Finding Number: 2021-SA3 Material Weakness – Activities Allowed or Unallowed and Allowable Costs/Cost Principles and Period of Performance Compliance and Control Finding Federal Award: No. 64.024 VA Homeless Providers Grant and Per Diem Program Federal Agency: U.S. Veterans Administration Pass-Through Entity: Not applicable Criteria or Specific Requirement: CFR section 200.403, Factors affecting allowability of costs, states costs must: conform to limitations or exclusions, be accorded consistent treatment, a cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost and be adequately documented. 2 CFR section 200.405, Allowable costs, states this standard is met if the cost is incurred specifically for the Federal award. 2 CFR section 200.430(i) Standards for Documentation of Personnel Expenses state charges to Federal awards for salaries must be based on records that accurately reflect the work performed and these records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award a Federal award and non-Federal award and charges for the salaries and wages of nonexempt employees… must be supported by records indicating the total number of hours worked each day. Condition: The Organization did not maintain an effective control environment to ensure costs incurred for expenditures charged to the program were in accordance with contract requirements and applicable cost principles. Records do not provide reasonable assurance that the charges are accurate, allowable, and properly allocated. Records do not appear to support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award or a Federal award and non-federal activity. Charges for non-exempt employees are not supported by records indicating the total number of hours worked each day. Expenditure details included costs that were allocated to the Federal award but may not have been incurred specifically for the Federal award. These costs included unsupported journal entries and uncategorized expenditures. Additionally, due to lack of budgets for the fiscal year, it was not determinable if costs conformed to limitations or exclusions set forth in the Federal award. Costs were not adequately documented, and it is unknown if costs were accorded consistent treatment. Cause: Factors beyond the control of current management, including poor recordkeeping, have caused financial records to be inadequate for audit purposes, as key members of the accounting department left the Organization before appropriately transferring knowledge and records related to the Federal awards. Effect or Potential Effect: Potential for unallowable activities, unallowable costs, and costs outside of the period of performance and additional questioned costs. Questioned Costs: Related questioned costs related to payroll expenditures are unknown. Questioned costs related to non-payroll expenditures are unknown. Context: During the year under audit, the issues represent a systemic problem, beyond the control of current management. Recommendation: Policies and procedures should be designed and implemented to ensure expenditures are reviewed for allowability before being charged to federal awards. Policies and procedures should be designed and implemented to ensure costs are reviewed for allowability before being charged to federal awards. Management should perform budget to actual analysis on a periodic basis to ensure that costs are not exceeding limitations. View of Responsible Officials: In response to finding number 2021-SA3, management agrees with the finding and will design, implement, and maintain policies and procedures that ensure expenditures are reviewed for allowability before being charged to Federal awards. Management will also design, implement, and maintain policies and procedures that ensure costs are reviewed for allowability before being charged to Federal awards. Further, management will perform budget-to-actual analysis on a periodic basis to ensure costs do not exceed limitations.
Finding Number: 2021-SA3 Material Weakness – Activities Allowed or Unallowed and Allowable Costs/Cost Principles and Period of Performance Compliance and Control Finding Federal Award: No. 64.024 VA Homeless Providers Grant and Per Diem Program Federal Agency: U.S. Veterans Administration Pass-Through Entity: Not applicable Criteria or Specific Requirement: CFR section 200.403, Factors affecting allowability of costs, states costs must: conform to limitations or exclusions, be accorded consistent treatment, a cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost and be adequately documented. 2 CFR section 200.405, Allowable costs, states this standard is met if the cost is incurred specifically for the Federal award. 2 CFR section 200.430(i) Standards for Documentation of Personnel Expenses state charges to Federal awards for salaries must be based on records that accurately reflect the work performed and these records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award a Federal award and non-Federal award and charges for the salaries and wages of nonexempt employees… must be supported by records indicating the total number of hours worked each day. Condition: The Organization did not maintain an effective control environment to ensure costs incurred for expenditures charged to the program were in accordance with contract requirements and applicable cost principles. Records do not provide reasonable assurance that the charges are accurate, allowable, and properly allocated. Records do not appear to support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award or a Federal award and non-federal activity. Charges for non-exempt employees are not supported by records indicating the total number of hours worked each day. Expenditure details included costs that were allocated to the Federal award but may not have been incurred specifically for the Federal award. These costs included unsupported journal entries and uncategorized expenditures. Additionally, due to lack of budgets for the fiscal year, it was not determinable if costs conformed to limitations or exclusions set forth in the Federal award. Costs were not adequately documented, and it is unknown if costs were accorded consistent treatment. Cause: Factors beyond the control of current management, including poor recordkeeping, have caused financial records to be inadequate for audit purposes, as key members of the accounting department left the Organization before appropriately transferring knowledge and records related to the Federal awards. Effect or Potential Effect: Potential for unallowable activities, unallowable costs, and costs outside of the period of performance and additional questioned costs. Questioned Costs: Related questioned costs related to payroll expenditures are unknown. Questioned costs related to non-payroll expenditures are unknown. Context: During the year under audit, the issues represent a systemic problem, beyond the control of current management. Recommendation: Policies and procedures should be designed and implemented to ensure expenditures are reviewed for allowability before being charged to federal awards. Policies and procedures should be designed and implemented to ensure costs are reviewed for allowability before being charged to federal awards. Management should perform budget to actual analysis on a periodic basis to ensure that costs are not exceeding limitations. View of Responsible Officials: In response to finding number 2021-SA3, management agrees with the finding and will design, implement, and maintain policies and procedures that ensure expenditures are reviewed for allowability before being charged to Federal awards. Management will also design, implement, and maintain policies and procedures that ensure costs are reviewed for allowability before being charged to Federal awards. Further, management will perform budget-to-actual analysis on a periodic basis to ensure costs do not exceed limitations.
