Finding Text
Federal Awarding Agency: U.S. Department of Health and Human Services Pass-Through Entity: County of Yolo, Placer County, Advocates for Human Potential, Inc. Category of Finding: Allowable Cost/Cost Principles Federal-Pass through Grantor: 2020-2019-PHI01, HHS000025, 7438-CA-BHWD-PHI AL No: 93.959 Finding: The audit identified noncompliance by the nonprofit organization regarding the requirements stipulated in OMB Circular A-133, Section .225(b). This section mandates that federal awards must be accounted for and reported separately from other funds. Notably, the organization's current practice involves allocating multiple funding sources to the facilities it operates without ensuring the necessary segregation of federal awards. Cause: The nonprofit organization did not have adequate controls in place to ensure that federal awards were tracked and accounted for separately from other funds. There was a lack of communication and coordination among the different departments responsible for tracking and reporting federal awards. Effect: The failure to account for federal awards separately from other funds could result in the organization inadvertently using federal funds for purposes that are not allowed or in violation of federal regulations. It could also lead to difficulties in properly reporting and accounting for the use of federal awards, which could result in audit findings or compliance issues. Criteria: The Organization should ensure that its practices align with the requirements stated in OMB Circular A-133, Section .225(b), which mandates the separate accounting and reporting of federal awards. Questioned costs ? Unknown Repeat finding - No Recommendation: The nonprofit organization should establish and implement effective controls to ensure that federal awards are tracked and accounted for separately from other funds, in accordance with the requirements of OMB Circular A-133, Section .225(b). This could include designating a specific account or accounts for federal awards, ensuring that federal awards are coded and tracked separately in the organization's accounting system, and implementing regular reconciliations to ensure that federal awards are properly accounted for. Additionally, the organization should provide training to staff members responsible for handling federal awards to ensure that they are aware of the requirements for tracking and accounting for federal awards separately. Finally, the organization should conduct regular reviews and monitoring of its financial management processes to ensure that federal awards are being used in compliance with all applicable laws and regulations.