncompliance or questioned costs. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the Organization enforce policies requiring all expenditures charged to federal programs to be reviewed and approved by an appropriate official, and document the approval through dated signatures, electronic approvals, or maintained audit trails in software utilized by the Organization. Views of Responsible Officials: Management agrees with the finding.
Finding 2024-003 Insufficient Documentation of Other Direct Expenses Type of Finding: Noncompliance and Material Weakness in Internal Control over Compliance Condition: During testing of direct costs charged to the federal program, the Organization did not maintain sufficient documentation to fully support all expenditures claimed. In one instance, a receipt supporting a claimed expense was missing. In three additional cases, although the expenditures were generally supported, the documentation did not clearly reflect how the amounts allocated to the major federal program were determined. While these issues were isolated and the known and likely questioned costs were immaterial, the lack of complete documentation represents noncompliance with federal requirements for allowable costs. Criteria: According to Uniform Guidance 2 CFR §200.302(b)(3), the Organization's financial management system must maintain records that sufficiently identify the amount, source, and expenditure of Federal funds for Federal awards. All records must be supported by source documentation. Additionally, 2 CFR §200.403(g) requires that all costs charged to federal awards must be adequately documented. Cause: These exceptions appear to result from informal documentation practices and a lack of consistent application of procedures. Management is heavily involved in the Organization’s financial processes, including allocation of costs, which can limit opportunities for independent oversight or review. The absence of a standardized and consistently enforced process for documenting cost allocations contributes to inconsistent recordkeeping. Possible of Known Effect: Although the overall financial impact of these exceptions was not material, the missing documentation prevents the Organization from fully demonstrating compliance with 2 CFR 200.403 and 200.302. Overreliance on a single individual for documentation and procedural execution without accompanying review or monitoring controls can increase the risk of errors, omissions, or audit findings, even when expenditures are reasonable and allowable. Questioned Costs: Known questioned costs of $2,742 were identified. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the Organization implement a standardized procedure for documenting all direct and indirect cost allocations charged to federal programs, ensuring that each claim includes full supporting documentation such as receipts and annotated allocation details with consistent allocation methods. To strengthen internal controls, the Organization should consider establishing a review process for claims preparation that includes someone other than the individual preparing or allocating the expenditures. This will enhance accountability and help ensure compliance with federal documentation requirements. Views of Responsible Officials: The Organization will develop written guidelines specifying the required supporting documentation for each type of direct expense. Set up vendors in QuickBooks. We will hire and train Finance Manager to manage and track revenue and expenses, QuickBooks, grant reporting etc. All receipts and expenses will be scanned in and kept electronically. The Organization will provide training on documentation requirements, proper record submission, and compliance expectations.
Finding 2024-001 Interproject Payable – Amounts Owed to Other HUD Project Type of finding: Significant deficiency in internal control. Condition and context: During our audit we noted that the project has recorded a payable due to another HUD-assisted project in the amount of $3,072, and there is no documented HUD authorization supporting this obligation. Criteria: Per 2 CFR Part 200 (Uniform Guidance), §§200.302 and 200.403, federal program funds must be used only for allowable costs and in direct support of the objectives of the program. HUD requirements also prohibit the commingling of funds between projects unless explicitly authorized. Interproject payables or advances without proper documentation or timely settlement may constitute an unallowable use of program resources. Cause: Management permitted the use of funds from another HUD-assisted project to support operations of this project without obtaining HUD approval or establishing proper repayment terms. This occurred due to inadequate oversight of cash management and interproject transactions. Effect: Maintaining an outstanding payable to another HUD project: • Indicates potential misuse of federal funds. • Increases the risk of noncompliance with HUD requirements and Uniform Guidance. • May impair the project’s ability to demonstrate financial independence and program accountability. • Exposes the project to possible HUD sanctions, questioned costs, or repayment obligations. Questioned costs: Known questioned costs are $3,072. Recommendation: We recommend that project management: • Repay the outstanding payable to the related HUD project as soon as feasible. • Cease the practice of interproject borrowing unless HUD has provided explicit authorization. • Implement stronger internal controls over cash management and interproject transactions. • Document and monitor all project-level obligations to ensure compliance with HUD regulations. Views of Responsible Officials: Management agrees with this finding and the payment will be corrected. Management will review internal controls and implement a review process to only pay expenses already incurred to avoid future payments.
Federal Agency: U.S. Department of Health & Human Services Federal Program Name: Refugee and Entrant Assistance Voluntary Agency Programs Assistance Listing Number: 93.576 Federal Award Identification Number and Year: Various, see below Pass-Through Agency: Various, see below Pass-Through Number: Various, see below Award Period: Various, see below Compliance Requirement Affected: Suspension & Debarment Direct Agency Direct Award number Award Period Pass Through Entity (or) Pass Through Number U.S. Department of Health & Human Services (Direct) 90RG0243-01-00 10/1/2023-9/30/2024 90RG0225-01-00 10/1/2022-9/29/2025 90ZI0174-01-00 9/30/2023-09/29/2027 Passed through California Department of Social Services N/A 10/1/2023-9/30/2024 Passed through Los Rios Community College District N/A 9/30/2022-9/29/2025 Passed through Church World Services CWS-2024-04-015 10/1/2023-9/30/2024 CWS-2024-10-017 10/1/2024-9/30/2025 Type of Finding: Material Weakness in Internal Control over Compliance and Material Noncompliance Criteria: 2 CFR 200.403(a) - When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition: During our single audit procedures, 100% of our suspension and debarment samples selected did not contain sufficient documentation detailing the Organization’s process for determining the vendor was not suspended nor debarred prior to participating in the transaction. Context: A nonstatistical sample of 6 out of 21 vendors were selected for testing for the Refugee and Entrant Assistance Voluntary Agency Programs program. The condition noted above was identified during our procedures over ODI's Suspension and Debarment. Effect: ODI did not verify suspension or debarment status, which could result in entering into a contract with a vendor, which is potentially suspended or debarred. Cause: ODI did not consistently ensure that Suspension or Debarment status was verified before entering into agreements with the vendors. Repeat Finding: The finding is not a repeat finding. Recommendation: We recommend that ODI strengthen its current policies and procedures to ensure that Suspension and Debarment Status is verified for vendors subject to verification according to ODI's Procurement policy, prior to entering into a contract with the vendor. Management’s Views: Management notes that debarment checks performed post transactions confirmed that no vendors were suspended or debarred. Management takes responsibility for the finding and believes that in future years, they will be able to implement proper controls to mitigate this finding.
Federal Agency: U.S. Department of Health & Human Services Federal Program Name: Refugee and Entrant Assistance Voluntary Agency Programs Assistance Listing Number: 93.576 Federal Award Identification Number and Year: Various, see below Pass-Through Agency: Various, see below Pass-Through Number: Various, see below Award Period: Various, see below Compliance Requirement Affected: Allowable Costs & Activities (Payroll) Direct Agency Direct Award number Award Period Pass Through Entity (or) Pass Through Number U.S. Department of Health & Human Services (Direct) 90RG0243-01-00 10/1/2023-9/30/2024 90RG0225-01-00 10/1/2022-9/29/2025 90ZI0174-01-00 9/30/2023-09/29/2027 Passed through California Department of Social Services N/A 10/1/2023-9/30/2024 Passed through Los Rios Community College District N/A 9/30/2022-9/29/2025 Passed through Church World Services CWS-2024-04-015 10/1/2023-9/30/2024 CWS-2024-10-017 10/1/2024-9/30/2025 Type of Finding: Material Weakness in Internal Control over Compliance Criteria: 2 CFR 200.403(a) - Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Condition: During our single audit procedures of allowable costs, six employees had pay rates that could not be substantiated via evidence of approval on an approved wage rate change form. Questioned Costs: Known $14,112 Likely $553,607 Context: A nonstatistical sample of 16 out > 250 pay periods were selected for testing for the Refugee and Entrant Assistance Voluntary Agency Programs program. The condition noted above was identified during our procedures over ODI's Allowable Costs & Activities (payroll). Effect: ODI did not retain documentation of wage rate change approvals, which could result in unapproved increases in wage rate changes being charged to the grant. Cause: ODI has a control designed to approve wage rate changes. However, documentation of approval could not be located. Repeat Finding: The finding is not a repeat finding. Recommendation: We recommend that ODI strengthen its current policies and procedures to ensure that documentation is retained for approval of all wage rate changes. Management’s Views: Management takes responsibility for the finding and believes that in future years, they will be able to implement proper controls to mitigate this finding.