Finding Number: 2021-SA3 Material Weakness – Activities Allowed or Unallowed and Allowable Costs/Cost Principles and Period of Performance Compliance and Control Finding Federal Award: No. 64.024 VA Homeless Providers Grant and Per Diem Program Federal Agency: U.S. Veterans Administration Pass-Through Entity: Not applicable Criteria or Specific Requirement: CFR section 200.403, Factors affecting allowability of costs, states costs must: conform to limitations or exclusions, be accorded consistent treatment, a cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost and be adequately documented. 2 CFR section 200.405, Allowable costs, states this standard is met if the cost is incurred specifically for the Federal award. 2 CFR section 200.430(i) Standards for Documentation of Personnel Expenses state charges to Federal awards for salaries must be based on records that accurately reflect the work performed and these records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award a Federal award and non-Federal award and charges for the salaries and wages of nonexempt employees… must be supported by records indicating the total number of hours worked each day. Condition: The Organization did not maintain an effective control environment to ensure costs incurred for expenditures charged to the program were in accordance with contract requirements and applicable cost principles. Records do not provide reasonable assurance that the charges are accurate, allowable, and properly allocated. Records do not appear to support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award or a Federal award and non-federal activity. Charges for non-exempt employees are not supported by records indicating the total number of hours worked each day. Expenditure details included costs that were allocated to the Federal award but may not have been incurred specifically for the Federal award. These costs included unsupported journal entries and uncategorized expenditures. Additionally, due to lack of budgets for the fiscal year, it was not determinable if costs conformed to limitations or exclusions set forth in the Federal award. Costs were not adequately documented, and it is unknown if costs were accorded consistent treatment. Cause: Factors beyond the control of current management, including poor recordkeeping, have caused financial records to be inadequate for audit purposes, as key members of the accounting department left the Organization before appropriately transferring knowledge and records related to the Federal awards. Effect or Potential Effect: Potential for unallowable activities, unallowable costs, and costs outside of the period of performance and additional questioned costs. Questioned Costs: Related questioned costs related to payroll expenditures are unknown. Questioned costs related to non-payroll expenditures are unknown. Context: During the year under audit, the issues represent a systemic problem, beyond the control of current management. Recommendation: Policies and procedures should be designed and implemented to ensure expenditures are reviewed for allowability before being charged to federal awards. Policies and procedures should be designed and implemented to ensure costs are reviewed for allowability before being charged to federal awards. Management should perform budget to actual analysis on a periodic basis to ensure that costs are not exceeding limitations. View of Responsible Officials: In response to finding number 2021-SA3, management agrees with the finding and will design, implement, and maintain policies and procedures that ensure expenditures are reviewed for allowability before being charged to Federal awards. Management will also design, implement, and maintain policies and procedures that ensure costs are reviewed for allowability before being charged to Federal awards. Further, management will perform budget-to-actual analysis on a periodic basis to ensure costs do not exceed limitations.
Finding Number: 2021-SA3 Material Weakness – Activities Allowed or Unallowed and Allowable Costs/Cost Principles and Period of Performance Compliance and Control Finding Federal Award: No. 64.024 VA Homeless Providers Grant and Per Diem Program Federal Agency: U.S. Veterans Administration Pass-Through Entity: Not applicable Criteria or Specific Requirement: CFR section 200.403, Factors affecting allowability of costs, states costs must: conform to limitations or exclusions, be accorded consistent treatment, a cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost and be adequately documented. 2 CFR section 200.405, Allowable costs, states this standard is met if the cost is incurred specifically for the Federal award. 2 CFR section 200.430(i) Standards for Documentation of Personnel Expenses state charges to Federal awards for salaries must be based on records that accurately reflect the work performed and these records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award a Federal award and non-Federal award and charges for the salaries and wages of nonexempt employees… must be supported by records indicating the total number of hours worked each day. Condition: The Organization did not maintain an effective control environment to ensure costs incurred for expenditures charged to the program were in accordance with contract requirements and applicable cost principles. Records do not provide reasonable assurance that the charges are accurate, allowable, and properly allocated. Records do not appear to support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award or a Federal award and non-federal activity. Charges for non-exempt employees are not supported by records indicating the total number of hours worked each day. Expenditure details included costs that were allocated to the Federal award but may not have been incurred specifically for the Federal award. These costs included unsupported journal entries and uncategorized expenditures. Additionally, due to lack of budgets for the fiscal year, it was not determinable if costs conformed to limitations or exclusions set forth in the Federal award. Costs were not adequately documented, and it is unknown if costs were accorded consistent treatment. Cause: Factors beyond the control of current management, including poor recordkeeping, have caused financial records to be inadequate for audit purposes, as key members of the accounting department left the Organization before appropriately transferring knowledge and records related to the Federal awards. Effect or Potential Effect: Potential for unallowable activities, unallowable costs, and costs outside of the period of performance and additional questioned costs. Questioned Costs: Related questioned costs related to payroll expenditures are unknown. Questioned costs related to non-payroll expenditures are unknown. Context: During the year under audit, the issues represent a systemic problem, beyond the control of current management. Recommendation: Policies and procedures should be designed and implemented to ensure expenditures are reviewed for allowability before being charged to federal awards. Policies and procedures should be designed and implemented to ensure costs are reviewed for allowability before being charged to federal awards. Management should perform budget to actual analysis on a periodic basis to ensure that costs are not exceeding limitations. View of Responsible Officials: In response to finding number 2021-SA3, management agrees with the finding and will design, implement, and maintain policies and procedures that ensure expenditures are reviewed for allowability before being charged to Federal awards. Management will also design, implement, and maintain policies and procedures that ensure costs are reviewed for allowability before being charged to Federal awards. Further, management will perform budget-to-actual analysis on a periodic basis to ensure costs do not exceed limitations.
