Finding 1161418 (2024-001)

Material Weakness Repeat Finding
Requirement
L
Questioned Costs
-
Year
2024
Accepted
2025-10-24

AI Summary

  • Issue: The single audit report was not submitted on time to the Office of Management and Budget.
  • Requirements Impacted: This violates the Uniform Guidance 2 CFR 200.501, which mandates timely submission of audit reports.
  • Recommended Follow-Up: Improve year-end closing and audit preparation processes, and monitor progress to ensure compliance with deadlines.

Finding Text

Condition/Context The single audit report was not submitted to the Office of Management and Budget in accordance with the reporting requirement. Criteria COSO/Internal Control Framework defines control activities as “policies and procedures that help ensures management’s directives are carried out.” This would include preparation of the schedule of expenditures of federal awards and the related data collection form in a timely manner. Uniform Guidance 2 CFR 200.501 states that the audit shall be completed, and the data collection form shall be submitted within the earlier of 30 days after the receipt of the auditor’s report, or 9 months after the end of the audit period. Cause: The single audit report was not submitted due to delays in the year-end closing process, resulting in the audit being delayed. Effect: As a result of the finding, the organization did not provide the required information to its federal oversight agency in a timely manner. Questioned Costs: None Recommendation: We believe the year-end closing and audit preparation processes should be completed sooner after year end. Progress should be monitored by management to ensure that established due dates are being met and required reports are submitted to regulatory agencies within the compliance time frame. Views of Responsible Officials and Planned Corrective Actions See corrective actions plans section.

Corrective Action Plan

Views of Responsible Officials and Planned Corrective Actions We acknowledge the finding regarding the delayed submission of the FY 2024 Single Audit Report to the Federal Audit Clearinghouse, and we appreciate the opportunity to provide our explanation and corrective action plan. To address this finding and prevent future recurrence, the following corrective actions have been initiated: Hiring of CFO Replacement: A qualified replacement for the Chief Financial Officer has been identified and is currently in the final stages of the hiring and onboarding process. This individual will assume responsibility for financial oversight, including audit preparation and timely submission of compliance reports. Interim Oversight and Delegation: In the interim period, the duties previously overseen by the CFO have been temporarily assigned to the Controller and Chief Executive Officer, with close coordination with the Finance Committee of the Board. This ensures proper oversight and continuity of compliance functions during leadership transition. Revised Internal Calendar and Milestone Tracking: An internal compliance calendar is being updated to reflect all critical reporting deadlines, including those under Uniform Guidance. Key deliverables (e.g., SEFA preparation, audit milestones, report reviews) will be tracked and monitored monthly by management to ensure deadlines are met. Enhanced Communication with Auditors: Management will work closely with external auditors to formalize an earlier schedule for yearend fieldwork, allowing for earlier identification of issues and timely resolution to support ontime audit completion. We have determined that the year-end single audit must start no later than January 31of the end of the year. Internal Controls Improvement: Hillcrest is enhancing its internal control framework (aligned with COSO standards) by documenting audit preparation procedures and establishing written protocols for contingency planning in the event of future staff turnover. Hillcrest Children and Family Center is committed to strong financial management, regulatory compliance, and transparency in all its operations. We view this incident as an isolated disruption resulting from an unanticipated leadership transition and are taking proactive steps to strengthen our internal processes. We are confident that the corrective actions outlined above will ensure timely audit completion and reporting in future years. Name of the contact person responsible for corrective action: Carroll Parks, Chief Executive Officer Planned completion date for the corrective action plan: The corrective action plan is currently active and will be moving forward.

Categories

Reporting Internal Control / Segregation of Duties

Other Findings in this Audit

  • 1161416 2024-001
    Material Weakness Repeat
  • 1161417 2024-001
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
93.696 CERTIFIED COMMUNITY BEHAVIORAL HEALTH CLINIC EXPANSION GRANTS $977,435
93.788 OPIOID STR $492,000
93.243 SUBSTANCE ABUSE AND MENTAL HEALTH SERVICES PROJECTS OF REGIONAL AND NATIONAL SIGNIFICANCE $37,000