Federal Agency: U.S. Department of Health & Human Services Federal Program Name: Refugee and Entrant Assistance Voluntary Agency Programs Assistance Listing Number: 93.576 Federal Award Identification Number and Year: Various, see below Pass-Through Agency: Various, see below Pass-Through Number: Various, see below Award Period: Various, see below Compliance Requirement Affected: Suspension & Debarment Direct Agency Direct Award number Award Period Pass Through Entity (or) Pass Through Number U.S. Department of Health & Human Services (Direct) 90RG0243-01-00 10/1/2023-9/30/2024 90RG0225-01-00 10/1/2022-9/29/2025 90ZI0174-01-00 9/30/2023-09/29/2027 Passed through California Department of Social Services N/A 10/1/2023-9/30/2024 Passed through Los Rios Community College District N/A 9/30/2022-9/29/2025 Passed through Church World Services CWS-2024-04-015 10/1/2023-9/30/2024 CWS-2024-10-017 10/1/2024-9/30/2025 Type of Finding: Material Weakness in Internal Control over Compliance and Material Noncompliance Criteria: 2 CFR 200.403(a) - When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition: During our single audit procedures, 100% of our suspension and debarment samples selected did not contain sufficient documentation detailing the Organization’s process for determining the vendor was not suspended nor debarred prior to participating in the transaction. Context: A nonstatistical sample of 6 out of 21 vendors were selected for testing for the Refugee and Entrant Assistance Voluntary Agency Programs program. The condition noted above was identified during our procedures over ODI's Suspension and Debarment. Effect: ODI did not verify suspension or debarment status, which could result in entering into a contract with a vendor, which is potentially suspended or debarred. Cause: ODI did not consistently ensure that Suspension or Debarment status was verified before entering into agreements with the vendors. Repeat Finding: The finding is not a repeat finding. Recommendation: We recommend that ODI strengthen its current policies and procedures to ensure that Suspension and Debarment Status is verified for vendors subject to verification according to ODI's Procurement policy, prior to entering into a contract with the vendor. Management’s Views: Management notes that debarment checks performed post transactions confirmed that no vendors were suspended or debarred. Management takes responsibility for the finding and believes that in future years, they will be able to implement proper controls to mitigate this finding.
Federal Agency: U.S. Department of Health & Human Services Federal Program Name: Refugee and Entrant Assistance Voluntary Agency Programs Assistance Listing Number: 93.576 Federal Award Identification Number and Year: Various, see below Pass-Through Agency: Various, see below Pass-Through Number: Various, see below Award Period: Various, see below Compliance Requirement Affected: Allowable Costs & Activities (Payroll) Direct Agency Direct Award number Award Period Pass Through Entity (or) Pass Through Number U.S. Department of Health & Human Services (Direct) 90RG0243-01-00 10/1/2023-9/30/2024 90RG0225-01-00 10/1/2022-9/29/2025 90ZI0174-01-00 9/30/2023-09/29/2027 Passed through California Department of Social Services N/A 10/1/2023-9/30/2024 Passed through Los Rios Community College District N/A 9/30/2022-9/29/2025 Passed through Church World Services CWS-2024-04-015 10/1/2023-9/30/2024 CWS-2024-10-017 10/1/2024-9/30/2025 Type of Finding: Material Weakness in Internal Control over Compliance Criteria: 2 CFR 200.403(a) - Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Condition: During our single audit procedures of allowable costs, six employees had pay rates that could not be substantiated via evidence of approval on an approved wage rate change form. Questioned Costs: Known $14,112 Likely $553,607 Context: A nonstatistical sample of 16 out > 250 pay periods were selected for testing for the Refugee and Entrant Assistance Voluntary Agency Programs program. The condition noted above was identified during our procedures over ODI's Allowable Costs & Activities (payroll). Effect: ODI did not retain documentation of wage rate change approvals, which could result in unapproved increases in wage rate changes being charged to the grant. Cause: ODI has a control designed to approve wage rate changes. However, documentation of approval could not be located. Repeat Finding: The finding is not a repeat finding. Recommendation: We recommend that ODI strengthen its current policies and procedures to ensure that documentation is retained for approval of all wage rate changes. Management’s Views: Management takes responsibility for the finding and believes that in future years, they will be able to implement proper controls to mitigate this finding.
Federal Agency: U.S. Department of Health & Human Services Federal Program Name: Refugee and Entrant Assistance Voluntary Agency Programs Assistance Listing Number: 93.576 Federal Award Identification Number and Year: Various, see below Pass-Through Agency: Various, see below Pass-Through Number: Various, see below Award Period: Various, see below Compliance Requirement Affected: Suspension & Debarment Direct Agency Direct Award number Award Period Pass Through Entity (or) Pass Through Number U.S. Department of Health & Human Services (Direct) 90RG0243-01-00 10/1/2023-9/30/2024 90RG0225-01-00 10/1/2022-9/29/2025 90ZI0174-01-00 9/30/2023-09/29/2027 Passed through California Department of Social Services N/A 10/1/2023-9/30/2024 Passed through Los Rios Community College District N/A 9/30/2022-9/29/2025 Passed through Church World Services CWS-2024-04-015 10/1/2023-9/30/2024 CWS-2024-10-017 10/1/2024-9/30/2025 Type of Finding: Material Weakness in Internal Control over Compliance and Material Noncompliance Criteria: 2 CFR 200.403(a) - When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition: During our single audit procedures, 100% of our suspension and debarment samples selected did not contain sufficient documentation detailing the Organization’s process for determining the vendor was not suspended nor debarred prior to participating in the transaction. Context: A nonstatistical sample of 6 out of 21 vendors were selected for testing for the Refugee and Entrant Assistance Voluntary Agency Programs program. The condition noted above was identified during our procedures over ODI's Suspension and Debarment. Effect: ODI did not verify suspension or debarment status, which could result in entering into a contract with a vendor, which is potentially suspended or debarred. Cause: ODI did not consistently ensure that Suspension or Debarment status was verified before entering into agreements with the vendors. Repeat Finding: The finding is not a repeat finding. Recommendation: We recommend that ODI strengthen its current policies and procedures to ensure that Suspension and Debarment Status is verified for vendors subject to verification according to ODI's Procurement policy, prior to entering into a contract with the vendor. Management’s Views: Management notes that debarment checks performed post transactions confirmed that no vendors were suspended or debarred. Management takes responsibility for the finding and believes that in future years, they will be able to implement proper controls to mitigate this finding.
Federal Agency: U.S. Department of Health & Human Services Federal Program Name: Refugee and Entrant Assistance Voluntary Agency Programs Assistance Listing Number: 93.576 Federal Award Identification Number and Year: Various, see below Pass-Through Agency: Various, see below Pass-Through Number: Various, see below Award Period: Various, see below Compliance Requirement Affected: Allowable Costs & Activities (Payroll) Direct Agency Direct Award number Award Period Pass Through Entity (or) Pass Through Number U.S. Department of Health & Human Services (Direct) 90RG0243-01-00 10/1/2023-9/30/2024 90RG0225-01-00 10/1/2022-9/29/2025 90ZI0174-01-00 9/30/2023-09/29/2027 Passed through California Department of Social Services N/A 10/1/2023-9/30/2024 Passed through Los Rios Community College District N/A 9/30/2022-9/29/2025 Passed through Church World Services CWS-2024-04-015 10/1/2023-9/30/2024 CWS-2024-10-017 10/1/2024-9/30/2025 Type of Finding: Material Weakness in Internal Control over Compliance Criteria: 2 CFR 200.403(a) - Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Condition: During our single audit procedures of allowable costs, six employees had pay rates that could not be substantiated via evidence of approval on an approved wage rate change form. Questioned Costs: Known $14,112 Likely $553,607 Context: A nonstatistical sample of 16 out > 250 pay periods were selected for testing for the Refugee and Entrant Assistance Voluntary Agency Programs program. The condition noted above was identified during our procedures over ODI's Allowable Costs & Activities (payroll). Effect: ODI did not retain documentation of wage rate change approvals, which could result in unapproved increases in wage rate changes being charged to the grant. Cause: ODI has a control designed to approve wage rate changes. However, documentation of approval could not be located. Repeat Finding: The finding is not a repeat finding. Recommendation: We recommend that ODI strengthen its current policies and procedures to ensure that documentation is retained for approval of all wage rate changes. Management’s Views: Management takes responsibility for the finding and believes that in future years, they will be able to implement proper controls to mitigate this finding.
Federal Agency: U.S. Department of Health & Human Services Federal Program Name: Refugee and Entrant Assistance Voluntary Agency Programs Assistance Listing Number: 93.576 Federal Award Identification Number and Year: Various, see below Pass-Through Agency: Various, see below Pass-Through Number: Various, see below Award Period: Various, see below Compliance Requirement Affected: Suspension & Debarment Direct Agency Direct Award number Award Period Pass Through Entity (or) Pass Through Number U.S. Department of Health & Human Services (Direct) 90RG0243-01-00 10/1/2023-9/30/2024 90RG0225-01-00 10/1/2022-9/29/2025 90ZI0174-01-00 9/30/2023-09/29/2027 Passed through California Department of Social Services N/A 10/1/2023-9/30/2024 Passed through Los Rios Community College District N/A 9/30/2022-9/29/2025 Passed through Church World Services CWS-2024-04-015 10/1/2023-9/30/2024 CWS-2024-10-017 10/1/2024-9/30/2025 Type of Finding: Material Weakness in Internal Control over Compliance and Material Noncompliance Criteria: 2 CFR 200.403(a) - When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition: During our single audit procedures, 100% of our suspension and debarment samples selected did not contain sufficient documentation detailing the Organization’s process for determining the vendor was not suspended nor debarred prior to participating in the transaction. Context: A nonstatistical sample of 6 out of 21 vendors were selected for testing for the Refugee and Entrant Assistance Voluntary Agency Programs program. The condition noted above was identified during our procedures over ODI's Suspension and Debarment. Effect: ODI did not verify suspension or debarment status, which could result in entering into a contract with a vendor, which is potentially suspended or debarred. Cause: ODI did not consistently ensure that Suspension or Debarment status was verified before entering into agreements with the vendors. Repeat Finding: The finding is not a repeat finding. Recommendation: We recommend that ODI strengthen its current policies and procedures to ensure that Suspension and Debarment Status is verified for vendors subject to verification according to ODI's Procurement policy, prior to entering into a contract with the vendor. Management’s Views: Management notes that debarment checks performed post transactions confirmed that no vendors were suspended or debarred. Management takes responsibility for the finding and believes that in future years, they will be able to implement proper controls to mitigate this finding.