Finding Number: 2021-SA3 Material Weakness – Activities Allowed or Unallowed and Allowable Costs/Cost Principles and Period of Performance Compliance and Control Finding Federal Award: No. 64.024 VA Homeless Providers Grant and Per Diem Program Federal Agency: U.S. Veterans Administration Pass-Through Entity: Not applicable Criteria or Specific Requirement: CFR section 200.403, Factors affecting allowability of costs, states costs must: conform to limitations or exclusions, be accorded consistent treatment, a cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost and be adequately documented. 2 CFR section 200.405, Allowable costs, states this standard is met if the cost is incurred specifically for the Federal award. 2 CFR section 200.430(i) Standards for Documentation of Personnel Expenses state charges to Federal awards for salaries must be based on records that accurately reflect the work performed and these records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award a Federal award and non-Federal award and charges for the salaries and wages of nonexempt employees… must be supported by records indicating the total number of hours worked each day. Condition: The Organization did not maintain an effective control environment to ensure costs incurred for expenditures charged to the program were in accordance with contract requirements and applicable cost principles. Records do not provide reasonable assurance that the charges are accurate, allowable, and properly allocated. Records do not appear to support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award or a Federal award and non-federal activity. Charges for non-exempt employees are not supported by records indicating the total number of hours worked each day. Expenditure details included costs that were allocated to the Federal award but may not have been incurred specifically for the Federal award. These costs included unsupported journal entries and uncategorized expenditures. Additionally, due to lack of budgets for the fiscal year, it was not determinable if costs conformed to limitations or exclusions set forth in the Federal award. Costs were not adequately documented, and it is unknown if costs were accorded consistent treatment. Cause: Factors beyond the control of current management, including poor recordkeeping, have caused financial records to be inadequate for audit purposes, as key members of the accounting department left the Organization before appropriately transferring knowledge and records related to the Federal awards. Effect or Potential Effect: Potential for unallowable activities, unallowable costs, and costs outside of the period of performance and additional questioned costs. Questioned Costs: Related questioned costs related to payroll expenditures are unknown. Questioned costs related to non-payroll expenditures are unknown. Context: During the year under audit, the issues represent a systemic problem, beyond the control of current management. Recommendation: Policies and procedures should be designed and implemented to ensure expenditures are reviewed for allowability before being charged to federal awards. Policies and procedures should be designed and implemented to ensure costs are reviewed for allowability before being charged to federal awards. Management should perform budget to actual analysis on a periodic basis to ensure that costs are not exceeding limitations. View of Responsible Officials: In response to finding number 2021-SA3, management agrees with the finding and will design, implement, and maintain policies and procedures that ensure expenditures are reviewed for allowability before being charged to Federal awards. Management will also design, implement, and maintain policies and procedures that ensure costs are reviewed for allowability before being charged to Federal awards. Further, management will perform budget-to-actual analysis on a periodic basis to ensure costs do not exceed limitations.
Finding Number: 2021-SA3 Material Weakness – Activities Allowed or Unallowed and Allowable Costs/Cost Principles and Period of Performance Compliance and Control Finding Federal Award: No. 64.024 VA Homeless Providers Grant and Per Diem Program Federal Agency: U.S. Veterans Administration Pass-Through Entity: Not applicable Criteria or Specific Requirement: CFR section 200.403, Factors affecting allowability of costs, states costs must: conform to limitations or exclusions, be accorded consistent treatment, a cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost and be adequately documented. 2 CFR section 200.405, Allowable costs, states this standard is met if the cost is incurred specifically for the Federal award. 2 CFR section 200.430(i) Standards for Documentation of Personnel Expenses state charges to Federal awards for salaries must be based on records that accurately reflect the work performed and these records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award a Federal award and non-Federal award and charges for the salaries and wages of nonexempt employees… must be supported by records indicating the total number of hours worked each day. Condition: The Organization did not maintain an effective control environment to ensure costs incurred for expenditures charged to the program were in accordance with contract requirements and applicable cost principles. Records do not provide reasonable assurance that the charges are accurate, allowable, and properly allocated. Records do not appear to support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award or a Federal award and non-federal activity. Charges for non-exempt employees are not supported by records indicating the total number of hours worked each day. Expenditure details included costs that were allocated to the Federal award but may not have been incurred specifically for the Federal award. These costs included unsupported journal entries and uncategorized expenditures. Additionally, due to lack of budgets for the fiscal year, it was not determinable if costs conformed to limitations or exclusions set forth in the Federal award. Costs were not adequately documented, and it is unknown if costs were accorded consistent treatment. Cause: Factors beyond the control of current management, including poor recordkeeping, have caused financial records to be inadequate for audit purposes, as key members of the accounting department left the Organization before appropriately transferring knowledge and records related to the Federal awards. Effect or Potential Effect: Potential for unallowable activities, unallowable costs, and costs outside of the period of performance and additional questioned costs. Questioned Costs: Related questioned costs related to payroll expenditures are unknown. Questioned costs related to non-payroll expenditures are unknown. Context: During the year under audit, the issues represent a systemic problem, beyond the control of current management. Recommendation: Policies and procedures should be designed and implemented to ensure expenditures are reviewed for allowability before being charged to federal awards. Policies and procedures should be designed and implemented to ensure costs are reviewed for allowability before being charged to federal awards. Management should perform budget to actual analysis on a periodic basis to ensure that costs are not exceeding limitations. View of Responsible Officials: In response to finding number 2021-SA3, management agrees with the finding and will design, implement, and maintain policies and procedures that ensure expenditures are reviewed for allowability before being charged to Federal awards. Management will also design, implement, and maintain policies and procedures that ensure costs are reviewed for allowability before being charged to Federal awards. Further, management will perform budget-to-actual analysis on a periodic basis to ensure costs do not exceed limitations.
