Finding 975034 (2023-002)

Significant Deficiency
Requirement
P
Questioned Costs
-
Year
2023
Accepted
2024-05-28

AI Summary

  • Core Issue: The Organization's policies and procedures do not comply with the LSC Financial Guide and related regulations.
  • Impacted Requirements: Compliance with 45 C.F.R. Parts 1600-1644 and the updated LSC Financial Guide is essential for managing funds accurately.
  • Recommended Follow-Up: Revise policies and procedures to align with LSC guidelines; the Finance Director will oversee this and ensure annual reviews and updates.

Finding Text

Criteria: Legal Services Corporation (LSC) grant recipients are required to establish and maintain adequate accounting systems and financial records to accurately account for all funds (both LSC and non-LSC funds). LSC requires recipients and subrecipients to (1) responsibly manage all funds pursuant to the cost standards and procedures of 45 C.F.R. Part 1630 and other LSC regulations at 45 C.F.R. Parts 1600-1644; and (2) record transactions in accounting records and, where required, prepare annual financial statements in accordance with GAAP. Recipients are also required to adhere to requirements of the LSC Financial Guide (effective January 1, 2023) including Section 2 "Accounting Systems and Governance" and Section 3 "Managing LSC Grants." Condition/Context: The Organization's written policies and procedures did not meet the requirements outlined by the LSC Financial Guideline and other LSC regulations. Cause: The Organization did not align its policies and procedures with the recently issued LSC Financial Guide. The updated Guide required operational changes that had not yet been implemented. Effect: Lack of proscribed procedures and controls could result in the Organization administering the LSC Grant out of compliance with the Guide. Questioned Costs: N/A Recommendation: It is recommended that the Organization revise their written policies and operational procedures to align with the regulatory guidance. Views of Responsible Officials: Management agrees with the auditor’s finding and will take immediate action to revise the Organization’s accounting manual to align with the regulatory requirements. The Director of Finance will work directly with the Organization’s assigned Fiscal Compliance Analyst from Legal Services Corporation (LSC) to ensure policies and procedures are aligned with LSC’s Financial Guide. The Director will review the Organization’s accounting manual annually and will notify the CEO and the Finance and Audit Committee of any updates to any policy and procedures.

Categories

Subrecipient Monitoring

Other Findings in this Audit

  • 398591 2023-002
    Significant Deficiency
  • 398592 2023-002
    Significant Deficiency
  • 398593 2023-002
    Significant Deficiency
  • 398594 2023-002
    Significant Deficiency
  • 398595 2023-002
    Significant Deficiency
  • 975033 2023-002
    Significant Deficiency
  • 975035 2023-002
    Significant Deficiency
  • 975036 2023-002
    Significant Deficiency
  • 975037 2023-002
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
09.524 Basic Field and Pai Grants $2.13M
09.524 Migrant Grant $764,726
93.044 Special Programs for the Aging_title Iii, Part B_grants for Supportive Services and Senior Centers $173,422
16.575 Crime Victim Assistance $173,191
14.418 Private Enforcement Initiatives $170,111
09.524 Technology Improvement Grant $61,909
14.169 Housing Counseling Assistance Program $57,122
93.566 Refugee and Entrant Assistance_state Administered Programs $41,553
09.524 Adoption, Expansion and Enhancement Grant $12,397