Finding 503557 (2023-005)

Significant Deficiency
Requirement
B
Questioned Costs
-
Year
2023
Accepted
2024-10-23

AI Summary

  • Core Issue: The Boys and Girls Club of Livingston County miscalculated salary reimbursements, leading to a $99 discrepancy over four months.
  • Impacted Requirements: Documentation standards for personnel expenses under Uniform Guidance were not met, increasing the risk of errors or fraud.
  • Recommended Follow-Up: Implement a review policy for reimbursement requests by the CEO and CPA to enhance internal controls and accuracy.

Finding Text

Finding No. 2023-005: Temporary Assistance for Needy Families Grant Claim Support (Federal Assistance # 93.558) Type of Finding: Significant Deficiency in Internal Control over Major Programs Criteria: Uniform Guidance indicates that that standards for documentation of personnel expenses are such that charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. Condition: The Boys and Girls Club of Livingston County (the Organization) remits a variety of expense reimbursements to various agencies. We tested 8 bi-weekly timesheets and paystubs from one employee for the 4-month award period. The Organization incorrectly calculated the salary reimbursement for each month. This caused a net discrepancy of $99 of total wages during the 4-month award period. Cause: The Organization functions with a small number of office personnel therefore, the Organization is unable to have a review of the requested reimbursement performed. Effect: A lack of segregation of duties increases the risk that errors or fraud may occur and not be prevented or detected on a timely basis. Questioned Costs: None Repeat Finding: No Recommendation: We recommend the Organization implement a policy to have an employee review the requested reimbursements and corresponding receipts to ensure they agree. Management Response: The financial policies and procedures will be modified with the policy to include review of the submissions by the CEO and the CPA prior to submission of the grant reimbursement request, this will increase the ability to segregate the duties and provide more accurate reporting. Overall, with 2023 still coping with lack of employment pool coming off COVID, securing the CFO was and is crucial to prevent future findings in the Internal Control over the programs.

Corrective Action Plan

The financial policies and procedures will be modified with the policy to include review of the submissions by the CEO and the CPA prior to submission of the grant reimbursement request, this will increase the ability to segregate the duties and provide more accurate reporting. Overall, with 2023 still coping with lack of employment pool coming off COVID, securing the CFO was and is crucial to prevent future findings in the Internal Control over the programs. The IL Alliance that manages the grant for the local organization has created a new tool to assist in the accuracy of the submissions which have been provided since January 1st which will eliminate most reimbursement discrepancies. For example, if the supplies budget line-item was $500.00 and the organization submitted $525.00 in receipts the tool being utilized will be highlighted in red and will not be reimbursed at $525.00, only the $500.00 allowed and this is through all the grants. No overage of dollars was received other than what the grant allowed even though the submission might have been less or more. If it was less, the IL Alliance reaches out to the organization for additional receipts. The Boys & Girls Club of Livingston County will ensure the numbers are more accurate in the reporting moving forward.

Categories

Internal Control / Segregation of Duties Cash Management Reporting Significant Deficiency

Other Findings in this Audit

  • 503556 2023-004
    Significant Deficiency
  • 503558 2023-002
    Significant Deficiency
  • 503559 2023-003
    Significant Deficiency
  • 1079998 2023-004
    Significant Deficiency
  • 1079999 2023-005
    Significant Deficiency
  • 1080000 2023-002
    Significant Deficiency
  • 1080001 2023-003
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
84.287 Twenty-First Century Community Learning Centers $524,578
84.425 Education Stabilization Fund $277,580
93.558 Temporary Assistance for Needy Families $226,764
94.006 Americorps State and National 94.006 $84,572
16.726 Juvenile Mentoring Program $80,622
10.559 Summer Food Service Program for Children $24,807
10.558 Child and Adult Care Food Program $19,959