Finding Number: 2021-SA3 Material Weakness – Activities Allowed or Unallowed and Allowable Costs/Cost Principles and Period of Performance Compliance and Control Finding Federal Award: No. 64.024 VA Homeless Providers Grant and Per Diem Program Federal Agency: U.S. Veterans Administration Pass-Through Entity: Not applicable Criteria or Specific Requirement: CFR section 200.403, Factors affecting allowability of costs, states costs must: conform to limitations or exclusions, be accorded consistent treatment, a cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost and be adequately documented. 2 CFR section 200.405, Allowable costs, states this standard is met if the cost is incurred specifically for the Federal award. 2 CFR section 200.430(i) Standards for Documentation of Personnel Expenses state charges to Federal awards for salaries must be based on records that accurately reflect the work performed and these records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award a Federal award and non-Federal award and charges for the salaries and wages of nonexempt employees… must be supported by records indicating the total number of hours worked each day. Condition: The Organization did not maintain an effective control environment to ensure costs incurred for expenditures charged to the program were in accordance with contract requirements and applicable cost principles. Records do not provide reasonable assurance that the charges are accurate, allowable, and properly allocated. Records do not appear to support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award or a Federal award and non-federal activity. Charges for non-exempt employees are not supported by records indicating the total number of hours worked each day. Expenditure details included costs that were allocated to the Federal award but may not have been incurred specifically for the Federal award. These costs included unsupported journal entries and uncategorized expenditures. Additionally, due to lack of budgets for the fiscal year, it was not determinable if costs conformed to limitations or exclusions set forth in the Federal award. Costs were not adequately documented, and it is unknown if costs were accorded consistent treatment. Cause: Factors beyond the control of current management, including poor recordkeeping, have caused financial records to be inadequate for audit purposes, as key members of the accounting department left the Organization before appropriately transferring knowledge and records related to the Federal awards. Effect or Potential Effect: Potential for unallowable activities, unallowable costs, and costs outside of the period of performance and additional questioned costs. Questioned Costs: Related questioned costs related to payroll expenditures are unknown. Questioned costs related to non-payroll expenditures are unknown. Context: During the year under audit, the issues represent a systemic problem, beyond the control of current management. Recommendation: Policies and procedures should be designed and implemented to ensure expenditures are reviewed for allowability before being charged to federal awards. Policies and procedures should be designed and implemented to ensure costs are reviewed for allowability before being charged to federal awards. Management should perform budget to actual analysis on a periodic basis to ensure that costs are not exceeding limitations. View of Responsible Officials: In response to finding number 2021-SA3, management agrees with the finding and will design, implement, and maintain policies and procedures that ensure expenditures are reviewed for allowability before being charged to Federal awards. Management will also design, implement, and maintain policies and procedures that ensure costs are reviewed for allowability before being charged to Federal awards. Further, management will perform budget-to-actual analysis on a periodic basis to ensure costs do not exceed limitations.
Finding Number: 2021-SA3 Material Weakness – Activities Allowed or Unallowed and Allowable Costs/Cost Principles and Period of Performance Compliance and Control Finding Federal Award: No. 64.024 VA Homeless Providers Grant and Per Diem Program Federal Agency: U.S. Veterans Administration Pass-Through Entity: Not applicable Criteria or Specific Requirement: CFR section 200.403, Factors affecting allowability of costs, states costs must: conform to limitations or exclusions, be accorded consistent treatment, a cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost and be adequately documented. 2 CFR section 200.405, Allowable costs, states this standard is met if the cost is incurred specifically for the Federal award. 2 CFR section 200.430(i) Standards for Documentation of Personnel Expenses state charges to Federal awards for salaries must be based on records that accurately reflect the work performed and these records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award a Federal award and non-Federal award and charges for the salaries and wages of nonexempt employees… must be supported by records indicating the total number of hours worked each day. Condition: The Organization did not maintain an effective control environment to ensure costs incurred for expenditures charged to the program were in accordance with contract requirements and applicable cost principles. Records do not provide reasonable assurance that the charges are accurate, allowable, and properly allocated. Records do not appear to support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award or a Federal award and non-federal activity. Charges for non-exempt employees are not supported by records indicating the total number of hours worked each day. Expenditure details included costs that were allocated to the Federal award but may not have been incurred specifically for the Federal award. These costs included unsupported journal entries and uncategorized expenditures. Additionally, due to lack of budgets for the fiscal year, it was not determinable if costs conformed to limitations or exclusions set forth in the Federal award. Costs were not adequately documented, and it is unknown if costs were accorded consistent treatment. Cause: Factors beyond the control of current management, including poor recordkeeping, have caused financial records to be inadequate for audit purposes, as key members of the accounting department left the Organization before appropriately transferring knowledge and records related to the Federal awards. Effect or Potential Effect: Potential for unallowable activities, unallowable costs, and costs outside of the period of performance and additional questioned costs. Questioned Costs: Related questioned costs related to payroll expenditures are unknown. Questioned costs related to non-payroll expenditures are unknown. Context: During the year under audit, the issues represent a systemic problem, beyond the control of current management. Recommendation: Policies and procedures should be designed and implemented to ensure expenditures are reviewed for allowability before being charged to federal awards. Policies and procedures should be designed and implemented to ensure costs are reviewed for allowability before being charged to federal awards. Management should perform budget to actual analysis on a periodic basis to ensure that costs are not exceeding limitations. View of Responsible Officials: In response to finding number 2021-SA3, management agrees with the finding and will design, implement, and maintain policies and procedures that ensure expenditures are reviewed for allowability before being charged to Federal awards. Management will also design, implement, and maintain policies and procedures that ensure costs are reviewed for allowability before being charged to Federal awards. Further, management will perform budget-to-actual analysis on a periodic basis to ensure costs do not exceed limitations.
Finding Number: 2021-SA3 Material Weakness – Activities Allowed or Unallowed and Allowable Costs/Cost Principles and Period of Performance Compliance and Control Finding Federal Award: No. 64.024 VA Homeless Providers Grant and Per Diem Program Federal Agency: U.S. Veterans Administration Pass-Through Entity: Not applicable Criteria or Specific Requirement: CFR section 200.403, Factors affecting allowability of costs, states costs must: conform to limitations or exclusions, be accorded consistent treatment, a cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost and be adequately documented. 2 CFR section 200.405, Allowable costs, states this standard is met if the cost is incurred specifically for the Federal award. 2 CFR section 200.430(i) Standards for Documentation of Personnel Expenses state charges to Federal awards for salaries must be based on records that accurately reflect the work performed and these records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award a Federal award and non-Federal award and charges for the salaries and wages of nonexempt employees… must be supported by records indicating the total number of hours worked each day. Condition: The Organization did not maintain an effective control environment to ensure costs incurred for expenditures charged to the program were in accordance with contract requirements and applicable cost principles. Records do not provide reasonable assurance that the charges are accurate, allowable, and properly allocated. Records do not appear to support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award or a Federal award and non-federal activity. Charges for non-exempt employees are not supported by records indicating the total number of hours worked each day. Expenditure details included costs that were allocated to the Federal award but may not have been incurred specifically for the Federal award. These costs included unsupported journal entries and uncategorized expenditures. Additionally, due to lack of budgets for the fiscal year, it was not determinable if costs conformed to limitations or exclusions set forth in the Federal award. Costs were not adequately documented, and it is unknown if costs were accorded consistent treatment. Cause: Factors beyond the control of current management, including poor recordkeeping, have caused financial records to be inadequate for audit purposes, as key members of the accounting department left the Organization before appropriately transferring knowledge and records related to the Federal awards. Effect or Potential Effect: Potential for unallowable activities, unallowable costs, and costs outside of the period of performance and additional questioned costs. Questioned Costs: Related questioned costs related to payroll expenditures are unknown. Questioned costs related to non-payroll expenditures are unknown. Context: During the year under audit, the issues represent a systemic problem, beyond the control of current management. Recommendation: Policies and procedures should be designed and implemented to ensure expenditures are reviewed for allowability before being charged to federal awards. Policies and procedures should be designed and implemented to ensure costs are reviewed for allowability before being charged to federal awards. Management should perform budget to actual analysis on a periodic basis to ensure that costs are not exceeding limitations. View of Responsible Officials: In response to finding number 2021-SA3, management agrees with the finding and will design, implement, and maintain policies and procedures that ensure expenditures are reviewed for allowability before being charged to Federal awards. Management will also design, implement, and maintain policies and procedures that ensure costs are reviewed for allowability before being charged to Federal awards. Further, management will perform budget-to-actual analysis on a periodic basis to ensure costs do not exceed limitations.
