EIN: 526066477
UEI: X1C5ZSQU1KL6
Data as of August 21, 2026
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on December 31, 2025. Under 2 CFR 200.521(d), a pass-through entity that provided federal funds to this organization for this audit period must issue a management decision on these findings by July 1, 2026, which was (51 days ago).
What is a management decision? →Finding Reference: 2024-002 SEFA Changes Due to Final Reconciliation of Grant Activities Prior Year Finding: 2023-002 Federal Agency: Various Compliance Requirement: Reporting Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Federal Program: Various Grant Award: Various Condition/Context: Certain program expenditures reported on the initial SEFA provided during the audit changed as a result of the final reconciliation and determination of grant activities. Criteria: Uniform Guidance (2 CFR Part 200) requires recipients of federal awards to prepare a SEFA that accurately reflects expenditures incurred during the reporting period. Preparation from a reconciliation of underlying grant activities is an essential internal control to ensure that SEFA reporting aligns with federal requirements. Cause: Management’s final reconciliation and determination of the grant expenditures resulted in changes to the SEFA. Effect: The SEFA submitted for audit contained overstated federal expenditures for certain programs. These corrections did not result in a change in required testing based on applicable compliance requirements. Questioned Costs: None Recommendation: Management should ensure that the process related to the preparation of the SEFA occurs from its finalized grants reconciliation process to ensure accurate financial reporting.
Finding Reference: 2024-002 Views of Responsible Officials and Planned Corrective Actions The Agency agrees with this finding and recommendation as presented. Management has implemented procedures to enhance fiscal efforts in reconciling its grants receivable accounts before preparing the SEFA. The agency reevaluated the fiscal department’s needs and hired new staff, including a finance director, account payables, and part-time fiscal support specialist, and contracted with a CPA to assist with the following scope of work: Close out accounts receivable and payable. Account for any grants received during the fiscal year. Monitor budget-to-actual program expenditures throughout the grant year. Reconcile grants receivable balances to the general ledger. Name of the contact person responsible for corrective action: Michael Young, President, (301) 274-4474. Corrective action completed as of : December 31, 2024.
2023-002
Finding Reference: 2024-003 Prior Year Finding: 2023-003 Federal Agency: Department of Health and Human Services Compliance Requirement: Allowable Costs (Indirect Costs) Type of Finding: Material Weakness in Internal Control over Compliance Federal Program: 93.569 – Community Services Block Grant (CSBG) Grant Award: Various Condition/Context: For fiscal year 2024, SMTCCAC charged general and administrative costs for other programs to the Community Services Block Grant in excess of the approved budget for administration costs, which is part of a two year grant which ends September 30, 2025. Criteria: On November 13, 2024, the Department of Health and Human Services approved a provisional indirect cost rate of 22% to be applied to total direct salaries and fringe benefit costs related to all federal programs. This rate is applicable to SMTCCAC’s grants, contract, and other agreements covered by 2 CFR 200 for the period effective from December 1, 2020 to June 30, 2024. According to the approved rate agreement, if any federal contract, grant, or other agreement is reimbursing indirect costs by a means other than the approved rate in this agreement, the organization should (1) credit such costs to the affected programs, and (2) apply the approved rate to the appropriate base to identify the proper amount of indirect costs allocable to these programs. Cause: For fiscal year 2024, SMTCCAC allocated $205,051 in indirect costs for salaries and fringe benefits and general and administrative expenses to the Community Services Block Grant (CSBG). The amended and approved CSBG budget for CSBG designated 25% ($118,088) of the total grant for administrative costs and 75% ($354,265) for program operating costs. Based on the approved indirect cost rate of 22% applied to total salaries and fringe benefits, the allowable indirect cost allocation amounts to $25,609, a difference of $179,442. This is $61,354 in excess of the total budget allowed costs for administration for the year ended June 30, 2024. The total costs for CSBG do not exceed the total budget during FY 2024. Effect: SMTCCAC allocated administrative costs in excess of the approved budget to the Community Services Block Grant. These costs were in excess of the budget for administration costs, although within the aggregate budget total. Questioned Costs: SMTCCAC allocated general and administrative costs to the CSBG grant which was not clearly authorized by the budget for the grant for that ended September 30, 2024. Questioned cost is $61,354. Recommendation: We recommend that SMTCCAC ensures compliance with the cost principles in 2 CFR Part 200, Subpart E, adhere to the approved federal indirect cost rate agreement, and properly apply either the actual annual indirect cost rate or the approved federal rate, whichever is lower, when determining indirect costs charged to federal awards. In addition, other general and administrative costs charged to CSBG should be within an approved budget for the costs.
