The Public Health FoundationNon-Profit

2019-001 Reconciliations Material Weakness Criteria: Generally accepted accounting principles in the United States (GAAP) requires entities to establish and maintain effective internal controls over financial reporting to ensure accurate financial reports. Condition: In fiscal year 2019, as management was performing year-end close procedures, a variance of $65,182 was identified. Through management?s investigation, the variance was identified as being excess drawdowns that occurred prior to fiscal year 2019. The variance affected federal awards which were closed during fiscal year 2014 and fiscal year 2019. Cause: Management did not perform reconciliations of the draws by individual federal award. There were several other issues involved which also allowed for this overdraw including: the implementation of the federal salary cap, a co-mingling of the awards by the governing agency in the Payment Management System, and Affordable Care Act awards. Effect: The lack of internal controls surrounding this reconciliation have allowed the Foundation to overdraw Federal Funds. A liability has been recorded for this variance and will be subsequently returned Questioned Costs: None Auditor?s Recommendation: We recommend that management perform a reconciliation of expenditures by federal award prior to drawing down future funds to ensure this not happen in the future. Views of Responsible Officials and Planned Corrective Actions: The Foundation agrees with the finding and has implemented the following control procedures: ? The ACFO will maintain a log of reimbursement requests, with dates, amounts and funds available for reimbursement, and ? The ACFO will generate a payment data inquiry from the Department of Health and Human Services Program Support Centers Payment Management System, and ? The ACFO will compare the log and inquiry to ensure that previous reimbursement data matches. ? The CFO/COO will review the records provided by the ACFO quarterly with the preparation and submission of the quarterly Federal Cash Transactions Report via the Payment Management System. Repeat Finding: This is not a repeat finding.

2019-002 Policies and Procedures Material Weakness Program Information CFDA # 93.421 Strengthening Public Health Systems Criteria: Non-federal entities must follow the procurement standards of 2 CFR sections 200.318 to 200.326. The effective date of required procurement under these standards is for auditee fiscal years beginning on or after December 26, 2017. Condition: The Public Health Foundation did not adopt a formal written procurement policy following these standards by June 30, 2019. Cause: The Foundation did not update its written procurement policy to account for the new OMB regulations, nor did management document how procurement decisions were made, nor how or if those procurements should be categorized per the new procurement regulations. Effect: The Foundation did not comply with the requirement that the procurement policy be documented by the required date. However, the Foundation?s main expenditure is for salaries, benefits and related payroll taxes of its employees. These costs, totaling approximately $659,559 were 75.9% of the Foundation?s total expenditures for this federal award. Salaries and related fringe benefits would not be subject to the competitive bidding process required under the procurement policy. Questioned Costs: None Auditor?s Recommendation: The Foundation should adopt a formal written procurement policy in the format and with the elements required by 2 CFR sections 200.318 to 200.326. Views of Responsible Officials and Planned Corrective Actions: The Foundation agrees with the finding, and will update its written procurement policy and document procurement decisions. Repeat Finding: This is not a repeat finding.

GSA_MIGRATION