Finding 1165068 (2024-001)

Material Weakness Repeat Finding
Requirement
L
Questioned Costs
-
Year
2024
Accepted
2025-12-16
Audit: 375217
Organization: Caresouth Carolina, Inc. (SC)
Auditor: BROWN CPA LLC

AI Summary

  • Core Issue: Staff turnover and a new accounting system led to delays and errors in financial reporting.
  • Impacted Requirements: Effective internal controls over financial reporting were not maintained, resulting in numerous correcting journal entries.
  • Recommended Follow-Up: Increase resources in the finance department to ensure adequate staffing with qualified individuals.

Finding Text

Finding: 2024-001 Oversight of Financial Reporting Criteria: Management is responsible for establishing and maintaining effective internal controls over financial reporting and timely performance of associated financial reporting functions. Condition: During the current year audit there was staff turnover and a new accounting system was installed. This contributed to a situation where: 1. Numerous correcting journal entries were necessary to arrive at the adjusted financial statement amounts. 2. As discussed in finding 2024-002 the financial statement audit was not timely completed. Cause: The Organization has had staffing issues during the year and numerous positions were either unfilled or there was turnover resulting in inefficient operations additionally the new accounting system resulted in unexpected reporting problems. Effect: Additional time and effort was needed to finalize the financial reporting for fiscal year 2024. Recommendation: The Organization needs to devote more resources to the finance department so that adequate staffing levels can be maintained by qualified individuals. Views of Responsible Officials: See Attachment A.

Corrective Action Plan

We have reviewed the comments provided herein and are in agreement with the comments and will remediate the findings as follows: • We are reviewing the staffing of our finance department in an effort to ensure that on an ongoing basis these issues and findings are addressed and corrected. • Turnover has been due to the retirement of our Chief Financial Officer who had been with the organization for over thirty years. We made the decision to fill the CFO position vacated by the retiring CFO with the currently employed Controller. Although this transition has been in process for approximately a year, we recognize the need for ongoing training and support. We will ensure this. • Additionally, we have recruited a Staff Accountant with a start date of February 2025 to support accounting needs. • Although with this recruitment there are no Finance staff vacancies, we are evaluating to determine if we need to increase current staffing. In closing, we will support turnover and have individuals with adequate training and subject matter knowledge to perform assigned functions in accordance with appropriate standards and expectations. Additionally, we plan to finalize our internal balancing and financial reporting by August 31st thereby allowing for more time to complete the annual financial statement audit. We are always receptive to positive constructive criticism in our effort to improve upon compliance and financial reporting. Sincerely yours, Ann M. Lewis Chief Executive Officer

Categories

Reporting Internal Control / Segregation of Duties

Other Findings in this Audit

  • 1165069 2024-002
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
93.224 HEALTH CENTER PROGRAM (COMMUNITY HEALTH CENTERS, MIGRANT HEALTH CENTERS, HEALTH CARE FOR THE HOMELESS, AND PUBLIC HOUSING PRIMARY CARE) $8.50M
93.045 SPECIAL PROGRAMS FOR THE AGING, TITLE III, PART C, NUTRITION SERVICES $1.81M
93.044 SPECIAL PROGRAMS FOR THE AGING, TITLE III, PART B, GRANTS FOR SUPPORTIVE SERVICES AND SENIOR CENTERS $1.48M
93.052 NATIONAL FAMILY CAREGIVER SUPPORT, TITLE III, PART E $277,432
93.918 GRANTS TO PROVIDE OUTPATIENT EARLY INTERVENTION SERVICES WITH RESPECT TO HIV DISEASE $267,056
93.211 TELEHEALTH PROGRAMS $238,656
93.053 NUTRITION SERVICES INCENTIVE PROGRAM $206,430
93.767 CHILDREN'S HEALTH INSURANCE PROGRAM $149,062
93.332 COOPERATIVE AGREEMENT TO SUPPORT NAVIGATORS IN FEDERALLY-FACILITATED EXCHANGES $129,594
93.526 GRANTS FOR CAPITAL DEVELOPMENT IN HEALTH CENTERS $126,050
10.855 DISTANCE LEARNING AND TELEMEDICINE LOANS AND GRANTS $103,381
93.153 COORDINATED SERVICES AND ACCESS TO RESEARCH FOR WOMEN, INFANTS, CHILDREN, AND YOUTH $87,651
93.043 SPECIAL PROGRAMS FOR THE AGING, TITLE III, PART D, DISEASE PREVENTION AND HEALTH PROMOTION SERVICES $79,610
93.297 TEENAGE PREGNANCY PREVENTION PROGRAM $58,000
93.527 GRANTS FOR NEW AND EXPANDED SERVICES UNDER THE HEALTH CENTER PROGRAM $57,657
93.778 MEDICAL ASSISTANCE PROGRAM $47,815
93.324 STATE HEALTH INSURANCE ASSISTANCE PROGRAM $44,536
93.042 SPECIAL PROGRAMS FOR THE AGING, TITLE VII, CHAPTER 2, LONG TERM CARE OMBUDSMAN SERVICES FOR OLDER INDIVIDUALS $38,288
93.217 FAMILY PLANNING SERVICES $30,000
93.071 MEDICARE ENROLLMENT ASSISTANCE PROGRAM $26,666
93.048 SPECIAL PROGRAMS FOR THE AGING, TITLE IV, AND TITLE II, DISCRETIONARY PROJECTS $19,716