Finding Text
Federal Agency: U.S. Department of Veteran Affairs Federal Program Name: Supporting Services for Veteran Families Program Assistance Listing Number: 64.033 Federal Award Identification Number and Year: 14-IN-200, 14-IN-200-LT Award Period: October 1, 2022 – September 30, 2026 Type of Finding: Material Weakness in Internal Control over Compliance and Other Matter Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Award require compliance with the provisions of cash management. The Organization should have internal controls designed to ensure compliance with those provisions. Condition: During our testing, we noted the Organization did not have adequate internal controls designed to ensure requests for reimbursement were supported by costs incurred and paid within the required timeline of the federal awarding agency. Questioned costs: None Context: During our testing, it was noted that there was no formal layer of review over the draw-down requests prepared by the senior accountant before it was submitted to the awarding agency. Amounts drawn did not consistently agree with known upcoming or previously incurred expenditures. Cause: A process of internal controls was not in place to ensure all draw-down requests were fully supported and approved. On January 27, 2025, the Office of Management and Budget (OMB), an office of the Executive Office of the President of the United States, ordered a pause to the disbursement of federal grants and loans, to take effect the following day. InteCare was notified by the VA that the system would be shut down, although awarded dollars were available for a draw down prior to the cut off. Effect: Amounts received in advance were not consistently spent within the number of days per the requirement. Interest may be owed to the federal awarding agency for funds received in advance and not spent within the guidelines required by the grantor. Repeat Finding: No. Recommendation: We recommend the Organization design controls to ensure the draw down requests and related support are formally reviewed and approved by the Finance Director before submitting the request to the awarding agency and that the support is retained. Views of responsible officials: There is no disagreement with the audit finding.