Finding Text
Condition – Under Uniform Guidance, Porchlight, Inc.'s audited financial statements for the year ended December 31, 2022 were due to the federal single audit clearinghouse by September 30, 2023. Porchlight Inc.'s December 31, 2022 audited financial statements were not completed for submission to the federal audit clearinghouse until after September 30, 2023. In addition, Porchlight, Inc. did not file its quarterly expense status reports for its federal and state grants in a timely manner.
Criteria – Uniform Guidance 200.302(b)(4) states each non-federal entity must provide for “effective control over, and accountability for, all funds, property, and other assets.” In addition, Uniform Guidance requires audited financial statements to be submitted to the federal audit clearinghouse within nine-months after an entity’s year-end. The federal and state grant contract provided deadlines for when the quarterly reports were to be submitted.
Cause – During the audit year, there was turnover in Porchlight, Inc.’s business office which contributed to the lack of timely reconciliation's. In addition, the circumstances surrounding the COVID-19 pandemic continued to affect the timeliness of the reconciliation process. Porchlight, Inc. is working on streamlining and implementing processes to address the deficiencies noted in the condition paragraph.
Effect – A significant deficiency in internal control over compliance and an instance of noncompliance exists due to failure to provide financial statements and grant quarterly reports in a timely manner in order to meet audit and contract submission deadlines.
Recommendation – We recommend Porchlight, Inc.'s implement procedures to ensure timely completion of the annual audit and quarterly expense reports.
View of Responsible Officials – Management agrees with the assessment and has committed to a corrective action plan.