Finding Number: 2024-007 Finding Title: Regulatory Deadline for Submission of Schedule of Expenditures of Federal Awards Federal Program Information: • Federal Agency: Department of Housing and Urban Development; Department of the Treasury • Assistance Listing Numbers (ALN): 14.251 and 21.027 • Federal Program Names: Economic Development Initiatives—Special Project, Neighborhood Initiative and Neighborhood Stabilization Program; Coronavirus State and Local Fiscal Recovery Funds Compliance Requirement: Reporting - Audit Requirements and Single Audit Submission (2 CFR §200.512(a)) Questioned Costs: $0 Repeat Finding: No Management's Response: The Board of Directors of Restoration Christian Ministries agrees with the finding. The Organization engaged a firm to perform the audit with the intent of completing and submitting the audit within the requirement timeframe. Due to unforeseen issues, the completion of the audit was delayed. Corrective Action Plan: Corrective Action #1: Audit Planning Timeline • Action: Develop detailed audit preparation timeline working backwards from nine-month deadline. Engage auditors by March 31 following fiscal year end to allow adequate planning and completion time. Board Treasurer will schedule regular status meetings with auditors throughout audit process. Build contingency time into schedule for unforeseen delays. • Responsible Person/Title: Board Treasurer • Anticipated Completion Date: December 31, 2025 (for FY 2025 audit); Annually thereafter by October following fiscal year end Corrective Action #2: Enhanced Year-End Close Procedures • Action: Implement enhanced year-end closing procedures ensuring financial records are audit-ready within 60 days of fiscal year end. Contract Accountant will prepare preliminary SEFA and supporting schedules by January 31 following fiscal year end. Board Treasurer will conduct internal pre-audit review identifying and resolving issues before auditors begin fieldwork. • Responsible Person/Title: Contract Accountant and Board Treasurer • Anticipated Completion Date: February 28, 2026 (procedures development); January 31, 2026 (first implementation for FY 2025) Corrective Action #3: Audit Documentation Preparation • Action: Prepare all audit supporting schedules and documentation in advance of audit fieldwork. Organize federal grant files with all required documentation readily accessible. Board Treasurer will coordinate with Contract Accountant to ensure prompt responses to auditor requests. • Responsible Person/Title: Contract Accountant and Board Treasurer • Anticipated Completion Date: March 31, 2026 (for FY 2025 audit); Annually thereafter Corrective Action #4: Board Oversight and Accountability • Action: Assign Board Treasurer responsibility and accountability for ensuring timely audit completion and submission. Require monthly status updates from Board Treasurer to full Board on audit progress during audit period. Include audit status as standing agenda item at Board meetings from April through September. • Responsible Person/Title: Board President • Anticipated Completion Date: April 30, 2026 (initial); Ongoing monthly April-September annually Corrective Action #5: Board Engagement and Resource Authorization • Action: Board Treasurer will immediately notify full Board if any issues arise that could jeopardize meeting submission deadline. Board will authorize additional resources (e.g., consultant support for Contract Accountant) if needed to meet deadline. • Responsible Person/Title: Board Treasurer • Anticipated Completion Date: Ongoing, as needed Corrective Action #6: Compliance Calendar with Milestones • Action: Incorporate FAC submission deadline into Organization's compliance calendar with milestone checkpoints. Set internal deadline of eight months (rather than nine months) to provide buffer for unforeseen issues. Track key milestones: audit engagement (by March 31), fieldwork completion (by July 31), draft report (by August 15), final report (by August 31), FAC submission (by September 15). • Responsible Person/Title: Board Treasurer • Anticipated Completion Date: January 31, 2026 Corrective Action #7: Contingency Planning • Action: Develop contingency plan if audit delays occur, including escalation procedures and potential for additional temporary accounting support. Maintain regular communication with auditors to identify potential delays early. Board will evaluate whether additional contracted accounting support is needed during audit season. • Responsible Person/Title: Board Treasurer • Anticipated Completion Date: March 31, 2026 Corrective Action #8: Resource Capacity Assessment • Action: Board will assess whether current Contract Accountant arrangement provides adequate capacity to meet federal compliance requirements. Consider increasing Contract Accountant hours or engaging additional professional support for federal grants administration. Evaluate cost-benefit of engaging grants management consultant to support compliance activities. • Responsible Person/Title: Board of Directors • Anticipated Completion Date: March 31, 2026