Finding Text
FINDING 2023-002 - Block Grants for Prevention and Treatment of Substance Abuse - Assistance Listing No. 93.959; Grant Period - For the year ended June 30, 2023
Condition: The internal controls over the expense approval process were not operating as designed. As a result, we were unable to review approval on specific expenses for a selection of transactions claimed as part of the Block Grants for Prevention and Treatment of Substance Abuse.
Criteria: The Organization's policy is to have dual signature approval from the purchaser and a supervisor of the appropriate level for all expenses with the exception of certain recurring expenses. Proper functioning internal controls would result in the Organization having consistent control procedures in place for expense approval.
Cause: The system of controls over the Block Grants for Prevention and Treatment of Substance Abuse did not operate properly to allow for the Organization to provide evidence of specific expense approval or documentation to confirm the expense was considered recurring for 18 of 40 items selected for testing as part of the allowable cost testwork performed.
Effect: While overall vendor contracts were provided, the Organization was unable to provide documentation to verify that the specific expense transactions were approved in accordance with the purchasing policy.
Recommendation: The Organization's internal control system over the invoice approval process should be re-evaluated, all recurring expenses should be documented and all employees involved should be trained on the process.
Views of Responsible Officials and Planned Corrective Actions: The Organization has reviewed its invoice approval process, and has notified staff of the requirement to approve and code invoices for payment. The Accounts Payable Specialist is monitoring compliance, and forwarding invoices for approval where necessary. Invoices pertaining to recurring expenses are approved either via the credit card expense report or invoice approval processes.