Northwest Iowa Mental Health Center d/b/a Seasons Center for Community Mental HealthNon-Profit

Department of Health and Human Services FFAL #93.696, H79SM087069, 9/30/2022 – 9/30/2026 Certified Community Behavior Health Clinic Expansion Grants Activities Allowed or Unallowed and Allowable Costs/Cost Principles Significant Deficiency in Internal Control over Compliance Criteria: The Center is required to have procedures in place to ensure that federal awards are expended only for allowable costs in accordance with Subpart E – Cost Principles of the Uniform Guidance. Allowable costs are supported by appropriate documentation and correctly charged as to account, amount, and period. 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. 2 CFR 200.430(g) establishes the standards for documentation of personnel expenses including charges to Federal awards for salaries and wages. Charges must be based on records that accurately reflect the work performed with the records meeting the following standards: a) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. b) Be incorporated into the office records of the non-Federal entity. c) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities. d) Encompass both federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy. e) Comply with the established accounting policies and practices of the non-Federal entity. f) Support the distribution of the employee’s salary or wages among specific activities or cost objectives. g) Budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes. Condition: In our sample of expenditures selected for testing, we noted the following items: a) ClickTime timecard, which tracks federal and nonfederal hours for employees, did not properly reflect the employees total federal and nonfederal hours being paid within the payroll register (2 instances). b) Calculation errors for payroll expenses allocated to the grant (2 instances). Cause: An employee did not enter 2 hours of PTO into ClickTime and 2.87 hours of an employee’s time was not listed under the grant in ClickTime. In addition, the calculation errors identified were due to the use of a wrong employee’s allocation percentage and a manual keying error for payroll expenses for an employee. The secondary review of the employee ClickTime timecards did not identify the incorrectly tracked hours and double tracked time. Also, the secondary review of federal grant expenditure tracking spreadsheet did not identify the calculation errors. Effect: The Center’s controls did not detect or correct the errors identified, which results in a reasonable possibility that the Center could submit disallowed costs under the federal awards and would not be able to detect and correct noncompliance in a timely manner. Questioned Costs: None. The grant was undercharged. Context: A total non-statistical sample of 36 payroll transactions out of 180 transactions were selected for testing, which accounted for approximately $161,400 of approximately $775,900 of direct payroll program expenditures. Repeat Finding from Prior Year: Yes, prior year finding 2024-004. Recommendation: We recommend management review the procedures and control processes involving timecards, allocating payroll expenses and the federal grant expenditure tracking spreadsheet to ensure compliance with the federal grant. Views of Responsible Officials: Management is in agreement.

Department of Health and Human Services FFAL #93.087, 90CU0095, 9/30/2018 – 9/29/2024 Enhance Safety of Children Affected by Substance Abuse Activities Allowed or Unallowed and Allowable Costs and Cost Principles Significant Deficiency in Internal Control over Compliance Criteria: The Center is required to have procedures in place to ensure that federal awards are expended only for allowable costs in accordance with Subpart E – Cost Principles of the Uniform Guidance. Allowable costs are supported by appropriate documentation and correctly charged as to account, amount, and period. 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: In our sample of expenditures selected for testing, we noted calculation errors when allocating payroll expenses to the federal grant. Cause: The calculation errors were due to the use of a wrong employee’s allocation percentage, a keying error for the amount of payroll taxes for an employee, and not properly updating the calculation of worker’s compensation based upon the new percentage effective January 1, 2024 for the state of Iowa. In addition, the secondary review of federal grant expenditure tracking spreadsheet did not identify the calculation errors. Effect: The Center’s controls did not detect or correct the errors identified, which results in a reasonable possibility that the Center could submit disallowed costs under the federal awards and would not be able to detect and correct noncompliance in a timely manner. Questioned Costs: The program was overcharged by $1,348. Context: A total non-statistical sample of 60 nonpayroll and payroll transactions out of more than 250 transactions were selected for testing, which accounted for $113,666 of $474,590 of federal payroll and nonpayroll direct program expenditures. Repeat Finding from Prior Year: Yes, prior year finding 2023-003 Recommendation: We recommend management review the procedures and control processes involving allocating payroll expenses and the federal grant expenditure tracking spreadsheet to ensure compliance with the federal grant. Views of Responsible Officials: Management is in agreement.

Department of Health and Human Services FFAL #93.696, 1H79SM087069, 9/30/2022 – 9/30/2026 Certified Community Behavior Health Clinic Expansion Grants Activities Allowed or Unallowed and Allowable Costs and Cost Principles Significant Deficiency in Internal Control over Compliance Criteria: The Center is required to have procedures in place to ensure that federal awards are expended only for allowable costs in accordance with Subpart E – Cost Principles of the Uniform Guidance. Allowable costs are supported by appropriate documentation and correctly charged as to account, amount, and period. 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. 2 CFR 200.430(i) establishes the standards for documentation of personnel expenses including charges to Federal awards for salaries and wages. Charges must be based on records that accurately reflect the work performed with the records meeting the following standards: a) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. b) Be incorporated into the office records of the non-Federal entity. c) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities. d) Encompass both federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy. e) Comply with the established accounting policies and practices of the non-Federal entity. f) Support the distribution of the employee’s salary or wages among specific activities or cost objectives. g) Budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes. Condition: In our sample of expenditures selected for testing, we noted the following items: a) ClickTime timecard, which tracks federal and nonfederal hours for employees, did not properly reflect the employees total federal and nonfederal hours being paid within the payroll register (1 instances). b) Calculation errors for expenses allocated to the grant (3 instances). c) Employee tracked 2.7 hours under the federal program and a nonfederal program line in ClickTime (1 instance) causing it to be double counted. Cause: An employee entered 8 hours of PTO into ClickTime for two days each; however, the employee was only paid for 4 hours of PTO for each day. The calculation errors were due to the use of a wrong employee’s allocation percentage and a keying error for payroll expenses for an employee. The secondary review of the employee ClickTime timecards did not identify the incorrectly tracked hours and double tracked time. Also, the secondary review of federal grant expenditure tracking spreadsheet did not identify the calculation errors. Effect: The Center’s controls did not detect or correct the errors identified, which results in a reasonable possibility that the Center could submit disallowed costs under the federal awards and would not be able to detect and correct noncompliance in a timely manner. Questioned Costs: The program was overcharged by $1,134. Context: A total non-statistical sample of 60 nonpayroll and payroll transactions out of more than 250 transactions were selected for testing, which accounted for $239,541 of $886,400 of federal payroll and nonpayroll direct program expenditures. Repeat Finding from Prior Year: No Recommendation: We recommend management review the procedures and control processes involving timecards, allocating payroll expenses and the federal grant expenditure tracking spreadsheet to ensure compliance with the federal grant. Views of Responsible Officials: Management is in agreement.

Department of Health and Human Services FFAL #93.087, 90CU0095, 9/30/2018 – 9/29/2024 Enhance Safety of Children Affected by Substance Abuse Matching Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. In addition, 2 CFR 200.306 establishes that matching funds be verifiable from the non-federal entity’s records and are allowable under Subpart E – Cost Principles and 2 CFR 200.403(g) establishes that costs be adequately documented. Condition: In our sample of expenditures selected for testing, we noted 5.15 hours identified as Medicaid hours for one employee were not removed from the employee’s total hours when calculating the amount of match for the federal program. Cause: The employee’s Medicaid hours were not properly included within a revenues report due to the employee’s provider number not being included within the report parameters. Effect: The Center’s controls did not detect or correct the errors identified, which results in a reasonable possibility that the Center could claim as match disallowed costs under the federal award and would not be able to detect and correct noncompliance in a timely manner. Questioned Costs: Error resulted in $142; however, the Center has identified more than the match requirement under the federal program. Context: A total non-statistical sample of 12 out of 58 match transactions were selected for testing, which accounted for $49,219 out of $233,501 of federal match expenditures. Repeat Finding from Prior Year: Yes, prior year finding 2023-006 Recommendation: We recommend management review the procedures and control processes involving the match claim workbook to ensure compliance with the federal grant. Views of Responsible Officials: Management is in agreement.

