Finding Text
2023-006 Preparation of Schedule of Expenditures of Federal Awards Assistance Listing Number: 93.958
Name of Program and Cluster: Block Grants for Community Mental Health Services Agency: U.S. Department of Health and Human Services
Material Weakness
Condition: The Organization was unable to provide a complete Schedule of Expenditures of Federal Awards ("SEFA") with all Federal programs, Assistance Listing Numbers, and total expenditures.
Criteria: The Organization is required to track and report Federal Awards and related expenditures in a SEFA in order to comply with Single Audit Requirements.
Context: The Organization did not identify several contracts that included Federal Awards and amounts originally reported were for total revenues received and not for expenditures.
Cause: The Organization does not have any controls in place to track awards based on funder. The Organization also tracks administrative costs charged to Federal Awards in a separate cost center and does not reconcile indirect costs charged to federal awards with actual indirect expenses incurred.
Effect: The Organization may understate expenditures of Federal Awards or deem a Single Audit unnecessary due to improper tracking of awards and expenditures. There was no system in place to track federal awards.
Recommendation: RBT recommends that the Organization track revenue and expenditures for federal awards when they are received and spent in order to properly record them on the SEFA.