Finding 613457 (2022-001)

Material Weakness Repeat Finding
Requirement
P
Questioned Costs
-
Year
2022
Accepted
2023-07-12

AI Summary

  • Core Issue: The Network failed to submit required financial reports to the Federal Audit Clearinghouse and GATA portal within the nine-month deadline after June 30, 2022.
  • Impacted Requirements: This noncompliance affects financial reporting standards under Uniform Guidance and GATA, increasing the risk of material misstatements.
  • Recommended Follow-Up: Establish a timeline for completing financial transactions and reports, and update financial policies for board approval to ensure timely submissions in the future.

Finding Text

Criteria The Network has grant agreements from State of Illinois agencies with terms requiring compliance with financial reporting requirements in accordance with Uniform Guidance and the State of Illinois Grant Accountability and Transparency Act (GATA). As such, for the year ended June 30, 2022, the Network is required to submit audited financial statements, a schedule of expenditures of federal awards (SEFA) and single audit reports to the Federal Audit Clearinghouse and the same audit package plus a Consolidated Year End Financial Report (CYEFR) to the GATA portal. All items are required to be submitted within nine (9) months after the Network?s fiscal year-end. Condition The Network did not submit its audited financial statements, SEFA and CYEFR and other required information to the Federal Audit Clearinghouse and GATA portal within nine (9) months after June 30, 2022. Cause This condition was due to several factors including a normal ?learning curve? experienced during its change of accountants from fiscal year 2021 to fiscal year 2022 and subsequent change of accountants after fiscal year 2022. As such, there was a delay in completing the recording of year-end financial transactions, performing account reconciliations and preparing financial reports for fiscal year 2022 as needed for the audit. Effect The effect is that controls over the financial reporting process were weakened thereby increasing the risk that material misstatements could be included in the financial statements without management being aware. Additionally, noncompliance with financial reporting deadlines could cause funding sources for the Network to suspend funding until compliance is achieved. Questioned Costs None noted. Recommendation We recommend that current accounting personnel establish a schedule of completing the recording all financial transactions and preparation of account reconciliations and financial reports, including a CYEFR and, if applicable, a SEFA, at year-end in a timely manner for review by management and the board of directors. We further recommend that these procedures be included in an updated set of financial policies and procedures that are reviewed and approved by the board of directors. Management Response See corrective action plan.

Categories

Reporting

Other Findings in this Audit

  • 37015 2022-001
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
16.034 Coronavirus Emergency Supplemental Funding Program $1.90M
93.671 Family Violence Prevention and Services/domestic Violence Shelter and Supportive Services $439,865