Department of Health and Human Services FFLA #93.087, 90CU0090, 9/30/2020 – 9/29/2023; 90CU0095, 9/30/2018 – 9/29/2024 Enhance Safety of Children Affected by Substance Abuse Activities Allowed and Allowable Costs Significant Deficiency in Internal Control over Compliance Criteria: The Center is required to have procedures in place to ensure that federal awards are expended only for allowable costs in accordance with Subpart E – Cost Principles of the Uniform Guidance. Allowable costs are supported by appropriate documentation and correctly charged as to account, amount, and period. 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. 2 CFR 200.430(i) establishes the standards for documentation of personnel expenses including charges to Federal awards for salaries and wages. Charges must be based on records that accurately reflect the work performed with the records meeting the following standards: a) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. b) Be incorporated into the office records of the non-Federal entity. c) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities. d) Encompass both federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy. e) Comply with the established accounting policies and practices of the non-Federal entity. f) Support the distribution of the employee’s salary or wages among specific activities or cost objectives. g) Budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes. Condition: In our sample of expenditures selected for testing, we noted the following items: a) ClickTime timecard, which tracks federal and nonfederal hours for employees, did not properly reflect the employees total federal and nonfederal hours being paid within the payroll register (3 instances). b) Calculation errors for expenses allocated to the grant (1 instance). Cause: Employees did not enter all nonfederal hours within the ClickTime system and the secondary review of the employee ClickTime timecards did not identify the missing hours. In addition, the secondary review of federal grant expenditure tracking spreadsheet did not identify the calculation errors. Effect: The Center’s controls did not detect or correct the errors identified, which results in a reasonable possibility that the Center could submit disallowed costs under the federal awards and would not be able to detect and correct noncompliance in a timely manner. Questioned Costs: None reported. The program was underallocated. Context: A total non-statistical sample of 60 nonpayroll and payroll transactions were tested which accounted for $119,973 out of $1,006,904 of federal payroll and nonpayroll direct program expenditures. Repeat Finding from Prior Year: Yes, prior year finding 2022-003 Recommendation: We recommend management review the procedures and control processes involving timecards and the federal grant expenditure tracking spreadsheet to ensure compliance with the federal grant. Views of Responsible Officials: Management is in agreement.

Department of Health and Human Services FFLA #93.829, H79SM083331, 5/1/2021 – 12/31/2023 Section 223 Demonstration Programs to Improve Community Mental Health Services Activities Allowed and Allowable Costs Material Weakness in Internal Control over Compliance Criteria: The Center is required to have procedures in place to ensure that federal awards are expended only for allowable costs in accordance with Subpart E – Cost Principles of the Uniform Guidance. Allowable costs are supported by appropriate documentation and correctly charged as to account, amount, and period. 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. 2 CFR 200.430(i) establishes the standards for documentation of personnel expenses including charges to Federal awards for salaries and wages. Charges must be based on records that accurately reflect the work performed with the records meeting the following standards: a) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. b) Be incorporated into the office records of the non-Federal entity. c) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities. d) Encompass both federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy. e) Comply with the established accounting policies and practices of the non-Federal entity. f) Support the distribution of the employee’s salary or wages among specific activities or cost objectives. g) Budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes. Condition: In our sample of expenditures selected for testing, we noted the following items: a) ClickTime timecard, which tracks federal and nonfederal hours for employees, did not properly reflect the employees total federal and nonfederal hours being paid within the payroll register (2 instances). b) Calculation errors for expenses allocated to the grant (2 instances). c) Employee’s overtime hours were not properly tracked in ClickTime (2 instances). d) Employee tracked paid time off under PTO and CCBHC lines in ClickTime (1 instance) causing it to be double tracked. e) Grant was overcharged as it relates to a client’s gym membership (1 instance). Cause: Employees did not enter all nonfederal hours within the ClickTime system and the secondary review of the employee ClickTime timecards did not identify the missing hours, the incorrectly tracked hours, and double tracked time. Also, the secondary review of federal grant expenditure tracking spreadsheet did not identify the calculation errors. In addition, the grant was overcharged for nonpayroll as it relates to a gym membership claimed for a customer of the grant. Effect: The Center’s controls did not detect or correct the errors identified, which results in a reasonable possibility that the Center could submit disallowed costs under the federal awards and would not be able to detect and correct noncompliance in a timely manner. Questioned Costs: The program was overcharged by $127. Context: A total non-statistical sample of 60 payroll and nonpayroll transactions were tested which accounted for $170,945 out of $702,139 of federal payroll and nonpayroll direct program expenditures. Repeat Finding from Prior Year: Yes, prior year finding 2022-005 Recommendation: We recommend management review the procedures and control processes involving timecards and the federal grant expenditure tracking spreadsheet to ensure compliance with the federal grant. Views of Responsible Officials: Management is in agreement.

Department of Health and Human Services FFLA #93.958, 6H79SM085542, 9/30/2021 – 9/29/2023 Block Grants for Community Mental Health Services Activities Allowed and Allowable Costs Significant Deficiency in Internal Control over Compliance Criteria: The Center is required to have procedures in place to ensure that federal awards are expended only for allowable costs in accordance with Subpart E – Cost Principles of the Uniform Guidance. Allowable costs are supported by appropriate documentation and correctly charged as to account, amount, and period. 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. 2 CFR 200.430(i) establishes the standards for documentation of personnel expenses including charges to Federal awards for salaries and wages. Charges must be based on records that accurately reflect the work performed with the records meeting the following standards: a) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. b) Be incorporated into the office records of the non-Federal entity. c) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities. d) Encompass both federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity’s written policy. e) Comply with the established accounting policies and practices of the non-Federal entity. f) Support the distribution of the employee’s salary or wages among specific activities or cost objectives. g) Budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes. Condition: In our sample of expenditures selected for testing, we noted the following items: a) ClickTime timecard, which tracks federal and nonfederal hours for employees, did not properly reflect the employees total federal and nonfederal hours being paid within the payroll register (2 instances). b) The tracking spreadsheet did not reflect the entire months payroll and instead only included 2 weeks of payroll and benefits which resulted in a calculation error for expenses allocated to the grant (1 instance). Cause: Employees did not enter all nonfederal hours within the ClickTime system and the secondary review of the employee ClickTime timecards did not identify the missing hours. In addition, the secondary review of federal grant expenditure tracking spreadsheet did not identify the missing pay periods. Effect: The Center’s controls did not detect or correct the errors identified, which results in a reasonable possibility that the Center could submit disallowed costs under the federal awards and would not be able to detect and correct noncompliance in a timely manner. Questioned Costs: None reported. The program was underallocated. Context: A total non-statistical sample of 60 nonpayroll and payroll transactions were tested which accounted for $99,320 out of $844,289 of federal payroll and nonpayroll direct program expenditures. Repeat Finding from Prior Year: No. Recommendation: We recommend management review the procedures and control processes involving timecards and the federal grant expenditure tracking spreadsheet to ensure compliance with the federal grant. Views of Responsible Officials: Management is in agreement.

