FAC Explorer

Finding 1165249 (2024-001)

Material Weakness Repeat Finding
Requirement
C
Questioned Costs
-
Year
2024
Accepted
2025-12-17
Audit: 375704
Organization: Power 4 STL Inc (MO)
Auditor: ANDERS MINKLER HUBER & HELM LLP

AI Summary

  • Core Issue: Reimbursement requests were made for expenses not yet incurred, violating funding guidelines.
  • Impacted Requirements: Funds should only be disbursed after actual costs are incurred and paid.
  • Recommended Follow-Up: Revise reimbursement procedures and train staff on compliance with funding requirements.

Finding Text

Condition: During our testing of cash management procedures, we identified instances where the Organization submitted reimbursement requests for expenses supported by invoices dated after the reimbursement date. Specifically, we noted that the reimbursement was requested and received for construction and remodeling services totaling $143,467 that had not yet been invoiced, indicating that the costs had not yet been incurred. Criteria: When an entity is funded on a reimbursement basis, it must disburse funds only after the costs have been incurred and paid. Reimbursement requests must be based on actual expenditures, not expected or anticipated cost. Cause: The Organization misunderstood the timing requirements for reimbursement and believed that requesting reimbursement based on expected invoices was acceptable. Effect: Premature drawdown of federal funds. Recommendation: Management should revise its reimbursement procedures to ensure federal funds are only requested after the related expenses have been both incurred and paid. Staff involved in grant administration should receive training on the compliance requirements under the Uniform Guidance.

Corrective Action Plan

Cause of Finding: The Organization submitted reimbursement requests for expenses supported by invoices dated after the reimbursement date. The Organization misunderstood the timing requirements for reimbursement. Action: The Executive Director and the Bookkeeper will work to ensure increased accuracy in processing payments and reconciling the financial statements. The Executive Director and Bookkeeper, will both provide staff training and support to ensure they have the necessary knowledge and skill to effectively perform job functions with regards to reimbursements and cash management. The Executive Director has implemented and updated Internal Controls, in order to ensure proper processes are in place with regards to cash management. In addition, a Reimbursement Policy has been implemented, to ensure consistency of invoice management. The Internal Controls provide for three, separate points of contact, with regards to Cash Management. The Bookkeeper has implemented monthly account reconciliations and will continue to perform monthly reconciliations to ensure accurate reporting of invoices and any accounts receivable. The Bookkeeper will follow the recommended month-end and year-end closing procedures. Both, the Executive Director and the Bookkeeper, agree to confirm the proper timing of reimbursement requirements. Anticipated Date of Completion: Some items have been implemented, however the final date of completion will be 12/01/2025 Completed Responsible Party: Executive Director and Bookkeeper

Categories

Cash Management

Other Findings in this Audit

  • 1165250 2024-002
    Material Weakness Repeat
  • 1165251 2024-003
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
93.493 CONGRESSIONAL DIRECTIVES $752,496
16.045 COMMUNITY-BASED VIOLENCE INTERVENTION AND PREVENTION INITIATIVE $210,538
93.136 INJURY PREVENTION AND CONTROL RESEARCH AND STATE AND COMMUNITY BASED PROGRAMS $177,234
93.788 OPIOID STR $162,617
93.488 NATIONAL HARM REDUCTION TECHNICAL ASSISTANCE AND SYRINGE SERVICES PROGRAM (SSP) MONITORING AND EVALUATION FUNDING OPPORTUNITY $135,393