FAC Explorer

Finding 518468 (2022-004)

Material Weakness
Requirement
P
Questioned Costs
-
Year
2022
Accepted
2025-01-09
Audit: 336928
Organization: Montgomery Area Coalition for the Homeless, Inc. (AL)
Auditor: Moses and Moses CPAS INC

AI Summary

  • Core Issue: There is a material weakness in internal controls for the Emergency Solution Grant due to employee turnover and inconsistent monitoring of grant billing.
  • Impacted Requirements: Compliance with 2 CFR Section 200.61, which mandates effective internal controls for managing federal awards.
  • Recommended Follow-Up: Establish a grant billing schedule and review it monthly to ensure timely submissions and adherence to internal control policies.

Finding Text

Finding 2022-004 Internal Control: Material Weakness Program: Emergency Solution Grant ALN No.: 14.231 Federal Grantor: U.S. Department of Housing and Urban Development Passed-through: City of Montgomery Award No. and Year: MACH-covid19-ESG-CV1-PY2020 Condition: Under 2 CFR Section 200.61, non-federal entities must establish and maintain effective internal controls to provide reasonable assurance that the entity is managing the federal awards in compliance with statutes, regulations, and the terms and conditions of the award. Cause: The condition was found to be the result of employee turnover and failure to consistently perform internal controls previously in place to monitor grant billing for third party grant reimbursement for allowable expenditures. Effect or Potential Effect: Loss of revenue if billings are not completed within the time frame allotted by the grants and inaccurate interim financial statements. Questioned Costs: No questioned costs were identified as a result of our procedures. Context/Sampling: 1 out of the 5 reimbursable grants was not billed in a timely manner Repeat Finding from Prior Year: No Recommendation: We recommend that Mid-Alabama Coalition for the Homeless follow their internal control policies on all grants and perform timely billings of contracts through setting a grant billing schedule and review it monthly, in order to assure billings are timely submitted. Views of Responsible Officials: Management of Mid-Alabama Coalition for the Homeless concurs with this finding and has provided a response, which is noted in Mid-Alabama Coalition for the Homeless 's Corrective Action Plan ( see page 28 through 31 ).

Corrective Action Plan

Corrective Action by MACH: The Mid-Alabama Coalition for the Homeless agrees with this finding. Since the close of the contract year, MACH's Executive Director, accountant, and CPA firm have established a system for coding, submitting, reconciling, and requesting reimbursement from grant funders. Currently, all grant documentation is assembled as transactions occur, and reimbursement requests are submitted to every grant source each month.

Categories

Cash Management Material Weakness Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties

Other Findings in this Audit

  • 518469 2022-005
    Significant Deficiency
  • 518470 2022-005
    Significant Deficiency
  • 518471 2022-005
    Significant Deficiency
  • 518472 2022-005
    Significant Deficiency
  • 518473 2022-005
    Significant Deficiency
  • 1094910 2022-004
    Material Weakness
  • 1094911 2022-005
    Significant Deficiency
  • 1094912 2022-005
    Significant Deficiency
  • 1094913 2022-005
    Significant Deficiency
  • 1094914 2022-005
    Significant Deficiency
  • 1094915 2022-005
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
14.231 Emergency Solutions Grant Program $1.32M
14.267 Continuum of Care Program $51,328