Finding 1172457 (2024-002)

Finding 2024-002: Cash Management Requirements U.S Department of Health and Human Services – Pass-through Office of Refugee Resettlement – Unaccompanied Children ALN 93.676 Cash Management Statement of Condition: During the audit of KidsPeace it was observed that the organization did not minimize the time elapsing between the transfer of funds from the Federal agency to the disbursement of these funds. Funds were drawn down in advance of actual disbursement needs resulting in excess cash balances. Questioned Costs: None. Criteria: According to 2CFR 200.305(b), non- Federal entities must minimize the time elapsing between the transfer of funds from the federal agency and the disbursement of funds by the non- Federal entity. Advance payments must be limited to the minimum amounts needed and timed in accordance with the actual immediate cash requirements of the entity in carrying out the purpose of the program. Cause: The organization lacked adequate procedures to ensure that funds were drawn down only as needed for immediate disbursement. Additionally, there was insufficient oversight of cash management practices. Effect of the Condition: The cash on hand by year end was approximately $1.37 million which is in excess of the immediate needs of the program Repeat Finding: This is a repeat finding for 2023-001. Recommendation: We recommend that the Organization implements further procedures to ensure the drawdown amounts reflect actual expenditures incurred. Views of Responsible Officials: Management agrees with the findings. See corrective action plan.