Finding Reference: 2024-003 Views of Responsible Officials and Planned Corrective Actions The Agency agrees with this finding and recommendation as presented. Given this finding, the Agency will review monthly its application of the approved provisional indirect cost rate to all grants, contracts, and other agreements covered by 2 CFR 200. Management has taken corrective action by ensuring that all indirect cost allocations remain within the approved 22% rate and has also participated in additional financial training to strengthen compliance and oversight. The Agency will proceed in the following scope of work: Ensure indirect charges follow the applicable cost principles per 2 CFR 200, Appendix IV, and grant agreement. Receive permission from funders for indirect charges over the allocation of the indirect costs per the grant agreement. Review the grant performance period of the CSBG that ends September 30, 2025. Obtain a revised budget approval, if necessary, for any line budgeted items that exceed 20% of the total award based on the original awarded contract upon close out of the grant at the end of the period of performance. Name of the contact person responsible for corrective action: Michael Young, President, (301) 274-4474. Planned completion date for corrective action plan: December 31, 2025
2023-003
Finding Reference: 2024-004 Prior Year Finding: 2023-004 Federal Agency: Department of Health and Human Services Compliance Requirement: Reporting Type of Finding: Material Weakness in Internal Control over Compliance, Other Matters Federal Program: Impacts All Federal Award Programs Grant Award: Various Condition/Context: The single audit report was not submitted to the Office Management and Budget in accordance with the reporting requirement. Criteria: COSO/Internal Control Framework defines control activities as “policies and procedures that help ensures management’s directives are carried out” This would include preparation of the Schedule of Expenditures of Federal Awards and the related Data Collection Form in a timely manner. Uniform Guidance 2 CFR 200.501 states that the audit shall be completed, and the data collection form shall be submitted within the earlier of 30 days after the receipt of the auditor’s report, or nine months after the end of the audit period. Accordingly, audit for fiscal year ending June 30, 2024 was due on March 31, 2025. Cause: The single audit report was not submitted due to delays in year-end closing entries, schedules, and reconciliations. Effect: As a result of the finding, SMTCCAC did not provide required information to its federal oversight agency in a timely manner. Questioned Costs: None Recommendation: We believe that the year-end closing process could proceed in a timely manner by adhering to a closing schedule and maintaining timely account reconciliations. Progress should be monitored by management to determine that due dates are being met and required reports are submitted to regulatory agencies within the compliance time frame.
Finding Reference: 2024-004 Views of Responsible Officials and Planned Corrective Actions The Agency agrees with this finding and recommendation as presented. In some contexts, the Agency experienced significant turnover in the Finance department during the third quarter, and a new Finance Director was hired during the fourth quarter of fiscal year 2024. The turnover in fiscal staff hindered the accounting processes and oversight that included journal entry review and postings and account reconciliations promptly. As a corrective measure to ensure adhering to a closing schedule and maintaining timely account reconciliations, the Agency reevaluated the fiscal department’s needs and hired new staff, including a finance director, accounts payable, part-time fiscal support specialist, and contracted with a CPA to assist with the following scope of work: Review all trial fund balance processes. Prepare a closing schedule that includes reporting and data processing deadlines. Reconcile all balance sheet accounts in the general ledger chart of accounts. Timely prepare and file all financial reports required by each award. Work with the independent auditor to implement an interim audit fieldwork schedule to reduce required work subsequent to fiscal year-end. Name of the contact person responsible for corrective action: Michael Young, President, (301) 274-4474. Planned completion date for corrective action plan: December 31, 2025
2023-004
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on February 13, 2025. Under 2 CFR 200.521(d), a pass-through entity that provided federal funds to this organization for this audit period must issue a management decision on these findings by August 13, 2025, which was (373 days ago).
What is a management decision? →Finding Reference: 2023-002 Inaccurate SEFA Reporting Due to Failure to Reconcile Grants Receivable Federal Agency: Various Compliance Requirement: Reporting Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Federal Program: Impacts All Federal Award Programs Grant Award: Various Condition: SMTCCAC’s SEFA included incorrect expenditures resulting from unreconciled grants receivable balances. Certain federal expenditures were either overstated or understated because SMTCCAC did not reconcile its grants receivable accounts before preparing the SEFA. Criteria: Uniform Guidance (2 CFR Part 200) requires recipients of federal awards to prepare a SEFA that accurately reflects expenditures incurred during the reporting period. Reconciliation of grants receivable is an essential internal control to ensure that SEFA reporting aligns with federal requirements. Cause: Management did not implement adequate procedures to reconcile grants receivable accounts prior to the preparation of the SEFA. Effect: The SEFA submitted for audit contained material misstatements, including overstated federal expenditures for certain programs and understated expenditures for others. This could result in non-compliance with Uniform Guidance and inaccurate financial reporting. Questioned Costs: None Recommendation: Management should establish and enforce a grants reconciliation process to ensure that grants receivable are fully reconciled before the preparation of the SEFA. This includes reviewing all grant activity, reconciling receivable balances to underlying documentation, and making necessary adjustments promptly.