Finding Number: 2021-SA3 Material Weakness – Activities Allowed or Unallowed and Allowable Costs/Cost Principles and Period of Performance Compliance and Control Finding Federal Award: No. 64.024 VA Homeless Providers Grant and Per Diem Program Federal Agency: U.S. Veterans Administration Pass-Through Entity: Not applicable Criteria or Specific Requirement: CFR section 200.403, Factors affecting allowability of costs, states costs must: conform to limitations or exclusions, be accorded consistent treatment, a cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost and be adequately documented. 2 CFR section 200.405, Allowable costs, states this standard is met if the cost is incurred specifically for the Federal award. 2 CFR section 200.430(i) Standards for Documentation of Personnel Expenses state charges to Federal awards for salaries must be based on records that accurately reflect the work performed and these records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award a Federal award and non-Federal award and charges for the salaries and wages of nonexempt employees… must be supported by records indicating the total number of hours worked each day. Condition: The Organization did not maintain an effective control environment to ensure costs incurred for expenditures charged to the program were in accordance with contract requirements and applicable cost principles. Records do not provide reasonable assurance that the charges are accurate, allowable, and properly allocated. Records do not appear to support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award or a Federal award and non-federal activity. Charges for non-exempt employees are not supported by records indicating the total number of hours worked each day. Expenditure details included costs that were allocated to the Federal award but may not have been incurred specifically for the Federal award. These costs included unsupported journal entries and uncategorized expenditures. Additionally, due to lack of budgets for the fiscal year, it was not determinable if costs conformed to limitations or exclusions set forth in the Federal award. Costs were not adequately documented, and it is unknown if costs were accorded consistent treatment. Cause: Factors beyond the control of current management, including poor recordkeeping, have caused financial records to be inadequate for audit purposes, as key members of the accounting department left the Organization before appropriately transferring knowledge and records related to the Federal awards. Effect or Potential Effect: Potential for unallowable activities, unallowable costs, and costs outside of the period of performance and additional questioned costs. Questioned Costs: Related questioned costs related to payroll expenditures are unknown. Questioned costs related to non-payroll expenditures are unknown. Context: During the year under audit, the issues represent a systemic problem, beyond the control of current management. Recommendation: Policies and procedures should be designed and implemented to ensure expenditures are reviewed for allowability before being charged to federal awards. Policies and procedures should be designed and implemented to ensure costs are reviewed for allowability before being charged to federal awards. Management should perform budget to actual analysis on a periodic basis to ensure that costs are not exceeding limitations. View of Responsible Officials: In response to finding number 2021-SA3, management agrees with the finding and will design, implement, and maintain policies and procedures that ensure expenditures are reviewed for allowability before being charged to Federal awards. Management will also design, implement, and maintain policies and procedures that ensure costs are reviewed for allowability before being charged to Federal awards. Further, management will perform budget-to-actual analysis on a periodic basis to ensure costs do not exceed limitations.
Finding Number: 2021-SA3 Material Weakness – Activities Allowed or Unallowed and Allowable Costs/Cost Principles and Period of Performance Compliance and Control Finding Federal Award: No. 64.024 VA Homeless Providers Grant and Per Diem Program Federal Agency: U.S. Veterans Administration Pass-Through Entity: Not applicable Criteria or Specific Requirement: CFR section 200.403, Factors affecting allowability of costs, states costs must: conform to limitations or exclusions, be accorded consistent treatment, a cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost and be adequately documented. 2 CFR section 200.405, Allowable costs, states this standard is met if the cost is incurred specifically for the Federal award. 2 CFR section 200.430(i) Standards for Documentation of Personnel Expenses state charges to Federal awards for salaries must be based on records that accurately reflect the work performed and these records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award a Federal award and non-Federal award and charges for the salaries and wages of nonexempt employees… must be supported by records indicating the total number of hours worked each day. Condition: The Organization did not maintain an effective control environment to ensure costs incurred for expenditures charged to the program were in accordance with contract requirements and applicable cost principles. Records do not provide reasonable assurance that the charges are accurate, allowable, and properly allocated. Records do not appear to support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award or a Federal award and non-federal activity. Charges for non-exempt employees are not supported by records indicating the total number of hours worked each day. Expenditure details included costs that were allocated to the Federal award but may not have been incurred specifically for the Federal award. These costs included unsupported journal entries and uncategorized expenditures. Additionally, due to lack of budgets for the fiscal year, it was not determinable if costs conformed to limitations or exclusions set forth in the Federal award. Costs were not adequately documented, and it is unknown if costs were accorded consistent treatment. Cause: Factors beyond the control of current management, including poor recordkeeping, have caused financial records to be inadequate for audit purposes, as key members of the accounting department left the Organization before appropriately transferring knowledge and records related to the Federal awards. Effect or Potential Effect: Potential for unallowable activities, unallowable costs, and costs outside of the period of performance and additional questioned costs. Questioned Costs: Related questioned costs related to payroll expenditures are unknown. Questioned costs related to non-payroll expenditures are unknown. Context: During the year under audit, the issues represent a systemic problem, beyond the control of current management. Recommendation: Policies and procedures should be designed and implemented to ensure expenditures are reviewed for allowability before being charged to federal awards. Policies and procedures should be designed and implemented to ensure costs are reviewed for allowability before being charged to federal awards. Management should perform budget to actual analysis on a periodic basis to ensure that costs are not exceeding limitations. View of Responsible Officials: In response to finding number 2021-SA3, management agrees with the finding and will design, implement, and maintain policies and procedures that ensure expenditures are reviewed for allowability before being charged to Federal awards. Management will also design, implement, and maintain policies and procedures that ensure costs are reviewed for allowability before being charged to Federal awards. Further, management will perform budget-to-actual analysis on a periodic basis to ensure costs do not exceed limitations.