Department of Health and Human Services FFLA #93.087, 90CU0090, 9/30/2020 – 9/29/2023; 90CU0095, 9/30/2018 – 9/29/2024 Enhance Safety of Children Affected by Substance Abuse Matching Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. In addition, 2 CFR 200.306 establishes that matching funds be verifiable from the non-federal entity’s records and are allowable under Subpart E – Cost Principles and 2 CFR 200.403(g) establishes that costs be adequately documented. Condition: In our sample of expenditures selected for testing, we noted the following items: a) The number of hours an employee worked per the approved timesheet vs. the hours claimed in the match claim workbook resulted in a clerical error. (1 instance) b) Per review of the supporting timesheet and paystub, an employee had mobile crisis pay which was not accurately reduced in the calculation for match in the match claim workbook (2 instances). Cause: The secondary review of match claim workbook did not identify the clerical errors. Effect: The Center’s controls did not detect or correct the errors identified, which results in a reasonable possibility that the Center could submit disallowed costs under the federal awards and would not be able to detect and correct noncompliance in a timely manner. Questioned Costs: None reported. The program was underallocated. Context: A total non-statistical sample of 25 match transactions were tested which accounted for $97,208 out of $488,366 of federal match direct program expenditures. Repeat Finding from Prior Year: No. Recommendation: We recommend management review the procedures and control processes involving the match claim workbook to ensure compliance with the federal grant. Views of Responsible Officials: Management is in agreement.

2022-003 Department of Health and Human Services FFLA #93.087, 90CU0090, 9/30/2020 ? 9/29/2022; 90CU0095, 9/30/2018 ? 9/29/2023 Enhance Safety of Children Affected by Substance Abuse Activities Allowed and Allowable Costs Material Weakness in Internal Control over Compliance Criteria: The Center is required to have procedures in place to ensure that federal awards are expended only for allowable costs in accordance with Subpart E ? Cost Principles of the Uniform Guidance. Allowable costs are supported by appropriate documentation and correctly charged as to account, amount, and period. 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. 2 CFR 200.430(i) establishes the standards for documentation of personnel expenses including charges to Federal awards for salaries and wages. Charges must be based on records that accurately reflect the work performed with the records meeting the following standards: a) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. b) Be incorporated into the office records of the non-Federal entity. c) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities. d) Encompass both federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity?s written policy. e) Comply with the established accounting policies and practices of the non-Federal entity. f) Support the distribution of the employee?s salary or wages among specific activities or cost objectives. g) Budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes. Condition: In our sample of expenditures selected for testing, we noted the following items: a) ClickTime timecard, which tracks federal and nonfederal hours for employees, did not properly reflect the employees total federal and nonfederal hours being paid within the payroll register (3 instances). b) Calculation errors for expenses allocated to the grant (4 instances). Cause: Employees did not enter all nonfederal hours within the ClickTime system and the secondary review of the employee ClickTime timecards did not identify the missing hours. In addition, the secondary review of federal grant expenditure tracking spreadsheet did not identify the calculation errors. Effect: The Center?s controls did not detect or correct the errors identified, which results in a reasonable possibility that the Center could submit disallowed costs under the federal awards and would not be able to detect and correct noncompliance in a timely manner. Questioned Costs: None reported. The program was underallocated. Context: A total non-statistical sample of 60 nonpayroll and payroll transactions were tested which accounted for $116,557 out of $870,823 of federal payroll and nonpayroll direct program expenditures. Repeat Finding from Prior Year: Yes, prior year finding 2021-003 Recommendation: We recommend management review the procedures and control processes involving timecards and the federal grant expenditure tracking spreadsheet to ensure compliance with the federal grant. Views of Responsible Officials: Management is in agreement.

2022-004 Department of Health and Human Services FFLA #93.087, 90CU0095, 9/30/2018 ? 9/29/2023 Enhance Safety of Children Affected by Substance Abuse Reporting Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. 2 CFR 200.328 and 2 CFR 200.329 require the auditee to collect financial information and monitor its activities under federal awards to assure compliance with applicable federal requirements and performance expectations are being achieved and report these items in accordance with the program requirements. Condition: Through testing of one programmatic report, we noted amounts reported did not agree to supporting documentation. Programmatic information included within the report were included in the wrong category for services provided to adults and children and amounts were included in two categories for services in which no adults or children were provided services. Cause: The preparer of the report improperly inputted the case sizes within the incorrect column within the report and entered incorrect information in two instances. Effect: The report included programmatic information in the wrong categories for services provided and services not provided to adults and children. Questioned Costs: None reported. Context: Included under the award letter of the federal program, one combined quarterly federal cash transaction report was reviewed in the Center?s fiscal year. In addition, one semi-annual federal financial report and one semi-annual programmatic report was reviewed in the Center?s fiscal year. There was a total of 5 reports filed. Repeat Finding from Prior Year: Yes, prior year finding 2021-004 Recommendation: We recommend management review the procedures and control processes surrounding preparation and review of reports to ensure reports are completed based upon supporting documentation. View of Responsible Officials: Management is in agreement.

2022-005 Department of Health and Human Services FFLA #93.829, H79SM083331-02, 5/1/2021 ? 12/31/2022 Section 223 Demonstration Programs to Improve Community Mental Health Services Activities Allowed and Allowable Costs Material Weakness in Internal Control over Compliance Criteria: The Center is required to have procedures in place to ensure that federal awards are expended only for allowable costs in accordance with Subpart E ? Cost Principles of the Uniform Guidance. Allowable costs are supported by appropriate documentation and correctly charged as to account, amount, and period. 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. 2 CFR 200.430(i) establishes the standards for documentation of personnel expenses including charges to Federal awards for salaries and wages. Charges must be based on records that accurately reflect the work performed with the records meeting the following standards: a) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. b) Be incorporated into the office records of the non-Federal entity. c) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities. d) Encompass both federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity?s written policy. e) Comply with the established accounting policies and practices of the non-Federal entity. f) Support the distribution of the employee?s salary or wages among specific activities or cost objectives. g) Budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes. Condition: In our sample of expenditures selected for testing, we noted the following items: a) ClickTime timecard, which tracks federal and nonfederal hours for employees, did not properly reflect the employees total federal and nonfederal hours being paid within the payroll register (7 instances). b) Calculation errors for expenses allocated to the grant (2 instances). Cause: Employees did not enter all nonfederal hours within the ClickTime system and the secondary review of the employee ClickTime timecards did not identify the missing hours. In addition, the secondary review of federal grant expenditure tracking spreadsheet did not identify the calculation errors. Effect: The Center?s controls did not detect or correct the errors identified, which results in a reasonable possibility that the Center could submit disallowed costs under the federal awards and would not be able to detect and correct noncompliance in a timely manner. Questioned Costs: None reported. The program was underallocated. Context: A total non-statistical sample of 60 payroll and nonpayroll transactions were tested which accounted for $222,843 out of $2,108,556 of federal payroll and nonpayroll direct program expenditures. Repeat Finding from Prior Year: Yes, prior year finding 2021-005 Recommendation: We recommend management review the procedures and control processes involving timecards and the federal grant expenditure tracking spreadsheet to ensure compliance with the federal grant. Views of Responsible Officials: Management is in agreement.