Federal Agency: U.S. Department of Health & Human Services Federal Program Name: Refugee and Entrant Assistance Voluntary Agency Programs Assistance Listing Number: 93.576 Federal Award Identification Number and Year: Various, see below Pass-Through Agency: Various, see below Pass-Through Number: Various, see below Award Period: Various, see below Compliance Requirement Affected: Allowable Costs & Activities (Payroll) Direct Agency Direct Award number Award Period Pass Through Entity (or) Pass Through Number U.S. Department of Health & Human Services (Direct) 90RG0243-01-00 10/1/2023-9/30/2024 90RG0225-01-00 10/1/2022-9/29/2025 90ZI0174-01-00 9/30/2023-09/29/2027 Passed through California Department of Social Services N/A 10/1/2023-9/30/2024 Passed through Los Rios Community College District N/A 9/30/2022-9/29/2025 Passed through Church World Services CWS-2024-04-015 10/1/2023-9/30/2024 CWS-2024-10-017 10/1/2024-9/30/2025 Type of Finding: Material Weakness in Internal Control over Compliance Criteria: 2 CFR 200.403(a) - Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Condition: During our single audit procedures of allowable costs, six employees had pay rates that could not be substantiated via evidence of approval on an approved wage rate change form. Questioned Costs: Known $14,112 Likely $553,607 Context: A nonstatistical sample of 16 out > 250 pay periods were selected for testing for the Refugee and Entrant Assistance Voluntary Agency Programs program. The condition noted above was identified during our procedures over ODI's Allowable Costs & Activities (payroll). Effect: ODI did not retain documentation of wage rate change approvals, which could result in unapproved increases in wage rate changes being charged to the grant. Cause: ODI has a control designed to approve wage rate changes. However, documentation of approval could not be located. Repeat Finding: The finding is not a repeat finding. Recommendation: We recommend that ODI strengthen its current policies and procedures to ensure that documentation is retained for approval of all wage rate changes. Management’s Views: Management takes responsibility for the finding and believes that in future years, they will be able to implement proper controls to mitigate this finding.
Federal Agency: U.S. Department of Health & Human Services Federal Program Name: Refugee and Entrant Assistance Voluntary Agency Programs Assistance Listing Number: 93.576 Federal Award Identification Number and Year: Various, see below Pass-Through Agency: Various, see below Pass-Through Number: Various, see below Award Period: Various, see below Compliance Requirement Affected: Suspension & Debarment Direct Agency Direct Award number Award Period Pass Through Entity (or) Pass Through Number U.S. Department of Health & Human Services (Direct) 90RG0243-01-00 10/1/2023-9/30/2024 90RG0225-01-00 10/1/2022-9/29/2025 90ZI0174-01-00 9/30/2023-09/29/2027 Passed through California Department of Social Services N/A 10/1/2023-9/30/2024 Passed through Los Rios Community College District N/A 9/30/2022-9/29/2025 Passed through Church World Services CWS-2024-04-015 10/1/2023-9/30/2024 CWS-2024-10-017 10/1/2024-9/30/2025 Type of Finding: Material Weakness in Internal Control over Compliance and Material Noncompliance Criteria: 2 CFR 200.403(a) - When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition: During our single audit procedures, 100% of our suspension and debarment samples selected did not contain sufficient documentation detailing the Organization’s process for determining the vendor was not suspended nor debarred prior to participating in the transaction. Context: A nonstatistical sample of 6 out of 21 vendors were selected for testing for the Refugee and Entrant Assistance Voluntary Agency Programs program. The condition noted above was identified during our procedures over ODI's Suspension and Debarment. Effect: ODI did not verify suspension or debarment status, which could result in entering into a contract with a vendor, which is potentially suspended or debarred. Cause: ODI did not consistently ensure that Suspension or Debarment status was verified before entering into agreements with the vendors. Repeat Finding: The finding is not a repeat finding. Recommendation: We recommend that ODI strengthen its current policies and procedures to ensure that Suspension and Debarment Status is verified for vendors subject to verification according to ODI's Procurement policy, prior to entering into a contract with the vendor. Management’s Views: Management notes that debarment checks performed post transactions confirmed that no vendors were suspended or debarred. Management takes responsibility for the finding and believes that in future years, they will be able to implement proper controls to mitigate this finding.
Federal Agency: U.S. Department of Health & Human Services Federal Program Name: Refugee and Entrant Assistance Voluntary Agency Programs Assistance Listing Number: 93.576 Federal Award Identification Number and Year: Various, see below Pass-Through Agency: Various, see below Pass-Through Number: Various, see below Award Period: Various, see below Compliance Requirement Affected: Allowable Costs & Activities (Payroll) Direct Agency Direct Award number Award Period Pass Through Entity (or) Pass Through Number U.S. Department of Health & Human Services (Direct) 90RG0243-01-00 10/1/2023-9/30/2024 90RG0225-01-00 10/1/2022-9/29/2025 90ZI0174-01-00 9/30/2023-09/29/2027 Passed through California Department of Social Services N/A 10/1/2023-9/30/2024 Passed through Los Rios Community College District N/A 9/30/2022-9/29/2025 Passed through Church World Services CWS-2024-04-015 10/1/2023-9/30/2024 CWS-2024-10-017 10/1/2024-9/30/2025 Type of Finding: Material Weakness in Internal Control over Compliance Criteria: 2 CFR 200.403(a) - Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Condition: During our single audit procedures of allowable costs, six employees had pay rates that could not be substantiated via evidence of approval on an approved wage rate change form. Questioned Costs: Known $14,112 Likely $553,607 Context: A nonstatistical sample of 16 out > 250 pay periods were selected for testing for the Refugee and Entrant Assistance Voluntary Agency Programs program. The condition noted above was identified during our procedures over ODI's Allowable Costs & Activities (payroll). Effect: ODI did not retain documentation of wage rate change approvals, which could result in unapproved increases in wage rate changes being charged to the grant. Cause: ODI has a control designed to approve wage rate changes. However, documentation of approval could not be located. Repeat Finding: The finding is not a repeat finding. Recommendation: We recommend that ODI strengthen its current policies and procedures to ensure that documentation is retained for approval of all wage rate changes. Management’s Views: Management takes responsibility for the finding and believes that in future years, they will be able to implement proper controls to mitigate this finding.
Federal Agency: U.S. Department of Health & Human Services Federal Program Name: Refugee and Entrant Assistance Voluntary Agency Programs Assistance Listing Number: 93.576 Federal Award Identification Number and Year: Various, see below Pass-Through Agency: Various, see below Pass-Through Number: Various, see below Award Period: Various, see below Compliance Requirement Affected: Suspension & Debarment Direct Agency Direct Award number Award Period Pass Through Entity (or) Pass Through Number U.S. Department of Health & Human Services (Direct) 90RG0243-01-00 10/1/2023-9/30/2024 90RG0225-01-00 10/1/2022-9/29/2025 90ZI0174-01-00 9/30/2023-09/29/2027 Passed through California Department of Social Services N/A 10/1/2023-9/30/2024 Passed through Los Rios Community College District N/A 9/30/2022-9/29/2025 Passed through Church World Services CWS-2024-04-015 10/1/2023-9/30/2024 CWS-2024-10-017 10/1/2024-9/30/2025 Type of Finding: Material Weakness in Internal Control over Compliance and Material Noncompliance Criteria: 2 CFR 200.403(a) - When a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition: During our single audit procedures, 100% of our suspension and debarment samples selected did not contain sufficient documentation detailing the Organization’s process for determining the vendor was not suspended nor debarred prior to participating in the transaction. Context: A nonstatistical sample of 6 out of 21 vendors were selected for testing for the Refugee and Entrant Assistance Voluntary Agency Programs program. The condition noted above was identified during our procedures over ODI's Suspension and Debarment. Effect: ODI did not verify suspension or debarment status, which could result in entering into a contract with a vendor, which is potentially suspended or debarred. Cause: ODI did not consistently ensure that Suspension or Debarment status was verified before entering into agreements with the vendors. Repeat Finding: The finding is not a repeat finding. Recommendation: We recommend that ODI strengthen its current policies and procedures to ensure that Suspension and Debarment Status is verified for vendors subject to verification according to ODI's Procurement policy, prior to entering into a contract with the vendor. Management’s Views: Management notes that debarment checks performed post transactions confirmed that no vendors were suspended or debarred. Management takes responsibility for the finding and believes that in future years, they will be able to implement proper controls to mitigate this finding.
Federal Agency: U.S. Department of Health & Human Services Federal Program Name: Refugee and Entrant Assistance Voluntary Agency Programs Assistance Listing Number: 93.576 Federal Award Identification Number and Year: Various, see below Pass-Through Agency: Various, see below Pass-Through Number: Various, see below Award Period: Various, see below Compliance Requirement Affected: Allowable Costs & Activities (Payroll) Direct Agency Direct Award number Award Period Pass Through Entity (or) Pass Through Number U.S. Department of Health & Human Services (Direct) 90RG0243-01-00 10/1/2023-9/30/2024 90RG0225-01-00 10/1/2022-9/29/2025 90ZI0174-01-00 9/30/2023-09/29/2027 Passed through California Department of Social Services N/A 10/1/2023-9/30/2024 Passed through Los Rios Community College District N/A 9/30/2022-9/29/2025 Passed through Church World Services CWS-2024-04-015 10/1/2023-9/30/2024 CWS-2024-10-017 10/1/2024-9/30/2025 Type of Finding: Material Weakness in Internal Control over Compliance Criteria: 2 CFR 200.403(a) - Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. Condition: During our single audit procedures of allowable costs, six employees had pay rates that could not be substantiated via evidence of approval on an approved wage rate change form. Questioned Costs: Known $14,112 Likely $553,607 Context: A nonstatistical sample of 16 out > 250 pay periods were selected for testing for the Refugee and Entrant Assistance Voluntary Agency Programs program. The condition noted above was identified during our procedures over ODI's Allowable Costs & Activities (payroll). Effect: ODI did not retain documentation of wage rate change approvals, which could result in unapproved increases in wage rate changes being charged to the grant. Cause: ODI has a control designed to approve wage rate changes. However, documentation of approval could not be located. Repeat Finding: The finding is not a repeat finding. Recommendation: We recommend that ODI strengthen its current policies and procedures to ensure that documentation is retained for approval of all wage rate changes. Management’s Views: Management takes responsibility for the finding and believes that in future years, they will be able to implement proper controls to mitigate this finding.
