EIN: 530212296
UEI: ZN9ZL7XENSB8
Audited by: Aprio LLP
Oversight agency: 93 [Department of Health and Human Services]
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Data as of August 28, 2026
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on March 17, 2026. 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 September 17, 2026 (19 days from today).
What is a management decision? →During our testing of procurement activity, we noted that procurement contracts were executed (in September/October of 2024) by an individual who did not have the delegated authority to approve or sign the agreement, as required by the Organization’s internal procurement policy. The contracts exceeded the individual’s approval threshold. The policy’s required internal approval levels were not followed prior to execution. Cause: This issue appears to have resulted from a breakdown in adherence to established internal control procedures, possibly due to a lack of training or oversight. The Organization’s procurement policy was in place and compliant with 2 CFR requirements, but it was not enforced in practice. Effect: Noncompliance with internal procurement approval controls increases the risk of unauthorized or inappropriate spending, lack of transparency, and potential ineligibility of costs charged to federal programs. While the transaction itself may ultimately be allowable, failure to follow established approval protocols constitutes a significant deficiency in internal control over compliance. Repeat finding: This is a repeat finding. See 2024-004 in prior year report. Questioned costs: None identified, as the expenditure appeared otherwise allowable. However, the control deficiency presents a risk for future noncompliance. Perspective: We selected two procurement transactions from a population of four procurement transactions from this program. The issue reflects a control failure affecting procurement activity across federally funded programs and may result in future questioned costs if not corrected. Recommendation: We recommend that the Organization follow up with the relevant parties to ensure proper reporting requirements are met on a timely basis. Management’s response and corrective action plan (unaudited): See corrective action plan
Show full finding ▾Hide full finding ▴Finding 2025-001: Reportable finding considered a significant deficiency - Noncompliance with Internal Procurement Authorization Controls Program name: Child and Adult Care Food Program Assistance Listing: 10.558 Federal awarding agency: U.S. Department of Agriculture (USDA) Pass-through entity: Maryland State Department of Education, District of Columbia Education Office Award identification number: 012-2024/2025-3539-000 Award Years: 2024/2025 Criteria: Under 2 CFR 200.318(a), non-federal entities must establish and maintain oversight to ensure that contractors perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders. As required under 2 CFR Subpart D (§§200.317–200.327), organizations must follow written procurement procedures that reflect applicable state, local, and tribal laws and regulations, provided that the procurements conform to applicable federal law and the standards in the Uniform Guidance. The Organization’s internal procurement policy includes specific thresholds for contract approvals and designates levels of review and signature authority based on the contract value. Adherence to these internal controls is essential to ensure compliance with federal procurement requirements and appropriate stewardship of federal funds. Condition: During our testing of procurement activity, we noted that procurement contracts were executed (in September/October of 2024) by an individual who did not have the delegated authority to approve or sign the agreement, as required by the Organization’s internal procurement policy. The contracts exceeded the individual’s approval threshold. The policy’s required internal approval levels were not followed prior to execution. Cause: This issue appears to have resulted from a breakdown in adherence to established internal control procedures, possibly due to a lack of training or oversight. The Organization’s procurement policy was in place and compliant with 2 CFR requirements, but it was not enforced in practice. Effect: Noncompliance with internal procurement approval controls increases the risk of unauthorized or inappropriate spending, lack of transparency, and potential ineligibility of costs charged to federal programs. While the transaction itself may ultimately be allowable, failure to follow established approval protocols constitutes a significant deficiency in internal control over compliance. Repeat finding: This is a repeat finding. See 2024-004 in prior year report. Questioned costs: None identified, as the expenditure appeared otherwise allowable. However, the control deficiency presents a risk for future noncompliance. Perspective: We selected two procurement transactions from a population of four procurement transactions from this program. The issue reflects a control failure affecting procurement activity across federally funded programs and may result in future questioned costs if not corrected. Recommendation: We recommend that the Organization follow up with the relevant parties to ensure proper reporting requirements are met on a timely basis. Management’s response and corrective action plan (unaudited): See corrective action plan
We will be updating our internal procurement policy. We will also review our policy and train staff on it annually as well as with new hires during orientation to ensure that the policy is understood and followed.
