VERA HOUSENon-Profit

2021-001 Effective Design and Consistent Execution of Vouchering Condition: Vouchers are not reconciled to the general ledger as a part of quarterly grant submissions to ensure that the amounts vouchered for correspond to expenses incurred for each grant within the general ledger. Criteria: Effective and detective controls should be integrated in processes to ensure complete and accurate reporting in accordance with grant requirements. Cause: The process of preparing the voucher reimbursement request for each grant is manually driven and subject to human error. The manual spreadsheets are prepared separate from the general ledger and submitted for reimbursement with external payroll records and invoices. This coupled with the fact that vouchers are not reconciled to the general ledger and manual spreadsheets are tracked separate from the ledger, making the supervision process ineffective. Effect: Reconciliation between the vouchers and the general ledger could not be performed accurately as the Agency posted several adjustments and reconciling items within the ledger subsequent to submitting grant vouchers. Further, in several instances the Agency over and under claimed payroll hours and had other miscellaneous adjustments which were corrected and adjusted by the grantor prior to payment of voucher requests. Recommendation: The auditor recommends that a formal voucher process be designed and documented to ensure complete and consistent vouchering. Also, a process be developed to reconcile the voucher with the general ledger at least quarterly before submission of the voucher. In addition, the auditor recommend that the review process be evaluated and modified as deemed necessary to provide necessary oversight. View of Responsible Official: The Agency agrees with the finding identified and has made the necessary corrections of voucher preparation and reconciliation processes and procedures. A new general voucher process is being implemented to ensure complete and consistent vouchering. New procedures in place include accompanying all quarterly vouchers with an income statement to ensure the general ledger corresponds to expenses incurred for each grant. In addition, the Agency has implemented a quarterly reconciliation process to voucher with general ledger before submission of vouchers.

2020-001 Grant Revenue and Accounts Receivable Recording Criteria: Effectively designed policies and procedures should exist to ensure proper recordkeeping and reporting.Condition: The Organization migrated to a new accounting system at the beginning of 2020. During the system implementation and throughout the year, there were inconsistencies in the use of the accounts receivable, grants receivable and unvouchered receivable accounts both when posting invoices and payments for various grants. Cause: Posting and reconciliation of the various accounts receivable ledger balances in the new accounting system did not consistently take place throughout the year. Effect: The inconsistent use of these accounts resulted in a large debit balance in grants receivable was offset by a large credit (negative) balance in vouchered receivables, as well as, several other reconciliation difficulties due to uncleared offsetting activity posted. Recommendation: We recommend management discontinue the use of the grants receivable and unvouchered receivable accounts on the trial balance and record all billing and payment activity through the accounts receivable subsidiary ledger. This will ensure all activity has been captured by grant and agrees to final receivable balances on the trial balance. Views of Responsible Official and Planned Corrective Actions: During 2020, Vera House implemented new accounting software, had sudden staff transition in the leadership of its Finance unit, and dealt with the challenges of remote work during COVID-19, all of which contributed to the deficiencies identified. As of July 2021, we have fully addressed and resolved the concerns raised. We have conducted a thorough review of our new system, trial balance, and made necessary corrections, have improved and streamlined monthly closing processes including elimination and the usage of grants receivable and unvouchered receivable accounts, and are ensuring that Finance staff are fully trained. Management is confident that 2020 was an unusual anomaly that will not be repeated. 2020-002 Effective Design and Consistent Execution of Vouchering Criteria: Effective and detective controls should be integrated in processes to ensure complete and accurate reporting in accordance with grant requirements. Condition: Vouchers are not reconciled to the general ledger as a part of quarterly grant submissions to ensure that the amounts vouchered for correspond to expenses incurred for each grant within the general ledger. Cause: The process of preparing the voucher reimbursement request for each grant is manually driven and subject to human error. The manual spreadsheets are submitted for reimbursement with external payroll records and invoices. The vouchers are not reconciled to the general ledger. Effect: Reconciliation between the vouchers and the general ledger could not be performed accurately as the Organizations switched software systems during the grant period and also posted several adjustments and reconciling items within the ledger subsequent to submitting grant vouchers. Further, in several instances the Organizations over and under claimed payroll hours, which were corrected and adjusted by the grantor prior to payment of voucher requests. Recommendation: A process be developed to reconcile the submitted vouchers with the general ledger at least quarterly before submission of the voucher. In addition, the auditor recommend that the review process be evaluated and modified as deemed necessary to provide necessary oversight of the voucher/claim submission. View of Responsible Official: During 2020, Vera House implemented new accounting software, had sudden staff transition in the leadership of its Finance unit, and dealt with the challenges of remote work during COVID-19, all of which contributed to the deficiencies identified. As of October 2021, we have fully addressed and resolved the concerns raised. We have conducted a thorough review of our new system, trial balance, and made necessary corrections, have improved and streamlined monthly closing and vouchering processes and are ensuring that Finance staff are fully trained. Management is confident that 2020 was an unusual anomaly that will not be repeated.