Finding Reference: 2023-002 Views of Responsible Officials and Planned Corrective Actions The Agency agrees with this finding and recommendation as presented. Management has implemented procedures to enhance fiscal efforts in reconciling its grants receivable accounts before preparing the SEFA. The agency reevaluated the fiscal department’s needs and hired new staff, including a finance director, account payables, and part-time fiscal support specialist, and contracted with a CPA to assist with the following scope of work: Close out accounts receivable and payable. Account for any grants received during the fiscal year. Monitor budget-to-actual program expenditures throughout the grant year. Reconcile grants receivable balances to the general ledger. Name of the contact person responsible for corrective action: Michael Young, President, (301) 274-4474. Corrective action completed as of : December 31, 2023. Auditor’s Note: The stated completion date for the corrective action plan is based on the Agency's representation. The implementation of these corrective actions has not been audited by the auditors and will be subject to review during the next audit period.
Finding Reference: 2023-003 Prior Year Finding: 2022-006 Federal Agency: Department of Health and Human Services Compliance Requirement: Allowable Costs (Indirect Costs) Type of Finding: Material Weakness in Internal Control over Compliance Federal Program: 93.569 – Community Services Block Grant (CSBG) Grant Award: Various Condition/Context: During the testing of indirect cost allocations to federal programs, it was determined that SMTCCAC charged excess indirect costs for programs to the Community Services Block Grant. The actual indirect costs allocated to all programs exceeded the approved provisional federal indirect cost rate of 22%; and was ultimately reported as administration costs within other costs for the grant, which exceeded the CSBG budget line without obtaining approval from the applicable funding agencies. Criteria: On November 13, 2023, the Department of Health and Human Services approved a provisional indirect cost rate of 22% to be applied to total direct salaries and fringe benefit costs related to all federal programs. This rate is applicable to SMTCCAC’s grants, contract, and other agreements covered by 2 CFR 200 for the period effective from December 1, 2020 to June 30, 2024. According to the approved rate agreement, if any federal contract, grant, or other agreement is reimbursing indirect costs by a means other than the approved rate in this agreement, the organization should (1) credit such costs to the affected programs, and (2) apply the approved rate to the appropriate base to identify the proper amount of indirect costs allocable to these programs. Cause: SMTCCAC allocated general and administration costs to the grant based on its monthly calculated indirect cost rate per program, rather than allocating indirect costs to programs which should not exceed the approved provisional rate of 22%. For FY2023, SMTCCAC calculated an actual indirect cost rate of 57.48% and the excess above the approved provisional rate of 22% was charged to CSBG program for all programs. These excess costs were not within the approved budget for the category administration costs. Effect: SMTCCAC allocated indirect costs for programs in excess of the approved provisional rate to the Community Services Block Grant. These costs were in excess of the budget for administration costs, although within the aggregate budget total. Questioned Costs: Based on our assessment using the approved provisional rate, SMTCCAC overallocated indirect costs to the CSBG grant by $385,819, which exceeded the CSBG budget line category for administration costs. Recommendation: We recommend that SMTCCAC ensures compliance with the cost principles in 2 CFR Part 200, Subpart E, adhere to the approved federal indirect cost rate agreement, and properly apply either the actual annual indirect cost rate or the approved federal rate, whichever is lower, when determining indirect costs charged to federal awards. In addition, other general and administrative costs charged to CSBG should be within an approved budget for the costs.
Finding Reference: 2023-003 Views of Responsible Officials and Planned Corrective Actions The Agency agrees with this finding and recommendation as presented. Given this finding, the Agency will review monthly its application of the approved provisional indirect cost rate to all grants, contracts, and other agreements covered by 2 CFR 200. The agency will proceed in the following scope of work: Ensure indirect chargers follow the applicable cost principles per 2 CFR 200, Appendix IV, and grant agreement. Receive permission from funders for indirect charges over the allocation of the indirect costs per the grant agreement. Name of the contact person responsible for corrective action: Michael Young, President, (301) 274-4474. Planned completion date for corrective action plan: December 31, 2025
2022-006
Finding Reference: 2023-004 Prior Year Finding: 2022-005 Federal Agency: Department of Health and Human Services Compliance Requirement: Reporting Type of Finding: Material Weakness in Internal Control over Compliance, Other Matters Federal Program: Impacts All Federal Award Programs Grant Award: Various Condition/Context: The single audit report was not submitted to the Office Management and Budget in accordance with the reporting requirement. Criteria: COSO/Internal Control Framework defines control activities as “policies and procedures that help ensures management’s directives are carried out” This would include preparation of the Schedule of Expenditures of Federal Awards and the related Data Collection Form in a timely manner. Uniform Guidance 2 CFR 200.501 states that the audit shall be completed, and the data collection form shall be submitted within the earlier of 30 days after the receipt of the auditor’s report, or nine months after the end of the audit period. Accordingly, audits for fiscal years ending June 30, 2023 would be due on March 31, 2024. Cause: The single audit report was not submitted due to delays in year-end closing entries, schedules, and reconciliations. Effect: As a result of the finding, SMTCCAC did not provide required information to its federal oversight agency in a timely manner. Questioned Costs: None Recommendation: We believe that the year-end closing process could proceed in a timely manner by adhering to a closing schedule and maintaining timely account reconciliations. Progress should be monitored by management to determine that due dates are being met and required reports are submitted to regulatory agencies within the compliance time frame.