2024-001: Activities Allowed or Unallowed & Allowable Costs/Cost Principles - Material Weakness in Internal Control and Material Noncompliance Repeat of Prior Audit Finding 2023-001 Federal Program: Trans-National Crime Federal Agency: U.S. Department of State - Bureau of International Narcotics and Law Enforcement Affairs Federal Assistance Listing Number: 19.705 Federal Award Year: December 31, 2024 Criteria: 2 CFR section 200.303(a) of the Uniform Guidance requires all non-Federal entities to establish and maintain effective internal control over the Federal awards that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal awards. In addition, 2 CFR sections 200.405 and 200.403(g) require federal awards be expended only for allowable activities and be adequately documented, respectively. Condition/Context: The Corporation was unable to provide a signed contract or reconciliation to evidence allowability of the expenditures or documentation of review and approval for the following: • For 5 out of 40 selections, no evidence of approval of signed contract could be provided (control). • For 6 out of 40 selections, no evidence of signed contract or reconciliation support could be provided (compliance). This was not a statistically valid sample. Questioned Costs: Questioned costs were approximately $19,428. Cause: The Corporation did not retain/could not retrieve the signed contract or due to poor document retention. Effect: The Corporation has not complied with the specific requirements for activities allowed or unallowed and allowable costs/cost principles as described in the Uniform Guidance. Unallowable costs may have been charged to the federal program. Recommendation: We recommend that the Corporation review its process and implement procedures that would allow management to properly maintain all required documentation on its federal expenditures. Views of Responsible Officials: The Corporation has sustained and built upon the improvements achieved in 2023, maintaining a reduced occurrence of the findings noted in prior audits. The HR solution, Rippling, implemented in 2024, continues to be an integral part of ensuring that all agreements and rate changes are accurately tracked and fully documented. This system has strengthened the Corporation’s document retention practices and supported ongoing compliance with federal regulations. The rollout of Rippling’s timesheet module was completed for all of the Corporation’s South American entities, Central America, UK, France, Gabon and Senegal. The Corporation continued roll out into 2025 and completed that for all remaining entities including Thailand, Malaysia, UAE, Saudia Arabia, Central and South Africa.
Finding 2024-005 Agency: National Science Foundation Program: Research and Development Cluster (AL No. 47.076) Control Deficiency over Allowable Costs/Cost Principles Repeat Finding: No Condition: For 1 out of 25 selections, the transaction did not properly follow accrual basis accounting. The transaction was related to work performed in fiscal year 2023 but was included in the SEFA for fiscal year 2024. The total amount of this non-compliant transaction was $6,650. Criteria: As provided in 2 CFR section 200.403: Factors affecting allowability of costs, except where otherwise authorized by statute, costs must be determined in accordance with generally accepted accounting principles (GAAP) to be allowable under Federal awards. Cause: AACC does not have an effective policy in place to ensure costs are properly recorded in the correct fiscal year. Effect: AACC was not in compliance with the Allowable Costs/Cost Principles requirements in accordance with Uniform Guidance. Questioned Costs: None Recommendation: We recommend AACC implements a policy to properly accrue expenditures into the correct fiscal year. Auditee Response and Corrective Action Plan: Management agrees with the finding. Refer to the corrective action plan on current findings in Part V of this report.
Finding 2024-005 Agency: National Science Foundation Program: Research and Development Cluster (AL No. 47.076) Control Deficiency over Allowable Costs/Cost Principles Repeat Finding: No Condition: For 1 out of 25 selections, the transaction did not properly follow accrual basis accounting. The transaction was related to work performed in fiscal year 2023 but was included in the SEFA for fiscal year 2024. The total amount of this non-compliant transaction was $6,650. Criteria: As provided in 2 CFR section 200.403: Factors affecting allowability of costs, except where otherwise authorized by statute, costs must be determined in accordance with generally accepted accounting principles (GAAP) to be allowable under Federal awards. Cause: AACC does not have an effective policy in place to ensure costs are properly recorded in the correct fiscal year. Effect: AACC was not in compliance with the Allowable Costs/Cost Principles requirements in accordance with Uniform Guidance. Questioned Costs: None Recommendation: We recommend AACC implements a policy to properly accrue expenditures into the correct fiscal year. Auditee Response and Corrective Action Plan: Management agrees with the finding. Refer to the corrective action plan on current findings in Part V of this report.
Finding 2024-005 Agency: National Science Foundation Program: Research and Development Cluster (AL No. 47.076) Control Deficiency over Allowable Costs/Cost Principles Repeat Finding: No Condition: For 1 out of 25 selections, the transaction did not properly follow accrual basis accounting. The transaction was related to work performed in fiscal year 2023 but was included in the SEFA for fiscal year 2024. The total amount of this non-compliant transaction was $6,650. Criteria: As provided in 2 CFR section 200.403: Factors affecting allowability of costs, except where otherwise authorized by statute, costs must be determined in accordance with generally accepted accounting principles (GAAP) to be allowable under Federal awards. Cause: AACC does not have an effective policy in place to ensure costs are properly recorded in the correct fiscal year. Effect: AACC was not in compliance with the Allowable Costs/Cost Principles requirements in accordance with Uniform Guidance. Questioned Costs: None Recommendation: We recommend AACC implements a policy to properly accrue expenditures into the correct fiscal year. Auditee Response and Corrective Action Plan: Management agrees with the finding. Refer to the corrective action plan on current findings in Part V of this report.
Finding 2024-001 Agency: Department of Labor Program: Apprenticeship State Funds (AL No. 17.285) Material Weakness over Allowable Costs/Cost Principles Repeat Finding: No Condition: For 1 out of 24 selections, the amounts recorded in the SEFA did not match the supporting documentation. For 3 out of 24 selections, there was incomplete supporting documentation provided which was related to unsigned/unapproved subrecipient reimbursement request forms and missing invoices. For 2 out of 24 selections, the amounts recorded were noted to be duplicated and included in the SEFA twice. However, we noted that these costs were not yet billed to the Department of Labor. Criteria: As provided in 2 CFR section 200.403: Factors affecting allowability of costs, except where otherwise authorized by statute, must by adequately documented to be allowable under Federal awards. Cause: AACC received amounts from their subrecipient or vendor to accrue into their SEFA for fiscal year 2024, but did not receive all invoice or receipt documentation to ensure accuracy of the costs.. Effect: AACC was not in compliance with the Allowable Costs/Cost Principles requirements in accordance with Uniform Guidance. Questioned Costs: $85,758.22 Recommendation: We recommend AACC implements a policy to require all subrecipients and vendors to submit complete expenditure documentation within a reasonable timeframe and AACC to properly review the documentation for accuracy and completeness. We also recommend AACC implements a policy to properly track invoices during the accrual and payment process to ensure duplicate entries do not occur.Auditee Response and Corrective Action Plan: Management agrees with the finding. Refer to the corrective action plan on current findings in Part V of this report.
Assistance Listing Number: 93.193 Name of Federal Program: COVID-19 Urban Indian Health Services Name of Federal Agency: Department of Health and Human Services Award Period: January 1, 2024 – December 31, 2024 Criteria or Specific Requirement: Per 2 CFR Part 200, non-federal entities receiving federal awards must establish and maintain written policies and procedures addressing areas including, but not limited to: procurement (§200.317–§200.327); travel costs (§200.475); methods for avoiding duplication of costs (§200.403); subrecipient monitoring (§200.332); cash management and allowable costs (§200.302, §200.305). Condition: The organization has not implemented all policies and procedures required under the Uniform Guidance. Specifically, certain written policies and procedures required by 2 CFR Part 200, such as cash management, allowability of costs, equipment management, conflict of interest, procurement, travel, compensation, and fringe benefits, were either incomplete, not formally documented, or not in place during the audit period. Cause: The Council has not detailed its policies to conform with the requirements of the Uniform Guidance. Effect or Potential Effect: Without documented and implemented policies and procedures, the organization increases the risk of noncompliance with federal regulations, inconsistent application of requirements, unallowable costs being charged to federal awards, and potential questioned costs or sanctions from funding agencies. Repeat Finding: No Recommendation: Management should develop, formally adopt, and implement all required Uniform Guidance policies and procedures. Policies should be documented, communicated to relevant staff, and periodically reviewed to ensure ongoing compliance. Views of Responsible Officials: Management agrees with the finding and revise its policies and procedures to meet the criteria of the Uniform Guidance.
