FAC Explorer

Finding 15941 (2022-004)

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Requirement
P
Questioned Costs
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Year
2022
Accepted
2023-07-25
Audit: 19559
Organization: Syracuse Model Neighborhood Facility, Inc. (NY)
Auditor: Grossman St Amour Certified Public Accountants PLLC

AI Summary

  • Core Issue: There are inconsistencies in how functional expenses are allocated due to new staffing in the finance department.
  • Impacted Requirements: Accounting standards require accurate reporting of expenses by function, which affects grant voucher preparation and revenue recognition.
  • Recommended Follow-Up: Conduct a detailed analysis of expenses to ensure proper classification between program and administrative costs.

Finding Text

2022-004 Allocation of Functional Expenses Criteria: Accounting standards require that not for profit organization present expenses by function and natural classification. Expenses that are directly attributable to a specific functional area of the Facility should be reported as expenses of those functional areas. Condition: The proper allocation of functional expenses is a management estimate that should be evaluated on a periodic basis. In particular, management should ensure that all program expenses are properly allocated to program costs and expenses that should be administration are similarly identified. Cause: New staffing within the Facility's finance department during 2022 contributed to inconsistencies in the allocation of functional expenses. Effect: The incorrect allocation of expenses between programs and administration may result in inaccurate preparation of grant vouchers. This impacts voucher submissions and revenue recognized for programs. Recommendation: We recommend that a detailed analysis be performed of the Facility?s expenses to ensure the allocation of functional expenses is consistent with the operations of the Facility. Views of Responsible Official and Planned Corrective Action: The Chief Executive Officer and Chief Financial Officer will ensure a detailed review is performed so that expenses are properly classified between program expenses and administrative expenses.

Corrective Action Plan

Control Deficiency 2022-004 Allocation of Functional Expenses Contact Person Responsible for Corrective Action Plan: Lawrence Williams, Chief Executive Officer. Corrective Action Plan: The Chief Executive Officer and Chief Financial Officer will ensure a detailed review is performed of expenses between program expense and administrative expenses. Anticipated Completion Date of Corrective Action Plan: December 31, 2023

Categories

Allowable Costs / Cost Principles

Other Findings in this Audit

  • 15938 2022-001
    Material Weakness Repeat
  • 15939 2022-002
    Significant Deficiency
  • 15940 2022-003
    Significant Deficiency
  • 15942 2022-001
    Material Weakness Repeat
  • 15943 2022-002
    Significant Deficiency
  • 15944 2022-003
    Significant Deficiency
  • 15945 2022-004
    -
  • 592380 2022-001
    Material Weakness Repeat
  • 592381 2022-002
    Significant Deficiency
  • 592382 2022-003
    Significant Deficiency
  • 592383 2022-004
    -
  • 592384 2022-001
    Material Weakness Repeat
  • 592385 2022-002
    Significant Deficiency
  • 592386 2022-003
    Significant Deficiency
  • 592387 2022-004
    -

Programs in Audit

ALN Program Name Expenditures
14.218 Community Development Block Grants/entitlement Grants $444,565
16.575 Crime Victim Assistance $185,170
93.959 Block Grants for Prevention and Treatment of Substance Abuse $161,642
93.926 Healthy Start Initiative $135,140
93.778 Medical Assistance Program $123,734
17.259 Wia Youth Activities $62,113
14.252 Section 4 Capacity Building for Community Development and Affordable Housing $35,765
93.940 Hiv Prevention Activities_health Department Based $30,970
93.994 Maternal and Child Health Services Block Grant to the States $23,977