FAC Explorer

Finding 1176813 (2025-003)

Material Weakness Repeat Finding
Requirement
L
Questioned Costs
-
Year
2025
Accepted
2026-03-06
Audit: 390662
Organization: Rural Resources Community Action (WA)
Auditor: BAKER TILLY

AI Summary

  • Core Issue: There is a material weakness in internal controls over compliance, leading to reports lacking proper support and being submitted late.
  • Impacted Requirements: Federal regulations require timely submission of reports with adequate supporting documentation and a review process by different individuals.
  • Recommended Follow-Up: Implement a standardized reconciliation checklist, clarify roles for report preparation and review, and provide ongoing training to ensure compliance with control requirements.

Finding Text

FINDING 2025‐003 – Reporting; Material Weakness in Internal Control over Compliance and Instance of Material Noncompliance WIOA Cluster Assistance Listing Numbers: 17.258, 17.259, 17.278 Federal Program Names: WIOA Adult Program, WIOA Youth Activities, and WIOA Dislocated Worker Formula Grants Award Years: Various Criteria: Federal regulations and grant and contract conditions require that applicable reports be properly supported by accounting records and submitted. Financial and performance information should be reviewed by a different person than the preparer, supporting documentation should be maintained, and reports filed timely. Condition and context: Of ten report submissions filed during the year, we selected four reports and noted that supporting documentation was maintained but could not be traced back to the four reports submitted. Additionally, for two of four reports selected, the closeout report was submitted twenty-seven days late and a quarterly report submitted one day late. Questioned costs: None. Effect: Without centralized controls that include retention of documentation supporting the amounts in the reports, reports submitted were not properly supported or filed timely. Cause: This occurred because controls in place were not consistently adhered to ensuring reports are reconciled to supporting documentation prior to submission. Documentation of the preparer and reviewer of reconciled support should be maintained to ensure the control is being performed on a timely basis. Controls were not operating as designed to ensure the timely submission of the reports required were filed by the due dates as a result of the lack of segregation of duties and procedures surrounding deadlines. Repeat finding: Yes 2024-004. Recommendation: We recommend management reinforce and formalize the reconciliation control by requiring that all reports be reconciled to supporting documentation prior to submission. A standardized reconciliation checklist or template should be implemented to evidence completion, including clear documentation of the preparer and reviewer, along with dates of preparation and review. Additionally, management should provide periodic training to ensure awareness of control requirements and perform periodic monitoring or quality reviews to confirm the control is operating consistently and in a timely manner. Views of responsible officials and planned corrective actions: Management agrees with the assessment. To address this issue, management has reinforced and formalized its reporting reconciliation controls. All financial and performance reports submitted for WIOA programs will be reconciled to supporting documentation prior to submission. Management has clarified roles and responsibilities to ensure that report preparation and review are performed by separate individuals. All reports required by contract must be submitted timely and must include two levels of documented review. Reports will be reviewed by the preparer’s Director (or their designee); if the Director is the preparer, the review will be conducted by the Chief Operating Officer or in their absence, the Chief Executive Officer. All financial reports required by contract must have documented review by a member of the fiscal department. Supporting documentation related to report reconciliations will be retained to ensure traceability and availability for review. During the year, the department experienced a leadership transition, and the new Director is receiving additional training on reporting requirements and internal control expectations. Management will also provide periodic training to staff involved in report preparation and review to reinforce control requirements and expectations. Management expects significant improvement for the fiscal year ending in 2026.