Finding Number: 2021-SA3 Material Weakness – Activities Allowed or Unallowed and Allowable Costs/Cost Principles and Period of Performance Compliance and Control Finding Federal Award: No. 64.024 VA Homeless Providers Grant and Per Diem Program Federal Agency: U.S. Veterans Administration Pass-Through Entity: Not applicable Criteria or Specific Requirement: CFR section 200.403, Factors affecting allowability of costs, states costs must: conform to limitations or exclusions, be accorded consistent treatment, a cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost and be adequately documented. 2 CFR section 200.405, Allowable costs, states this standard is met if the cost is incurred specifically for the Federal award. 2 CFR section 200.430(i) Standards for Documentation of Personnel Expenses state charges to Federal awards for salaries must be based on records that accurately reflect the work performed and these records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award a Federal award and non-Federal award and charges for the salaries and wages of nonexempt employees… must be supported by records indicating the total number of hours worked each day. Condition: The Organization did not maintain an effective control environment to ensure costs incurred for expenditures charged to the program were in accordance with contract requirements and applicable cost principles. Records do not provide reasonable assurance that the charges are accurate, allowable, and properly allocated. Records do not appear to support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than one Federal award or a Federal award and non-federal activity. Charges for non-exempt employees are not supported by records indicating the total number of hours worked each day. Expenditure details included costs that were allocated to the Federal award but may not have been incurred specifically for the Federal award. These costs included unsupported journal entries and uncategorized expenditures. Additionally, due to lack of budgets for the fiscal year, it was not determinable if costs conformed to limitations or exclusions set forth in the Federal award. Costs were not adequately documented, and it is unknown if costs were accorded consistent treatment. Cause: Factors beyond the control of current management, including poor recordkeeping, have caused financial records to be inadequate for audit purposes, as key members of the accounting department left the Organization before appropriately transferring knowledge and records related to the Federal awards. Effect or Potential Effect: Potential for unallowable activities, unallowable costs, and costs outside of the period of performance and additional questioned costs. Questioned Costs: Related questioned costs related to payroll expenditures are unknown. Questioned costs related to non-payroll expenditures are unknown. Context: During the year under audit, the issues represent a systemic problem, beyond the control of current management. Recommendation: Policies and procedures should be designed and implemented to ensure expenditures are reviewed for allowability before being charged to federal awards. Policies and procedures should be designed and implemented to ensure costs are reviewed for allowability before being charged to federal awards. Management should perform budget to actual analysis on a periodic basis to ensure that costs are not exceeding limitations. View of Responsible Officials: In response to finding number 2021-SA3, management agrees with the finding and will design, implement, and maintain policies and procedures that ensure expenditures are reviewed for allowability before being charged to Federal awards. Management will also design, implement, and maintain policies and procedures that ensure costs are reviewed for allowability before being charged to Federal awards. Further, management will perform budget-to-actual analysis on a periodic basis to ensure costs do not exceed limitations.
2020-108 Lack of Controls over Costs Submitted for Reimbursement (initially reported 2020) Assistance Listing Number: 93.224 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) Compliance Requirement: Activities Allowed, Allowable Costs and Period of Performance Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: 6H80CS06452-15 (2020), COVID-19 1H8CCS35035-01 (2020), COVID-19 1H8DCS36007-01 (2020) and COVID-19 1H8ECS39010-01 (2020) Finding Type: Significant Deficiency in Internal Control Known Questioned Costs: $0 Condition: The Organization included an invoice for reimbursement under the program for which a vendor credit memo for the full amount of the invoice had been received due to miscoding of the credit memo to the correct COVID-19 class on the general ledger. In addition, the Organization did not include an applicable invoice for COVID-19 expenses for reimbursement due to the same miscoding of the COVID-19 class to the general ledger. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Under compliance requirements for allowable costs 2 CFR section 200.405(a)(1) costs should be incurred specifically for the federal award, and 2 CFR section 200.406(a) to the extent credits accruing or received by the nonfederal entity relate to allowable costs, they must be credited to the federal award program either as a cost reduction or cash refund as appropriate. Cause: The Organization did not apply the credit memo or the invoice to the correct general ledger classification resulting in the credit memo and invoice being incorrectly included or not included in the reimbursement request. Effect: The Organization is not applying for reimbursement with the correct supporting documentation which could lead to a loss of grant funding. Recommendation: The Organization should review the posting of any credit memos or applicable invoices to ensure they are posted to the correct account/classification so that only allowable costs which were incurred during the period of performance are included on any reimbursement requests. Views of Responsible Officials and Planned Corrective Action: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. Management understands the importance of reviewing the posting of credit memos or applicable invoices to ensure they are posted correctly. We will update our policy to include a process for review of credit memos prior to posting. The planned corrective action for this finding is currently in the process of development, approval, and implementation.
2020-108 Lack of Controls over Costs Submitted for Reimbursement (initially reported 2020) Assistance Listing Number: 93.224 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) Compliance Requirement: Activities Allowed, Allowable Costs and Period of Performance Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: 6H80CS06452-15 (2020), COVID-19 1H8CCS35035-01 (2020), COVID-19 1H8DCS36007-01 (2020) and COVID-19 1H8ECS39010-01 (2020) Finding Type: Significant Deficiency in Internal Control Known Questioned Costs: $0 Condition: The Organization included an invoice for reimbursement under the program for which a vendor credit memo for the full amount of the invoice had been received due to miscoding of the credit memo to the correct COVID-19 class on the general ledger. In addition, the Organization did not include an applicable invoice for COVID-19 expenses for reimbursement due to the same miscoding of the COVID-19 class to the general ledger. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Under compliance requirements for allowable costs 2 CFR section 200.405(a)(1) costs should be incurred specifically for the federal award, and 2 CFR section 200.406(a) to the extent credits accruing or received by the nonfederal entity relate to allowable costs, they must be credited to the federal award program either as a cost reduction or cash refund as appropriate. Cause: The Organization did not apply the credit memo or the invoice to the correct general ledger classification resulting in the credit memo and invoice being incorrectly included or not included in the reimbursement request. Effect: The Organization is not applying for reimbursement with the correct supporting documentation which could lead to a loss of grant funding. Recommendation: The Organization should review the posting of any credit memos or applicable invoices to ensure they are posted to the correct account/classification so that only allowable costs which were incurred during the period of performance are included on any reimbursement requests. Views of Responsible Officials and Planned Corrective Action: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. Management understands the importance of reviewing the posting of credit memos or applicable invoices to ensure they are posted correctly. We will update our policy to include a process for review of credit memos prior to posting. The planned corrective action for this finding is currently in the process of development, approval, and implementation.