2022-006 Department of Health and Human Services FFLA #93.829, H79SM083331-02, 5/1/2021 ? 12/31/2022 Section 223 Demonstration Programs to Improve Community Mental Health Services Reporting Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. 2 CFR 200.328 and 2 CFR 200.329 require the auditee to collect financial information and monitor its activities under federal awards to assure compliance with applicable federal requirements and performance expectations are being achieved and report these items in accordance with the program requirements. Condition: Through testing of one programmatic report, we noted the number of adults and children served during the reporting period included six individuals twice. Cause: As a result of a software change during the grant year, management combined the listing of adults and children served from two electronic health record systems and did not identify these six individuals were duplicates in the listings. Effect: The programmatic report included a total of six adults and children serviced during the reporting period twice. Questioned Costs: None reported. Context: Included under the award letter of the federal program, one annual federal financial report and one annual programmatic progress report was reviewed in the Center?s fiscal year. There was a total of 5 reports filed. Repeat Finding from Prior Year: Yes, prior year finding 2021-006 Recommendation: We recommend management review the procedures and control processes surrounding preparation and review of reports to ensure reports are completed based upon supporting documentation. View of Responsible Officials: Management is in agreement.

2022-007 Department of Health and Human Services FFLA #93.087, 90CU0090, 9/30/2020 ? 9/29/2022 Enhance Safety of Children Affected by Substance Abuse FFLA #93.829, H79SM083331-02, 5/1/2021 ? 12/31/2022 Section 223 Demonstration Programs to Improve Community Mental Health Services Procurement, Suspension & Debarment Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. The non-Federal entity?s documented procurement procedures must conform to the procurement standards identified in 2 CRF 200.318 through 200.327 which also requires documentation to be retained to detail the history of procurements. 2 CFR 200 Appendix II requires certain provisions be included in contracts if criteria are met. Condition: During testing, we identified one contract for each of the above FFLA?s where the required contract provisions in accordance with Uniform Guidance were not included within a contract over $25,000. In addition, no documentation was retained to support management?s rationale to select both of these contracted vendors. Cause: Contract provisions were not evaluated compared to Uniform Guidance contract requirements and documentation was not retained to support management?s rationale to select two contracted vendors. Effect: Contracts may be entered into with a vendor who is suspended or debarred, and contracts may not be in compliance with Uniform Guidance if required contract provisions are not included within the contract. In addition, it is hard to demonstrate that the program complies with laws, regulations, and other compliance requirements when documentation is not retained. Questioned Costs: None reported Context: There was only one contract above the $10,000 procurement policy threshold under the Enhance Safety of Children Affected by Substance Abuse program which was fully tested. There was a total of four contracts above the $10,000 procurement policy threshold under the Section 223 Demonstration Programs to Improve Community Mental Health Services program and two contracts were tested. Repeat Finding from Prior Year: Yes, prior year finding 2021-007 Recommendation: We recommend that management review the procedures and control processes to ensure contract include the required Uniform Guidance provisions and documentation is retained to support the rationale for selecting vendors during the procurement process. Views of Responsible Officials: Management is in agreement.

2021-003 Department of Health and Human Services FFLA #93.087, 90CU0090-03-01, 9/30/2019 ? 9/29/2020; 90CU0090-04-01, 9/30/2020 ? 9/29/2021; 90CU0095-01-00, 9/30/2018 ? 9/29/2021 Enhance Safety of Children Affected by Substance Abuse Activities Allowed and Allowable Costs Material Weakness in Internal Control over Compliance Criteria: The Center is required to have procedures in place to ensure that federal awards are expended only for allowable costs in accordance with Subpart E ? Cost Principles of the Uniform Guidance. Allowable costs are supported by appropriate documentation and correctly charged as to account, amount, and period. 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. 2 CFR 200.430(i) establishes the standards for documentation of personnel expenses including charges to Federal awards for salaries and wages. Charges must be based on records that accurately reflect the work performed with the records meeting the following standards: a) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. b) Be incorporated into the office records of the non-Federal entity. c) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities. d) Encompass both federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity?s written policy. e) Comply with the established accounting policies and practices of the non-Federal entity. f) Support the distribution of the employee?s salary or wages among specific activities or cost objectives. g) Budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes. Condition: In our sample of expenditures selected for testing, we noted the following items: a) No documentation to support a formal review of timecards for salaried employees (11 instances out of 16 salaried employee timecards tested). b) Payroll expenses for hourly employees were allocated to the program with the use of a monthly timecard rather than allocated based on the actual time worked on the program for the payroll period being paid (11 instances). c) Timecard did not properly reflect the employees total federal and nonfederal hours being paid within the payroll register (10 instances). d) Calculation error for expenses allocated to the grant (5 instances). e) No documentation was retained to support an allocation methodology for advertising costs (1 instance). Cause: Management implemented some controls over review of payroll disbursements charged to the program; however, lack of compliance with designed internal controls over disbursements allows for allocation of expenditures that were not at the correct amount. Documentation on allocation methodology was not retained for advertising costs. Effect: The Center?s controls did not detect or correct the errors identified, which results in a reasonable possibility that the Center could submit disallowed costs under the federal awards and would not be able to detect and correct noncompliance in a timely manner. Additionally, without the review and approval of timecards for salaried employees, demonstrating that costs comply with laws, regulations, and other compliance requirements is difficult. Questioned Costs: None reported. The program was underallocated. Context: A total non-statistical sample of 60 nonpayroll and payroll transactions were tested which accounted for $120,923 out of $742,339 of federal payroll and nonpayroll direct program expenditures. Repeat Finding from Prior Year: Yes Recommendation: We recommend that management implement procedures and control processes to comply with the federal requirements noted above. Views of Responsible Officials: Management is in agreement.

2021-004 Department of Health and Human Services FFLA #93.087, 90CU0090-03-01, 9/30/2019 ? 9/29/2020; 90CU0090-04-01, 9/30/2020 ? 9/29/2021; 90CU0095-01-00, 9/30/2018 ? 9/29/2021 Enhance Safety of Children Affected by Substance Abuse Reporting Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. 2 CFR 200.327 and 2 CFR 200.328 require the auditee to collect financial information and monitor its activities under federal awards to assure compliance with applicable federal requirements and performance expectations are being achieved and report these items in accordance with the program requirements. Condition: Through testing of federal financial reports, we noted the amounts reported did not agree to supporting documentation (1 instance). Cause: Formal review and approval process did not detect the variances between the amounts reported and the amounts supported by documentation retained. Effect: Without retaining documentation to support the amounts reported and to support oversight over the reporting process, demonstrating that the program complies with laws, regulations, and other compliance requirements is difficult. Questioned Costs: None reported. Context: Included under the three award letters of the federal program, one combined quarterly federal cash transaction report was reviewed in the Center?s fiscal year. In addition, one semi-annual federal financial report, one annual federal financial report, and one semi-annual programmatic progress report was reviewed in the Center?s fiscal year. There was a total of 12 reports filed. Repeat Finding from Prior Year: Yes Recommendation: We recommend that supporting documentation used to prepare the reports is retained. View of Responsible Officials: Management is in agreement.

