Finding 391476 (2023-002)

Condition: During our audit procedures, we noted that the following financial reports were not submitted on time and/or with incorrect balances of cumulative expenses. Criteria: As stated in the award terms 2.CFR 200.328, financial reports are due on a quarterly basis. Cause: Staff members responsible for compiling and submitting financial reports may lack a comprehensive understanding of the specific reporting requirements stipulated by the Federal awarding agency. Without clear guidance or training on reporting deadlines, formatting, and content expectations, they may confront problems meeting compliance obligations in a timely and accurate manner. Effect: Late submissions of required financial reports can result in heightened scrutiny from Federal awarding agencies. The Corporation could face delays in receiving future funding until compliance issues are resolved, impacting its financial stability and mission delivery. Recommendation: Centro Margarita, Inc. should establish clear protocols and timelines for the preparation and submission of financial reports to ensure compliance with Federal awarding agency requirements. This include defining roles and responsibilities within the finance and accounting team and setting deadlines well in advance of the reporting due dates.