FAC Explorer

Finding 399873 (2023-003)

Significant Deficiency
Requirement
I
Questioned Costs
$1
Year
2023
Accepted
2024-06-04
Audit: 307979
Organization: Inland Counties Legal Services (CA)
Auditor: Halliday & Company Certified Public Accountants

AI Summary

  • Core Issue: The Organization did not get prior approval for a $29,924 security guard contract, violating federal requirements.
  • Impacted Requirements: 45 CFR Parts 1630 and 1631 mandate prior approval for purchases over $25,000 using LSC funds.
  • Recommended Follow-Up: Implement policies for regular follow-ups on prior approval requests to ensure compliance and prevent future issues.

Finding Text

Service Contract Prior Approval Federal Program: Legal Services Corporation (09-805230) grant period ending December 31, 2023 Finding Type: Significant deficiency Condition/Context: The Organization failed to obtain prior approval for a contract for security guard service for which over $25,000 was charged to LSC. Criteria: 45 CFR Parts 1630 Cost Standards and Procedures and 1631 Purchasing and Property Management require prior approval by LSC for certain purchases for which over $25,000 of LSC funds will be utilized. Questioned Costs: $29,924 Cause: Prior approval was request from LSC; however, the contract was sent back to the Organization by LSC with items for clarification/correction. At the time application was returned, the submitting party was on sick leave. They inadvertently missed the notification that the request was returned and failed to follow-up on it, so the prior approval was never successfully obtained. Effect: The Organization is seeking retroactive approval; however, it is possible the amount charged to LSC may be disallowed. Repeat Finding: No Recommendation: The organization should implement additional policies and procedures requiring periodic follow-up and review of outstanding prior approval request to ensure the process is seen through to the end and the necessary approvals are obtained. Views of Responsible Officials and Planned Corrective Actions: Management accepts the finding. See management’s Corrective Action Plan included at the end of the report.

Corrective Action Plan

2023-003 Service Contract Prior Approval Federal Program: Legal Services Corporation (09-80523) grant period ending December 31, 2023 Additional Context: The security guard services have been provided under a long-standing relationship with the vendor. ICLS received prior approval from LSC in 2021 for one year of security services. The contract was cancelable and at prevailing vendor rates. Services were expanded into additional offices and an additional prior approval was requested. The request was not completed due to unanswered questions about the contract terms, and negotiation between ICLS and the vendor stalled. For the safety of employees, clients, and applicants, services continued during this time. As prior approval was no longer timely, ICLS began working with LSC on an allowability determination. Corrective Action: Management accepts the finding and will implement additional policies and procedures requiring periodic follow-up and review of outstanding Prior Approval or Allowability Determination requests to ensure the process is completed and the necessary approvals obtained. Currently, since all requests are submitted in GrantEase, management periodically reviews GrantEase for outstanding requests and provides follow-up. Allowability Determinations unfortunately end up at the bottom of the workflow in LSC’s review process. ICLS is working with LSC for a post “Allowability Determination” for the contract in question. Contact Person: Jaime Cartagena, Deputy Director of Operations Anticipated Completion Date: December 31, 2024

Categories

Questioned Costs Procurement, Suspension & Debarment Significant Deficiency

Other Findings in this Audit

  • 399872 2023-002
    Significant Deficiency
  • 976314 2023-002
    Significant Deficiency
  • 976315 2023-003
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
09.U01 Legal Services Corporation Basic Field Grant $5.60M
21.027 Coronavirus State and Local Fiscal Recovery Funds $1.58M
93.044 Special Programs for the Aging_title Iii, Part B_grants for Supportive Services and Senior Centers $271,876
21.008 Low Income Taxpayer Clinics $185,342
09.U02 Legal Services Corporation Pro Bono Innovation Fund Grant $171,123
16.524 Legal Assistance for Victims $81,925
93.634 Support for Ombudsman and Beneficiary Counseling Programs for States Participating in Financial Alignment Model Demonstrations for Dually Eligible Individuals $38,657
64.033 Va Supportive Services for Veteran Families Program $1,815