2020-108 Lack of Controls over Costs Submitted for Reimbursement (initially reported 2020) Assistance Listing Number: 93.224 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) Compliance Requirement: Activities Allowed, Allowable Costs and Period of Performance Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: 6H80CS06452-15 (2020), COVID-19 1H8CCS35035-01 (2020), COVID-19 1H8DCS36007-01 (2020) and COVID-19 1H8ECS39010-01 (2020) Finding Type: Significant Deficiency in Internal Control Known Questioned Costs: $0 Condition: The Organization included an invoice for reimbursement under the program for which a vendor credit memo for the full amount of the invoice had been received due to miscoding of the credit memo to the correct COVID-19 class on the general ledger. In addition, the Organization did not include an applicable invoice for COVID-19 expenses for reimbursement due to the same miscoding of the COVID-19 class to the general ledger. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Under compliance requirements for allowable costs 2 CFR section 200.405(a)(1) costs should be incurred specifically for the federal award, and 2 CFR section 200.406(a) to the extent credits accruing or received by the nonfederal entity relate to allowable costs, they must be credited to the federal award program either as a cost reduction or cash refund as appropriate. Cause: The Organization did not apply the credit memo or the invoice to the correct general ledger classification resulting in the credit memo and invoice being incorrectly included or not included in the reimbursement request. Effect: The Organization is not applying for reimbursement with the correct supporting documentation which could lead to a loss of grant funding. Recommendation: The Organization should review the posting of any credit memos or applicable invoices to ensure they are posted to the correct account/classification so that only allowable costs which were incurred during the period of performance are included on any reimbursement requests. Views of Responsible Officials and Planned Corrective Action: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. Management understands the importance of reviewing the posting of credit memos or applicable invoices to ensure they are posted correctly. We will update our policy to include a process for review of credit memos prior to posting. The planned corrective action for this finding is currently in the process of development, approval, and implementation.
2020-108 Lack of Controls over Costs Submitted for Reimbursement (initially reported 2020) Assistance Listing Number: 93.224 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) Compliance Requirement: Activities Allowed, Allowable Costs and Period of Performance Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: 6H80CS06452-15 (2020), COVID-19 1H8CCS35035-01 (2020), COVID-19 1H8DCS36007-01 (2020) and COVID-19 1H8ECS39010-01 (2020) Finding Type: Significant Deficiency in Internal Control Known Questioned Costs: $0 Condition: The Organization included an invoice for reimbursement under the program for which a vendor credit memo for the full amount of the invoice had been received due to miscoding of the credit memo to the correct COVID-19 class on the general ledger. In addition, the Organization did not include an applicable invoice for COVID-19 expenses for reimbursement due to the same miscoding of the COVID-19 class to the general ledger. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Under compliance requirements for allowable costs 2 CFR section 200.405(a)(1) costs should be incurred specifically for the federal award, and 2 CFR section 200.406(a) to the extent credits accruing or received by the nonfederal entity relate to allowable costs, they must be credited to the federal award program either as a cost reduction or cash refund as appropriate. Cause: The Organization did not apply the credit memo or the invoice to the correct general ledger classification resulting in the credit memo and invoice being incorrectly included or not included in the reimbursement request. Effect: The Organization is not applying for reimbursement with the correct supporting documentation which could lead to a loss of grant funding. Recommendation: The Organization should review the posting of any credit memos or applicable invoices to ensure they are posted to the correct account/classification so that only allowable costs which were incurred during the period of performance are included on any reimbursement requests. Views of Responsible Officials and Planned Corrective Action: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. Management understands the importance of reviewing the posting of credit memos or applicable invoices to ensure they are posted correctly. We will update our policy to include a process for review of credit memos prior to posting. The planned corrective action for this finding is currently in the process of development, approval, and implementation.
2020-108 Lack of Controls over Costs Submitted for Reimbursement (initially reported 2020) Assistance Listing Number: 93.224 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) Compliance Requirement: Activities Allowed, Allowable Costs and Period of Performance Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: 6H80CS06452-15 (2020), COVID-19 1H8CCS35035-01 (2020), COVID-19 1H8DCS36007-01 (2020) and COVID-19 1H8ECS39010-01 (2020) Finding Type: Significant Deficiency in Internal Control Known Questioned Costs: $0 Condition: The Organization included an invoice for reimbursement under the program for which a vendor credit memo for the full amount of the invoice had been received due to miscoding of the credit memo to the correct COVID-19 class on the general ledger. In addition, the Organization did not include an applicable invoice for COVID-19 expenses for reimbursement due to the same miscoding of the COVID-19 class to the general ledger. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Under compliance requirements for allowable costs 2 CFR section 200.405(a)(1) costs should be incurred specifically for the federal award, and 2 CFR section 200.406(a) to the extent credits accruing or received by the nonfederal entity relate to allowable costs, they must be credited to the federal award program either as a cost reduction or cash refund as appropriate. Cause: The Organization did not apply the credit memo or the invoice to the correct general ledger classification resulting in the credit memo and invoice being incorrectly included or not included in the reimbursement request. Effect: The Organization is not applying for reimbursement with the correct supporting documentation which could lead to a loss of grant funding. Recommendation: The Organization should review the posting of any credit memos or applicable invoices to ensure they are posted to the correct account/classification so that only allowable costs which were incurred during the period of performance are included on any reimbursement requests. Views of Responsible Officials and Planned Corrective Action: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. Management understands the importance of reviewing the posting of credit memos or applicable invoices to ensure they are posted correctly. We will update our policy to include a process for review of credit memos prior to posting. The planned corrective action for this finding is currently in the process of development, approval, and implementation.