2024-004
Certain employees allocate time to the various projects within the headstart cluster, however, incorrect allocations resulted in payroll costs being charged to Federal awards using the wrong allocation percentages for approximately six months before the error was detected. The errors were mostly identified and corrected by the Organization; however, this correction occurred roughly six months after the incorrect allocation began. Management processed correcting entries such that the total payroll costs charged to the Head Start Federal awards for the fiscal year were corrected in the accounting records. Cause: The error resulted from a combination of data entry errors when setting up the allocation in the payroll allocation system; and insufficient review and monitoring controls over payroll allocation setup and ongoing allocations, including the lack of a documented, periodic review to confirm that allocations continue to reflect actual time and effort and the relative benefits received by Head Start and other programs. As a result, an incorrect allocation remained in place for several months before being identified and corrected. Effect: For approximately six months, payroll costs were allocated among the various Head Start awards and other programs using incorrect allocation percentages. This resulted in a control deficiency in the Organization’s internal control over compliance with Federal requirements for payroll and payroll allocations, including the requirement for effective control over and accountability for all funds in 2 CFR § 200.302(b)(4) and periods during which costs charged to the Head Start Federal awards were not aligned with the relative benefits received by the program, which is inconsistent with the allocability requirements of 2 CFR § 200.405(a). Although management corrected the year-end totals charged to the Head Start Federal awards, the delayed detection of the error indicates that similar errors could occur and remain undetected, potentially resulting in unsupported or unallowable payroll charges in future periods. Management’s response and corrective action plan (unaudited): See corrective action plan. Repeat finding: This is not a repeat finding. Questioned costs: None identified, as the expenditure appeared otherwise allowable. However, the control deficiency presents a risk for future noncompliance. Perspective: In our original sample of 40 payroll allocation transactions related to the Head Start program (ALN 93.600), we noted 5 errors impacting 2 employees. We did not increase our sample size because the error was pervasive across multiple employees. Additional testing over compliance was performed and noted that the errors were materially corrected by management during the year. Recommendation: We recommend that the Organization: • Strengthen payroll allocation setup and review controls by implementing and documenting a review and approval process (by someone independent of the preparer) for new or modified payroll allocation setups in the payroll system for employees whose salaries are charged in whole or in part to Head Start. • Implement periodic after-the-fact reviews of payroll allocations for employees whose salaries are allocated to Head Start and other programs to confirm that allocations remain consistent with actual time and effort and the relative benefits received by each program, and that necessary adjustments are recorded timely. • Enhance documentation and training related to payroll allocations, including: o Written procedures describing how allocations affecting Head Start are established, reviewed, and monitored; and o Training for staff responsible for entering and reviewing payroll allocations on the requirements of 2 CFR § 200.302, § 200.405, and § 200.430, and the importance of timely identification and correction of errors. These actions should help ensure that payroll costs charged to the Head Start Federal award are accurate, properly supported, and allocable in accordance with Federal requirements.
Show full finding ▾Hide full finding ▴Finding 2025-002: Reportable finding considered a significant deficiency - Noncompliance with Payroll Allocation Controls Program name: Headstart Cluster Assistance Listing: 93.600 Federal awarding agency: U.S. Department of Health and Human Services Award identification numbers: 03CH012075-04-00, 03CH012075-05-00, 03CH012317-02-00, 03CH012317-03-00 Award Years: 2024/2025 Criteria: Under 2 CFR § 200.430(g)(1), charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable, and properly allocated. The records must also support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Condition: Certain employees allocate time to the various projects within the headstart cluster, however, incorrect allocations resulted in payroll costs being charged to Federal awards using the wrong allocation percentages for approximately six months before the error was detected. The errors were mostly identified and corrected by the Organization; however, this correction occurred roughly six months after the incorrect allocation began. Management processed correcting entries such that the total payroll costs charged to the Head Start Federal awards for the fiscal year were corrected in the accounting records. Cause: The error resulted from a combination of data entry errors when setting up the allocation in the payroll allocation system; and insufficient review and monitoring controls over payroll allocation setup and ongoing allocations, including the lack of a documented, periodic review to confirm that allocations continue to reflect actual time and effort and the relative benefits received by Head Start and other programs. As a