Assistance Listing Number: 93.193 Name of Federal Program: COVID-19 Urban Indian Health Services Name of Federal Agency: Department of Health and Human Services Award Period: January 1, 2024 – December 31, 2024 Criteria or Specific Requirement: Per 2 CFR Part 200, non-federal entities receiving federal awards must establish and maintain written policies and procedures addressing areas including, but not limited to: procurement (§200.317–§200.327); travel costs (§200.475); methods for avoiding duplication of costs (§200.403); subrecipient monitoring (§200.332); cash management and allowable costs (§200.302, §200.305). Condition: The organization has not implemented all policies and procedures required under the Uniform Guidance. Specifically, certain written policies and procedures required by 2 CFR Part 200, such as cash management, allowability of costs, equipment management, conflict of interest, procurement, travel, compensation, and fringe benefits, were either incomplete, not formally documented, or not in place during the audit period. Cause: The Council has not detailed its policies to conform with the requirements of the Uniform Guidance. Effect or Potential Effect: Without documented and implemented policies and procedures, the organization increases the risk of noncompliance with federal regulations, inconsistent application of requirements, unallowable costs being charged to federal awards, and potential questioned costs or sanctions from funding agencies. Repeat Finding: No Recommendation: Management should develop, formally adopt, and implement all required Uniform Guidance policies and procedures. Policies should be documented, communicated to relevant staff, and periodically reviewed to ensure ongoing compliance. Views of Responsible Officials: Management agrees with the finding and revise its policies and procedures to meet the criteria of the Uniform Guidance.
Federal Agencies: Department of Health and Human Services Federal Assistance Listing Numbers: 93.224 & 93.527 Program: Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.403(e), costs must be in accordance with Generally Accepted Accounting Procedures (GAAP) to be allowable under Federal awards. Condition: During our testing of 2024 costs, we noted that 3 of the 60 payroll transactions selected for testing within the Health Center Program Cluster were incurred in 2023. This practice is not in accordance with GAAP, which require that costs be recorded in the period in which they are incurred. Cause: The Village did not have adequate policies and procedures in place to ensure that federal expenditures are properly accrued and recorded in the fiscal year in which the costs are actually incurred. Effect or Potential Effect: Failure to accrue costs in accordance with GAAP may result in expenditures being materially misstated on the SEFA that could lead to inaccurate reporting to the federal agencies. Questioned Costs: Health Center Program Cluster Known Questioned Costs: $473 Health Center Program Cluster Likely Questioned Costs: $26,444 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Repeat Finding: 2023-001 Recommendation: We recommend Village implement policies and procedures to accrue for federal expenditures in the period the costs were incurred to ensure costs are being recorded in accordance with GAAP and the SEFA is representative of all federal expenditures incurred in the reporting year. Views of Responsible Officials:
Federal Agencies: Department of Health and Human Services Federal Assistance Listing Numbers: 93.224 & 93.527 Program: Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.403(e), costs must be in accordance with Generally Accepted Accounting Procedures (GAAP) to be allowable under Federal awards. Condition: During our testing of 2024 costs, we noted that 3 of the 60 payroll transactions selected for testing within the Health Center Program Cluster were incurred in 2023. This practice is not in accordance with GAAP, which require that costs be recorded in the period in which they are incurred. Cause: The Village did not have adequate policies and procedures in place to ensure that federal expenditures are properly accrued and recorded in the fiscal year in which the costs are actually incurred. Effect or Potential Effect: Failure to accrue costs in accordance with GAAP may result in expenditures being materially misstated on the SEFA that could lead to inaccurate reporting to the federal agencies. Questioned Costs: Health Center Program Cluster Known Questioned Costs: $473 Health Center Program Cluster Likely Questioned Costs: $26,444 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Repeat Finding: 2023-001 Recommendation: We recommend Village implement policies and procedures to accrue for federal expenditures in the period the costs were incurred to ensure costs are being recorded in accordance with GAAP and the SEFA is representative of all federal expenditures incurred in the reporting year. Views of Responsible Officials:
Federal Agencies: Department of Health and Human Services Federal Assistance Listing Numbers: 93.224 & 93.527 Program: Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.403(e), costs must be in accordance with Generally Accepted Accounting Procedures (GAAP) to be allowable under Federal awards. Condition: During our testing of 2024 costs, we noted that 3 of the 60 payroll transactions selected for testing within the Health Center Program Cluster were incurred in 2023. This practice is not in accordance with GAAP, which require that costs be recorded in the period in which they are incurred. Cause: The Village did not have adequate policies and procedures in place to ensure that federal expenditures are properly accrued and recorded in the fiscal year in which the costs are actually incurred. Effect or Potential Effect: Failure to accrue costs in accordance with GAAP may result in expenditures being materially misstated on the SEFA that could lead to inaccurate reporting to the federal agencies. Questioned Costs: Health Center Program Cluster Known Questioned Costs: $473 Health Center Program Cluster Likely Questioned Costs: $26,444 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Repeat Finding: 2023-001 Recommendation: We recommend Village implement policies and procedures to accrue for federal expenditures in the period the costs were incurred to ensure costs are being recorded in accordance with GAAP and the SEFA is representative of all federal expenditures incurred in the reporting year. Views of Responsible Officials:
Federal Agencies: Department of Health and Human Services Federal Assistance Listing Numbers: 93.224 & 93.527 Program: Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.403(e), costs must be in accordance with Generally Accepted Accounting Procedures (GAAP) to be allowable under Federal awards. Condition: During our testing of 2024 costs, we noted that 3 of the 60 payroll transactions selected for testing within the Health Center Program Cluster were incurred in 2023. This practice is not in accordance with GAAP, which require that costs be recorded in the period in which they are incurred. Cause: The Village did not have adequate policies and procedures in place to ensure that federal expenditures are properly accrued and recorded in the fiscal year in which the costs are actually incurred. Effect or Potential Effect: Failure to accrue costs in accordance with GAAP may result in expenditures being materially misstated on the SEFA that could lead to inaccurate reporting to the federal agencies. Questioned Costs: Health Center Program Cluster Known Questioned Costs: $473 Health Center Program Cluster Likely Questioned Costs: $26,444 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Repeat Finding: 2023-001 Recommendation: We recommend Village implement policies and procedures to accrue for federal expenditures in the period the costs were incurred to ensure costs are being recorded in accordance with GAAP and the SEFA is representative of all federal expenditures incurred in the reporting year. Views of Responsible Officials:
Federal Agencies: Department of Health and Human Services Federal Assistance Listing Numbers: 93.224 & 93.527 Program: Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.403(e), costs must be in accordance with Generally Accepted Accounting Procedures (GAAP) to be allowable under Federal awards. Condition: During our testing of 2024 costs, we noted that 3 of the 60 payroll transactions selected for testing within the Health Center Program Cluster were incurred in 2023. This practice is not in accordance with GAAP, which require that costs be recorded in the period in which they are incurred. Cause: The Village did not have adequate policies and procedures in place to ensure that federal expenditures are properly accrued and recorded in the fiscal year in which the costs are actually incurred. Effect or Potential Effect: Failure to accrue costs in accordance with GAAP may result in expenditures being materially misstated on the SEFA that could lead to inaccurate reporting to the federal agencies. Questioned Costs: Health Center Program Cluster Known Questioned Costs: $473 Health Center Program Cluster Likely Questioned Costs: $26,444 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Repeat Finding: 2023-001 Recommendation: We recommend Village implement policies and procedures to accrue for federal expenditures in the period the costs were incurred to ensure costs are being recorded in accordance with GAAP and the SEFA is representative of all federal expenditures incurred in the reporting year. Views of Responsible Officials:
Federal Agencies: Department of Health and Human Services Federal Assistance Listing Numbers: 93.224 & 93.527 Program: Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.403(e), costs must be in accordance with Generally Accepted Accounting Procedures (GAAP) to be allowable under Federal awards. Condition: During our testing of 2024 costs, we noted that 3 of the 60 payroll transactions selected for testing within the Health Center Program Cluster were incurred in 2023. This practice is not in accordance with GAAP, which require that costs be recorded in the period in which they are incurred. Cause: The Village did not have adequate policies and procedures in place to ensure that federal expenditures are properly accrued and recorded in the fiscal year in which the costs are actually incurred. Effect or Potential Effect: Failure to accrue costs in accordance with GAAP may result in expenditures being materially misstated on the SEFA that could lead to inaccurate reporting to the federal agencies. Questioned Costs: Health Center Program Cluster Known Questioned Costs: $473 Health Center Program Cluster Likely Questioned Costs: $26,444 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Repeat Finding: 2023-001 Recommendation: We recommend Village implement policies and procedures to accrue for federal expenditures in the period the costs were incurred to ensure costs are being recorded in accordance with GAAP and the SEFA is representative of all federal expenditures incurred in the reporting year. Views of Responsible Officials:
