Finding Text
Cash Management Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name / Assistance Listing Number / Pass-Through Agency(ies) / Pass-Through Number(s): • Block Grants for Prevention and Treatment of Substance Abuse, 93.959 o Passed through the State of Connecticut, Department of Mental Health and Addiction Services, 24MHA1009 o Passed through the Commonwealth of Pennsylvania, Department of Drug and Alcohol Programs, 4100089071 o Passed through the State of Louisiana, Department of Health, 2000758195 o Passed through the State of Oklahoma, Department of Mental Health and Substance Abuse Services, B08TI083962 & B08TI084602 • COVID-19 - Substance Abuse and Mental Health Services Projects of Regional and National Significance, 93.243 o Passed through the State of California, Department of Health Care Services, 21-10299 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or specific requirement: 2 CFR Part 200.303 (a) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award, Internal Controls requires that the recipient must: “Establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should align with the guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control-Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” Shatterproof should have internal controls designed and effectively operating to ensure compliance with those provisions. Condition: Shatterproof was unable to provide documentation to support the review and approval for 4 requests for reimbursement. Questioned costs: None Context: Documentation of the review and approval for 4 of 14 requests for reimbursements could not be provided. Cause: Controls over the performance and documentation of the review and approval of reimbursement requests were implemented in 2025. Effect: The lack of internal controls over these compliance requirements provides an opportunity for noncompliance and questioned costs. Repeat Finding: The finding is a modified repeat of findings in the immediately prior year. Prior year finding numbers were 2023-006 and 2023-007. Recommendation: We recommend Shatterproof implement controls to ensure an adequate review process is in place to review reimbursement requests to determine and document the request is properly supported and in compliance with the grant agreement. Views of responsible officials: There is no disagreement with the audit finding.