result, an incorrect allocation remained in place for several months before being identified and corrected. Effect: For approximately six months, payroll costs were allocated among the various Head Start awards and other programs using incorrect allocation percentages. This resulted in a control deficiency in the Organization’s internal control over compliance with Federal requirements for payroll and payroll allocations, including the requirement for effective control over and accountability for all funds in 2 CFR § 200.302(b)(4) and periods during which costs charged to the Head Start Federal awards were not aligned with the relative benefits received by the program, which is inconsistent with the allocability requirements of 2 CFR § 200.405(a). Although management corrected the year-end totals charged to the Head Start Federal awards, the delayed detection of the error indicates that similar errors could occur and remain undetected, potentially resulting in unsupported or unallowable payroll charges in future periods. Management’s response and corrective action plan (unaudited): See corrective action plan. Repeat finding: This is not a repeat finding. Questioned costs: None identified, as the expenditure appeared otherwise allowable. However, the control deficiency presents a risk for future noncompliance. Perspective: In our original sample of 40 payroll allocation transactions related to the Head Start program (ALN 93.600), we noted 5 errors impacting 2 employees. We did not increase our sample size because the error was pervasive across multiple employees. Additional testing over compliance was performed and noted that the errors were materially corrected by management during the year. Recommendation: We recommend that the Organization: • Strengthen payroll allocation setup and review controls by implementing and documenting a review and approval process (by someone independent of the preparer) for new or modified payroll allocation setups in the payroll system for employees whose salaries are charged in whole or in part to Head Start. • Implement periodic after-the-fact reviews of payroll allocations for employees whose salaries are allocated to Head Start and other programs to confirm that allocations remain consistent with actual time and effort and the relative benefits received by each program, and that necessary adjustments are recorded timely. • Enhance documentation and training related to payroll allocations, including: o Written procedures describing how allocations affecting Head Start are established, reviewed, and monitored; and o Training for staff responsible for entering and reviewing payroll allocations on the requirements of 2 CFR § 200.302, § 200.405, and § 200.430, and the importance of timely identification and correction of errors. These actions should help ensure that payroll costs charged to the Head Start Federal award are accurate, properly supported, and allocable in accordance with Federal requirements.
We have a multi-pronged action plan. We will clarify and review our accounting policies and procedures regarding payroll allocations with staff; We will create a more thorough documentation process of the basis for each allocation; We will review the assumptions used for allocations during the year and update them (as needed); We will include regular monitoring and review of payroll allocations.
FAC accepted this audit on August 20, 2025 — management decision was due February 20, 2026.
The Organization failed to include two federal pass-through awards received from state and local governmental entities in prior years’ SEFAs. These awards were only identified as federal during the current audit year. Furthermore, when the awards were initially included in the current year’s SEFA, they were incorrectly classified under ALN 10.555 (National School Lunch Program). After additional inquiry and evaluation, they were determined to fall under ALN 10.558 (Child and Adult Care Food Program). The Organization was unable to locate specific subaward agreements; only a master service agreement from the state government was available. Cause: There were deficiencies in the Organization’s internal controls over SEFA preparation, specifically in identifying, classifying, and documenting pass-through federal awards. The absence of award documentation and misclassification of the assistance listing number further indicate inadequate review and verification procedures. Effect: Incomplete and inaccurate SEFA reporting may lead to noncompliance with Uniform Guidance requirements and increases the risk of omitted or misclassified programs subject to audit. Misreporting ALNs may also hinder proper audit coverage and oversight by federal and pass-through entities. Repeat finding: This is not a repeat finding. Questioned costs: There are no questioned costs associated with this finding. Perspective: This issue affected two federal awards and represents a systemic control issue over SEFA preparation. There is a reasonable possibility that similar issues could recur if not addressed. Recommendation: We recommend that the Organization: • Implement procedures to require written documentation (e.g., subaward agreements) for all federal pass-through funding received. • Enhance internal controls over the SEFA preparation process to ensure federal programs are accurately identified, classified, and reported, including verification of ALNs and funding sources. • Designate responsibility within the finance team for verifying the federal nature of all awards and ensure ongoing training on SEFA and Uniform Guidance requirements. Management’s response and corrective action plan (unaudited): See corrective action plan.