2021-005 Department of Health and Human Services FFLA #93.829, 5H79SM081903-02, 12/31/2019 ? 12/31/2020, H79SM083331-01, 5/1/2020 ? 4/30/2021, H79SM083331-02, 5/1/2021 ? 4/30/2022 Section 223 Demonstration Programs to Improve Community Mental Health Services Activities Allowed and Allowable Costs Material Weakness in Internal Control over Compliance Criteria: The Center is required to have procedures in place to ensure that federal awards are expended only for allowable costs in accordance with Subpart E ? Cost Principles of the Uniform Guidance. Allowable costs are supported by appropriate documentation and correctly charged as to account, amount, and period. 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. 2 CFR 200.430(i) establishes the standards for documentation of personnel expenses including charges to Federal awards for salaries and wages. Charges must be based on records that accurately reflect the work performed with the records meeting the following standards: a) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. b) Be incorporated into the office records of the non-Federal entity. c) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities. d) Encompass both federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity?s written policy. e) Comply with the established accounting policies and practices of the non-Federal entity. f) Support the distribution of the employee?s salary or wages among specific activities or cost objectives. g) Budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes. Condition: In our sample of expenditures selected for testing, we noted the following items: a) No documentation to support a formal review of timecards for salaried employees (15 instances out of 18 salaried employee timecards tested). b) Payroll expenses for hourly employees were allocated to the program with the use of a monthly timecard rather than allocated based on the actual time worked on the program for the payroll period being paid (10 instances). c) Timecard did not properly reflect the employees total federal and nonfederal hours being paid within the payroll register (26 instances). d) Incomplete timecard was submitted and approved (1 instance). e) Calculation error for expenses allocated to the grant (4 instances). f) No documentation was retained to support an allocation methodology for advertising costs (1 instance). Cause: Management implemented some controls over review of payroll disbursements charged to the program; however, lack of compliance with designed internal controls over disbursements allows for allocation of expenditures that were not at the correct amount. Documentation on allocation methodology was not retained for advertising costs. Effect: The Center?s controls did not detect or correct the errors identified, which results in a reasonable possibility that the Center could submit disallowed costs under the federal awards and would not be able to detect and correct noncompliance in a timely manner. Additionally, without the review and approval of timecards for salaried employees, demonstrating that costs comply with laws, regulations, and other compliance requirements is difficult. Questioned Costs: None reported. The program was underallocated. Context: A total non-statistical sample of 60 payroll and nonpayroll transactions were tested which accounted for $183,342 out of $1,744,871 of federal payroll and nonpayroll direct program expenditures. Repeat Finding from Prior Year: Yes Recommendation: We recommend that management implement procedures and control processes to comply with the federal requirements noted above. Views of Responsible Officials: Management is in agreement.

2021-006 Department of Health and Human Services FFLA #93.829, 5H79SM081903-02, 12/31/2019 ? 12/31/2020, H79SM083331-01, 5/1/2020 ? 4/30/2021, H79SM083331-02, 5/1/2021 ? 4/30/2022 Section 223 Demonstration Programs to Improve Community Mental Health Services Reporting Material Weakness in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. 2 CFR 200.327 and 2 CFR 200.328 require the auditee to collect financial information and monitor its activities under federal awards to assure compliance with applicable federal requirements and performance expectations are being achieved and report these items in accordance with the program requirements. Condition: Through testing of federal financial reports and programmatic progress reports, we noted the amounts reported did not agree to supporting documentation and amounts reported within the progress report were inaccurate based upon how reports were initially pulled to complete the report. Cause: Formal review and approval process over the programmatic progress reports did not detect the variances between the amounts reported and the amounts supported by documentation retained. Effect: Without retaining documentation to support the amounts reported and to support oversight over the reporting process, demonstrating that the program complies with laws, regulations, and other compliance requirements is difficult. Additionally, not having a formal oversight process over reporting for the full year results in a reasonable possibility that reports that are inaccurate or incomplete could be submitted. Questioned Costs: None reported. Context: Included under the two award letters of the federal program, two quarterly federal cash transaction reports were reviewed in the Center?s fiscal year. In addition, one annual federal financial report and one annual programmatic progress report was reviewed in the Center?s fiscal year. There was a total of 13 reports filed. Repeat Finding from Prior Year: Yes Recommendation: We recommend that management implement procedures and control processes to comply with the federal requirements noted above and supporting documentation used to prepare the reports is retained. View of Responsible Officials: Management is in agreement.

2021-007 Department of Health and Human Services FFLA #93.087, 90CU0090-03-01, 9/30/2019 ? 9/29/2020; 90CU0090-04-01, 9/30/2020 ? 9/29/2021; 90CU0095-01-00, 9/30/2018 ? 9/29/2021 Enhance Safety of Children Affected by Substance Abuse FFLA #93.829, 5H79SM081903-02, 12/31/2019 ? 12/31/2020, H79SM083331-01, 5/1/2020 ? 4/30/2021, H79SM083331-02, 5/1/2021 ? 4/30/2022 Section 223 Demonstration Programs to Improve Community Mental Health Services Procurement, Suspension & Debarment Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. 2 CFR 200 Appendix II requires certain provisions be included in contracts if criteria are met. Condition: During testing, we identified two instances where the required contract provisions in accordance with Uniform Guidance were not included within a contract over $25,000. Cause: Contract provisions were not evaluated compared to Uniform Guidance contract requirements. Effect: Contracts may be entered into with a vendor who is suspended or debarred, and contracts may not be in compliance with Uniform Guidance if required contract provisions are not included within the contract. Questioned Costs: None reported Context: Four contracts above the $10,000 procurement policy threshold were tested under the Enhance Safety of Children Affected by Substance Abuse program and Section 223 Demonstration Programs to Improve Community Mental Health Services program. Repeat Finding from Prior Year: Yes Recommendation: We recommend that management implement procedures and control processes contract include the required Uniform Guidance provisions. Views of Responsible Officials: Management is in agreement.

2021-008 Department of Health and Human Services FFLA #93.087, 90CU0090-03-01, 9/30/2019 ? 9/29/2020; 90CU0090-04-01, 9/30/2020 ? 9/29/2021; 90CU0095-01-00, 9/30/2018 ? 9/29/2021 Enhance Safety of Children Affected by Substance Abuse Matching Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. In addition, 2 CFR 200.306 establishes that matching funds be verifiable from the non-federal entity?s records and are allowable under Subpart E ? Cost Principles and 2 CRF 200.403(g) establishes that costs must be adequately documented. Condition: During testing, we identified the Center claimed revenue received from school contracts as match rather than specifically identifying the related costs of the related therapists? salaries and benefit expenses incurred by the Center under the contract. Cause: Management misinterpreted the Uniform Guidance match requirements. Effect: Without a full understanding, demonstrating that the items claimed as match comply with laws, regulations, and other compliance requirements is difficult. Questioned Costs: None reported. Upon identification of salaries and benefit expenses, the Center met the match requirement for the grant year period of 10/1/2019 through 9/30/2020. Context: A nonstatistical sample of 19 transactions out of 91 total transactions were selected for testing which accounted for $40,948 out of $200,420 of match expenditures. Repeat Finding from Prior Year: Yes Recommendation: We recommend that management review procedures and control processes to ensure matching expenditures comply with the federal requirements noted above. Views of Responsible Officials: Management is in agreement.