Corrective Action Plan

FINDING 2025-003 – Reporting Material Weakness in Internal Control over Compliance and Instance of Material Noncompliance Views of responsible officials and planned corrective actions: Management agrees with the assessment. To address this issue, management has reinforced and formalized its reporting reconciliation controls. All financial and performance reports submitted for WIOA programs will be reconciled to supporting documentation prior to submission. Management has clarified roles and responsibilities to ensure that report preparation and review are performed by separate individuals. All reports required by contract must be submitted timely and must include two levels of documented review. Reports will be reviewed by the preparer’s Director (or their designee); if the Director is the preparer, the review will be conducted by the Chief Operating Officer or in their absence, the Chief Executive Officer. All financial reports required by contract must have documented review by a member of the fiscal department. Supporting documentation related to report reconciliations will be retained to ensure traceability and availability for review. During the year, the department experienced a leadership transition, and the new Director is receiving additional training on reporting requirements and internal control expectations. Management will also provide periodic training to staff involved in report preparation and review to reinforce control requirements and expectations. Management expects significant improvement for the fiscal year ending in 2026. Contact Persons: Ryan Berendsen, Chief Operating Officer Delana Kromer, Controller

Categories

Internal Control / Segregation of Duties Subrecipient Monitoring Material Weakness Reporting

