Finding 1142433 (2024-002)

Allowable Costs – Legal Services Corporation Basic Field and Migrant Grant – Federal Assistance Listing Number 9.447030; Award Period: Year ended December 31, 2024; LSC Finding Code - RC1611 Criteria: The Organization should have effective internal controls in place over identification of cases allowable and reportable to LSC compared to other funding sources. The Organization should only report cases to LSC that are allowable under LSC requirements. Condition: During our audit, we noted there was not a review process over the case listing submitted to LSC prior to submission for allowability and that a case that did not meet LSC requirements was reported. Cause: The Organization should have effective internal controls in place over identification of cases allowable and reportable to LSC compared to other funding sources. Effect: The lack of review process of the case listing submitted to LSC could lead to unallowable cases being submitted. Questioned Costs: None noted. Context: During our audit, we noted 1 of 60 cases reviewed should not have been reported to LSC. This case had assets above the allowable threshold and was accepted under a grant from a non-LSC funding source. Recommendation: We recommend the Organization implements a review process of the case listing, whereby a second person is required to review and document their review of the case listing for allowable parameters. We further recommend there be some type of notation when cases are accepted to classify the case as an LSC or non-LSC case. Views of Responsible Officials: The Organization accepts the recommendation of the auditors to resolve their findings regarding material weaknesses in internal controls to ensure compliance with LSC requirements.