Finding 563574 (2024-002)

Significant Deficiency
Requirement
A
Questioned Costs
-
Year
2024
Accepted
2025-06-02

AI Summary

  • Core Issue: Lack of documented approval for expenditures before checks are signed.
  • Impacted Requirements: Compliance with grant approval processes is not being met.
  • Recommended Follow-Up: Implement a system to ensure all transactions are reviewed and approved before check issuance.

Finding Text

2024-002 Expense Approval Documentation - Significant Deficiency Criteria: Expenditures should be approved by a responsible official of the Organization who is aware of the various compliance requirements under the respective grant, this approval should be documented. Condition: During our testing, we tested 25 transactions and found that none of the transactions contained documentation of approval prior to the dually signed checks. Cause: Undetermined. Effect: The Organization did not approve transactions prior to signing checks, which allows for the possibility of having purchased or obligated the Organization for items that do not conform to grant requirements. Recommendation: We recommend that the Organization develops a more comprehensive system to ensure that all transactions are properly reviewed and approved prior to signing of checks.

Corrective Action Plan

2024-002 Corrective Action Plan: Expense Approval Documentation - Significant Deficiency Issue Summary A significant deficiency was identified during the audit process regarding inconsistent or missing documentation for expense approvals. Instance sincluded expenditures lacking evidence of required approvals, incomplete support for business purposes, and deviations from documented approval thresholds. Root Cause Analysis - Inconsistent application of expense approval policies. Corrective Actions Expected Outcome - Consistent and complete documentation of all expense approvals. - Increased compliance with internal controls and audit standards. - Reduced risk of unauthorized or inappropriate expenditures. - Strengthened accountability among approvers and departments. Monitoring and Reporting The Finance Committee, the Director of Operations and Finance, and the Executive Director will monitor progress monthly and update executive leadership. Ongoing compliance will be tracked via audit findings and system-generated reports.

Categories

Procurement, Suspension & Debarment Significant Deficiency

Other Findings in this Audit

  • 563573 2024-001
    Material Weakness
  • 1140015 2024-001
    Material Weakness
  • 1140016 2024-002
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
21.027 Coronavirus State and Local Fiscal Recovery Funds $3.00M
16.575 Crime Victim Assistance $69,292
10.555 National School Lunch Program $11,854
10.553 School Breakfast Program $5,741
10.559 Summer Food Service Program for Children $10