Finding 24089 (2022-004)

Material Weakness Repeat Finding
Requirement
G
Questioned Costs
-
Year
2022
Accepted
2023-03-06
Audit: 20775
Organization: Easter Seals Serving Dc/md/va (MD)
Auditor: Aprio LLP

AI Summary

  • Core Issue: The Organization failed to meet the 20% non-federal matching requirement for the Head Start program due to reduced volunteer activity during the COVID-19 pandemic.
  • Impacted Requirements: This violation affects compliance with the grant agreement and is classified as a material weakness.
  • Recommended Follow-Up: Ensure compliance with matching requirements annually or apply for a waiver promptly if unable to meet the match.

Finding Text

Finding 2022-004: Reportable Finding Considered a Material Weakness - Failure to Meet Matching Requirement Program name: Head Start Assistance Listing: 93.600 Federal awarding agency: United States Department of Health and Human Services Compliance requirement: Matching, level of effort, earmarking Criteria: The grant agreement (03CH010635-04-00 and 03CH010635-05-00) for the Head Start requires a non-federal matching of 20% unless a waiver is approved by the agency. Condition: The Organization did not meet the 20% non-federal match requirement for the year ended August 31, 2022, which includes the budget periods from August 1, 2021 through July 31, 2022 and August 1, 2022 through July 31, 2023. Context: It was determined that the matching requirement was not met due to not enough volunteer activity as a result of the COVID-19 pandemic. The Organization has requested a waiver from the agency. Cause: The Organization was not able to meet the non-federal matching contributions due to health department requirements to shut-down the Child Development Centers due to the COVID-19 pandemic. Due to the closures of the centers, there were fewer volunteer hours which the Organization uses to meet the matching requirement. Effect: The Organization is in violation of the matching requirement stipulated in the grant agreement. Repeat finding: This is a repeat finding. Questioned costs: There are no questioned costs associated with this finding. Recommendation: We recommend that the Organization ensure that the non-federal matching requirements for each federal grant be met every fiscal year or apply for a waiver as soon as it becomes apparent that the match will not be met. Management?s response and corrective action plan (unaudited): See Appendix A ? corrective action plan

Corrective Action Plan

Based on our grant agreement with Head Start, Easter Seals DC MD VA is required to provide a 20% contribution of total project costs for each annual budget period, unless a waiver has been requested and approved; any combination of actual cash expended, or in-kind contributions, may be used to meet the matching requirement. As noted in the audit report, our organization did not meet the 20% non-federal match requirement for the latest program year. Our inability to meet the 20% threshold in fiscal year 2022 was, in part, due to a lack of volunteering activity associated with limited operations/required closures of our Head Start locations throughout the COVID pandemic. The mandatory annual waivers associated with our organization?s 20% non-federal share matching contribution requirement for the first four years (ended July 31, 2019, 2020, 2021, and 2022) of our Prince George?s County Head Start Program grant agreement were submitted by the end of the organization?s Fiscal Year 2022. Likewise, the annual waver for the first year (ended June 2022) for our Washington, DC Head Start Program grant agreement was also submitted by the end of Fiscal Year 2022. The outstanding waiver requests are currently under review by representatives of The Administration of Families and Children, the agency that oversees the Office of Head Start program. While we have maintained a constant dialogue with the Office of Head Start over the last several months, which administers grant funding and oversight, we have yet to receive a formal approval for any of the individual submissions. We are hopeful that response to all five waiver requests submitted will be obtained no later than the end of the current grant year for our Prince George?s County Program (July 31, 2023).

Categories

Matching / Level of Effort / Earmarking

Other Findings in this Audit

  • 24090 2022-004
    Material Weakness Repeat
  • 24091 2022-004
    Material Weakness Repeat
  • 24092 2022-004
    Material Weakness Repeat
  • 600531 2022-004
    Material Weakness Repeat
  • 600532 2022-004
    Material Weakness Repeat
  • 600533 2022-004
    Material Weakness Repeat
  • 600534 2022-004
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
17.805 Homeless Veterans Reintegration Project $929,741
93.434 Every Student Succeeds Act/preschool Development Grants $905,000
21.027 Coronavirus State and Local Fiscal Recovery Funds $374,050
93.600 Head Start $179,683
93.575 Child Care and Development Block Grant $84,500
93.498 Provider Relief Fund $71,570
14.218 Community Development Block Grants/entitlement Grants $0