Barrio Logan College InstituteHigher Education

Finding 2023-001 – Reporting – Significant Deficiency in Internal Controls over Compliance (See Schedule of Findings and Questions Costs for table). Criteria – 45 CFR 75.501 requires a non-Federal entity that expends $750,000 or more during the non-Federal entity’s fiscal year in Federal awards must have a single or program-specific audit conducted for that year. Audits must be completed and submitted within 30 days after receipt of the auditor’s report, or nine months after the end of the audit period, whichever is earlier. Condition/context – The Organization did not submit a single audit in a timely manner to be following the audit requirement under 45 CFR 75.501. Cause – The Organization was unable to meet the deadline. The August 31, 2022 audit was not completed timely, which delayed the start of the August 31, 2023 audit. In addition, certain information was not provided within the agreed upon timelines, which impacted the auditor’s ability to complete testing as originally scheduled. Effect – Audit was not performed and submitted in a timely manner. The Organization has not met the reporting requirements under 45 CFR 75.501. Repeat finding – This is a repeat finding. Recommendation – We recommend the Organization improve internal controls and set a timeline for closing the books, preparing audit schedules and conducting the audit so the audit can be completed timely. Management should ensure that all involved in the audit process have adequate capacity, are aware of the deadlines and commit to meet them. Views of responsible officials - The Organization is committed to getting the single audit completed on time. A plan for August 31, 2024 audit has been developed and will begin in November 2024 and is expected to be completed before the deadline in 45 CFR 75.501.

Finding 2022-001 – Eligibility – Significant Deficiency in Internal Controls Over Compliance (See III - Federal Award Findings and Question Costs - Finding 2022-001 for included table) Criteria – The grant agreement requires the use of sign-in sheets for every workshop/session to gather attendance information. The sign-in sheets should include the activity name, provider’s name, date, participant name and signature, PN logo, and Partner logo. Condition/context – The Organization does not consistently use sign-in sheets for every workshop/session. Cause – The Organization takes attendance at all workshops/sessions; however, based on the nature/location of the workshop, sign-in sheets are not consistently used. Effect – The Organization does not have sign-in sheets to support the attendance at each of the workshops/sessions. Sign-in sheets provide more detail for each of the attendees and provides details that can be compared to the list of eligible participants. Repeat finding – This is not a repeat finding. Recommendation – We recommend that the Organization review the requirements of the grant and develop procedures to gather sign-in sheets at all workshops/sessions. If there are concerns about the ability to obtain this information, the Organization should work with the funding source to identify other acceptable documentation. All communication and conclusions with the funding source should be retained in the Organization’s records. Views of responsible officials – Sign-in sheets are used and maintained for students in third through fifth grade in the Academic Advocate elementary school and in the K-8 tutoring programs. Sign-in sheets were not used for the Academic Advocate middle school and high school tutoring programs.

Finding 2022-002 – Reporting – Significant Deficiency in Internal Controls over Compliance (See III - Federal Award Findings and Question Costs - Finding 2022-002 for included table) Criteria – 45 CFR 75.501 requires a non-Federal entity that expends $750,000 or more during the non-Federal entity’s fiscal year in Federal awards must have a single or program-specific audit conducted for that year. Audits must be completed and submitted within 30 days after receipt of the auditor’s report, or nine months after the end of the audit period, whichever is earlier. Condition/context – The Organization did not submit a single audit in a timely manner to be following the audit requirement under 45 CFR 75.501. Cause – The Organization was unable to meet the deadline. The August 31, 2021 audit was not completed timely, which delayed the start of the August 31, 2022 audit. Effect – Audit was not performed and submitted in a timely manner. The Organization has not met the reporting requirements under 45 CFR 75.501. Repeat finding – This is not a repeat finding. Recommendation – We recommend the Organization set a timeline for closing the books, preparing audit schedules and conducting the audit so the audit can be completed timely. Management should ensure that all involved in the audit process have adequate capacity, are aware of the deadlines and commit to meet them. Views of responsible officials – The Organization is committed to getting the single audit completed on time. A plan for the August 31, 2023 audit has been developed and will begin in February 2024 and is expected to be completed before the deadline in 45 CFR 75.501.