Federal Agencies: Department of Health and Human Services Federal Assistance Listing Numbers: 93.224 & 93.527 Program: Health Center Program Cluster, COVID-19 Health Center Program Cluster Award/Pass-Through Entity Identifying Numbers: H80CS10606-16-00, H80CS10606-17-04, H80CS10606-17-05, H8GCS48224, H8L50900-01-00, H8NCS53911-01-04 Criteria: The Uniform Guidance in 2 CFR §200.303 requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statues, regulations, and the terms and conditions of the Federal award. Per 2 CFR §200.403(e), costs must be in accordance with Generally Accepted Accounting Procedures (GAAP) to be allowable under Federal awards. Condition: During our testing of 2024 costs, we noted that 3 of the 60 payroll transactions selected for testing within the Health Center Program Cluster were incurred in 2023. This practice is not in accordance with GAAP, which require that costs be recorded in the period in which they are incurred. Cause: The Village did not have adequate policies and procedures in place to ensure that federal expenditures are properly accrued and recorded in the fiscal year in which the costs are actually incurred. Effect or Potential Effect: Failure to accrue costs in accordance with GAAP may result in expenditures being materially misstated on the SEFA that could lead to inaccurate reporting to the federal agencies. Questioned Costs: Health Center Program Cluster Known Questioned Costs: $473 Health Center Program Cluster Likely Questioned Costs: $26,444 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Payroll costs including fringe benefits for the Health Center Program Cluster in 2024 were $1,714,998. Repeat Finding: 2023-001 Recommendation: We recommend Village implement policies and procedures to accrue for federal expenditures in the period the costs were incurred to ensure costs are being recorded in accordance with GAAP and the SEFA is representative of all federal expenditures incurred in the reporting year. Views of Responsible Officials:
FINDING 2024-003 Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Period of Performance Federal Agency: Department of the Treasury Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number and Year (or Other Identifying Number): 2024 Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/ Cost Principles, Period of Performance Audit Findings: Material Weakness, Other Matters Condition and Context As part of sound management of the federal award, the City was responsible for implementing a system of internal controls that would ensure compliance with the applicable requirements. The City had not properly designed or implemented such a system, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. Prior to the receipt of direct COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (SLFRF), all eligible entities were required to execute a Financial Assistance Agreement (Agreement), which included the Award Terms and Conditions that recipients must comply with in carrying out the objectives of their award. Per the Agreement, the City was responsible for the effective administration of the federal award, as well as the application of sound management practices and administration of federal funds in a manner consistent with program objectives and terms and conditions of the award. Recipients may use SLFRF funds for any eligible expenses subject to the restrictions set forth in sections 602 and 603 of the Social Security Act, as added by section 9901 of the American Rescue Plan Act of 2021. The SLFRF program provides substantial flexibility for each recipient to meet local needs within four separate eligible use categories. Recipients may use SLFRF funds to: • Respond to the COVID-19 public health emergency and its negative economic impacts; • Respond to workers performing essential work during the COVID-19 public health emergency by providing premium pay to eligible workers of eligible employers that have eligible workers who are performing essential work; • Provide government services, to the extent COVID-19 caused a reduction in revenues collected in the most recent full fiscal year of the recipient; and • Make necessary investments in water, sewer, or broadband infrastructure. The City elected to receive the standard revenue loss allowance, allowing it to claim its total SLFRF allocation of $3,821,386 as revenue loss to use for government services. The allocated funds may only be used to cover costs incurred from the period beginning on March 3, 2021, and ending on December 31, 2024. Obligations for costs incurred are required to be liquidated no later than December 31, 2026. INDIANA STATE BOARD OF ACCOUNTS 18 CITY OF VINCENNES SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) During the audit period, the City completed one transfer of SLFRF funds from the Coronavirus State and Local Fi fund to the Grant Stipends fund in the amount of $30,000. The transfer was described as a reimbursement for stipends paid to essential workers. There was no documentation provided for audit to determine if the transfer was for allowable activities, met the cost objectives of the award, or that the associated expenditures were within the period of performance. The Grant Stipends fund was established in 2022, with total expenditures from the fund from 2022, 2023, and 2024 of only $28,009. Additionally, the transfer of SLFRF funds was commingled with other receipts into the Grant Stipends fund. Because the $30,000 transfer of SLFRF funds exceeded the total disbursements out of the Grant Stipends fund and because the City did not have an appropriate system in place to account for the federal expenditures separately from other grant and operating expenditures, we were unable to determine what, if any, expenditures from the Grant Stipends fund should be included in the population of federal expenditures under the award. Without a complete population of expenditures, we were unable to determine the City's compliance with the Activities Allowed or Unallowed, the Allowable Costs/Cost Principles, and the Period of Performance compliance requirements. As such, the $30,000 transferred from the Coronavirus State and Local Fi fund is considered questioned costs. The City also did not have written procedures for determining the allowability of costs in accordance with subpart E of 2 CFR 200. The lack of effective internal controls and noncompliance were isolated to the situations described above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.300(b) states in part: "The non-Federal entity is responsible for complying with all requirements of the Federal award. . . ." 2 CFR 200.302 states in part: "(a) Each state must expend and account for the Federal award in accordance with state laws and procedures for expending and accounting for the state's own funds. In addition, the state's and the other non-Federal entity's financial management systems, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award. . . . INDIANA STATE BOARD OF ACCOUNTS 19 CITY OF VINCENNES SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (b) The financial management system of each non-Federal entity must provide for the following . . . (1) Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. Federal program and Federal award identification must include, as applicable, the Assistance Listings title and number, Federal award identification number and year, name of the Federal agency, and name of the pass-through entity, if any. (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . . (3) Records that identify adequately the source and application of funds for federallyfunded activities. These records must contain information pertaining to Federal awards, authorizations, financial obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation. (4) Effective control over, and accountability for, all funds, property, and other assets. . . . (7) Written procedures for determining the allowability of costs in accordance with subpart E of this part and the terms and conditions of the Federal award." 2 CFR 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. . . . (g) be adequately documented. . . ." Cause A proper system of internal controls over the SLFRF expenditures was not designed by management of the City to ensure the SLFRF funds were being used appropriately. The City did not have policies and procedures in place to ensure that expenditures of federal awards were allowable and occurred within the period of performance. The City initiated a transfer of SLFRF funds from the grant fund to another fund without proper supporting documentation. The City was unable to differentiate expenditures made from federal and nonfederal funds within its ledger for the Grant Stipends fund. Effect Without the proper implementation of an effectively designed system of internal controls, a population of expenditures associated with the Grant Stipends fund could not be determined. As such, the City cannot ensure nor can we determine that expenditures of the grant were not unallowable, within the proper period, and adhered to established practices and policies. As a result, noncompliance in the form of questioned costs occurred and remained undetected. Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the City. INDIANA STATE BOARD OF ACCOUNTS 20 CITY OF VINCENNES SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs Questioned costs in the amount of $30,000 were identified as noted in the Condition and Context. Recommendation We recommended the City's management establish a proper system of internal controls and develop policies and procedures to ensure that expenditures of federal awards are allowable and occur within the period of performance. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Finding: 2024-001 ALN 10.559, USDA Summer Food Service Program (SFSP) Known/Likely Questioned Costs: $151,099.42 Criteria: Federal regulations require that costs charged to the program be necessary, reasonable, and properly documented (2 CFR 200.403–200.404). In addition, procurement must follow open and competitive bidding procedures (2 CFR 200.318), and contracts must be executed and approved before charging costs to the program. Deviation/Condition: The Organization paid $151,099.42 of SFSP program funds to UTA of Boro Park for outsourced payroll services without following federal procurement requirements and without an executed, approved contract. Cause: Inadequate internal controls over procurement and contract approval. Effect: Use of program funds for unallowable costs, resulting in questioned costs of $151,099.42. Perspective: The issue represents a material exception, as the entire amount of outsourced payroll services ($151,099.42) charged to the SFSP was deemed unallowable due to noncompliance with procurement and contract approval requirements. Reporting Period: 1/1/2024-12/31/2024 Repeat Finding: No Recommendation: The Organization should reimburse the SFSP program fund in the amount of $151,099.42 from its non-federal operating funds. In addition, the Organization should establish procedures to ensure all future service contracts are competitively procured, executed in writing, and approved by the State agency before being charged to the program. Views of Responsible Officials and Corrective Action Plan: Management agrees with the finding, has reimbursed $151,099.42 to the SFSP account, and will strengthen procurement controls through competitive bidding and contract approvals to ensure compliance.