Finding Reference: 2023-004 Views of Responsible Officials and Planned Corrective Actions The Agency agrees with this finding and recommendation as presented. In some contexts, the Agency experienced significant turnover in the Finance department during the third quarter, and a new Finance Director was hired during the fourth quarter of fiscal year 2023. The turnover in fiscal staff hindered the accounting processes and oversight that included journal entry review and postings and account reconciliations promptly. As a corrective measure to ensure adhering to a closing schedule and maintaining timely account reconciliations, the Agency reevaluated the fiscal department’s needs and hired new staff, including a finance director, accounts payable, part-time fiscal support specialist, and contracted with a CPA to assist with the following scope of work: Review all trial fund balance processes. Prepare a closing schedule that includes reporting and data processing deadlines. Reconcile all balance sheet accounts in the general ledger chart of accounts. Timely prepare and file all financial reports required by each award. Work with the independent auditor to implement an interim audit fieldwork schedule to reduce required work subsequent to fiscal year-end. Name of the contact person responsible for corrective action: Michael Young, President, (301) 274-4474. Planned completion date for corrective action plan: December 31, 2025
2022-005
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on August 30, 2023. Under 2 CFR 200.521(d), a pass-through entity that provided federal funds to this organization for this audit period must issue a management decision on these findings by March 1, 2024, which was (903 days ago).
What is a management decision? →Finding Reference: 2022-002 Federal Agency: Department of Treasury Compliance Requirement: Allowable Costs (Non-Payroll) Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Federal Program: 21.023 ? Emergency Rental Assistance Grant Award: ERAP I Charles County Condition/Context: FSTA selected a sample of sixty disbursements of rental assistance claims for testing and noted the following errors: ? SMTCCAC mistakenly processed a duplicate payment of $7,700 for an eligible claim, which was one (1) of the 60 rental assistance claims selected for testing in Charles County ERAP I grant. ? SMTCCAC made a payment of $31,800 to a landlord for one (1) of the 60 rental assistance claims selected for testing, for which another agency had made a payment for the same claim before SMTCCAC. Criteria: Internal Control: Per 2 CFR section 200.303(a), a non-Federal entity must: establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Compliance: Under OMB guidance, Public Law (Pub. L.) No. 107-300, the Improper Payments Information Act of 2002, as amended by Pub. L. No. 111-204, the Improper Payments Elimination and Recovery Act, Executive Order 13520 on reducing improper payments, and the June 18, 2010 Memorandum on Enhancing Payment Accuracy - Any payment that should not have been made or that was made in an incorrect amount, including an overpayment or underpayment, under a statutory, contractual, administrative, or other legally applicable requirement; and includes ? (i) any payment to an ineligible recipient;(ii) any payment for an ineligible good or service; (iii) any duplicate payment; (iv) any payment for services not received; and (v) any payment that does not account for credit for applicable discounts. Cause: Due to staff turnover, the claim of $7,700 was submitted to Finance for payment twice. SMTCCAC did not sufficiently monitor controls to detect the duplicate payment. Additionally, SMTCCAC did not adequately monitor controls to ensure proper review of the shared document among participating ERAP agencies in Charles County to avoid the duplication of benefits for the claim of $31,800. Effect: The duplicate expenditure included in the program cost was deemed unallowable. The landlord involved in the rental assistance claim confirmed receiving two checks, each totaling $7,700. SMTCCAC did not require the landlord to return the duplicate funds, nor did it establish a repayment plan after the landlord expressed a willingness to establish a repayment agreement. Ultimately, the landlord chose to apply the duplicate payment of $7,700 towards future rents for the applicable tenant. During FY2023, Charles County identified the duplicate check and promptly requested the return of duplicate payment of $7,700 from SMTCCAC. During a program file audit by Charles County, it was determined that a duplicate expenditure included in the program cost was deemed unallowable. In FY2022, SMTCCAC paid $31,800 to a landlord who had already received payment from another participating ERAP agency. Despite notifications from SMTCCAC, the landlord has not/was not willing to return the duplicate funds to SMCTTAC. Charles County has notified SMTCCAC on numerous occasions about the need to reimburse the County for the duplicated funds. Once the funds are received, Charles County will return the monies to the State of Maryland. In March of 2023, the County also sent an invoice of $31,800 requesting SMTCCAC to return the $31,800. Questioned Costs: $7,700 ? duplicate payment made to a landlord for a rental assistance claim selected for testing. $31,800 ? duplicate payment made to a landlord for a rental assistance claim selected for testing. Recommendation: We recommend that SMTCCAC implement effective controls to prevent duplicate payments. Additionally, we recommend that SMTCCAC consistently verify the shared document used among participating ERAP agencies in Charles County to ensure that a claim has not been applied for and paid by other agencies. Views of Responsible Officials and Planned Corrective Actions: See Corrective Action Plans section.
