Finding Text
Finding No. 2023-002: Reporting and Annual Audit Submission – Significant Deficiency
Assistance Listing Program Title and Number: All
Federal Agency: All
Criteria
As per the Code of Federal Regulations, Section 200.512 - Report Submission, the audit must be completed and the Data Collection Form and reporting package must be submitted within the earlier of 30 calendar days after receipt of the auditors’ report, or nine months after the end of the audit period. The due date for the audit and reporting package submission was March 31, 2024. The Organization is also required to submit periodic reports under the terms and conditions of its federal award contracts
Condition
The audit, Data Collection Form and reporting package were not submitted by the due date March 31, 2024. The Organization submitted reports that did not reconcile to the accounting records, and were not submitted by the due date.
Cause
The Organization was not able to timely prepare for the audit in order for the Uniform Guidance, Data Collection Form and reporting package to be filed by the due date. The Organization’s reporting of charges to federal awards for salaries and wages are not supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated, and that the reports reconcile to the expenditures charged to the federal award.
Effect
The audit, Data Collection Form and federal reporting package were not filed on time. Certain periodic reports did not reconcile to the general ledger. The Health Center Program required a reclassifying adjustment of $357,849 of expenditures between grant contracts. Ryan White required a reclassifying adjustment $599,717 of expenditures between grant contracts. The support for the allocations was not available as noted in finding 2023-003, therefore it is not known whether the reports contained unallowable costs or whether the costs were improperly recorded on the general ledger.
Questioned Costs
Unknown
Context
The Organization was unable to complete the financial statements and Federal Single Audit by the due date. The support used to reconcile the general ledger to the grant reports filed was not provided nor could the support be regenerated from the accounting system. The allocations made to the grants were not available or identified for testing.
Recommendation
We recommend that all necessary efforts be taken to ensure timely submission of the audit, Data Collection Form and reporting package. We recommend reports be reconciled to the accounting records prior to their submission. Sufficient internal controls should be designed and implemented to detect and prevent errors in reports and within the accounting system. We also recommend all necessary efforts be taken to ensure timely submission.
Management’s Response/View of Responsible Officials
Management agrees with this finding, see the Corrective Action Plan.