HOPEWORKS OF HOWARD COUNTY, INC.

2022-001 Late Submission of Required Financial, Programmatic, and Performance Reports Audit Results: Information on Federal Programs: Assistance Listing #: 16.575 Crime Victim Assistance Grant Award Numbers: VOCA-2019-0075, VOCA-2020-0037, VOCA-2018-0155, VOCA-2022-0018 Federal Agency: United States Department of Justice Pass-through Entity: State of Maryland - Governor's Office of Crime Control and Prevention Criteria: All of the grants under this program require that financial, programmatic, and performance reports be submitted on a quarterly basis. Quarterly progress and performance reports are due within fifteen calendar days from the end of each quarter. The grants require financial quarterly reports to be submitted within thirty calendar days of each quarter end date. The final financial reports are due no later than thirty calendar days from the end of the award. Condition: The Organization did not comply with the reporting requirements in accordance with grant requirements. We tested the entire population, which was twenty four reports in total required to be submitted. During our testing, we noted thirteen reports that were submitted after the deadline. We consider this to be an instance of non-compliance and a significant deficiency in internal control over compliance for the reporting requirement. This is a repeat of prior year finding 2021-001. Questioned costs: None Context: Federal agencies rely on these reports to ensure that recipients are meeting their expectations. Therefore delays in reporting can result in delays of the receipt of funding. Effect: As a result of the late submission, the Organization is not in compliance with the reporting requirements of the Uniform Guidance. Cause: This resulted from human error, a lack of review of the actual submission of the reports or an intentional delay to ensure more accurate reporting. Recommendation: We recommend reviewing the controls in place to ensure that all future reports are submitted on time and in accordance with grant requirements. If the Organization expects that there will be a delay in the submission of the reports, they should obtain permission to extend the submission date from the awarding agency. Views of Responsible Officials and Planned Corrective Actions: HopeWorks has implemented a number of streamlined processes in which to expedite the availability of the information needed to file the funder reports more timely. These processes are not limited to electronic import of payroll and benefit entries, implementation of Bill.com for expenditures, and prioritization of recording credit card activity. Fifteen days is a strict deadline and if for some reason reporting will be late, HopeWorks will communicate to the funder and document that communication .

CFDA#: 16.575 Crime Victim Assistance Grant Award Numbers: VOCA-2018-0095, VOCA-2017-0111, VOCA-2017-0022 Federal Agency: United States Department of Justice Pass-through Entity: State of Maryland - Governor's Office of Crime Control and Prevention All of the grants under this program require that financial, programmatic, and performance reports be submitted on a quarterly basis. Quarterly reports are due within fifteen calendar days from the end of each quarter. Two of the grants require financial quarterly reports to be submitted within thirty calendar days off each quarter end date. The final financial reports are due no later than thirty calendar days from the end of the award. Condition: The Organization did not comply with the reporting requirements in accordance with grant requirements. We tested the entire population, which was twenty four quarterly reports required to be submitted. During our testing, we noted four reports within two quarters were submitted after the deadline. We consider this to be an instance of non-compliance and a significant deficiency in internal control over compliance for the reporting requirement. This is a repeat of prior year finding 2020-003. Questioned costs: None Context: Federal agencies rely on these reports to ensure that recipients are meeting their expectations. Therefore delays in reporting can result in delays of the receipt of funding. Effect: As a result of the late submission, the Organization is not in compliance with the reporting requirements of the Uniform Guidance. Cause: This resulted from human error, a lack of review of the actual submission of the reports or an intentional delay to ensure more accurate reporting. Recommendation: We recommend reviewing the controls in place to ensure that all future reports are submitted on time and in accordance with grant requirements. If the Organization expects that there will be a delay in the submission of the reports, they should obtain permission to extend the submission date from the awarding agency. Views of Responsible Officials and Planned Corrective Actions: HopeWorks has implemented a number of streamlined processes in which to expedite the availability of the information needed to file the funder reports more timely. These processes are not limited to electronic import of payroll and benefit entries, implementation of Bill.com for expenditures, and prioritization of recording credit card activity. Fifteen days is a strict deadline and if for some reason reporting will be late, HopeWorks will communicate to the funder and document that communication .

CFDA#: 16.575 Crime Victim Assistance Grant Award Numbers: VOCA-2016-0081, VOCA-2017-022, VOCA-2015-0119 Federal Agency: United States Department of Justice Pass-through Entity: State of Maryland - Governor's Office of Crime Control and Prevention CRITERIA: All of the grants under this program require that financial, programmatic, and performance reports be submitted on a quarterly basis. Quarterly reports are due within fifteen calendar days from the end of each quarter. Two of the grants require financial quarterly reports to be submitted within thirty calendar days off each quarter end date. The final financial reports are due no later than thirty calendar days from the end of the award. CONDITION: The Organization did not comply with the reporting requirements in accordance with grant requirements. During our testing, we noted that two of the annual reports and ten of the quarterly reports, approximately 50% of the reports, were submitted after the deadline. We consider this to be an instance of non-compliance and a significant deficiency in internal control over compliance for the reporting requirement. This is a repeat of prior year finding 2019-001. CONTEXT: Federal agencies rely on these reports to ensure that recipients are meeting their expectations. Therefore delays in reporting can result in delays of the receipt of funding. EFFECT: As a result of the late submission, the Organization is not in compliance with the reporting requirements of the Uniform Guidance. CAUSE: This resulted from human error, a lack of review of the actual submission of the reports or an intentional delay to ensure more accurate reporting. RECOMMENDATION: We recommend reviewing the controls in place to ensure that all future reporting requirements are submitted on time and in accordance with grant requirements. If the Organization expects that there will be a delay in the submission of the reports, they should obtain permission to extend the submission date from the awarding agency. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: HopeWorks has implemented a number of streamlined processes in which to expedite the availability of the information needed to file the funder reports more timely. These processes are not limited to electronic import of payroll and benefit entries, implementation of Bill.com for expenditures, and prioritization of recording credit card activity. Fifteen days is a strict deadline and if for some reason reporting will be late, HopeWorks will communicate to the funder and document that communication .

