REFERENCE # 2022-004 CASH MANAGEMENT – MATERIAL WEAKNESS- NONCOMPLIANCE Program Name/ALN Emergency Food and Shelter National Board Program (ALN # 97.024) Criteria: Non-Federal Entities Other Than States- Non-federal entities must minimize the time elapsing between the transfer of funds from the US Treasury or pass-through entity and disbursement by the non-federal entity for direct program or project costs and the proportionate share of allowable indirect costs, whether the payment is made by electronic funds transfer, or issuance or redemption of checks, warrants, or payment by other means (2 CFR section 200.305(b)). What constitutes minimized elapsed time for funds transfer will depend on what payment system/method a non-federal entity uses. Under the advance payment method, federal awarding agency or pass-through entity payment is made to the non-federal entity before the non-federal entity disburses the funds for program purposes (2 CFR section 200.3). A non-federal entity must be paid in advance provided that it maintains, or demonstrates the willingness to maintain, both written procedures that minimize the time elapsing between the transfer of funds from the US Treasury and disbursement by the non-federal entity, as well as a financial management system that meets the specified standards for fund control and accountability (2 CFR section 200.305(b)(1)). Condition/Context: Division receive Emergency Food and Shelter National Board Program funds from the U.S. Department Homeland security/FEMA and various pass-through entities. Division receives advance funds from the pass-through agency and incurred program expenditures. Of the Sixty (60) files selected for testing We noted that the Division: (1) Does not have written procedures that minimize the time elapsing between the transfer of funds from the Pass-through entity and disbursement by the Division. Questioned Costs: Cannot be determined Recommendation: We recommend Division minimize the time elapsing between the transfer of funds from the Pass-through entity and disbursement by the Division. Corrective Action Plan: The Division will strive to minimize the time elapsing between the transfer of funds from the Pass-through entity and disbursement by the Division. Step 1 Action Date: Ongoing Final Implementation Date: 12/31/2023 Name and Phone # Of Person Responsible for Implementation: Jeanne Stromberg, Major, Divisional Finance Secretary (916) 563-3710