2020-003 Department of Health and Human Services CFDA #93.087, 90CU0090-02-01, 9/30/2018 ? 9/29/2019; 90CU0090-03-01, 9/30/2019 ? 9/29/2020; 90CU0095-01-00, 9/30/2018 ? 9/29/2021 Enhance Safety of Children Affected by Substance Abuse Activities Allowed and Allowable Costs Material Weakness in Internal Control over Compliance Criteria: The Center is required to have procedures in place to ensure that federal awards are expended only for allowable costs in accordance with Subpart E ? Cost Principles of the Uniform Guidance. Allowable costs are supported by appropriate documentation and correctly charged as to account, amount, and period. 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. 2 CFR 200.430(i) establishes the standards for documentation of personnel expenses including charges to Federal awards for salaries and wages. Charges must be based on records that accurately reflect the work performed with the records meeting the following standards: a) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. b) Be incorporated into the office records of the non-Federal entity. c) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities. d) Encompass both federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity?s written policy. e) Comply with the established accounting policies and practices of the non-Federal entity. f) Support the distribution of the employee?s salary or wages among specific activities or cost objectives. g) Budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes. Condition: In our sample of expenditures selected for testing, we noted the following items: a) No documentation to support a formal review of timecards for salaried employees (tested 25 timecards). b) Payroll expenses for hourly employees were allocated to the program with the use of a monthly timecard rather than allocated based on the actual time worked on the program for the payroll period being paid (9 instances). c) Timecard did not properly reflect the employees total federal and nonfederal hours being paid within the payroll register (6 instances). d) Retro-pay for an employee was allocated to the program with the use of a future monthly timecard rather than allocated based on the hours worked on the program for which the retro-pay was applicable (1 instance). e) Payroll expenses for Mobile Crisis On-Call pay was improperly allocated to the program as these expenses do not benefit the program (1 instance). f) Fringe benefits were undercharged to the program due to a calculation error (1 instance). Cause: Management implemented some controls over review of payroll disbursements charged to the program; however, lack of compliance with designed internal controls over disbursements allows for allocation of expenditures that were not at the correct amount. Effect: The Center?s controls did not detect or correct the errors identified, which results in a reasonable possibility that the Center could submit disallowed costs under the federal awards and would not be able to detect and correct noncompliance in a timely manner. Additionally, without the review and approval of timecards for salaried employees, demonstrating that costs comply with laws, regulations, and other compliance requirements is difficult. Questioned Costs: None reported over the $25,000 questioned cost threshold. Context: A non-statistical sample of 60 payroll transactions were tested which accounted for $134,535 out of $639,326 of federal payroll program expenditures. Repeat Finding from Prior Year: Yes Recommendation: We recommend that management implement procedures and control processes to comply with the federal requirements noted above. Views of Responsible Officials: Management is in agreement.

2020-004 Department of Health and Human Services CFDA #93.087, 90CU0090-02-01, 9/30/2018 ? 9/29/2019; 90CU0090-03-01, 9/30/2019 ? 9/29/2020; 90CU0095-01-00, 9/30/2018 ? 9/29/2021 Enhance Safety of Children Affected by Substance Abuse Matching Material Weakness in Internal Control over Compliance Criteria: 2CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. In addition, 2 CFR 200.306 establishes that matching funds be verifiable from the non-federal entity?s records and are allowable under Subpart E ? Cost Principles and 2 CFR 200.403(g) establishes that costs must be adequately documented. Condition: Management did not implement internal controls to verify allowability of matching expenditures in accordance with federal requirements. Additionally, we noted the following during testing: a) Payroll benefits were under-allocated as match expenditures due to a calculation error (1 instance). b) Payroll expenses for hourly employees were allocated as match expenditures with the use of a monthly timecard rather than allocated based on the actual time worked for the payroll period being paid (3 instances). c) Retro-pay for an employee was allocated as match expenditures with the use of a future monthly timecard rather than allocated based on the hours worked for which the retro-pay was applicable (2 instances). d) Marketing expenses were allocated as match expenditures in which the expenditures did not relate to the program or project objectives (2 instances). e) Marketing expenses were allocated as match expenditures with an unsupported allocation methodology (2 instances). Cause: The Center did not have a formal review process in place over matching expenditures. Effect: Without establishing a formal review process over matching expenditures, it is reasonably possible that disallowed expenditures could be used as matching expenditures, resulting in the Center not being compliant with the matching requirements outlined in grant documents. Questioned Costs: None reported over the $25,000 questioned costs threshold. Context: A nonstatistical sample of 34 transactions out of 196 total transactions were selected for testing which accounted for $42,809 out of $168,961 of match expenditures. Repeat Finding from Prior Year: Yes Recommendation: We recommend that management implement procedures and control processes to ensure matching expenditures comply with the federal requirements noted above. Views of Responsible Officials: Management is in agreement.

2020-005 Department of Health and Human Services CFDA #93.087, 90CU0090-02-01, 9/30/2018 ? 9/29/2019; 90CU0090-03-01, 9/30/2019 ? 9/29/2020; 90CU0095-01-00, 9/30/2018 ? 9/29/2021 Enhance Safety of Children Affected by Substance Abuse Procurement, Suspension, and Debarment Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. 2 CFR 200.318 requires documentation to be retained to detail the history of procurements. 2 CFR 200 Appendix II requires certain provisions be included in contracts if criteria are met. As outlined in 2 CFR 180, recipients must not utilize any vendor which is suspended or debarred or is otherwise excluded from the central contractor registry. Condition: The following conditions were identified during testing: a) For one instance where documentation was not retained to support the vendor being checked against the central contractor registry prior to contract inception or on a periodic basis to ensure that the vendor was not suspended or debarred. In addition, documentation was not retained to detail the history of procurement over this contract which was for an amount over the micro-purchase threshold. b) One instance where a contract tested for procurement did not contain the required contract provisions in accordance with Uniform Guidance. Cause: The Center did not retain documentation to support the history of procurement in accordance with Uniform Guidance and documentation was not retained to ensure the vendor was not suspended or debarred. Contract provisions were not evaluated compared to Uniform Guidance contract requirements. Effect: Without internal controls and processes in place to verify parties are not suspended or debarred, it is a reasonable possibility the Center would contract for services with ineligible parties. Without retaining supporting documentation detailing the history of procurement, demonstrating that the program complies with laws, regulations, and other compliance requirements is difficult. Questioned Costs: None reported Context: A non-statistical sample of 60 nonpayroll transactions were tested which accounted for $92,628 out of $296,852 of federal nonpayroll program expenditures. Only two contracts were above the micro-purchase threshold that have not been tested in a prior year. Repeat Finding from Prior Year: Yes Recommendation: We recommend that management implement procedures and control processes to comply with the federal requirements noted above. Views of Responsible Officials: Management is in agreement.

2020-006 Department of Health and Human Services CFDA #93.087, 90CU0090-02-01, 9/30/2018 ? 9/29/2019; 90CU0090-03-01, 9/30/2019 ? 9/29/2020; 90CU0095-01-00, 9/30/2018 ? 9/29/2021 Enhance Safety of Children Affected by Substance Abuse Reporting Material Weakness in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. 2 CFR 200.327 and 2 CFR 200.328 require the auditee to collect financial information and monitor its activities under federal awards to assure compliance with applicable federal requirements and performance expectations are being achieved and report these items in accordance with the program requirements. Condition: Through testing of federal financial reports, we noted the following: a) Documentation was not retained to support review and approval by an individual other than the preparer (2 instances). b) Insignificant variances were noted between the amounts reported and the amounts supported by the documentation retained (3 instances). Cause: No formal review and approval process over federal financial reports submitted through the Payment Management System and to the federal agency was put in place by the Center until March 2020. Formal review and approval process did not detect the variances between the amounts reported and the amounts supported by documentation retained. Effect: Without retaining documentation to support the amounts reported and to support oversight over the reporting process, demonstrating that the program complies with laws, regulations, and other compliance requirements is difficult. Additionally, not having a formal oversight process over reporting for the full year results in a reasonable possibility that reports that are inaccurate or incomplete could be submitted. Questioned Costs: None reported. Context: Included under the three award letters of the federal program, two quarterly federal cash transaction reports were reviewed in the Center?s fiscal year. In addition, one annual federal financial report and one semi-annual programmatic progress report was reviewed in the Center?s fiscal year. There was a total of 13 reports filed. Repeat Finding from Prior Year: Yes Recommendation: We recommend that management implement procedures and control processes to comply with the federal requirements noted above and supporting documentation used to prepare the reports is retained. View of Responsible Officials: Management is in agreement.

