RAPID CITY CLUB FOR BOYS, INCNon-Profit

2023-001 FINDING: Financial Statement Preparation and Schedule of Expenditures of Federal Awards Criteria and Effect: It is our responsibility to inform you that this deficiency could result in a material misstatement to the financial statements that could have been prevented or detected by the Organization’s management. In addition, management was unaware that Uniform Guidance requirements were necessary. Repeat Finding From Prior Year: Yes, prior year finding 2022-001 Recommendation: As in prior years, we have instructed management to review a draft of the auditor prepared financials and SEFA in detail for their accuracy, we have answered any questions they might have, and we have encouraged research of any accounting guidance in connection with the adequacy and appropriateness of classification and disclosure in your statements. We are satisfied the appropriate steps have been taken to provide the Organization with the completed financial statements and SEFA. It is the responsibility of management and the Board of Directors to make the decision whether to accept the degree of risk associated with this condition because of cost or other considerations. Response/Corrective Action Plan: The Organization agrees with the above Finding. See Corrective Action Plan.

Federal Program Affected: U.S. Department of Housing and Urban Development Home Investment Partnerships Program ALN 14.239 Compliance Requirement: All applicable requirements Questioned Costs: N/A Condition and Cause: During the course of our engagement, we found monitoring of the financial statements and internal controls has not been fully implemented in regard to Heartland Heights LP, Heartland Heights LLC, Heartland Heights LP2, and Heartland Heights LLC 2. We also noted approval documentation was not maintained for several internal control processes. Criteria and Effect: It is our responsibility to inform you that this deficiency could result in a material misstatement to the financial statements that could have been prevented or detected by the Organization’s management. Repeat Finding From Prior Year: No Recommendation: Management should receive and review regular financial statement activity and determine reasonableness based on knowledge of activities and expectations developed. This should include monitoring compliance with tax credits. In addition, with apartment operations starting in late FY22, internal controls should be assessed to determine proper segregation of duties is occurring and that accounts are properly reconciled (e.g. tenant receivables and security deposits). Response/Corrective Action Plan: The Organization agrees with the above Finding. See Corrective Action Plan.

2023-004 FINDING: Uniform Guidance Written Policies Federal Program Affected: U.S. Department of Housing and Urban Development Home Investment Partnerships Program ALN 14.239 Compliance Requirement: Reporting Questioned Costs: N/A Condition and Cause: None of the required Uniform Guidance written polices are adopted by the Organization. Criteria and Effect: Uniform Guidance requires certain organizational polices such as allowable costs, procurement, conflicts of interest and other policies to be adopted by the Organization to reduce the likelihood funds will be misused. Repeat Finding From Prior Year: Yes, prior year finding 2022-005 Recommendations: The Organization should reviewed and adopted required Uniform Guidance policies. Response/Corrective Action Plan: The Organization agrees with the above Finding. See Corrective Action Plan.

2022-001 FINDING: Combined Financial Statement Preparation and Schedule of Expenditures of Federal Awards Preparation Federal Program Affected: U.S. Department of Treasury Coronavirus Relief Fund ALN 21.019 Compliance Requirement: Reporting Questioned Costs: N/A Condition and Cause: We were requested to draft the audited combined financial statements and related footnote disclosures as part of our regular audit services as well as the Schedule of Expenditures of Federal Awards (SEFA). Ultimately, it is management?s responsibility to provide for the preparation of the Organization?s statements, footnotes, and SEFA, and the responsibility of the auditor to determine the fairness of the presentation of those statements. From a practical standpoint, we do both for the Organization at the same time in connection with our audit. This is not unusual for us to do this with Organizations of your size. Criteria and Effect: It is our responsibility to inform you that this deficiency could result in a material misstatement to the financial statements that could have been prevented or detected by the Organization?s management. Repeat Finding From Prior Year: N/A ? no Uniform Guidance audit in prior year. Recommendation: As in prior years, we have instructed management to review a draft of the auditor prepared financials in detail for their accuracy, we have answered any questions they might have, and we have encouraged research of any accounting guidance in connection with the adequacy and appropriateness of classification and disclosure in your statements. We are satisfied the appropriate steps have been taken to provide the Organization with the completed financial statements. It is the responsibility of management and the Board of Directors to make the decision whether to accept the degree of risk associated with this condition because of cost or other considerations. Response/Corrective Action Plan: The Organization agrees with the above Finding. See Corrective Action Plan.