OPEN DOOR CLINIC OF GREATER ELGINNon-Profit

Criteria: Under AU-C 265, Communicating Internal Control Related Matters Identified in an Audit, a deficiency in internal control exists when the design or operations of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonably possibility that a material misstatement of the entity?s financial statements will not be prevented or detected and corrected on a timely basis. Condition: In gaining our understanding of controls over cash disbursements, we noted in the control that all checks should have supporting documentation to support the payment. We viewed 40 disbursements and noted that the Organization was able to provide copies of the canceled checks for all 40 selections; however, the Organization was unable to provide vendor invoices or other supporting documentation to support 25 of our 40 selections. Cause: The accounting department had experienced a change in staff during the year and the current staff was unable to locate where the previous staff had filed the documentation. Auditor?s Recommendation: We recommend that the Organization develop a formal filing system to keep track of paid expenses. This will eliminate having different staff filing supporting documentation of expenses in various manners. This will make it easier to locate, find, and refile the supporting documentation for expenses. Effect: There is no documentation of what the expense was for and to help support expenses charged to grants. Management Response: We agreed with the auditor?s recommendation and have instituted a policy that will provide for correct record control and filing. None of the current accounting staff was working for Open Door a the time and spent many hours trying to organize and correct the issues noted.

Criteria: 2 CFR 200.512(a) requires that the reporting package (the Single audit report) and the data collection form be submitted to the Federal Audit Clearinghouse the earlier of 30 calendar days after the reports are received or nine months after the end of the audit period. Condition: Open Door Clinic of Greater Elgin?s December 31, 2019 reporting package and data collection was due no later than September 30, 2020. The reporting package was filed in October 2020. Cause: The Organization had significant turnover in the accounting department the whole year of 2019 and 2020. This resulted in significant delays in getting ready or providing information for the audit. Effect: This delay in reporting to the Federal Audit Clearinghouse and to pass-through entities will cause a delay in closing out grants and reporting results of the grants to various organizations. Auditor recommendation: We recommend that when there is a significant vacancy in the accounting department, the organization finds some temporary help to keep the accounting records accurate and up to date. This will enable the Organization to have adequate and complete accounting records to meet federal reporting requirements. Management response: As stated previously the reporting deadlines for 2019 were September 30, 2020 which is before the current staff was on board. We have added staff to the general accounting and grant management staff to insure timely filing of reports.

Condition and Criteria: According to 2 CFR Section 200.305(b)(3) all reimbursement requests should be based on supporting documentation that shows the cost was incurred before the request for payment and that the payment to vendor was made. All the cash drawdown reports (3 in total were tested) did not have adequate supporting documentation for the drawdown request. Effect: The effect is that the Organization could have either requested funds before actual expenses and not be in compliance with the cash management requirements under Uniform Grant Guidance or the Organization could be shorting themselves funds during the grant period and causing cash flow issues. Cause: The reason for the lack of support in the drawdowns is due to the allocation of expenses in the general ledger to the program not being made in a timely manner due to vacancies in the accounting department from turnover. Additionally, it appears drawdowns were requested based on estimated use instead of actual costs. The individual requesting the drawdowns did not have proper knowledge in relation to cash management compliance requirements. Context: In reviewing all the cash drawdown requests, we could not find the supporting documentation to support the expense was incurred before the drawdown request. We also could not determine that the cash payment was made to the vendor before the Organization requested it from the vendor. Auditor?s Recommendation: We recommend when a check is paid, the expense is allocated to the grant cost activity through the accounting system. This will help support the request and, if needed, a method to provide the actual invoice for the expense being requested. Management Response: We agree with the auditors' comments, and the following action will be taken to improve the situation. The Finance Manager will review with staff the Cost-based and Reasonable Payments for Services and with understanding that they should be follow base on the rules of the Office of Management and Budget (OMB). Open Door will: ? Make available to the grantee very detailed information on the allocation and costing of expenses for services provide ? Reasonable methodologies for allocating costs among different funding sources ? Reconcile projected unit costs with actual unit costs on a monthly or quarterly basis

GSA_MIGRATION

GSA_MIGRATION

GSA_MIGRATION