Finding Reference: 2022-002 Federal Agency: Department of Treasury Compliance Requirement: Allowable Costs (Non-Payroll) Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Federal Program: 21.023 ? Emergency Rental Assistance Grant Award: ERAP I Charles County Condition/Context: FSTA selected a sample of sixty disbursements of rental assistance claims for testing and noted the following errors: ? SMTCCAC mistakenly processed a duplicate payment of $7,700 for an eligible claim, which was one (1) of the 60 rental assistance claims selected for testing in Charles County ERAP I grant. ? SMTCCAC made a payment of $31,800 to a landlord for one (1) of the 60 rental assistance claims selected for testing, for which another agency had made a payment for the same claim before SMTCCAC. Criteria: Internal Control: Per 2 CFR section 200.303(a), a non-Federal entity must: establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Compliance: Under OMB guidance, Public Law (Pub. L.) No. 107-300, the Improper Payments Information Act of 2002, as amended by Pub. L. No. 111-204, the Improper Payments Elimination and Recovery Act, Executive Order 13520 on reducing improper payments, and the June 18, 2010 Memorandum on Enhancing Payment Accuracy - Any payment that should not have been made or that was made in an incorrect amount, including an overpayment or underpayment, under a statutory, contractual, administrative, or other legally applicable requirement; and includes ? (i) any payment to an ineligible recipient;(ii) any payment for an ineligible good or service; (iii) any duplicate payment; (iv) any payment for services not received; and (v) any payment that does not account for credit for applicable discounts. Cause: Due to staff turnover, the claim of $7,700 was submitted to Finance for payment twice. SMTCCAC did not sufficiently monitor controls to detect the duplicate payment. Additionally, SMTCCAC did not adequately monitor controls to ensure proper review of the shared document among participating ERAP agencies in Charles County to avoid the duplication of benefits for the claim of $31,800. Effect: The duplicate expenditure included in the program cost was deemed unallowable. The landlord involved in the rental assistance claim confirmed receiving two checks, each totaling $7,700. SMTCCAC did not require the landlord to return the duplicate funds, nor did it establish a repayment plan after the landlord expressed a willingness to establish a repayment agreement. Ultimately, the landlord chose to apply the duplicate payment of $7,700 towards future rents for the applicable tenant. During FY2023, Charles County identified the duplicate check and promptly requested the return of duplicate payment of $7,700 from SMTCCAC. During a program file audit by Charles County, it was determined that a duplicate expenditure included in the program cost was deemed unallowable. In FY2022, SMTCCAC paid $31,800 to a landlord who had already received payment from another participating ERAP agency. Despite notifications from SMTCCAC, the landlord has not/was not willing to return the duplicate funds to SMCTTAC. Charles County has notified SMTCCAC on numerous occasions about the need to reimburse the County for the duplicated funds. Once the funds are received, Charles County will return the monies to the State of Maryland. In March of 2023, the County also sent an invoice of $31,800 requesting SMTCCAC to return the $31,800. Questioned Costs: $7,700 ? duplicate payment made to a landlord for a rental assistance claim selected for testing. $31,800 ? duplicate payment made to a landlord for a rental assistance claim selected for testing. Recommendation: We recommend that SMTCCAC implement effective controls to prevent duplicate payments. Additionally, we recommend that SMTCCAC consistently verify the shared document used among participating ERAP agencies in Charles County to ensure that a claim has not been applied for and paid by other agencies. Views of Responsible Officials and Planned Corrective Actions: See Corrective Action Plans section.
Finding Reference: 2022-003 Federal Agency: Department of Treasury Compliance Requirement: Eligibility Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Federal Program: 21.023 ? Emergency Rental Assistance Grant Award: ERAPI Charles County Condition/Context: SMTCCAC did not provide proof of review of the shared document among participating ERAP agencies in Charles County to avoid duplication of benefits for four (4) of the 60 rental assistance claims selected for testing. Criteria: Internal Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Cause: SMTCCAC did not adequately monitor controls to ensure proper review of the shared document among participating ERAP agencies in Charles County resulting in the potential duplication of benefits. Effect: Failure to review the shared document used among participating ERAP agencies in Charles County could result in duplication of benefits. Questioned Costs: None Recommendation: We recommend that SMTCCAC consistently verify the shared document used among participating ERAP agencies in Charles County to avoid duplication of benefits. Views of Responsible Officials and Planned Corrective Actions: See Corrective Action Plans section.
Finding Reference: 2022-003 Federal Agency: Department of Treasury Compliance Requirement: Eligibility Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Federal Program: 21.023 ? Emergency Rental Assistance Grant Award: ERAPI Charles County Condition/Context: SMTCCAC did not provide proof of review of the shared document among participating ERAP agencies in Charles County to avoid duplication of benefits for four (4) of the 60 rental assistance claims selected for testing. Criteria: Internal Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Cause: SMTCCAC did not adequately monitor controls to ensure proper review of the shared document among participating ERAP agencies in Charles County resulting in the potential duplication of benefits. Effect: Failure to review the shared document used among participating ERAP agencies in Charles County could result in duplication of benefits. Questioned Costs: None Recommendation: We recommend that SMTCCAC consistently verify the shared document used among participating ERAP agencies in Charles County to avoid duplication of benefits. Views of Responsible Officials and Planned Corrective Actions: See Corrective Action Plans section.