FINDING 2024-001 Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Activities Allowed or Unallowed and Allowable Costs/Cost Principles Federal Agency: Department of the Treasury Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number and Year (or Other Identifying Number): 2024 Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Audit Findings: Material Weakness, Modified Opinion Repeat Finding This is a repeat finding from the immediately prior audit report for Allowable Costs/Cost Principles. The prior audit finding number was 2023-003. Condition and Context As a condition of receiving COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (SLFRF) award funds, all eligible entities were required to execute a financial assistance agreement that set forth the applicable terms and conditions. In accordance with this agreement, the County was responsible for the proper administration of the federal award, the application of sound financial management practices, and ensuring that all expenditures complied with the program's objectives and the requirements of the award. The SLFRF offers recipients significant flexibility to address local needs across seven eligible use categories. One eligible use category is providing government services. Under this category, entities may use award funds for government services up to the greater of $10 million or the amount of revenue loss due to the pandemic. The County chose this category and elected the standard allowance of up to $10 million, allowing it to use its entire allocation of $4,014,711, for the provision of government services. On May 11, 2021, the Board of County Commissioners passed Ordinance 2021-07 that created a new fund and adopted the American Rescue Plan (ARP). The Ordinance included the procedures for spending the ARP funding, which included the following: The Board of County Commissioners will establish the plan, conditions, and rules upon which the funds are to be requested and used. Funds shall be appropriated by the County's fiscal body before use. All expenditure of funds shall be approved by the Board of County Commissioners with any and all claims to be paid from the County's ARP fund. During the audit period, the County Council approved appropriations for 17 expenditures from the ARP fund. All 17 expenditures were tested to verify that costs were allowable and adhered to the cost principles. Of these, 9 expenditures, totaling $300,000, were approved for payment by the Board of County Commissioners and classified by the County Council as appropriated and obligated for donations. The donations were distributed as follows: INDIANA STATE BOARD OF ACCOUNTS 14 SULLIVAN COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Local camp and retreat center for insurance costs. Youth sportsplex for facility upgrades. Two non-profits for food purchases for needy individuals. Local volunteer fire department for a generator and equipment. Local fire territory for firefighting gear. Local humane society for connection into the wastewater system. Local ambulance service to assist with the purchase of an ambulance. Local park for road resurfacing. Documentation provided to support each expenditure consisted of a proposal for donations submitted by the requesting entity. The payment of donations does not constitute a government service of the County and is not an allowable cost. Therefore, the $300,000 disbursed as donations was considered questioned costs. The lack of internal controls and noncompliance were isolated to the donations identified above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. (b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. . . . (g) Be adequately documented. . . ." 2 CFR 200.434(a) states: "Costs of contributions and donations, including cash, property, and services, from the non-Federal entity to other entities, are unallowable." INDIANA STATE BOARD OF ACCOUNTS 15 SULLIVAN COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 31 CFR 35.6 states in part: "(a) . . . a recipient may use funds for one or more of the purposes described in paragraphs (b) through (h) of this section. . . . (d) Providing government services. . . ." 31 CFR 35.9 states in part: "A recipient must comply with all other applicable Federal statutes, regulations, and executive orders . . ." Cause The lack of effective internal controls allowed for the County to charge questionable expenditures to the SLFRF program. County officials believed that the expenditures were allowable as they were made to organizations that provided services and benefits to residents of the County and did not understand that expenditures designated as donations are strictly prohibited under federal regulations. Effect Without a proper system of internal controls in place that operated effectively, the County expended $300,000 from the federal award that was not an allowable use of funds. The U.S. Department of the Treasury could request these funds be returned. Questioned Costs We identified $300,000 in known questioned costs as noted above in the Condition and Context. Recommendation We recommended the County's management establish a proper system of internal controls and develop policies and procedures to ensure that costs are allowable for SLFRF award funds. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
Review of Casefiles Federal Agency: U.S. Department of Human Services Federal Program Name: Medical Assistance (Medicaid Cluster) Assistance Listing Number: 93.778 Federal Award Identification Number and Year: 2405MN5ADM, 2405MN5MAP; 2024 Pass-Through Agency: Minnesota Department of Human Services Compliance Requirement Affected: Eligibility Award Period: Year Ended December 31, 2024 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria or Specific Requirement: 2 CFR 200.403 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: During testing of eligibility requirements, it was noted there are no reviews being completed over MAXIS nor METS casefiles. Questioned Costs: None Context: No supervisor or peer review is being completed over METS and MAXIS casefiles. Cause: Due to staff turnover, the County did not have time to complete the reviews. Effect: Errors made in determining eligibility may not be discovered and benefits may be issued to clients who are not eligible. Repeat Finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number was 2024-005. Recommendation: We recommend that a supervisor or team lead perform regular internal reviews on MAXIS and METS casefiles to determine that proper policies and procedures are being followed in determining eligibility. Views of responsible officials: There is no disagreement with the audit finding. There is a corrective action plan in place.
Reporting Federal Agency: U.S. Department of Human Services Federal Program Name: Medical Assistance (Medicaid Cluster) Assistance Listing Number: 93.778 Federal Award Identification Number and Year: 2405MN5ADM, 2405MN5MAP; 2024 Pass-Through Agency: Minnesota Department of Human Services Compliance Requirement Affected: Reporting Award Period: Year Ended December 31, 2024 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: 2 CFR 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Additionally, 2 CFR 200.403 lists general criteria for allowability of costs under federal awards, and the 2556 Social Services quarterly report has further guidance on what is allowed to be reported. Condition: Reports for the 2556 Social Services Quarterly Expense Report were reviewed, but were not reported correctly and sent to the state with incorrect direct charges reported. Auditor estimates that the reimbursed amount based on these ineligible costs reported on the 2556 is less than $25,000. Questioned Costs: Amount less than $25,000. Context: The quarterly report was reviewed, however it was determined that incorrect expenses were reported and was not caught during the review process. Cause: Lack of review of the requirements of the 2556 instructions by the County. Effect: Ineligible costs could be reported. Repeat Finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number was 2023-009. Recommendation: We recommend that the County implement review procedures to ensure that the reports are submitted timely and accurately, and record of review is kept on file. Views of responsible officials: There is no disagreement with the audit finding. There is a corrective action plan in place.
Review of Casefiles Federal Agency: U.S. Department of Human Services Federal Program Name: Medical Assistance (Medicaid Cluster) Assistance Listing Number: 93.778 Federal Award Identification Number and Year: 2405MN5ADM, 2405MN5MAP; 2024 Pass-Through Agency: Minnesota Department of Human Services Compliance Requirement Affected: Eligibility Award Period: Year Ended December 31, 2024 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria or Specific Requirement: 2 CFR 200.403 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: During testing of eligibility requirements, it was noted there are no reviews being completed over MAXIS nor METS casefiles. Questioned Costs: None Context: No supervisor or peer review is being completed over METS and MAXIS casefiles. Cause: Due to staff turnover, the County did not have time to complete the reviews. Effect: Errors made in determining eligibility may not be discovered and benefits may be issued to clients who are not eligible. Repeat Finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number was 2024-005. Recommendation: We recommend that a supervisor or team lead perform regular internal reviews on MAXIS and METS casefiles to determine that proper policies and procedures are being followed in determining eligibility. Views of responsible officials: There is no disagreement with the audit finding. There is a corrective action plan in place.
Reporting Federal Agency: U.S. Department of Human Services Federal Program Name: Medical Assistance (Medicaid Cluster) Assistance Listing Number: 93.778 Federal Award Identification Number and Year: 2405MN5ADM, 2405MN5MAP; 2024 Pass-Through Agency: Minnesota Department of Human Services Compliance Requirement Affected: Reporting Award Period: Year Ended December 31, 2024 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: 2 CFR 200.303 states that the auditee must establish and maintain effective internal control over the federal award that provides reasonable assurance that the auditee is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Additionally, 2 CFR 200.403 lists general criteria for allowability of costs under federal awards, and the 2556 Social Services quarterly report has further guidance on what is allowed to be reported. Condition: Reports for the 2556 Social Services Quarterly Expense Report were reviewed, but were not reported correctly and sent to the state with incorrect direct charges reported. Auditor estimates that the reimbursed amount based on these ineligible costs reported on the 2556 is less than $25,000. Questioned Costs: Amount less than $25,000. Context: The quarterly report was reviewed, however it was determined that incorrect expenses were reported and was not caught during the review process. Cause: Lack of review of the requirements of the 2556 instructions by the County. Effect: Ineligible costs could be reported. Repeat Finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number was 2023-009. Recommendation: We recommend that the County implement review procedures to ensure that the reports are submitted timely and accurately, and record of review is kept on file. Views of responsible officials: There is no disagreement with the audit finding. There is a corrective action plan in place.
Criteria – According to 2 CFR § 200.403, 2 CFR § 200.405, and 2 CFR § 200.405, costs charged to federal awards must be allowable, reasonable, and allocable. Specifically, costs must be necessary and reasonable for the performance of the federal award, must conform to limitations and exclusions set forth in the cost principles, must be consistent with policies that apply uniformly to both federally financed and other activities, and costs must comply with the terms and conditions of the federal award. Federal funds must also only be used for expenditures incurred during the award period. Condition – During our review of expenditures charged to the Crime Victim Assistance (VOCA) grant, we noted that management charged an expense prior to the completion of the project. The expense was allowable under the grant, but the timing of the charge did not align with when the activity occurred. Cause – The premature charge occurred due to management attempting to use the remaining grant funds for that period before they expired. Questioned Cost Amount – Based on deviations noted in our testwork the projected likely questioned costs resulting in noncompliance are as follows: Crime Victim Assistance (VOCA), 16.575: $74,661. Effect – The Organization was not in compliance with the requirements listed above. Recommendation – We recommend the Organization review and reinforce policies regarding timing of cost obligations and expenditures and ensure expenses are recorded in alignment with when the related activity occurs. View of Responsible Officials – Management agrees with the finding. Corrective Action Plan – See attached corrective action plan from management.
Criteria – According to 2 CFR § 200.403, 2 CFR § 200.405, and 2 CFR § 200.405, costs charged to federal awards must be allowable, reasonable, and allocable. Specifically, costs must be necessary and reasonable for the performance of the federal award, must conform to limitations and exclusions set forth in the cost principles, must be consistent with policies that apply uniformly to both federally financed and other activities, and costs must comply with the terms and conditions of the federal award. Federal funds must also only be used for expenditures incurred during the award period. Condition – During our review of expenditures charged to the Crime Victim Assistance (VOCA) grant, we noted that management charged an expense prior to the completion of the project. The expense was allowable under the grant, but the timing of the charge did not align with when the activity occurred. Cause – The premature charge occurred due to management attempting to use the remaining grant funds for that period before they expired. Questioned Cost Amount – Based on deviations noted in our testwork the projected likely questioned costs resulting in noncompliance are as follows: Crime Victim Assistance (VOCA), 16.575: $74,661. Effect – The Organization was not in compliance with the requirements listed above. Recommendation – We recommend the Organization review and reinforce policies regarding timing of cost obligations and expenditures and ensure expenses are recorded in alignment with when the related activity occurs. View of Responsible Officials – Management agrees with the finding. Corrective Action Plan – See attached corrective action plan from management.