Show full finding ▾Hide full finding ▴Finding 2024-003: Reportable finding considered a significant deficiency - Inaccurate and Incomplete Schedule of Expenditures of Federal Awards (SEFA) Program name: Child and Adult Care Food Program Assistance Listing: 10.558 Federal awarding agency: U.S. Department of Agriculture (USDA) Pass-through Entity: Maryland State Department of Education, District of Columbia Education Office Criteria: In accordance with 2 CFR 200.510(b), the auditee must prepare a complete and accurate Schedule of Expenditures of Federal Awards (SEFA) that includes the total federal awards expended for each federal program, the assistance listing number (ALN), the name of the federal agency, and the pass-through entity identifying number. Accurate SEFA reporting is essential to support the auditor’s responsibility under 2 CFR 200.518 major program determination and for federal oversight. Condition: The Organization failed to include two federal pass-through awards received from state and local governmental entities in prior years’ SEFAs. These awards were only identified as federal during the current audit year. Furthermore, when the awards were initially included in the current year’s SEFA, they were incorrectly classified under ALN 10.555 (National School Lunch Program). After additional inquiry and evaluation, they were determined to fall under ALN 10.558 (Child and Adult Care Food Program). The Organization was unable to locate specific subaward agreements; only a master service agreement from the state government was available. Cause: There were deficiencies in the Organization’s internal controls over SEFA preparation, specifically in identifying, classifying, and documenting pass-through federal awards. The absence of award documentation and misclassification of the assistance listing number further indicate inadequate review and verification procedures. Effect: Incomplete and inaccurate SEFA reporting may lead to noncompliance with Uniform Guidance requirements and increases the risk of omitted or misclassified programs subject to audit. Misreporting ALNs may also hinder proper audit coverage and oversight by federal and pass-through entities. Repeat finding: This is not a repeat finding. Questioned costs: There are no questioned costs associated with this finding. Perspective: This issue affected two federal awards and represents a systemic control issue over SEFA preparation. There is a reasonable possibility that similar issues could recur if not addressed. Recommendation: We recommend that the Organization: • Implement procedures to require written documentation (e.g., subaward agreements) for all federal pass-through funding received. • Enhance internal controls over the SEFA preparation process to ensure federal programs are accurately identified, classified, and reported, including verification of ALNs and funding sources. • Designate responsibility within the finance team for verifying the federal nature of all awards and ensure ongoing training on SEFA and Uniform Guidance requirements. Management’s response and corrective action plan (unaudited): See corrective action plan.
COO will work with all program areas to ensure that all federal awards and subawards are identified as such to ensure we track properly COO will ensure we have written documentation for all federal pass-through funding We have added an experienced grants accountant supervised by the CFO to verify the federal nature of all awards and stay current on SEFA and Uniform Guidance
During our testing of procurement activity, we noted that a procurement contract was executed by an individual who did not have the delegated authority to approve or sign the agreement, as required by the Organization’s internal procurement policy. The contract amount exceeded the individual’s approval threshold. The policy’s required internal approval levels were not followed prior to execution. Cause: This issue appears to have resulted from a breakdown in adherence to established internal control procedures, possibly due to a lack of training or oversight. The Organization’s procurement policy was in place and compliant with 2 CFR requirements, but it was not enforced in practice. Effect: Noncompliance with internal procurement approval controls increases the risk of unauthorized or inappropriate spending, lack of transparency, and potential ineligibility of costs charged to federal programs. While the transaction itself may ultimately be allowable, failure to follow established approval protocols constitutes a significant deficiency in internal control over compliance. Repeat finding: This is not a repeat finding. Questioned costs: None identified, as the expenditure appeared otherwise allowable. However, the control deficiency presents a risk for future noncompliance. Perspective: We selected two procurement transactions from a population of four procurement transactions from this program. The issue reflects a control failure affecting procurement activity across federally funded programs and may result in future questioned costs if not corrected. Recommendation: We recommend that the Organization follow up with the relevant parties to ensure proper reporting requirements are met on a timely basis. Management’s response and corrective action plan (unaudited): See corrective action plan.
Show full finding ▾Hide full finding ▴Finding 2024-004: Reportable finding considered a significant deficiency - Noncompliance with Internal Procurement Authorization Controls Program name: Child and Adult Care Food Program Assistance Listing: 10.558 Federal awarding agency: U.S. Department of Agriculture (USDA) Pass-through Entity: Maryland State Department of Education, District of Columbia Education Office Criteria: Under 2 CFR 200.318(a), non-federal entities must establish and maintain oversight to ensure that contractors perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders. As required under 2 CFR Subpart D (§§200.317–200.327), organizations must follow written procurement procedures that reflect applicable state, local, and tribal laws and regulations, provided that the procurements conform to applicable federal law and the standards in the Uniform Guidance. The Organization’s internal procurement policy includes specific thresholds for contract approvals and designates levels of review and signature authority based on the contract value. Adherence to these internal controls is essential to ensure compliance with federal procurement requirements and appropriate stewardship of federal funds. Condition: During our testing of procurement activity, we noted that a procurement contract was executed by an individual who did not have the delegated authority to approve or sign the agreement, as required by the Organization’s internal procurement policy. The contract amount exceeded the individual’s approval threshold. The policy’s required internal approval levels were not followed prior to execution. Cause: This issue appears to have resulted from a breakdown in adherence to established internal control procedures, possibly due to a lack of training or oversight. The Organization’s procurement policy was in place and compliant with 2 CFR requirements, but it was not enforced in practice. Effect: Noncompliance with internal procurement approval controls increases the risk of unauthorized or inappropriate spending, lack of transparency, and potential ineligibility of costs charged to federal programs. While the transaction itself may ultimately be allowable, failure to follow established approval protocols constitutes a significant deficiency in internal control over compliance. Repeat finding: This is not a repeat finding. Questioned costs: None identified, as the expenditure appeared otherwise allowable. However, the control deficiency presents a risk for future noncompliance. Perspective: We selected two procurement transactions from a population of four procurement transactions from this program. The issue reflects a control failure affecting procurement activity across federally funded programs and may result in future questioned costs if not corrected. Recommendation: We recommend that the Organization follow up with the relevant parties to ensure proper reporting requirements are met on a timely basis. Management’s response and corrective action plan (unaudited): See corrective action plan.