Finding Reference: 2022-004 Federal Agency: Department of Treasury Compliance Requirement: Activities Allowed, Allowable Costs (Non-Payroll) Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Federal Program: 21.023 ? Emergency Rental Assistance Grant Award: ERAPI Charles County Condition/Context: SMTCCAC was unable to provide documentation to support review and approval for one (1) of the 40 transactions selected for testing. Criteria: Internal Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Cause: SMTCCAC was unable to locate the Expenditure Request Form that demonstrates the approval of an invoice. Effect: The risk of unallowed costs increases due to lack of supervisor review and approval of expenditures charged to the program. Questioned Costs: None Recommendation: We recommend that SMTCCAC maintain the documentation of review and approval of expenditures charged to the federal award programs. Views of Responsible Officials and Planned Corrective Actions: See Corrective Action Plans section.
Finding Reference: 2022-004 Federal Agency: Department of Treasury Compliance Requirement: Activities Allowed, Allowable Costs (Non-Payroll) Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Federal Program: 21.023 ? Emergency Rental Assistance Grant Award: ERAPI Charles County Condition/Context: SMTCCAC was unable to provide documentation to support review and approval for one (1) of the 40 transactions selected for testing. Criteria: Internal Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Cause: SMTCCAC was unable to locate the Expenditure Request Form that demonstrates the approval of an invoice. Effect: The risk of unallowed costs increases due to lack of supervisor review and approval of expenditures charged to the program. Questioned Costs: None Recommendation: We recommend that SMTCCAC maintain the documentation of review and approval of expenditures charged to the federal award programs. Views of Responsible Officials and Planned Corrective Actions: See Corrective Action Plans section.
Finding Reference: 2022-005 Federal Agency: Department of Health and Human Services Compliance Requirement: Reporting Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Federal Program: Impacts All Federal Award Programs Grant Award: Various Condition/Context: The single audit report was not submitted to the Office Management and Budget in accordance with the reporting requirement. Criteria: COSO/Internal Control Framework defines control activities as ?policies and procedures that help ensures management?s directives are carried out? This would include preparation of the Schedule of Expenditures of Federal Awards and the related Data Collection Form in a timely manner. Uniform Guidance 2 CFR 200.501 states that the audit shall be completed, and the data collection form shall be submitted within the earlier of 30 days after the receipt of the auditor?s report, or nine months after the end of the audit period. Accordingly, audits for fiscal years ending June 30, 2022 would be due on March 31, 2023. Cause: The single audit report was not submitted due to delays in year-end closing entries, schedules, and reconciliations. Effect: As a result of the finding, SMTCCAC did not provide required information to its federal oversight agency in a timely manner. Questioned Costs: None Recommendation: We believe that the year-end closing process could proceed in a timely manner by adhering to a closing schedule and maintaining timely account reconciliations. Progress should be monitored by management to determine that due dates are being met and required reports are submitted to regulatory agencies within the compliance time frame. Views of Responsible Officials and Planned Corrective Actions: See Corrective Action Plans section.
Finding Reference: 2022-005 Federal Agency: Department of Health and Human Services Compliance Requirement: Reporting Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters Federal Program: Impacts All Federal Award Programs Grant Award: Various Condition/Context: The single audit report was not submitted to the Office Management and Budget in accordance with the reporting requirement. Criteria: COSO/Internal Control Framework defines control activities as ?policies and procedures that help ensures management?s directives are carried out? This would include preparation of the Schedule of Expenditures of Federal Awards and the related Data Collection Form in a timely manner. Uniform Guidance 2 CFR 200.501 states that the audit shall be completed, and the data collection form shall be submitted within the earlier of 30 days after the receipt of the auditor?s report, or nine months after the end of the audit period. Accordingly, audits for fiscal years ending June 30, 2022 would be due on March 31, 2023. Cause: The single audit report was not submitted due to delays in year-end closing entries, schedules, and reconciliations. Effect: As a result of the finding, SMTCCAC did not provide required information to its federal oversight agency in a timely manner. Questioned Costs: None Recommendation: We believe that the year-end closing process could proceed in a timely manner by adhering to a closing schedule and maintaining timely account reconciliations. Progress should be monitored by management to determine that due dates are being met and required reports are submitted to regulatory agencies within the compliance time frame. Views of Responsible Officials and Planned Corrective Actions: See Corrective Action Plans section.