CFDA#: 16.575 Crime Victim Assistance Federal Agency: United States Department of Justice Pass-through Entity: State of Maryland - Governor's Office of Crime Control and Prevention CRITERIA: Per 2 CFR 200.430, "Standards for Documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated". CONDITION: We tested a random sample of forty payroll selections from the award. We noted that there was one payroll selection (2.5% of the selection) where the hours per the timecard did not match the amount recorded to the grant. We consider this to be an instance of non-compliance and a significant deficiency in internal control over compliance for the allowable costs requirement. EFFECT: The proper recording of time spent on each grant is critical to properly allocation of grant expenses. CAUSE: This was due to human error and oversight on this particular payroll. RECOMMENDATION: We recommend that payroll allocations be prepared by one person and reviewed by another to ensure proper allocation and recording of expenses to the proper grant. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: HopeWorks is working to update this process in which effort is reported by program and not funder. It is not typical for a nonprofit to ask staff to allocate time by funding stream and not required by federal regulations. This current process is burdensome to staff and due to the complexity and routine changes as awards begin and end, risk of error is inherent. HopeWorks is currently working with the auditors to develop a new and more appropriate process and will ensure its allowability with funders.

INFORMATION ON FEDERAL PROGRAMS: CFDA#: 16.575 Crime Victim Assistance Grant Award Numbers: VOCA-2016-0081, VOCA-2017-022, VOCA-2015-0119 Federal Agency: United States Department of Justice Pass-through Entity: State of Maryland - Governor's Office of Crime Control and Prevention CRITERIA:All of the grants under this program require that financial, programmatic, and performance reports be submitted on a quarterly basis. Quarterly reports are due within fifteen calendar days from the end of each quarter. Two of the grants require financial quarterly reports to be submitted within thirty calendar days off each quarter end date. The final financial reports are due no later than thirty calendar days from the end of the award. CONDITION:The Organization did not comply with the reporting requirements in accordance with Uniform Guidance. During our testing, we noted that for the grants we tested, eight of the reports were submitted between one day and three months after the deadline. CONTEXT:Federal agencies rely on these reports to ensure that recipients are meeting their expectations. Therefore delays in reporting can result in delays of the receipt of funding. EFFECT: As a result of the late submission, the Organization is not in compliance with the reporting requirements of the Uniform Guidance. CAUSE: This resulted from human error, a lack of review of the actual submission of the reports or an intentional delay to ensure more accurate reporting. RECOMMENDATION: We recommend reviewing the controls in place to ensure that all future reporting requirements are submitted on time. If the Organization expects that there will be a delay in the submission of the reports, they should obtain permission to extend the submission date from the awarding agency. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION:The three month delay in submitting the report was human error. The grantor?s electronic submission process requires completion of the report, hit of the submit button and then a second confirmation of submission verification. In one case, our grant manager submitted the report, but failed to hit the second submission verification button. Because we did not have any communication from the grantor inquiring of a late report, we proceeded thinking that the report had been successfully submitted. It wasn't until the following quarter, when we logged in to begin to prepare the next quarter?s report that we recognized the previous report had not been fully submitted. The second submission verification button was hit at that time. In contrast, another report that was 8 days late was intentional. It was the final reporting for a last minute grant that was a bit unusual in nature. We opted to submit a late financial report that we knew was correct as opposed to an on-time report that might not have been accurate. Management has addressed this issue by putting a process in place that requires the grant manager to save a copy of the confirmation of submission after each grant payment request is submitted. This process will be reviewed by the executive director periodically.

INFORMATION ON FEDERAL PROGRAMS: CFDA#: 16.575 Crime Victim Assistance Federal Agency: United States Department of Justice Pass-through Entity: State of Maryland - Governor's Office of Crime Control and Prevention CRITERIA:Cost charged to federal programs should be based on the relative benefits received and budget submitted. The funds received may only be used to provide direct services to crime victims and activities for supporting direct services. CONDITION:The Organization did not comply with the allowable cost principles requirements in accordance with Uniform Guidance. We noted that there were expenses reported as being spent for the major program, but the expenses were actually incurred for another program. These expenses were incorrectly charged to the major program and reported to the agency as costs incurred for the performance of the activities under the grant. QUESTIONED COST: $3,100 EFFECT: The Organization has determined these charges totaled $3,100 during fiscal year 2019. It was not practical to extend our auditing procedures sufficiently to determine whether the amount was properly calculated and whether any additional questioned costs resulted from this finding. The identified expenses should be returned to the agency or used on expenses relating to this grant. CAUSE: This was caused by a lack of review and monitoring of the coding of expenses charged to the different programs in the accounting system. RECOMMENDATION:We recommend reviewing the controls in place to ensure that all future charges are allowable under the federal program and are properly coded to the grant/program to which they belong. We recommend that a review be done on all grant expenses to ensure that they are being charged to the correct program. If miscoded expenses have already been received from the awarding agency, they should notify the agency and either reimburse the amount and apply the amount to future expenses. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION:The Organization recognizes that $3,100 worth of expenses were miscoded to the wrong grant due to human error. The overall grant expenditures were approximately $730,000 and this error constituted less than .5% of the total grant award. Although we believe the misstatement to be minor in impact and do not know of processes to control for all human error, the Organization is committed to ensuring that there are no mistakes in the tracking of expenditures. We will more thoroughly review all grant allocations.