Finding 1145822 (2024-003)

Finding F2024-003 – Untimely Submission and Lack of Formal Approval of Reports Assistance Listing Number: 21.027 Assistance Listing Program Title: Coronavirus State and Local Fiscal Recovery Funds Federal Agency: U.S. Department of Treasury Pass Through Entity: City of Los Angeles Community Development Department Federal Award Number: 141412-4, 145794-1, 145801-1 Federal Award Year: July 1, 2022 to December 31, 2024 June 1, 2024 to December 31, 2024 Compliance Requirement: Reporting A. Untimely Submission of Expenditure and Quarterly General Ledger Reconciliation Reports Criteria El Proyecto is required to use the City of Los Angeles (the City) template forms to submit the Expenditure Report and General Ledger Reconciliation Report to the City by the following required submission dates: Type of Report Assistance Listing Number Frequency Submission Deadline Expenditure Report 21.027 Monthly 15th calendar day of each month, with exception - due on the prior business day, if the 15th day should fall on a weekend or holiday General Ledger Reconciliation Report 21.027 Quarterly End of the month following each quarter   Condition In performing reporting compliance testwork, we noted the following: • Of the forty-two (42) monthly Expenditure Reports selected for testwork, we noted that three (3) monthly Expenditure Reports were submitted beyond the due date as follows: Program Title Contract Number Reporting Month Due Date Submission Date Days Late CA For All - Early Childhood Education Student Advancement Project 141412-4 December 2023 January 12, 2024 January 15, 2024 3 Summer HLAY Program- Californians for All [North Valley] 145794-1 August 2024 September 13, 2024 September 26, 2024 13 Summer HLAY Program- Californians for All [South Valley] 145801-1 August 2024 September 13, 2024 September 26, 2024 13 • Of the twelve (12) quarterly General Ledger Reconciliation Reports selected for testwork, we noted that five (5) reports for the quarter ended December 31, 2023 were not submitted within the required timeframe, as follows: Program Title Contract Number Reporting Quarter Ended Due Date Submission Date Days Late CA For All - LA Community College - City Pathways 141304-4 December 2023 January 31, 2024 February 14, 2024 14 CA For All - Youth & Community Harvest Internship Prg. [South Valley and North Valley) 141856-3 December 2023 January 31, 2024 February 14, 2024 14 CA For All - Youth & Community Harvest Internship Prg. [North Valley] 141898-3 December 2023 January 31, 2024 February 14, 2024 14 CA For All - Angeleno Corps - Youth Workforce Program [North Valley] 144504-2 December 2023 January 31, 2024 February 14, 2024 14 LA RISE - Youth Academy - California for All [South Valley] 141558-3 December 2023 January 31, 2024 February 14, 2024 14   Cause El Proyecto does not have adequate monitoring controls in place to ensure that required reports are submitted to the City within the required timeframe. Effect Late submission of required reports will result in noncompliance with the grant and funding agreement. Questioned Costs Not applicable. Recommendation We recommend that El Proyecto strengthen its controls to ensure compliance with grant reporting requirements, as specified in the award documents. We recommend that El Proyecto develop a tracking schedule for grant report submission due dates, maintain formal documentation of reports submitted, increase management oversight and review procedures, and perform additional staff training, as needed, regarding federal grants reporting requirements. Views of Responsible Officials and Planned Corrective Actions Refer to Finding F2024-002 part A. B. Lack of Formal Review of the Quarterly General Ledger Reconciliation Reports by Authorized Personnel Criteria In accordance with FMD Directive No. 24–002, El Proyecto must submit to the City the quarterly General Ledger Reconciliation Report by the end of the month following each quarter. A template form provided by the City includes a preparer and reviewer section. In accordance with El Proyecto’s formal policies and procedures, quarterly and monthly reports must be reviewed and approved by one of the following individuals: • Haimanot Fekado, Program Director • Mary Hernandez, Chief Operating Officer • Corinne Sanchez, Chief Executive Officer   Condition In performing reporting compliance testwork, we noted that six (6) out of the twelve (12) quarterly General Ledger Reconciliation Reports selected for testwork were not properly signed as reviewed and approved by one of the authorized personnel listed above, as follows: Program Title Contract Number Reporting Quarter Ended Cal For All - LA Community College - City Pathways 141304-4 December 2023 CA For All - Early Childhood Education Student Advancement Project 141412-4 December 2023 CA For All - Youth & Community Harvest Internship Prg. [South Valley and North Valley] 141856-3 December 2023 CA For All - Youth & Community Harvest Internship Prg. [North Valley] 141898-3 December 2023 CA For All - Angeleno Corps - Youth Workforce Program [North Valley] 144504-2 December 2023 LA RISE - Youth Academy - California for All [South Valley 141558-3 December 2023 Cause El Proyecto does not have adequate monitoring controls in place to ensure that reports submitted are properly reviewed and approved by authorized personnel. Effect Lack of formal review and approval by authorized personnel may result in errors not being identified and corrected prior to submission to the City. Questioned Costs Not applicable. Recommendation We recommend that El Proyecto strengthen its monitoring controls to ensure that formal policies and procedures for the review and approval of reports are properly adhered to. Views of Responsible Officials and Planned Corrective Actions Refer to Finding F2024-002 part A.