2020-007 Department of Health and Human Services CFDA #93.829, 6H79SM081903-01M001, 12/31/2018 ? 12/31/2019; 5H79SM081903-02, 12/31/2019 ? 12/31/2020 Section 223 Demonstration Programs to Improve Community Mental Health Services Activities Allowed and Allowable Costs Material Weakness in Internal Control over Compliance Criteria: The Center is required to have procedures in place to ensure that federal awards are expended only for allowable costs in accordance with Subpart E ? Cost Principles of the Uniform Guidance. Allowable costs are supported by appropriate documentation and correctly charged as to account, amount, and period. 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. 2 CFR 200.430(i) establishes the standards for documentation of personnel expenses including charges to Federal awards for salaries and wages. Charges must be based on records that accurately reflect the work performed with the records meeting the following standards: a) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. b) Be incorporated into the office records of the non-Federal entity. c) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities. d) Encompass both federally assisted and all other activities compensated by the non-Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non-Federal entity?s written policy. e) Comply with the established accounting policies and practices of the non-Federal entity. f) Support the distribution of the employee?s salary or wages among specific activities or cost objectives. g) Budget estimates alone do not qualify as support for charges to Federal awards, but may be used for interim accounting purposes. Condition: In our sample of expenditures selected for testing, we noted the following items: a) No documentation to support a formal review of timecards for salaried employees (tested 40 timecards). b) Payroll expenses for hourly employees were allocated to the program with the use of a monthly timecard rather than allocated based on the actual time worked on the program for the payroll period being paid (3 instances). c) Timecard did not properly reflect the employees total federal and nonfederal hours being paid within the payroll register (4 instances). d) Payroll expenses for Mobile Crisis On-Call pay was improperly allocated to the program as these expenses do not benefit the program (2 instances). e) Payroll expenses and fringe benefits relating to an employee were undercharged to the program due to the employee?s payrate increase effective February 2020 not being included within the payroll system (2 instances). f) Payroll expenses and fringe benefits were undercharged to the program due to a calculation error within a timecard and within the payroll and fringe allocation spreadsheet (3 instances). g) Advertising expenses were charged to the program however the expenses did not benefit the program or relate to program activity (1 instance). Cause: Management implemented some controls over review of payroll disbursements charged to the program; however, lack of compliance with designed internal controls over disbursements allows for allocation of expenditures that were not at the correct amount. Effect: The Center?s controls did not detect or correct the errors identified, which results in a reasonable possibility that the Center could submit disallowed costs under the federal awards and would not be able to detect and correct noncompliance in a timely manner. Additionally, without the review and approval of timecards for salaried employees, demonstrating that costs comply with laws, regulations, and other compliance requirements is difficult. Questioned Costs: None reported over the $25,000 questioned cost threshold. Context: A non-statistical sample of 60 payroll transactions were tested which accounted for $211,943 out of $1,566,782 of federal payroll program expenditures and a non-statistical sample of 60 nonpayroll transactions were tested which accounted for $163,092 out of $263,476 of federal nonpayroll program expenditures. Repeat Finding from Prior Year: No Recommendation: We recommend that management implement procedures and control processes to comply with the federal requirements noted above. Views of Responsible Officials: Management is in agreement.

2020-008 Department of Health and Human Services CFDA #93.829, 6H79SM081903-01M001, 12/31/2018 ? 12/31/2019; 5H79SM081903-02, 12/31/2019 ? 12/31/2020 Section 223 Demonstration Programs to Improve Community Mental Health Services Procurement Significant Deficiency in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. 2 CFR 200.318 requires documentation to be retained to detail the history of procurements. 2 CFR 200 Appendix II requires certain provisions be included in contracts if criteria are met. Condition: During testing, we identified one instance where a contract was not put in place between the Center and a vendor for estimated costs over the micro-purchase threshold. In addition, the required contract provisions in accordance with Uniform Guidance were not included within the estimate documentation. Cause: A vendor was overlooked for estimated costs over the micro-purchase threshold and contract provisions were not evaluated compared to Uniform Guidance contract requirements. Effect: Without a contract in place in accordance with the Center?s procurement policy and Uniform Guidance, demonstrating that the program complies with laws, regulations, and other compliance requirements is difficult. Questioned Costs: None reported Context: A non-statistical sample of 60 nonpayroll transactions were tested which accounted for $163,092 out of $263,476 of federal nonpayroll program expenditures. Only two contracts were above the micro-purchase threshold and one transaction without a contract was over the micro-purchase threshold. Repeat Finding from Prior Year: No Recommendation: We recommend that management implement procedures and control processes to comply with the federal requirements noted above. Views of Responsible Officials: Management is in agreement.

2020-009 Department of Health and Human Services CFDA #93.829, 6H79SM081903-01M001, 12/31/2018 ? 12/31/2019; 5H79SM081903-02, 12/31/2019 ? 12/31/2020 Section 223 Demonstration Programs to Improve Community Mental Health Services Reporting Material Weakness in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. 2 CFR 200.327 and 2 CFR 200.328 require the auditee to collect financial information and monitor its activities under federal awards to assure compliance with applicable federal requirements and performance expectations are being achieved and report these items in accordance with the program requirements. Condition: Through testing of federal financial reports and programmatic progress reports, we noted the following: a) Documentation was not retained to support review and approval by an individual other than the preparer (1 instance). b) Insignificant variances were noted between the amounts reported and the amounts supported by the documentation retained (1 instance). Cause: No formal review and approval process over federal financial reports submitted through the Payment Management System and to the federal agency was put in place by the Center until March 2020. Formal review and approval process over the programmatic progress reports did not detect the variances between the amounts reported and the amounts supported by documentation retained. Effect: Without retaining documentation to support the amounts reported and to support oversight over the reporting process, demonstrating that the program complies with laws, regulations, and other compliance requirements is difficult. Additionally, not having a formal oversight process over reporting for the full year results in a reasonable possibility that reports that are inaccurate or incomplete could be submitted. Questioned Costs: None reported. Context: Included under the two award letters of the federal program, one quarterly federal cash transaction report was reviewed in the Center?s fiscal year. In addition, one annual federal financial report and one annual programmatic progress report was reviewed in the Center?s fiscal year. There was a total of 6 reports filed. Repeat Finding from Prior Year: No Recommendation: We recommend that management implement procedures and control processes to comply with the federal requirements noted above and supporting documentation used to prepare the reports is retained. View of Responsible Officials: Management is in agreement.

