FAC Explorer

Finding 539427 (2024-002)

Material Weakness
Requirement
B
Questioned Costs
$1
Year
2024
Accepted
2025-03-28
Audit: 349994
Organization: Catholic Charities of the Rio Grande Valley (TX)
Auditor: Peña Briones McDaniel & CO

AI Summary

  • Core Issue: The Organization lacked consistent internal controls over expenditures, leading to insufficient documentation for 5% of shelter costs.
  • Impacted Requirements: Compliance with allowable costs under 2 CFR § 200.302 was not fully met, resulting in questioned costs of $48,502.
  • Recommended Follow-Up: Review and strengthen intake procedures to ensure all expenditures are documented and compliant with policies.

Finding Text

Reference Number: 2024-002 Assistance Listing Number: 97.024 Compliance Requirements: Allowable Costs/Cost Principles Criteria: The Organization should have internal controls over expenditures to ensure that policies and procedures are in place to support the allowability of expenditures in accordance with 2 CFR § 200.302. Condition and Context: The Organization provided humanitarian assistance to migrants and asylum seekers turned over by Customs and Border Protection (CBP), including meals, transportation and shelter at hotels and the Organizations Respite Center. The Organization has intake procedures in place with respect to hotel shelter expenditures. However, the intake process was not consistently applied to all participants. The Organization was not able to provide supporting documentation for 5% of the requested sample of individuals who received shelter. Effect: The allowability of certain expenditures was not fully supported by underlying documentation. We detected an error rate of 5%, which resulted in an extrapolated questioned cost of $48,502. Cause: There was an unprecedented influx of migrants requiring processing within a compressed timeframe, the program’s primary objective was to expedite assistance. This urgency, while addressing immediate humanitarian needs, resulted in some procedural oversights. Questioned Costs: $48,502. Management Response: See Corrective Action Plan.

Corrective Action Plan

Finding 2024-002 – The Organization provided humanitarian assistance to migrants and asylum seekers turned over by Customs and Border Protection (CBP), including meals, transportation and shelter at hotels and the Organizations Respite Center. The Organization has intake procedures in place with respect to hotel shelter expenditures. However, the intake process was not consistently applied to all participants. The Organization was not able to provide supporting documentation for 5% of the requested sample of individuals who received shelter. Management's view: Management acknowledges this finding, and awareness has been brought to this area. The errors identified in this finding were made due to a lack of implementation of proper agency financial procedures by a former employee and occurred during a period of substantial influx in the number of non-citizen migrants being assisted. Authorization of credit card use was provided to one hotel vendor which led to unverified charges. This was identified and corrected by senior staff within three weeks. Proposed Corrective Action: The following measures were already taken to correct this finding: The organization has provided proper training to its program staff and accounting bookkeepers to improve the internal payment review process on all payment requests and has prohibited the use of credit cards to cover hotel stays for clients. All hotel payments are to be paid by check after reviewing the proper documentation submitted by the vendor, which includes an invoice with the non-citizen migrant's name as spelled in the Notice to Appear documentation provided by U.S. Customs and Border Protection. This documentation is then compared to the registration database maintained by the organization which includes name and A-number for all non-citizen migrants served. Any unauthorized payment will be immediately investigated and disputed on a timely basis. This policy has already been implemented successfully. An internal sample verification process was completed successfully with supporting evidence for all clients served after the previous unauthorized charges were identified within the period of three weeks. Anticipated Correction Date: These measures have been implemented.

Categories

Questioned Costs Allowable Costs / Cost Principles Internal Control / Segregation of Duties

Other Findings in this Audit

  • 539428 2024-002
    Material Weakness
  • 539429 2024-002
    Material Weakness
  • 539430 2024-002
    Material Weakness
  • 539431 2024-002
    Material Weakness
  • 539432 2024-002
    Material Weakness
  • 539433 2024-002
    Material Weakness
  • 1115869 2024-002
    Material Weakness
  • 1115870 2024-002
    Material Weakness
  • 1115871 2024-002
    Material Weakness
  • 1115872 2024-002
    Material Weakness
  • 1115873 2024-002
    Material Weakness
  • 1115874 2024-002
    Material Weakness
  • 1115875 2024-002
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
97.141 Shelter and Services Program $100,789
97.008 Non-Profit Security Program $72,440
97.024 Emergency Food and Shelter National Board Program $50,241
14.218 Community Development Block Grants/entitlement Grants $15,832
19.510 U.s. Refugee Admissions Program $7,820
14.231 Emergency Solutions Grant Program $4,972