Finding Text
2024-001 Inaccurate Reports Submitted to the Funders
Program Name/Assistance Listing Number: 93.788 Opioid STR
Federal Agency: Department of Health and Human Services
Federal Award Identification: Unknown
Type of Finding: Significant Deficiency
Compliance Requirement: Reporting
Criteria: According to the terms of the funding agreements and applicable grant management guidelines, the Organization is required to submit accurate, complete, and timely financial and performance reports to funders. These reports must align with the Organization's internal controls, including the data maintained in its program management system. Accuracy and consistency between internal data and reports submitted to funders are essential to ensure compliance with funding requirements andmaintain transparency.
Condition: During the audit, it was identified that several reports submitted to funders were not accurate when compared to the data maintained in UMADAOP's internal database. Discrepancies were found in performance reporting. Further complicating the issue, it was found that only one individual at the organization had complete knowledge of the reporting process, the data entries, and the reconciliation between database and reports submitted to funders. This individual was solely responsible for preparing the reports and maintaining the accuracy of the data. Unfortunately, this person untimely passed away during the audit period and no one else within the organization was fully aware of how to explain or address the discrepancies in the reports or resolve any matter related to the reporting process.
Cause of Condition: The primary cause of the discrepancies and the inability to explain or address the issues following the individual's passing is the lack of adequate knowledge transfer and documentation within the organization. The reporting process relied heavily on a single individual without sufficient backup or cross-training for other staff members. As a result, there was no redundancy in knowledge regarding the reconciliation process, the data reporting requirements, or how to resolve issues if discrepancies arose. Additionally, manual data entry errors or delays in data input into
the internal database further contributed to the inconsistencies between the reports and UMADAOP's records.
Potential Effect of Condition: The inaccuracies in the reports submitted to funders, coupled with the lack of continuity in knowledge following the passing of the responsible individual, have several potential effects: 1. Non-Compliance: The Organization risks being out of compliance with the terms and conditions of funding agreements, which could lead to audit findings, delayed payments, or even the loss of funding. 2. Delayed Reporting: with no one else fully knowledgeable about the reporting process, there could be delays in submitting future reports, further complicating relationships with funders. 3. Financial and Reputational Damage: The Organization's credibility with funders may be damaged if discrepancies are not adequately explained or addressed, leading to potential reputational harm and the possibility of reduced funding opportunities in the future.
Questioned Cost: Not quantifiable.
Recommendation: To address these issues and prevent similar occurrences in the future, the following corrective actions are recommended: 1. Knowledge Transfer and Cross-Training: Implement a formal knowledge transfer process to ensure that multiple staff members are fully trained in the reporting and reconciliation process. This should include creating detailed documentation of procedures and responsibilities. 2. Backup and Succession Planning: Establish a clear succession plan for critical roles, particularly for key individuals responsible for financial and performance reporting. Ensure that backup staff members are identified and adequately trained to step in during emergencies or unexpected events. 3. Improve Documentation and Process Standardization: Develop and maintain comprehensive documentation of the reporting process, including step-by-step instructions, reconciliation
procedures, and data validation protocols. This will help ensure continuity in operations and provide a reference for other staff members when needed. By implementing these recommendations, the Organization can improve the accuracy and consistency of reports, safeguard against future disruptions, and enhance compliance with funder requirements, even in the event of unexpected personnel changes.
Description of the Nature and Extent of Issues Reported: We consider the following materiality for consideration of material noncompliance for the major program 93.788 at 5% of the total awards expended amounting to $106,845.
Management Response: Management concurred with the finding. The Organization will ensure that multiple people are trained to complete compliance obligations.