Condition: The Organization does not keep documentation of approved pay rates and the approved labor allocation in each employee?s personnel file. Criteria: Complete personnel file should be maintained by the Organization. Documentation gives the Organization an accurate view of an employee?s employment history. It also supports the Organization?s decisions and may protect the Organization in a lawsuit. Cause: Internal control systems were not in place to ensure that personnel files are complete. Effect: The Organization did not have a documentation for labor allocation for each employee. There was no separate worksheet of the split if the person is assigned to many programs. The only documentation is the Quickbooks payroll journal entry that shows the split. The determination of how much of payroll should go to the different programs/classes is primarily based on the employees? job assignment/title. For positions/titles that are less clear such as Chief Programs Officer their time is split based on what programs they manage which for FY20 was determined via an Operations Meeting held with the COO at beginning of fiscal year and any changes were communicated throughout the year during Operations Meetings. Recommendation: We recommend that the Organization make sure that documentation of pay rates and the labor allocation for each employee is maintained. This documentation should include employee and supervisor signatures. In addition, any employee status or pay rate changes, should also be maintained.

Condition: The Organization does not have written documentation of its procurement, cash management, and subrecipient monitoring policies. Criteria: As required by Title 2 U.S Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) written policies over procurement, cash management, and subrecipient monitoring must be documented in writing. Specifically, for procurement, the Uniform Guidance includes five procurement methods and written policies should detail the thresholds and five procurement methods. Cause: The Organization was not aware of the Uniform Guidance requirements. Effect: The Organization did not have written documentation of its policies in relation to procurement, cash management and subrecipient monitoring of federal expenditures. Recommendation: We recommend that the Organization review the requirements as specified in the Uniform Guidance. The procurement policy should detail the threshold and five procurement methods. The cash management and subrecipient policies should detail processes.

Condition: During the audit, we noted that the Organization does not keep documentation of approved pay rate and approved labor allocation in each employee?s personnel file. Criteria: Complete personnel file should be maintained by the Organization. Documentation gives the Organization an accurate view of an employee?s employment history. It also supports the Organization?s decisions and may protect the Organization in a lawsuit. Cause: Internal control systems were not in place to ensure that personnel files are complete. Effect: The Organization did not have a documentation for approved pay rate and labor allocation for each employee. Recommendation: We recommend that the Organization make sure that documentation of pay rate and labor allocation for each employee is maintained. This documentation should include employee and supervisor signatures. In addition, any employee status or pay rate changes, should also be maintained.

Condition: The Organization did not prepare a proper Schedule of Expenditures of Federal Awards (SEFA). Criteria: Per the Code of Federal Regulations Title 2 - Subtitle A - Chapter II ? Part 200.508 (b), each auditee must prepare appropriate financial statements, including the schedule of expenditures of federal and state awards, in accordance with 200.510 Financial Statements. Cause: Internal control systems were not in place to ensure that the preparation and review of the SEFA was completed. Effect: The Organization did not prepare a proper SEFA. Recommendation: We recommend that the Organization review the required elements of the schedule and document its internal controls to ensure compliance with Uniform Guidance. Additionally, we recommend a review of any contracts and agreements along with an inquiry of the grantor as to the amount of federal awards included in the contract. If exact federal awards cannot be determined immediately, the use of historical data and grantor estimates should lead to a reasonable expectation. This reasonable expectation is required to properly plan the single audit, determine which programs are to be tested, and avoid duplicate efforts.

Condition: The Organization does not have written documentation of its procurement, cash management, and subrecipient monitoring policies. Criteria: As required by Title 2 U.S Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) written policies over procurement, cash management, and subrecipient monitoring must be documented in writing. Specifically, for procurement, the Uniform Guidance includes five procurement methods and written policies should detail the thresholds and five procurement methods. Cause: The Organization was not aware of the Uniform Guidance requirements. Effect: The Organization did not have written documentation of its policies in relation to federal expenditures. Recommendation: We recommend that the Organization review the requirements as specified in the Uniform Guidance. The procurement policy should detail the threshold and five procurement methods. The cash management and subrecipient policies should detail processes.