Finding Text
Condition: Certain check sequences were backdated during the year. Same finding as 2023-002.
Criteria: Grant expenditures for the Community Services Block Grant must be incurred before they can be reimbursed by grantor. To the extent possible, sufficient liquidity should be maintained to ensure funds are expended before reimbursement from the CSBG grantor is requested.
Cause: The Organization could not provide an explanation for why the backdating of checks occurred.
Effects: As a result, in some cases, reimbursement of grant expenditures for the Community Services Block Grant were requested before they were actually paid out of cash. Cash and accounts payable balances were also materially misstated.
Recommendation: Checks should be dated the day they are cut and entered in the accounting system as of that date to ensure expenses are recorded in the proper period and grant reimbursements are not made until after the expense is paid.
Views of Responsible Officials and Planned Corrective Actions: The Organization agrees with the finding and will implement the recommended procedures as soon as possible.