Criteria – According to 2 CFR § 200.403, 2 CFR § 200.405, and 2 CFR § 200.405, costs charged to federal awards must be allowable, reasonable, and allocable. Specifically, costs must be necessary and reasonable for the performance of the federal award, must conform to limitations and exclusions set forth in the cost principles, must be consistent with policies that apply uniformly to both federally financed and other activities, and costs must comply with the terms and conditions of the federal award. Federal funds must also only be used for expenditures incurred during the award period. Condition – During our review of expenditures charged to the Crime Victim Assistance (VOCA) grant, we noted that management charged an expense prior to the completion of the project. The expense was allowable under the grant, but the timing of the charge did not align with when the activity occurred. Cause – The premature charge occurred due to management attempting to use the remaining grant funds for that period before they expired. Questioned Cost Amount – Based on deviations noted in our testwork the projected likely questioned costs resulting in noncompliance are as follows: Crime Victim Assistance (VOCA), 16.575: $74,661. Effect – The Organization was not in compliance with the requirements listed above. Recommendation – We recommend the Organization review and reinforce policies regarding timing of cost obligations and expenditures and ensure expenses are recorded in alignment with when the related activity occurs. View of Responsible Officials – Management agrees with the finding. Corrective Action Plan – See attached corrective action plan from management.
Criteria – According to 2 CFR § 200.403, 2 CFR § 200.405, and 2 CFR § 200.405, costs charged to federal awards must be allowable, reasonable, and allocable. Specifically, costs must be necessary and reasonable for the performance of the federal award, must conform to limitations and exclusions set forth in the cost principles, must be consistent with policies that apply uniformly to both federally financed and other activities, and costs must comply with the terms and conditions of the federal award. Federal funds must also only be used for expenditures incurred during the award period. Condition – During our review of expenditures charged to the Crime Victim Assistance (VOCA) grant, we noted that management charged an expense prior to the completion of the project. The expense was allowable under the grant, but the timing of the charge did not align with when the activity occurred. Cause – The premature charge occurred due to management attempting to use the remaining grant funds for that period before they expired. Questioned Cost Amount – Based on deviations noted in our testwork the projected likely questioned costs resulting in noncompliance are as follows: Crime Victim Assistance (VOCA), 16.575: $74,661. Effect – The Organization was not in compliance with the requirements listed above. Recommendation – We recommend the Organization review and reinforce policies regarding timing of cost obligations and expenditures and ensure expenses are recorded in alignment with when the related activity occurs. View of Responsible Officials – Management agrees with the finding. Corrective Action Plan – See attached corrective action plan from management.
Criteria – According to 2 CFR § 200.403, 2 CFR § 200.405, and 2 CFR § 200.405, costs charged to federal awards must be allowable, reasonable, and allocable. Specifically, costs must be necessary and reasonable for the performance of the federal award, must conform to limitations and exclusions set forth in the cost principles, must be consistent with policies that apply uniformly to both federally financed and other activities, and costs must comply with the terms and conditions of the federal award. Federal funds must also only be used for expenditures incurred during the award period. Condition – During our review of expenditures charged to the Crime Victim Assistance (VOCA) grant, we noted that management charged an expense prior to the completion of the project. The expense was allowable under the grant, but the timing of the charge did not align with when the activity occurred. Cause – The premature charge occurred due to management attempting to use the remaining grant funds for that period before they expired. Questioned Cost Amount – Based on deviations noted in our testwork the projected likely questioned costs resulting in noncompliance are as follows: Crime Victim Assistance (VOCA), 16.575: $74,661. Effect – The Organization was not in compliance with the requirements listed above. Recommendation – We recommend the Organization review and reinforce policies regarding timing of cost obligations and expenditures and ensure expenses are recorded in alignment with when the related activity occurs. View of Responsible Officials – Management agrees with the finding. Corrective Action Plan – See attached corrective action plan from management.
Information on the Federal Program: Assistance Listing Number 20.616—National Priority Safety Programs, United States Department of Transportation. Pass-Through Entity: New York State Governor’s Traffic Safety Committee Award Number: HS1-2024-NYS STOP DWI Found.-00199-(088) Compliance Requirement: Allowable Costs, Allowable Activities Type of Finding: Significant deficiency in internal control over compliance Criteria: Per 2 CFR 200.403, costs must be allowable, allocable, and adequately supported to be charged to a federal award. Payments should not exceed the documented amount requested by vendors. Condition and Context: During testing of grant expenditures, we noted management was unable to provide support for a payment made by the Foundation to a county. Specifically, the county invoices provided totaled $16,085 while the Foundation issued a reimbursement check of $20,085, resulting in questioned costs of $4,000. The Foundation included the larger amount on its grant funding request, which was approved and paid by the funding agency. Management was unable to locate the source of the discrepancy. Cause: The Foundation experienced turnover in the grant administrator role during the year. This transaction was processed by the prior grant administrator and the current grant administrator was unable to locate the supporting documentation or other source of the discrepancy. Effect: The Foundation was unable to support amounts paid to the county, resulting in questioned costs as noted above. Questioned Costs: $4,000. Known and likely questioned costs are less than $25,000. Repeat Finding: No Recommendation: We recommend the Foundation strengthen its document retention and review process over payments to ensure that all amounts paid are supported by appropriate documentation. Views of Responsible Officials: Management of the Foundation concurs with this audit finding.
#2024-004 – Major Federal Award Finding - Period of Performance Nature of Finding: Period of Performance – Compliance Finding and Material Weakness in Internal Control over Compliance Criteria/Condition: The Organization recorded certain expenses upon payment of invoices rather than when the service was provided. The guidelines provided at 2 CFR 200.403(e) require that costs be determined in accordance with GAAP to be allowable. In accordance with GAAP and the accrual basis of accounting, such expenses are to be recorded when services are performed, rather than upon payment of invoice. Cause/Context: The Organization had limited accounting resources which impacted timing and frequency of processing certain transactions. In addition, the Organization has contracts with providers that include pre-determined payment terms that may not precisely correlate to the actual work performed in terms of timing. The Organization recorded certain contract costs as the invoices were processed, and not necessarily as the providers’ actual work was completed. Effect: Adjusting journal entries were proposed during the audit to record expenses in the proper period for the financial statements. Federal grant expenses of approximately $100,700 were originally recorded in 2024 that related to 2025 services. Similarly, federal grant expenses of approximately $117,100 were recorded in 2025 that related to 2024 services. These net adjustments increased federal grant revenue and expenditures by approximately $16,400 for the year ended December 31, 2024. Recommendation: We recommend that care be exercised to evaluate financial activity considering the cost factors contained in 2 CFR 200.403, the accrual basis of accounting and period of performance. Controls should be enhanced to ensure that expenses are recorded to the proper period based on when the service or work is provided. Views of Responsible Officials and Planned Corrective Actions: Contracts are recorded as prepaid or accrued expenses and are being expensed monthly. Salaries and benefits incurred before month-end will be accrued to grants at grant cutoff dates and at year-end. Estimated monthly accruals for salaries will be implemented.
CORPORATION FOR NATIONAL AND COMMUNITY SERVICE- NON MAJOR PROGRAM Program Information: Assistance Listing Number: 94.016 AmeriCorps Seniors Senior Companion Program Federal Award Project Title: Senior Companion Program Federal Award Number: 21SCBMD001 Questioned Costs: $55,548 Compliance Requirement: Activities Allowed or Unallowed 2024-002 Unallowable Costs Condition: During an audit of the program by Office of Monitoring’s Financial and Operational Fitness and the National Service Criminal History Checks for the fiscal year 2023 expenses, it was noted that $13,513 arose from noncompliance with allowability of costs (2 CFR 200.403) and $42,035 for noncompliance with National Service Criminal History Checks Federal Regulations (45 CFR 2540.200-207) Criteria: The Code of Federal Regulations (CRF) requires organizations to be in compliance with 2 CFR 200.403 and 45 CFR 2540.200-207. Cause: Management was not aware of the specific federal requirement. Effect: AACF is not in compliance with 2 CFR 200.403 and 45 CFR 2540.200-207. Repeat Finding: No. Auditor’s Recommendation: We recommend AACF review its policies and procedures over compliance to ensure all requirements under 2 CFR 200.403 and 45 CFR 2540.200-207 are adopted in a formal written policy. Views of Responsible Officials and Planned Correct Action: AACF concurs with this finding. AACF submitted a corrective action plan to AmeriCorps and on January 31, 2025 AmeriCorps accepted their corrective action plan and closed the finding. AACF will ensure all requirements under 2 CFR 200.403 and 45 CFR 2540.200-207 are met moving forward.
Finding 2024-002 Material Weakness in Controls over Compliance and Material Noncompliance – Allowable Costs Federal Program: 93.137 Community Programs to Improve Minority Health Year: 2024 Federal Agency: Department of Health and Human Services Criteria – In accordance with 2 CFR 200.403 and 2 CFR 200.302 (b)(3) costs charged to the federal program should be adequately supported by source documentation. Condition – Payroll expenses for one employee were inadvertently recorded twice for the fiscal year, resulting in an overstatement of personnel costs charged to the federal award. Further, indirect costs were charged in excess of the budgeted and approved amount under the grant agreement. Cause – The capturing of payroll expenses to the federal grant was not set up appropriately in the general ledger system which led management to record the above entries manually to the grant program. The manual process led to the duplication of the payroll journal entry and the overcharging of the indirect cost. Perspective – There are six key personnel who charged payroll to the federal program. Out of the six personnel one individual’s payroll was incorrectly duplicated. This resulted in a $30,291 over charge to the grant. Further, from an indirect cost perspective, the grant budget limited indirect costs to $18,296, however a total of $70,965 was charged to the grant, resulting in a $52,669 overcharge. Questioned Cost - $82,960 Effect – Overcharging expenses may result in the granting agency withholding future funding for this grant. Recommendation – Ensure the grant is appropriately set up in the system to capture the relevant expenses. Management also needs to have a more precise control to ensure no expense items are duplicated and are within budget. View of Responsible Officials – See Corrective Action Plan