Finding Text
U.S. Department of State
Professional & Cultural Exchange Programs
Assistance Listing #19.415
Finding 2023-002
Significant Deficiency – Cash Management
Criteria: The A-102 Common Rule requires that non-Federal entities receiving Federal awards establish and maintain internal control designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Adequate segregation of duties provided between performance, review, and recordkeeping of a task is a control activity which will reasonably ensure compliance with Federal laws, regulations, and program requirements.
Condition: Internal control over reimbursement requests could not be readily substantiated.
Questioned Costs: None noted.
Context: Documentation of preparer and reviewer of reimbursement requests could not be substantiated.
Effect: By not maintaining adequate and consistent documentation of review, the Organization may not be able to readily prevent, detect, and correct potential errors in cash management requirements. Therefore, the Organization may be incorrectly reimbursed for expenditures under the program requirements.
Cause: Current processes do not include a consistent method of performing, documenting, and maintaining adequate documentation of the preparation and review of reimbursement requests.
Recommendation: The Organization should improve procedures to consistently prepare, perform, and document review of reimbursement requests.
Management’s Response: Management considers this finding resolved as of August 2024. In 2023, as was done in prior years, there was not a multi-level approval for submitting drawdown requests. Greenheart has now changed this process to have the Accounting Manager send a request to drawdown to the Director of Finance and Grants director. The Director of Finance ultimately approves the drawdown, and the email exchange is saved for documentation.