NORTHWEST BRONX COMMUNITY & CLERGY COALITION INC

2024-001 - Reporting Program: Weatherization Assistance for Low-Income Persons (ALN 81.042) Award Number: C096040-23 Federal Agency: U.S. Department of Energy Pass-Through Agency: New York State Division of Housing and Community Renewal Criteria: In accordance with 2 CFR § 200.403, reimbursement requests must be based on actual, finalized, and incurred costs. Costs that are preliminary, estimated, or subject to future reallocation do not meet the federal requirements for reimbursement. Submitting reimbursement requests based on unfinalized or tentative accounting records is inconsistent with federal financial management standards and may result in unallowable costs. Condition: During the audit, we noted that reimbursement vouchers submitted to the funding agency included costs that, while present in the accounting system at the time of billing, were later reallocated to a different contract as part of the year-end review process. As a result, some of the reimbursed costs were no longer allocable to the original award under which they were requested. Cause: This occurred due to the timing of the billing process, which relied on preliminary accounting data before the final close of the books. The organization does not currently have a formal process in place to verify that all billed expenses remain allocable and properly supported after final adjustments are made. Effect: Reimbursement requests may have included costs that were ultimately charged to a different award, which could lead to compliance concerns or potential repayment obligations if not addressed. Additionally, relying on unfinalized data increases the risk of reporting inaccuracies and weakens the reliability of financial information submitted to funding agencies. Questioned Costs: None noted. Context: This issue was identified in connection with year-end adjustments affecting one specific award. Based on the nature of the issue, it appears to be isolated but highlights the need for greater alignment between billing and final accounting procedures. Repeat Finding: No Recommendation: To enhance financial oversight and support strong grant management practices, we suggest that the organization consider implementing a monthly budget-to-actual review process for all contracts within the same program. This approach would promote closer alignment between actual expenses and approved budgets, help ensure costs are properly allocable to the appropriate contracts and enable early detection and correction of any deviations or misallocations before reimbursement requests are submitted. To further support compliance and make the most effective use of available funding—while minimizing the risk of overbilling—we recommend the following actions: • Conduct monthly budget-to-actual comparisons at both the individual contract and overall program level to ensure that expenses are accurately tracked against the correct funding sources and remain within allowable limits. • Monitor cumulative billed amounts throughout the contract period to support full utilization of awarded funds while avoiding excess or premature billing. These practices can help strengthen internal controls, improve financial reporting accuracy, and support compliance with applicable federal and contract requirements. Views of Responsible Officials: See Corrective Action Plan.

We appreciate the audit team’s diligence and acknowledge the reporting finding. This appears to reflect a difference in interpretation around when “final adjustments” to Weatherization Assistance Program contracts may occur. Based on our longstanding experience with the program and past guidance, we understood that adjustments could be made within the active contract period and up to 60 days after contract closeout. In this case, NWBCCC made an adjustment in 2024 to an active multi-year contract with a September 2025 end date, which we believed to be within allowable guidelines. However, based on the auditor’s definition of “final adjustment”, which is that every monthly voucher is a final adjustment, our action resulted in a finding. Going forward as a corrective measure, NWBCCC will treat each monthly voucher as a final submission for that period and enhance internal review processes to avoid retroactive changes. Where adjustments are necessary, we will coordinate with HCR to ensure proper documentation and compliance.