Veterans Life Center

Condition: The Uniform Guidance requires that the audit be submitted to the Federal Audit Clearinghouse by the earlier of thirty days after issuance of the auditor’s reports or nine months after the period’s end date. The Organization failed to submit the audit package by the due date of September 30, 2023 and is therefore not in compliance with this requirement. Criteria: The financial records of the Organization should have been closed and presented to the auditor in sufficient time to allow for the timely completion of the audit process and the resulting report package to be submitted to the proper authorities within the reasonable time period allotted. Effect: Due to the tardiness of the Organization in this regard, it may have jeopardized federal funding opportunities in the future. Recommendation: Management should develop a system that keeps the audit process on track so that future Single Audit packages are submitted on time.

Finding 2021-001 (Significant Deficiency): Condition: The Organization did not adequately document the approval of several cash disbursements. Most important, it did not maintain monthly timesheets for its workforce in 2021. Criteria: All cash disbursements (whether by check, credit or debit card, or online) should be supported with documentation indicating approval prior to payment, cancellation of the invoice, and account coding of the transaction. Internal controls should be in place to provide reasonable assurance that all cash disbursements (including salary allocations to various programs or functions) have been documented and approved by an authorized individual in a timely fashion. Effect: Failure to maintain detailed documentation could result in programs or functions being improperly charged. Unsupported expenses run the risk of being deemed as disallowed costs by funding agencies and therefore may require reversion to these same agencies. Insufficient cash disbursement procedures can also result in errors and misappropriation. Recommendation: Management should adopt and diligently enforce policies that strengthen the cash disbursements process. Specifically, the following suggestions are made: a) The distribution of salary and wages charged to federal awards should be based on actual employee activity as reflected in personnel activity reports (timesheets), prepared after-the-fact, that include the total activity for which employees were compensated. b) Timesheets should be certified as accurate by the employee and approved by a supervisor familiar with the employee's activities. c) All vendor invoice packages should be supported by [1] the expense account coding; [2] the signature or initials of (or similar electronic notice from) the approver; and [3] the date of approval. For recurring payments such as rent and utilities, a written approval of these charges on an annual basis could serve as sufficient documentation and audit trail. Views of Responsible Officials and Planned Corrective Actions: We will seek guidance from our grant representative on how to record timesheets and format.