Core Issue: There was a material weakness in internal controls, leading to improper accrual of expenses for the Healthy Marriage Promotion and Responsible Fatherhood Grants.
Impacted Requirements: Only allowable costs incurred during the approved budget period should be charged; expenses incurred after the period were incorrectly recorded.
Recommended Follow-Up: Conduct a detailed review of accrued expenses at grant year-end to ensure compliance with reporting requirements.
Finding Text
Finding 2022-003: Period of performance ? material weakness in internal controls overcompliance and compliance finding.93.086 Healthy Marriage Promotion and Responsible Fatherhood GrantsCriteria: A non-federal entity may charge only allowable costs incurred during the approvedbudget period of a federal award?s period of performance.Condition: During testing of accrued expenses, it was determined that purchases of equipmentmade subsequent to year end were improperly accrued as of September 30, 2022, resulting inthe incorrect grant year being charged for these expenses.Cause: The improper accrual was an oversight.Effect: The Organization charged the incorrect budget period for expenses incurred subsequentto the end of the period.Recommendation: Accrued expenses should be reviewed in detail at grant year end to ensureonly costs incurred prior to year end are accrued and reported as grant expenditures.Management?s response: See corrective action plan
Categories
Internal Control / Segregation of DutiesProcurement, Suspension & DebarmentAllowable Costs / Cost PrinciplesMaterial WeaknessPeriod of PerformanceEquipment & Real Property ManagementMatching / Level of Effort / Earmarking