Finding 1236576 (2023-003)

Material Weakness Repeat Finding
Requirement
ABH
Questioned Costs
-
Year
2023
Accepted
2026-09-25
Audit: 412125
Organization: COVATION CENTER INC (PA)

AI Summary

  • Core Issue: The Center lacks formal written policies and procedures for federal program management, violating Uniform Guidance requirements.
  • Impacted Requirements: Key areas affected include allowability of costs, cash management, and procurement.
  • Recommended Follow-Up: Management should develop and document the necessary policies and procedures to ensure compliance with Uniform Guidance.

Finding Text

(Noncompliance) Uniform Guidance Written Policies/Procedures Federal Program: Assistance Listing #14.228 Community Development Block Grants - CV - Small Business Assistance Program, Passed Through Pennsylvania Department of Community and Economic Development, Pass-Through Entity Identifying Number: C000082605 Prior Year Finding Number: N/A Criteria: The Uniform Guidance requires written policies and/or procedures in the areas of allowability of costs, cash management and procurement. Condition/Context: While the Center has informal policies and procedures surrounding the administration of its federal programs, these policies and procedures have not been formally documented in written form to ensure compliance with the areas of allowability of costs, cash management or procurement as required under the Uniform Guidance. Questioned Costs: N/A Cause: The Center does not typically receive/expend federal financial assistance and as such, was not initially aware of the requirements within Uniform Guidance to have formal, written policies and procedures in place. Effect: The Center is not in compliance with this requirement of the Uniform Guidance and as such, employees do not currently have the benefit of these written policies and/or procedures to assist in managing and directing its federal award programs. Recommendation: We recommend that Center management prepare the required written policies/procedures related to allowability of costs, cash management and subrecipient monitoring in accordance with the Uniform Guidance. Views of Responsible Officials and Planned Corrective Actions: Management understands and is working to formally document the required elements of its policies and procedures pursuant to the Uniform Guidance.

Corrective Action Plan

(Noncompliance) Uniform Guidance Written Policies/Procedures Condition: While the Center had informal policies and procedures surrounding the administration of its federal programs, these policies and procedures had not been formally documented in written form to ensure compliance with the areas of allowability of costs, cash management, or procurement as required under the Uniform Guidance. Corrective Action Planned: The Center will prepare and formally adopt written policies and procedures addressing allowability of costs, cash management, procurement, and subrecipient monitoring, in accordance with 2 CFR Part 200 (Uniform Guidance). These policies will be reviewed by the Board of Directors and incorporated into the Center's standard operating procedures for all current and future federal awards. Name(s) of Contact Person(s) Responsible for Corrective Action: Stephanie Desaulniers, Executive Director; Covation Center Board of Directors Anticipated Completion Date: December 31, 2026

Categories

Subrecipient Monitoring

Other Findings in this Audit

  • 1236574 2023-001
    Material Weakness Repeat
  • 1236575 2023-002
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
14.228 COMMUNITY DEVELOPMENT BLOCK GRANTS/STATE'S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII $999,451