Other Findings in this Audit

  • 1176759 2025-002
    Material Weakness Repeat
  • 1176760 2025-002
    Material Weakness Repeat
  • 1176761 2025-002
    Material Weakness Repeat
  • 1176762 2025-002
    Material Weakness Repeat
  • 1176763 2025-002
    Material Weakness Repeat
  • 1176764 2025-002
    Material Weakness Repeat
  • 1176765 2025-002
    Material Weakness Repeat
  • 1176766 2025-002
    Material Weakness Repeat
  • 1176767 2025-002
    Material Weakness Repeat
  • 1176768 2025-002
    Material Weakness Repeat
  • 1176769 2025-002
    Material Weakness Repeat
  • 1176770 2025-002
    Material Weakness Repeat
  • 1176771 2025-002
    Material Weakness Repeat
  • 1176772 2025-002
    Material Weakness Repeat
  • 1176773 2025-002
    Material Weakness Repeat
  • 1176774 2025-002
    Material Weakness Repeat
  • 1176775 2025-002
    Material Weakness Repeat
  • 1176776 2025-002
    Material Weakness Repeat
  • 1176777 2025-002
    Material Weakness Repeat
  • 1176778 2025-002
    Material Weakness Repeat
  • 1176779 2025-002
    Material Weakness Repeat
  • 1176780 2025-002
    Material Weakness Repeat
  • 1176781 2025-002
    Material Weakness Repeat
  • 1176782 2025-002
    Material Weakness Repeat
  • 1176783 2025-002
    Material Weakness Repeat
  • 1176784 2025-002
    Material Weakness Repeat
  • 1176785 2025-002
    Material Weakness Repeat
  • 1176786 2025-002
    Material Weakness Repeat
  • 1176787 2025-002
    Material Weakness Repeat
  • 1176788 2025-002
    Material Weakness Repeat
  • 1176789 2025-002
    Material Weakness Repeat
  • 1176790 2025-003
    Material Weakness Repeat
  • 1176791 2025-003
    Material Weakness Repeat
  • 1176792 2025-003
    Material Weakness Repeat
  • 1176793 2025-003
    Material Weakness Repeat
  • 1176794 2025-003
    Material Weakness Repeat
  • 1176795 2025-003
    Material Weakness Repeat
  • 1176796 2025-003
    Material Weakness Repeat
  • 1176797 2025-003
    Material Weakness Repeat
  • 1176798 2025-003
    Material Weakness Repeat
  • 1176799 2025-003
    Material Weakness Repeat
  • 1176800 2025-003
    Material Weakness Repeat
  • 1176801 2025-003
    Material Weakness Repeat
  • 1176802 2025-003
    Material Weakness Repeat
  • 1176803 2025-003
    Material Weakness Repeat
  • 1176804 2025-003
    Material Weakness Repeat
  • 1176805 2025-003
    Material Weakness Repeat
  • 1176806 2025-003
    Material Weakness Repeat
  • 1176807 2025-003
    Material Weakness Repeat
  • 1176808 2025-003
    Material Weakness Repeat
  • 1176809 2025-003
    Material Weakness Repeat
  • 1176810 2025-003
    Material Weakness Repeat
  • 1176811 2025-003
    Material Weakness Repeat
  • 1176812 2025-003
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
10.569 EMERGENCY FOOD ASSISTANCE PROGRAM (FOOD COMMODITIES) $527,836
10.766 COMMUNITY FACILITIES LOANS AND GRANTS $398,765
17.278 WIOA DISLOCATED WORKER FORMULA GRANTS $390,428
10.415 RURAL RENTAL HOUSING LOANS $380,423
16.575 CRIME VICTIM ASSISTANCE $364,825
14.239 HOME INVESTMENT PARTNERSHIPS PROGRAM $268,388
10.561 STATE ADMINISTRATIVE MATCHING GRANTS FOR THE SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM $248,573
93.600 HEAD START $191,770
10.565 COMMODITY SUPPLEMENTAL FOOD PROGRAM $154,734
93.569 COMMUNITY SERVICES BLOCK GRANT $146,176
93.568 LOW-INCOME HOME ENERGY ASSISTANCE $127,507
14.228 COMMUNITY DEVELOPMENT BLOCK GRANTS/STATE'S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII $91,004
10.558 CHILD AND ADULT CARE FOOD PROGRAM $88,959
81.042 WEATHERIZATION ASSISTANCE FOR LOW-INCOME PERSONS $84,575
10.182 PANDEMIC RELIEF ACTIVITIES: LOCAL FOOD PURCHASE AGREEMENTS WITH STATES, TRIBES, AND LOCAL GOVERNMENTS $79,093
81.999 BONNEVILLE POWER ADMINISTRATION/LIEE PROGRAM $78,008
17.258 WIOA ADULT PROGRAM $74,844
93.671 FAMILY VIOLENCE PREVENTION AND SERVICES/DOMESTIC VIOLENCE SHELTER AND SUPPORTIVE SERVICES $73,547
93.044 SPECIAL PROGRAMS FOR THE AGING, TITLE III, PART B, GRANTS FOR SUPPORTIVE SERVICES AND SENIOR CENTERS $72,034
93.495 COMMUNITY HEALTH WORKERS FOR PUBLIC HEALTH RESPONSE AND RESILIENT $58,842
10.568 EMERGENCY FOOD ASSISTANCE PROGRAM (ADMINISTRATIVE COSTS) $47,416
10.665 SCHOOLS AND ROADS - GRANTS TO STATES $32,970
10.218 BUILDINGS AND FACILITIES PROGRAM $30,300
93.323 EPIDEMIOLOGY AND LABORATORY CAPACITY FOR INFECTIOUS DISEASES (ELC) $28,948
93.052 NATIONAL FAMILY CAREGIVER SUPPORT, TITLE III, PART E $24,535
93.045 SPECIAL PROGRAMS FOR THE AGING, TITLE III, PART C, NUTRITION SERVICES $21,001
10.177 REGIONAL FOOD SYSTEM PARTNERSHIPS $20,815
93.497 FAMILY VIOLENCE PREVENTION AND SERVICES/ SEXUAL ASSAULT/RAPE CRISIS SERVICES AND SUPPORTS $14,873
93.391 EPIDEMIOLOGY AND LABORATORY CAPACITY FOR INFECTIOUS DISEASES (ELC) $14,582
10.187 THE EMERGENCY FOOD ASSISTANCE PROGRAM (TEFAP) COMMODITY CREDIT CORPORATION ELIGIBLE RECIPIENT FUNDS $13,754
17.259 WIOA YOUTH ACTIVITIES $13,687
16.588 VIOLENCE AGAINST WOMEN FORMULA GRANTS $11,364
93.778 MEDICAL ASSISTANCE PROGRAM $10,889
93.558 TEMPORARY ASSISTANCE FOR NEEDY FAMILIES $5,789
10.194 COMMODITY CREDIT CORPORATION (CCC) FUNDING TO ALLEVIATE EMERGENCY SUPPLY CHAIN DISRUPTION IN THE COMMODITY SUPPLEMENTAL FOOD PROGRAM (CSFP) $3,908
93.053 NUTRITION SERVICES INCENTIVE PROGRAM $3,880