Finding 1140887 (2022-003)

Significant Deficiency
Requirement
P
Questioned Costs
-
Year
2022
Accepted
2025-06-11

AI Summary

  • Core Issue: Day One submitted an inaccurate Schedule of Expenditures of Federal Awards (SEFA) for FY 2022, failing to reconcile with accounting records.
  • Impacted Requirements: This violates Uniform Guidance sections 200.510, 200.502, and 200.302, which mandate accurate reporting and financial management of federal awards.
  • Recommended Follow-Up: Management should establish policies and procedures to ensure all federal expenditures are accurately reported in the SEFA moving forward.

Finding Text

Condition: For the fiscal year ended June 30, 2022, we requested that Day One prepare and send us a Schedule of Expenditures of Federal Awards. Requested that the expenditures reported in the SEFA be reconciled to Day One’s accounting records. We reviewed the SEFA and compared them to the accounting records; we noted that the expenditures reported were inaccurate. Criteria: Recipients of federal awards are subject to requirements documented in section of the Uniform Guidance Sections 200.510, 200.502, and 200.302. The criteria for each are as follows: § 200.510 Financial statements (b) Schedule of expenditures of Federal awards. The auditee must also prepare a schedule of expenditures of Federal awards for the period covered by the auditee's financial statements which must include the total Federal awards expended as determined in accordance with § 200.502.” § 200.502 Basis for determining Federal awards expended (a) Determining Federal awards expended. The determination of when a federal award is expended must be based on when the activity related to the Federal award occurs. Generally, the activity pertains to events that require the non-Federal entity to comply with Federal statutes, regulations, and the terms and conditions of Federal awards, such as: expenditure/expense transactions associated with awards including grants, cost-reimbursement contracts under the FAR, compacts with Indian Tribes, cooperative agreements, and direct appropriations; the disbursement of funds to subrecipients; the use of loan proceeds under loan and loan guarantee programs; the receipt of property; the receipt of surplus property; the receipt or use of program income; the distribution or use of food commodities; the disbursement of amounts entitling the non-Federal entity to an interest subsidy; and the period when insurance is in force. § 200.302 Financial management (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.The financial management system of each non-Federal entity must provide for (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements…..” Questioned Costs: None Cause: The Organization has not implemented policies and procedures requiring that the Schedule of Federal Awards to complete and accurate. Effect and Context: The Organization reported expenditures that exceeded $750,000 for 2022. In determining the major program to be audited for 2022, the auditor could not rely on the SEFA provided because the SEFA was not complete and expenditures reported were inaccurate. Which could have lead to an inaccurate reporting of federal expenditures for the Organization for 2022. Recommendation: We recommend that management implement policies and procedures requiring all federal expenditures be accurately reported in the year end Schedule of Federal Awards. Management’s Response and Corrective Action Plan: See management’s responses documented on page 46-47.

Categories

Reporting Matching / Level of Effort / Earmarking

Other Findings in this Audit

  • 564445 2022-003
    Significant Deficiency
  • 564446 2022-004
    Significant Deficiency
  • 564447 2022-003
    Significant Deficiency
  • 1140888 2022-004
    Significant Deficiency
  • 1140889 2022-003
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
93.959 Block Grants for Prevention and Treatment of Substance Abuse $1.00M
93.137 Community Programs to Improve Minority Health $411,543
93.531 Pphf - Community Transformation Grants and National Dissemination and Support for Community Transformation Grants - Financed Solely by Prevention and Public Health Funds $199,995
93.671 Family Violence Prevention and Services/domestic Violence Shelter and Supportive Services $145,987