Finding Text
Assistance Listing Number, Federal Agency, and Program Name: 93.600 Head Start Federal Award Identification Number and Year: across all major programs. Pass-through Entity – N/A Finding Type – Material weakness in internal control over compliance Repeat Finding – No Criteria – Per 2 CFR § 200.303, the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition – During our testing for Activities Allowed - Allowable Cost-Cost Principles, it was noted the client could not provide evidence of approval to charge the grant for 13 out of 42 expenditures selected for testing. Identification of How Questioned Costs Were Computed – N/A Cause/Effect – Management could not provide the evidence of approval for the data requested due to changes in personnel who were responsible for monitoring and managing the records for the federal program compliance requirement. Recommendation – We recommend management monitor the Federal program compliance requirements on a regular basis. In addition, we recommend that management review its procedures and controls in place to ensure that all disbursements are reviewed and approved and include proper evidence of the review and approval. View of Responsible Officials and Corrective Action Plan –There was turnover in the finance department, and its filing systems were not consistently followed by accountants from contracted staffing agencies. It should be noted that both documentation for expenditures for personnel and non-personnel costs were examined for propriety and allowability by the program director and board treasurer as check signers, prior to disbursement of federal funds.