2020-108 Lack of Controls over Costs Submitted for Reimbursement (initially reported 2020) Assistance Listing Number: 93.224 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) Compliance Requirement: Activities Allowed, Allowable Costs and Period of Performance Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: 6H80CS06452-15 (2020), COVID-19 1H8CCS35035-01 (2020), COVID-19 1H8DCS36007-01 (2020) and COVID-19 1H8ECS39010-01 (2020) Finding Type: Significant Deficiency in Internal Control Known Questioned Costs: $0 Condition: The Organization included an invoice for reimbursement under the program for which a vendor credit memo for the full amount of the invoice had been received due to miscoding of the credit memo to the correct COVID-19 class on the general ledger. In addition, the Organization did not include an applicable invoice for COVID-19 expenses for reimbursement due to the same miscoding of the COVID-19 class to the general ledger. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Under compliance requirements for allowable costs 2 CFR section 200.405(a)(1) costs should be incurred specifically for the federal award, and 2 CFR section 200.406(a) to the extent credits accruing or received by the nonfederal entity relate to allowable costs, they must be credited to the federal award program either as a cost reduction or cash refund as appropriate. Cause: The Organization did not apply the credit memo or the invoice to the correct general ledger classification resulting in the credit memo and invoice being incorrectly included or not included in the reimbursement request. Effect: The Organization is not applying for reimbursement with the correct supporting documentation which could lead to a loss of grant funding. Recommendation: The Organization should review the posting of any credit memos or applicable invoices to ensure they are posted to the correct account/classification so that only allowable costs which were incurred during the period of performance are included on any reimbursement requests. Views of Responsible Officials and Planned Corrective Action: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. Management understands the importance of reviewing the posting of credit memos or applicable invoices to ensure they are posted correctly. We will update our policy to include a process for review of credit memos prior to posting. The planned corrective action for this finding is currently in the process of development, approval, and implementation.
2020-108 Lack of Controls over Costs Submitted for Reimbursement (initially reported 2020) Assistance Listing Number: 93.224 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) Compliance Requirement: Activities Allowed, Allowable Costs and Period of Performance Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: 6H80CS06452-15 (2020), COVID-19 1H8CCS35035-01 (2020), COVID-19 1H8DCS36007-01 (2020) and COVID-19 1H8ECS39010-01 (2020) Finding Type: Significant Deficiency in Internal Control Known Questioned Costs: $0 Condition: The Organization included an invoice for reimbursement under the program for which a vendor credit memo for the full amount of the invoice had been received due to miscoding of the credit memo to the correct COVID-19 class on the general ledger. In addition, the Organization did not include an applicable invoice for COVID-19 expenses for reimbursement due to the same miscoding of the COVID-19 class to the general ledger. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Under compliance requirements for allowable costs 2 CFR section 200.405(a)(1) costs should be incurred specifically for the federal award, and 2 CFR section 200.406(a) to the extent credits accruing or received by the nonfederal entity relate to allowable costs, they must be credited to the federal award program either as a cost reduction or cash refund as appropriate. Cause: The Organization did not apply the credit memo or the invoice to the correct general ledger classification resulting in the credit memo and invoice being incorrectly included or not included in the reimbursement request. Effect: The Organization is not applying for reimbursement with the correct supporting documentation which could lead to a loss of grant funding. Recommendation: The Organization should review the posting of any credit memos or applicable invoices to ensure they are posted to the correct account/classification so that only allowable costs which were incurred during the period of performance are included on any reimbursement requests. Views of Responsible Officials and Planned Corrective Action: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. Management understands the importance of reviewing the posting of credit memos or applicable invoices to ensure they are posted correctly. We will update our policy to include a process for review of credit memos prior to posting. The planned corrective action for this finding is currently in the process of development, approval, and implementation.
2020-108 Lack of Controls over Costs Submitted for Reimbursement (initially reported 2020) Assistance Listing Number: 93.224 Name of Federal Agency: Department of Health and Human Services, HRSA Program Title: Health Center Program (Community Health Centers, Migrant Health Centers, Health Care for the Homeless, and Public Housing Primary Care) Compliance Requirement: Activities Allowed, Allowable Costs and Period of Performance Pass-through Entity: N/A Federal Grant/Contract Number and Grant Year: 6H80CS06452-15 (2020), COVID-19 1H8CCS35035-01 (2020), COVID-19 1H8DCS36007-01 (2020) and COVID-19 1H8ECS39010-01 (2020) Finding Type: Significant Deficiency in Internal Control Known Questioned Costs: $0 Condition: The Organization included an invoice for reimbursement under the program for which a vendor credit memo for the full amount of the invoice had been received due to miscoding of the credit memo to the correct COVID-19 class on the general ledger. In addition, the Organization did not include an applicable invoice for COVID-19 expenses for reimbursement due to the same miscoding of the COVID-19 class to the general ledger. Criteria: 2 CFR section 200.303 requires that nonfederal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the nonfederal entity is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Under compliance requirements for allowable costs 2 CFR section 200.405(a)(1) costs should be incurred specifically for the federal award, and 2 CFR section 200.406(a) to the extent credits accruing or received by the nonfederal entity relate to allowable costs, they must be credited to the federal award program either as a cost reduction or cash refund as appropriate. Cause: The Organization did not apply the credit memo or the invoice to the correct general ledger classification resulting in the credit memo and invoice being incorrectly included or not included in the reimbursement request. Effect: The Organization is not applying for reimbursement with the correct supporting documentation which could lead to a loss of grant funding. Recommendation: The Organization should review the posting of any credit memos or applicable invoices to ensure they are posted to the correct account/classification so that only allowable costs which were incurred during the period of performance are included on any reimbursement requests. Views of Responsible Officials and Planned Corrective Action: The Organization has hired a new Chief Financial Officer as well as additional supporting staff within the finance department. Management understands the importance of reviewing the posting of credit memos or applicable invoices to ensure they are posted correctly. We will update our policy to include a process for review of credit memos prior to posting. The planned corrective action for this finding is currently in the process of development, approval, and implementation.