Finding Text
According to Section 200.303 of the Uniform Guidance, a nonfederal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal
award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Point of Freedom needs to establish and document their policies and procedures to meet the control objectives outlined in 2 CFR section 200.1. One of the objectives focuses on ensuring that transactions are accurately recorded and accounted for, enabling the accurate preparation of dependable financial statements and federal reports. Based on our testing of reports, management was not able to provide accurate supporting documentation to corroborate reports submitted to the funding agency. The Organization's initial exposure to a Single Audit, along with limited time to develop policies and procedures for compliance, has resulted in the identified deficiencies. Inadequate controls in this compliance area could lead to a significant risk of the Organization not meeting federal award reporting requirements. We selected three months' worth of monthly reports for ADAMHS and one closeout report for OHMAS. We recommend management to seek professional advice in developing and implementing policies and procedures that address compliance requirements. We recommend further to provide comprehensive training to employees on these policies and procedures, along with consistent monitoring, to ensure accuracy and timeliness in federal reporting.