Finding 34667 (2022-002)

Significant Deficiency
Requirement
M
Questioned Costs
-
Year
2022
Accepted
2023-07-16
Audit: 34598
Organization: Boys & Girls Clubs in Tennessee (TN)
Auditor: Bdo USA P A

AI Summary

  • Core Issue: The Organization failed to comply with subrecipient monitoring requirements, as monthly invoices did not match accounting records.
  • Impacted Requirements: All accounting records must be supported by source documentation to demonstrate proper fund usage per grant agreements.
  • Recommended Follow-Up: Enhance policies and procedures for subrecipient monitoring to ensure accurate invoicing and compliance.

Finding Text

Program Information: 21st Century Community Learning Centers (ALN #93.575) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): Federal Compliance Requirement: M. Subrecipient Monitoring- All accounting records must be supported by source documentation and retained in order to show for what purpose funds were spent per the grant agreement. Condition: The Organization is not in compliance with certain subrecipient monitoring conditions as required. Monthly subrecipient invoice did not agree to accounting records. Cause: Administrative oversight with respect to subrecipient monitoring requirements. Effect or Potential Effect: The Organization was not in compliance with subrecipient monitoring requirements. Questioned Costs: Below reporting threshold. Context: For 1 of 15 monthly invoices selected for testing, the Organization did not properly verify that the underlying expenditures incurred matched the invoice amounts requested for reimbursement from the State. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the Organization enhance its policies and procedures over subrecipient monitoring to ensure accurate invoicing. Views of Responsible Officials and Planned Corrective Actions: Management will update subrecipient monitoring procedures to ensure compliance with subrecipient monitoring requirements.

Corrective Action Plan

Individual Responsible for Corrective Action Plan: Whitney Holliday, Director of Club Financial Services Corrective Action: Previous Process: The previous process was created prior to the current admin becoming the dedicated Financial Services leader on the Boys & Girls Clubs in TN/TN Alliance admin team. All changes took place over the 2022/2023 grant cycles. Current Process: The previous process was overhauled to our current process in Q1 of 2022. Training and updates to the process were performed with 20 organizations throughout the year. We also implemented better direct communication with admin/staff 1:1s and a quarterly financial update call to continue training and best practice sharing. Process Update: A process update will be implemented beginning with July 2023 reimbursement requests/submissions to funders. These updates will be shared with individual Clubs with an expectation of full implementation by the end of Q3 2023. The admin will enhance its policies and procedures over sub-recipient monitoring to ensure accurate invoicing. -All reimbursement requests due from the Clubs by the 15th of each month o Previous Process: ? Requests were either loaded in the shared drive or emailed directly to the admin. Requests were consistently late and admin would communicate with each Club to see if they submitted something but it was missed. o Current Process: ? Calendar reminders are disbursed to all financial contacts with the deadlines clearly defined ? All submissions must be made in the shared drive. No email reimbursement requests are allowed. ? Admin no longer reached out to Clubs if nothing is loaded in the shared drive to process by the deadline ? Direct communication opened and established between Club financial leaders and admin financial leader to ensure all deadlines are met o Process Update: ? No update is needed ? Reimbursement Request/Cover Sheet o Previous Process: ? Submissions were processed based on a spreadsheet that the Clubs tracked in the shared drive. ? Manual verification of lines requested o Current Process: ? A cover sheet detailing the calculations of each line in the reimbursement request is required with each submission. Acknowledgment by Clubs that they have included/not included (timesheets signed in 3 places, receipts with no sales tax or other unallowable expenses, request submitted by the 15th of each month) via check boxes prior to authorized signature and date. ? All salary and benefit calculations must be completely detailed in the supporting documentation. This has remained difficult with all 20 organizations having different pay structures, paycheck layouts, benefit providers, etc. ? All supporting documentation must be present at the time of processing or line item requests are removed from overall submission. ? All submissions are compiled and sent to funders by their deadline on a monthly basis o Process Update: ? Additional calculation details will now be required for all submissions. We will add a separate box for the percentage breakdown to be charged to each grant to match supporting documentation exactly. ? All communication of errors will be in writing and detailed notes will be kept. No more phone conversations about corrections unless also documented in writing. ? If there are any unclear calculations in the request, it will be sent back to the Club to submit the following month. This will take the liability for the error off the admin and place it back with the Club. ? We will no longer allow miscellaneous benefits (other than payroll taxes) as an allowable expense for reimbursement as they are difficult to verify. ? 1:1 training will be conducted with each Club prior to their first reimbursement request for new grant cycles. With turnover and task sharing in our organization, this will ensure direct training and increase compliance. ? Quarterly financial update calls will be longer/more specific. ? We will no longer allow Clubs to combine requests over multiple months. This inconsistency tends to lead to errors. ? Additional admin support has been added to decrease the number of requests being processed by one individual per month. We have hired an additional staff member. ? Status of Funds o Previous Process: ? Clubs kept up with their budgets/available balances themselves o Current Process: ? Admin updates a running spreadsheet in the shared drive after each month's submission to ensure Clubs are aware of their available balances for each grant o Process Update: No update is needed Anticipated Completion Date: September 30, 2023

Categories

Subrecipient Monitoring Cash Management Reporting

Other Findings in this Audit

  • 34668 2022-002
    Significant Deficiency
  • 34669 2022-003
    -
  • 611109 2022-002
    Significant Deficiency
  • 611110 2022-002
    Significant Deficiency
  • 611111 2022-003
    -

Programs in Audit

ALN Program Name Expenditures
84.287 Twenty-First Century Community Learning Centers $295,533
93.558 Temporary Assistance for Needy Families $237,814
93.235 Title V State Sexual Risk Avoidance Education Program $80,509
93.391 Activities to Support State, Tribal, Local and Territorial (stlt) Health Department Response to Public Health Or Healthcare Crises $57,756
93.590 Community-Based Child Abuse Prevention Grants $24,819