The Chickahominy Indian Tribe respectfully submits the following corrective action plan for the year ended December 31, 2024.
Name and address of independent public accounting firm:
Brown, Edwards & Company, L.L.P. 1909 Financial Drive
Harrisonburg, Virginia 22801
Audit period: December 31, 2024
The findings from the December 31, 2024 Schedule of Findings and Questioned Costs (the “Schedule”) are discussed below. The findings are numbered consistently with the number assigned in the Schedule.
FINDINGS – FINANCIAL STATEMENT AUDIT
2024-001: Material Audit Adjustments (Material Weakness)
Condition:
Multiple material audit adjustments were proposed.
Criteria:
Financial information should be materially correct.
Cause:
The Tribe switched from using an excel spreadsheet to an accounting software for tracking financial information in 2023. During the year, there were reconciliation issues between the software and the spreadsheet which did not get resolved.
Material audit adjustments needed to be made to ensure the accuracy of the financial statement, but the cumulative effect of these entries was significantly less than in the prior year.
Effect:
Audit adjustments were required to ensure the financial statements are materially correct.
Recommendation:
We do not consider it necessary to reconcile between the Tribal Ledger and Abila; however, we strongly encourage adding a procedure to the monthly bank reconciliations. Bank deposits should be matched to Abila revenue, and bank disbursements to Abila expenses. This will ensure revenues and expenses are properly recorded in addition to ending cash balances being reconciled.
Corrective Action:
The accounting software is the only source of accounting information now. The Tribal Ledger is no longer being maintained. We continue to learn the intricacies of the new software and the proper way to use it. We are instituting a more formal schedule for review of accounting entries, to ensure they are done in a more timely manner. We have been developing a handbook which will list proper procedures, including proper entry of non- typical transactions. It will also include the procedure for bank reconciliation. We anticipate that material audit adjustments will not be required in the future.
FINDINGS AND QUESTIONED COSTS – MAJOR FEDERAL AWARD PROGRAM AUDIT
2024-002: Child Care Development Fund Cluster ALN 93.575 and 93.596
Condition
There was one expenditure tested under the CCDF American Rescue Plan Act Child Care Supplementary Discretionary grant that did not get obligated by the required date.
Criteria
Funds should be obligated by the end of the succeeding federal fiscal year after award and expended by the end of the third federal fiscal year.
Cause
The CCDF ARP Supplementary Discretionary grant was the only grant that did not receive a federal extension or Tribal waiver. The Tribe was under the impression that all CCDF grants would have waivers.
Effect
One item was not obligated by the required date, total $13,604.
Perspective Information
One tested of one in the ARP discretionary, but one of 25 in all CCDF.
Recommendation
We recommend establishing a formal policy regarding definitions of obligation and liquidation. This should be formally approved by Council with a resolution.
Corrective Action:
During a meeting prior to the end of the obligation period, we decided how we would use the referenced funds. We documented that decision in the meeting minutes and believed we had met the obligation requirements. The Funding Agency was satisfied with our explanation of the funds being considered obligated, as Tribes can define obligation in their own terms. However, the actual contract wasn’t executed until after the obligation period was over. In addition, we also thought the obligation and liquidation periods for this particular grant had been extended along with those of similar grants that we have from this agency, but realized later that they had not been.
We immediately started a review at the beginning of each month of all grants to determine those whose obligation period ends that month. We also review at that time for grants whose liquidation period ends that month. When either of these occurs, I issue a notification to FinanceStaff to make them aware. I also notify the manager of those grants to ensure they are aware of the obligation and liquidation deadlines. We will also review our Financial Policy and clarify our definition of Obligation as needed.
If the Federal Audit Clearinghouse has questions regarding this plan, please call Wayne Adkins, First Assistant Chief and Finance Officer at 804-829-2027.
Sincerely yours,
Wayne Adkins
First Assistant Chief and Finance Officer