Finding 1157364 (2024-002)

Finding number 2024-002, material weakness in internal controls over compliance – cash management Federal Agency: U.S. Department of Justice Federal Program: Justice Reinvestment Initiative, ALN 16.827 Criteria: 2 CFR 200.303 states that the non-Federal entity is responsible for maintaining effective internal controls over cash management to comply with the terms and conditions of the Federal award. Under CFR 200.305(b), the timing of cash draws for cost reimbursement awards should be as close as administratively feasible to the actual disbursements of the expenditures. Condition: During the year ended December 31, 2024, the Organization’s federal draw down requests were not properly reconciled to actual cash needs. This also resulted in an instance where $121,533 was required to be returned to the awarding agency in June 2024. Cause: Inadequate procedures to monitor cash needs based on actual expenditures. Effect: The Organization temporarily held federal funds without immediate need and is not requesting funds based on actual expenditures incurred. Questioned Costs: None Recommendation: Management should improve the monitoring of actual expenditures to better align cash needs and draw down requests with actual expenditures incurred. Views of Responsible Officials: Management concurs with this finding. See Corrective Action Plan.