ALIVE, INC.

2024-001: Crime Victim Assistance - Significant Deficiency in Internal Controls over Compliance Condition: While the Organization does have policies/controls in place to establish and maintain effective internal controls over allowable costs. It was noted while testing key controls over allowable costs that there were expenses reimbursed twice, leading to ineffective internal controls. Criteria: As defined in the Code of Federal Regulations the Organization must establish and maintain effective internal controls over the financial award that provides reasonable assurance that the non-Federal entity is managing the Federal Award in compliance with Federal statutes, regulation, and the terms and conditions of the Federal award per § 200.303. These requirements detail all the information that must be included in the Organization’s internal controls. Cause: Expenses were submitted and reimbursed twice due to an isolated instance of internal control failure. Effect: The deficiency of controls over allowable costs leads to an increase risk of errors, misstatements, or omissions in the financials statements which could misrepresent the Organization’s financial statements. Questioned costs of $13,019 were computed for duplicate expenses reimbursed. Context: During our audit procedures, we identified an isolated instance of expenses being submitted for reimbursement in July 2023. Recommendation: We recommend that the Organization reassess the invoice submission process and reimbursement request review process to ensure duplicate reimbursements do not continue to happen. Views of Responsible Officials: Management agrees with the finding. OTHER ISSUES The Summary Schedule of Prior Audit Findings is not included in this report because there were no prior audit findings related to federal award programs. See the following page for the Corrective Action Plan.

Finding 2022-001: Material Weakness in Compliance and Internal Controls Over Compliance for Unallowable Costs Federal Agency: U.S. Department of Justice Program Title: Victims of Crime Act CFDA Number: 16.575 Pass-Through Entity: Missouri Department of Social Services Award Number: ER130200006 Award Period: November 1, 2019 to March 31, 2022 Criteria ALIVE, Inc. is responsible for ensuring expenditures are not used multiple times for reimbursement from federally funded sources. Condition Subsequent to year end, it came to the attention of the auditor that ALIVE, Inc. applied for the Employee Retention Credit using expenditures that had been previously reimbursed by the federal grant for periods during the year ending March 31, 2022. Cause Failure to appropriately communicate with contracted individual who provides additional oversight, ALIVE, Inc. contracted with a third party who had a conflict of interest and inappropriately applied for the Employee Retention Credit. Effect Received funding of over $550,000 for expenditures previously reimbursed by federal sources. Repeat Finding Not Applicable. Questioned Costs $550,000 Recommendation ALIVE, Inc. needs to refund funds from the Employee Retention Credit immediately. ALIVE, Inc. also needs to hire and retain an individual who has nonprofit and federal award experience. Management needs to communicate more effectively and follow the guidance of those who have appropriate nonprofit and federal award experience. Response by Auditee In direct response to this finding, the Employee Retention Credit funds that were erroneously applied for and awarded to ALIVE through ERC Specialists were returned to the IRS on October 20, 2022.

Finding 2021-001: Material Weakness in Compliance and Internal Controls Over Compliance for Unallowable Costs Federal Agency: U.S. Department of Justice Program Title: Victims of Crime Act CFDA Number: 16.575 Pass-Through Entity: Missouri Department of Social Services Award Number: ER130200006 Award Period: November 1, 2019 to September 30, 2021 Criteria ALIVE, Inc. is responsible for calculating and preparing invoices for actual costs to federal awards. Condition During testing over reporting, it was noted that federal award invoices were significantly higher than expected. Cause Upon review of invoices, it was noted that one disbursement had been resubmitted for reimbursement in error. It was also noted that the spreadsheet used for calculating reimbursement had an inaccurate calculation due to one cell containing an incorrect formula. Furthermore, indirect costs were being incorrectly calculated. Effect Failure to accurately calculate the amounts to be paid to ALIVE, Inc. for the program resulted in overcharging the federal award. Repeat Finding Not Applicable. Questioned Costs $75,529 Recommendation It is recommended policies and procedures are created and implemented to notate invoices as submitted for payment to ensure that duplicates are not resubmitted for payment from federal awards and only original invoices are submitted for payments. Statements and copies should not be used for payment. It is also recommended that financial reporting be prepared by program in an efficient manner and reviewed regularly by management to determine irregularities by program as it relates to other programs and in total for the organization. Response by Auditee ALIVE administrative staff identified a corrupted excel file used to invoice VOCA federal funds for a period of three months in 2021 resulting in overpayments of funds. This identified mistake was immediately reported to the Department of Social Services who oversees the VOCA funds in Missouri. In direct response to this finding, the corrupted excel invoice was corrected and no other invoices were determined to be incorrect. Arrangements have been made to contract with a new CPA firm to provide additional oversight over federal funds and expenditures.