Finding 1221630 (2025-001)

Material Weakness Repeat Finding
Requirement
L
Questioned Costs
-
Year
2025
Accepted
2026-06-30

AI Summary

  • Core Issue: Inadequate controls were found for reviewing and approving grant reports before submission.
  • Impacted Requirements: Compliance with 2 CFR 200.303, which mandates effective internal controls over Federal awards.
  • Recommended Follow-Up: Establish clear processes to ensure all grant reports are reviewed and approved prior to submission.

Finding Text

Item 2025-001 Reporting (Repeat 2024-002) Head Start and Early Head Start Assistance Listing #93.600 Head Start Grant No. 04CH0127807 U.S. Department of Health and Human Services Federal Award Year - 2025 Condition – Adequate controls were not in place to review and approve grant reports prior to their submission to the grantor. The Federal Financial Reports (SF-425) for the Head Start Cluster grants were not reviewed and approved prior to submission to the Payment Management System. Criteria – Grantees should have controls in place to ensure that grant reports are being reviewed and approved by management prior to being submitted to the grantor. 2 CFR 200.303 requires the non‐Federal entity to “(a) establish and maintain effective internal controls over the Federal award that provides reasonable assurance that the non‐Federal entity is managing the Federal statutes, regulations, and the terms and conditions of the Federal award.” Cause – Lack of sufficient controls over the review and approval of grant reports to ensure the accuracy and completeness of the report being submitted to the grantor. Questioned Costs – None noted. This finding is a deficiency in internal control over compliance for reporting that does not affect amounts expended or received from the Federal award. Effect – Lack of proper review and approval could result in improper reporting which could lead to disallowed costs. However, our audit disclosed no instances of unallowable costs. Recommendation – We recommend the implementation of controls to ensure there is evidence of review and approval of the quarterly grant reports prior to submission to the grantor. Management’s Response – The Agency will implement controls to ensure proper review and approval is obtained on required grant reports prior to submission to the grantor.

Corrective Action Plan

Please accept this correspondence as the Alfred Saliba Family Services Center, Inc. 's formal corrective action response to Finding 2025-001: Reporting, related to the review and documentation process for Federal Financial Reports, including SF-425 reports. During the prior audit cycle, management became aware of deficiencies related to the review and documentation process for Federal Financial Reports. While the 2024 audit was occurring and these deficiencies were being identified, the previous Grants Manager was relieved from her position. Following that personnel change, the Alfred Saliba Family Services Center undertook a reorganization of fiscal management responsibilities to strengthen oversight, accountability, and internal controls. As part of this corrective action, the organization reviewed, rewrote, and codified its Fiscal Policies and Procedures, which were formally adopted by the Board of Directors. These revised policies clarified reporting responsibilities, strengthened the review and approval process, and established clearer expectations for documentation, supervisory review, and retention of records related to grant reporting. The revised fiscal policies also include a new Federal Financial Report (SF-425) Review & Approval Form, located in Appendix X of Standard 2 - Fiscal Policies and Procedures, to ensure consistent documentation of management review prior to submission. Since the personnel and fiscal management changes were implemented, SF-425 reports have been prepared and provided to the Executive Director in a timely manner prior to submission. The Executive Director reviews the reports, verifies the information as appropriate, and signs the reports to document management review and approval. This process provides clear evidence that financial reports are revi_ewed before submission and that appropriate oversight is occurring. The Alfred Saliba Family Services Center believes these corrective actions have addressed the condition noted in the finding. The organization will continue to monitor this process as part of its ongoing fiscal management framework to ensure sustained compliance, timely reporting, and proper documentation of management review. Anticipated Completion: Immediately Responsible Party: Jim Hartnett, Executive Director

Categories

Reporting Allowable Costs / Cost Principles

Other Findings in this Audit

  • 1221629 2025-001
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
93.600 HEAD START $690,120
93.556 MARYLEE ALLEN PROMOTING SAFE AND STABLE FAMILIES PROGRAM $350,079
10.561 STATE ADMINISTRATIVE MATCHING GRANTS FOR THE SUPPLEMENTAL NUTRITION ASSISTANCE PROGRAM $71,210
10.558 CHILD AND ADULT CARE FOOD PROGRAM $64,259
93.558 TEMPORARY ASSISTANCE FOR NEEDY FAMILIES $40,000
14.218 COVID-19 COMMUNITY DEVELOPMENT BLOCK GRANTS/ENTITLEMENT GRANTS $26,834
14.218 COMMUNITY DEVELOPMENT BLOCK GRANTS/ENTITLEMENT GRANTS $11,095