Finding Reference: 2022-006 Federal Agency: Department of Health and Human Services Compliance Requirement: Allowable Costs (Indirect Costs) Type of Finding: Material Weakness in Internal Control over Compliance, Other Matters Federal Program: 93.600 ? Head Start; 93.569 ? CSBG; Grant Award: Various Condition/Context: During the testing of indirect cost allocations to federal programs, it was determined that SMTCCAC overcharged indirect costs on two of seven federal programs. Head Start, a major program, was one of the two programs with overcharges. The indirect costs charged to the programs exceeded the approved provisional federal indirect cost rate of 31.5% without obtaining approvals from the federal awarding agencies. As a result, an overallocation of indirect expenses was incurred by the effected federal programs. In addition, we found that SMTCCAC applied indirect cost rates inconsistently among programs and failed to calculate an actual indirect cost rate and provide composition of indirect costs for the fiscal year 2022. Criteria: On July 23, 2021, the Department of Health and Human Services approved a provisional indirect cost rate of 31.5% to be applied to total direct salaries and fringe benefit costs related to all federal programs. This rate is applicable to SMTCCAC?s grants, contract, and other agreements covered by 2 CFR 200 for the period effective from December 1, 2020 to June 30, 2023. According to the approved rate agreement, if any federal contract, grant, or other agreement is reimbursing indirect costs by a means other than the approved rate in this agreement, the organization should (1) credit such costs to the affected programs, and (2) apply the approved rate to the appropriate base to identify the proper amount of indirect costs allocable to these programs. Cause: SMTCCAC charged indirect costs to grants based on budgeted amounts per grant agreements instead of allocating indirect costs to programs based on an actual indirect rate for the fiscal year not to exceed its approved provisional indirect cost rate of 31.5%. SMTCCAC didn?t calculate an actual annual indirect cost rate for FY 2022 to compare to the approved provisional rate. The actual rate should have been calculated to determine if it was lower than the approved provisional rate. If lower, the actual rate should have been applied. If higher, the approved provisional rate should have been used. Additionally, indirect cost rates were not consistently applied across the various programs. Effect: Indirect cost rates were inconsistently applied across each federal program. SMTCCAC obtained approval from the ERAP grantor to charge indirect costs in excess of the approved provisional indirect cost rate of 31.5%. However, SMTCCAC allocated indirect costs in excess of the approved provisional rate to two of the six remaining federal programs. The remaining four programs were charged below the approved provisional rate. Questioned Costs: The questioned costs were not determinable because the actual annual indirect cost rate was not calculated. Without the actual rate, we could not determine if the actual rate was lower or higher than the approved provisional rate. However, based on our assessment using the approved provisional rate, the overallocations appear to be material. Recommendation: We recommend that SMTCCAC ensures compliance with the cost principals in 2 CFR Part 200, Subpart E, and follows the approved federal indirect cost rate agreement and calculate the actual annual indirect cost rate when determining indirect costs charged to federal awards. Views of Responsible Officials and Planned Corrective Actions: See Corrective Action Plans section.
Finding Reference: 2022-006 Federal Agency: Department of Health and Human Services Compliance Requirement: Allowable Costs (Indirect Costs) Type of Finding: Material Weakness in Internal Control over Compliance, Other Matters Federal Program: 93.600 ? Head Start; 93.569 ? CSBG; Grant Award: Various Condition/Context: During the testing of indirect cost allocations to federal programs, it was determined that SMTCCAC overcharged indirect costs on two of seven federal programs. Head Start, a major program, was one of the two programs with overcharges. The indirect costs charged to the programs exceeded the approved provisional federal indirect cost rate of 31.5% without obtaining approvals from the federal awarding agencies. As a result, an overallocation of indirect expenses was incurred by the effected federal programs. In addition, we found that SMTCCAC applied indirect cost rates inconsistently among programs and failed to calculate an actual indirect cost rate and provide composition of indirect costs for the fiscal year 2022. Criteria: On July 23, 2021, the Department of Health and Human Services approved a provisional indirect cost rate of 31.5% to be applied to total direct salaries and fringe benefit costs related to all federal programs. This rate is applicable to SMTCCAC?s grants, contract, and other agreements covered by 2 CFR 200 for the period effective from December 1, 2020 to June 30, 2023. According to the approved rate agreement, if any federal contract, grant, or other agreement is reimbursing indirect costs by a means other than the approved rate in this agreement, the organization should (1) credit such costs to the affected programs, and (2) apply the approved rate to the appropriate base to identify the proper amount of indirect costs allocable to these programs. Cause: SMTCCAC charged indirect costs to grants based on budgeted amounts per grant agreements instead of allocating indirect costs to programs based on an actual indirect rate for the fiscal year not to exceed its approved provisional indirect cost rate of 31.5%. SMTCCAC didn?t calculate an actual annual indirect cost rate for FY 2022 to compare to the approved provisional rate. The actual rate should have been calculated to determine if it was lower than the approved provisional rate. If lower, the actual rate should have been applied. If higher, the approved provisional rate should have been used. Additionally, indirect cost rates were not consistently applied across the various programs. Effect: Indirect cost rates were inconsistently applied across each federal program. SMTCCAC obtained approval from the ERAP grantor to charge indirect costs in excess of the approved provisional indirect cost rate of 31.5%. However, SMTCCAC allocated indirect costs in excess of the approved provisional rate to two of the six remaining federal programs. The remaining four programs were charged below the approved provisional rate. Questioned Costs: The questioned costs were not determinable because the actual annual indirect cost rate was not calculated. Without the actual rate, we could not determine if the actual rate was lower or higher than the approved provisional rate. However, based on our assessment using the approved provisional rate, the overallocations appear to be material. Recommendation: We recommend that SMTCCAC ensures compliance with the cost principals in 2 CFR Part 200, Subpart E, and follows the approved federal indirect cost rate agreement and calculate the actual annual indirect cost rate when determining indirect costs charged to federal awards. Views of Responsible Officials and Planned Corrective Actions: See Corrective Action Plans section.