2019-004 Department of Health and Human Services CFDA #93.087, 90CU0090-01-03, 9/30/2017 ? 9/29/2018, 90CU0090-02-01, 9/30/18 ? 9/29/19, 90CU0095-01-00, 9/30/18 ? 9/29/2021 Enhance Safety of Children Affected by Substance Abuse Activities Allowed and Allowable Costs and Period of Performance Material Weakness in Internal Control over Compliance Criteria: The Center is required to have procedures in place to ensure that federal awards are expended only for allowable costs in accordance with Subpart E ? Cost Principles of the Uniform Guidance. Allowable costs are supported by appropriate documentation and correctly charged as to account, amount, and period. 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: Management was aware of the requirement for expenditures to be incurred within the period of performance and to be incurred only for allowable costs and activities allowed. The Center informally reviewed expenditures but did not retain documentation to support a formal oversight process. Additionally, we noted two instances where fringe benefits were overcharged to the program due to a calculation error in a spreadsheet where the fringe was calculated based on the incorrect employee?s hours worked during the pay period. Cause: Management implemented controls over review of payroll and nonpayroll disbursements charged to the program; however, the review was informally performed, and documentation was not retained to support the controls taking place. Effect: The Center?s controls did not detect or correct the errors identified, which results in a reasonable possibility that the Center could submit disallowed costs under the federal awards and would not be able to detect and correct noncompliance in a timely manner. Additionally, without retaining documentation to support the review and approval of expenditures, demonstrating that costs comply with laws, regulations, and other compliance requirements is difficult. Questioned Costs: None reported over the $25,000 questioned cost threshold. Context: A non-statistical sample of 60 out of 1087 total transactions was selected for testing, which accounted for $120,603 out of $792,625 of federal program expenditures. Repeat Finding from Prior Year: Yes. Recommendation: We recommend that management implement procedures and control processes to comply with the federal requirements noted above. Views of Responsible Officials: Management is in agreement.

2019-005 Department of Health and Human Services CFDA #93.087, 90CU0090-01-03, 9/30/2017 ? 9/29/2018, 90CU0090-02-01, 9/30/18 ? 9/29/19, 90CU0095-01-00, 9/30/18 ? 9/29/2021 Enhance Safety of Children Affected by Substance Abuse Matching Material Weakness in Internal Control over Compliance Criteria: 2CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. In addition, 2 CFR 200.306 establishes that matching funds be verifiable from the non-federal entity?s records and are allowable under Subpart E ? Cost Principles and 2 CFR 200.403(g) establishes that costs must be adequately documented. Condition: Management did not implement internal controls to verify allowability of matching expenditures in accordance with federal requirements. Additionally, we noted the following during testing: a) Two instances where payroll or benefits were charged as a direct cost to a federal program and also used to meet the matching requirement for the 90CU0090-02-01 award. b) Two instances where the hours used to allocate payroll or benefits used to meet the matching requirement didn?t agree to the supporting time sheets for the 90CU0095-01-00 award. c) Four instances where payroll or benefits were used to meet the matching requirement were not allowable as they did not relate to program or project objectives for the 90CU0090-02-01 award. Additionally, we noted that time and effort was not tracked for certain salaried individuals total time who attended a grant-related training and had personnel costs used to meet the matching requirement for the 90CU0095-01-00 award. A sign-in sheet was retained supporting attendance by each employee. Cause: The Center did not have a formal review process in place over matching expenditures. Effect: Without establishing a formal review process over matching expenditures, it is reasonably possible that disallowed expenditures could be used as matching expenditures, resulting in the Center not being compliant with the matching requirements outlined in grant documents. Questioned Costs: None reported over the $25,000 questioned costs threshold. Context: A nonstatistical sample of 50 transactions out of 249 total transactions were selected for testing which accounted for $23,709 out of $58,342 of match expenditures. Repeat Finding from Prior Year: Yes. Recommendation: We recommend that management implement procedures and control processes to ensure that matching costs comply with the federal requirements noted above. Views of Responsible Officials: Management is in agreement.

2019-006 Department of Health and Human Services CFDA #93.087, 90CU0090-01-03, 9/30/2017 ? 9/29/2018, 90CU0090-02-01, 9/30/18 ? 9/29/19, 90CU0095-01-00, 9/30/18 ? 9/29/2021 Enhance Safety of Children Affected by Substance Abuse Procurement, Suspension, and Debarment Material Weakness in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. 2 CFR 200.318 requires documentation to be retained to detail the history of procurements. 2 CFR 200 Appendix II requires certain provisions be included in contracts if criteria are met. As outlined in 2 CFR 180, recipients must not utilize any vendor which is suspended or debarred or is otherwise excluded from the central contractor registry. Condition: The following conditions were identified during testing: a) Two instances where documentation was not retained to support a formal review process over the suspension and debarment verification check. None of the vendors were found to be suspended or debarred. b) One instance where documentation was not retained to support the vendor being checked against the central contractor registry prior to contract inception or on a periodic basis to ensure that the vendor was not suspended or debarred. c) Two instances where documentation was not retained to detail the history of procurement for procurements over the micro-purchase threshold. d) One instance where a contract tested for procurement did not contain the required contract provisions in accordance with Uniform Guidance. Cause: The Center?s review process for suspension and debarment verifications was not formally documented. The Center did not retain documentation to support the history of procurement in accordance with Uniform Guidance. Contract provisions were not evaluated compared to Uniform Guidance contract requirements. Effect: Without internal controls and processes in place to verify parties are not suspended or debarred, it is a reasonable possibility the Center would contract for services with ineligible parties. Without retaining supporting documentation detailing the history of procurement, demonstrating that the program complies with laws, regulations, and other compliance requirements is difficult. Questioned Costs: None reported Context: Sampling was not used. Repeat Finding from Prior Year: Yes Recommendation: We recommend that management implement procedures and control processes to comply with the federal requirements noted above. Views of Responsible Officials: Management is in agreement.

2019-007 Department of Health and Human Services CFDA #93.087, 90CU0090-01-03, 9/30/2017 ? 9/29/2018, 90CU0090-02-01, 9/30/18 ? 9/29/19, 90CU0095-01-00, 9/30/18 ? 9/29/2021 Enhance Safety of Children Affected by Substance Abuse Reporting Material Weakness in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. 2 CFR 200.327 and 2 CFR 200.328 require the auditee to collect financial information and monitor its activities under federal awards to assure compliance with applicable federal requirements and performance expectations are being achieved and report these items in accordance with the program requirements. Condition: Through testing of federal financial reports and progress reports, we noted the following: a) Four instances where documentation was not retained to support review and approval by an individual other than the preparer for federal financial reports and insignificant variances were noted between the amounts reported and the amounts supported by the documentation retained b) One instance where there were insignificant differences between the amounts reported in a semi-annual progress report and the amounts supported by the documentation retained due to changes made to the supporting spreadsheet after the report was issued Cause: Management implemented a formal oversight process over progress reports; however, the process did not detect the missing supporting documentation. Management did not implement a formal oversight process over financial reports submitted through the Program Support Center through the Payment Management System and to the federal agency. Effect: Without retaining documentation to support the amounts reported and to support oversight over the reporting process, demonstrating that the program complies with laws, regulations, and other compliance requirements is difficult. Additionally, not having a formal oversight process over reporting results in a reasonable possibility that reports that are inaccurate or incomplete could be submitted. Questioned Costs: None reported. Context: A non-statistical sample of 5 reports out of 10 total reports was selected for testing Repeat Finding from Prior Year: Yes Recommendation: We recommend that management implement procedures and control processes to comply with the federal requirements noted above and supporting documentation used to prepare the reports is retained. View of Responsible Officials: Management is in agreement.

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