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on November 15, 2021. Under 2 CFR 200.521(d), a pass-through entity that provided federal funds to this organization for this audit period must issue a management decision on these findings by May 15, 2022, which was (1559 days ago).
What is a management decision? →Federal Agency: U.S. Department of Health and Human Services Compliance Requirement: Activities Allowed, Allowable Costs (Non-Payroll) Type of Finding: Internal Control over Compliance Federal Program: 93.600 ? Head Start Grant Award: 03HP000161-01 Condition/Context: Management did not provide sufficient documentation for one (1) of the 40 transactions selected for testing. Criteria: 2 CFR part 200 of the Uniform Guidance requires that all costs under federal award programs ?be adequately documented.? Cause: Sufficient documentation was not maintained by management for all expenditures under the federal award programs. Effect: It could not be determined if the expenditure was for activities/costs allowable under the grant as well as general federal award requirements and whether the allocation basis of the cost was reasonable. In addition, it could not be verified if these costs were accurately included in the schedule of expenditures of federal awards. Questioned Costs: None. Management recorded a journal entry to transfer this expenditure out of the Head Start Program prior to the audit report date. Recommendation: We recommend that management require supporting invoices and other documentation be maintained for all expenditures charged to the federal award programs, including those related to credit card purchases and ACH payments. Views of Responsible Officials and Planned Corrective Actions: See Corrective Action Plans section
Views of Responsible Officials and Planned Corrective Actions We agree with the recommendations as presented and have implemented procedures to enhance the fiscal efforts in the areas of accounting processes oversight that includes account reconciliations and reviews of transactions to ensure costs are allowable and supported by proper documentation. These accounting processes have oversight by the board of directors and the finance committee on a monthly basis. Name of the contact person responsible for corrective action: Michael Young, President, (301) 274-4474. Planned completion date for corrective action plan: December 31, 2021
Federal Agency: U.S. Department of Health and Human Services Compliance Requirement: Reporting Type of Finding: Internal Control, Noncompliance Federal Program: Impacts All Federal Award Programs Grant Award: Various Condition/Context: The single audit report was not submitted to the Office Management and Budget in accordance with the reporting requirement. Criteria: COSO/Internal Control Framework defines control activities as ?policies and procedures that help ensures management?s directives are carried out? This would include preparation of the Schedule of Expenditures of Federal Awards and the related Data Collection Form in a timely manner. Uniform Guidance 2 CFR 200.501 states that the audit shall be completed, and the data collection form shall be submitted within the earlier of 30 days after the receipt of the auditor?s report, or nine months after the end of the audit period. In March 2021, OMB issued memorandum M-21-20 extending the single audit filing date as a direct result of the COVID 19 crisis. Accordingly, audits with normal due dates of March 31, 2021 (fiscal years ending June 30, 2020) would have an extension up to six (6) months beyond the normal due date or September 30, 2021. Cause: The single audit report was not submitted due to significant delays in year-end closing entries, schedules, and reconciliations. Effect: As a result of the finding, the Organization did not provide required information to its federal oversight agency in a timely manner. Questioned Costs: None Recommendation: We believe that the year-end closing process could proceed in a timely manner by adhering to a closing schedule and maintaining timely account reconciliations. Progress should be monitored by management to determine that due dates are being met and required reports are submitted to regulatory agencies within the compliance time frame. Views of Responsible Officials and Planned Corrective Actions: See Corrective Action Plan section
Views of Responsible Officials and Planned Corrective Actions We agree with the recommendations as presented and have implemented procedures to enhance the fiscal efforts in the areas of accounting processes oversight that includes account reconciliations and reviews of transactions to ensure costs are allowable and supported by proper documentation. The June 30, 2020 audit was delayed as a result of the time required to reconcile accounts. Now that balances are properly reconciled as of June 30, 2020, it is our expectation that the June 30, 2021 audit will be submitted on time. Name of the contact person responsible for corrective action: Michael Young, President, (301) 274-4474. Planned completion date for corrective action plan: December 31, 2021
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on August 19, 2019. Under 2 CFR 200.521(d), a pass-through entity that provided federal funds to this organization for this audit period must issue a management decision on these findings by February 19, 2020, which was (2375 days ago).
What is a management decision? →Data source: This information comes from the Federal Audit Clearinghouse, the official repository of Single Audit data. All data is public domain. Verify this organization's audit history at fac.gov.
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