Retrained all staff on procurement policies – the approver misunderstood and thought that because this was a reimbursed cost that the higher level signature was not needed, so we have clarified that approval limits apply regardless of whether it is a reimbursable cost Establishing new, more automated procurement approval process that allows us to set approval levels for each user and will reduce potential for errant approvals Ensure all new management staff receive and acknowledge the procurement policy
During our audit procedures, we noted that the Organization does not identify or code unallowable costs (e.g., fundraising event expenses) within its accounting system at the time of transaction entry. As part of our review of the General and Administrative (G&A) cost pool used for indirect cost rate calculations, we identified unallowable costs included in the detailed listing. Per discussion with management, these costs are not intended to be charged to federal awards. Management explained that federal drawdowns are based on a provisional rate and unallowable costs are manually excluded during the closing and cost submission process. Cause: The Organization lacks system-based controls and procedures to flag or segregate unallowable costs during transaction coding. The current process relies heavily on manual review and adjustments at year-end, which increases the risk of unallowable costs being inadvertently included in rates charged to federal programs. Effect: Including unallowable costs in the indirect cost pool—whether or not ultimately billed—represents a significant deficiency in internal control over compliance. Although management asserts that such costs are removed prior to federal reimbursement claims, the absence of preventive controls increases the risk of noncompliance, incorrect cost submissions, and potential disallowed costs during future oversight or audits. Repeat finding: This is not a repeat finding. Questioned costs: None identified as costs were reportedly removed prior to billing; however, the issue represents a control weakness. Perspective: This control deficiency affects the Organization’s system-wide treatment of indirect costs across all federal programs using the provisional rate. Recommendation: We recommend that the Organization: • Implement accounting system enhancements or protocols to flag unallowable costs at the point of entry to ensure proper coding and segregation. • Establish written procedures and staff training to reinforce cost allowability standards under Uniform Guidance. • Consider performing interim reviews of indirect cost pool activity to ensure early identification and removal of unallowable expenses. Management’s response and corrective action plan (unaudited): See corrective action plan.
Show full finding ▾Hide full finding ▴Finding 2024-005: Reportable finding considered a significant deficiency - Inadequate Controls over Identification of Unallowable Costs in the Indirect Cost Pool Program name: Applies to all federal program utilizing indirect cost rates Assistance Listing: All Federal awarding agency: All Pass-through Entity: All Criteria: In accordance with 2 CFR 200.403 and 2 CFR 200.412–415, costs charged to federal awards, whether direct or indirect, must be allowable under the cost principles of Subpart E. Organizations must have adequate internal controls to identify, segregate, and exclude unallowable costs from charges to federal programs. In particular, indirect cost pools used to calculate rates billed to federal awards must not include unallowable costs such as fundraising, entertainment, or other expressly unallowable expenses. Condition: During our audit procedures, we noted that the Organization does not identify or code unallowable costs (e.g., fundraising event expenses) within its accounting system at the time of transaction entry. As part of our review of the General and Administrative (G&A) cost pool used for indirect cost rate calculations, we identified unallowable costs included in the detailed listing. Per discussion with management, these costs are not intended to be charged to federal awards. Management explained that federal drawdowns are based on a provisional rate and unallowable costs are manually excluded during the closing and cost submission process. Cause: The Organization lacks system-based controls and procedures to flag or segregate unallowable costs during transaction coding. The current process relies heavily on manual review and adjustments at year-end, which increases the risk of unallowable costs being inadvertently included in rates charged to federal programs. Effect: Including unallowable costs in the indirect cost pool—whether or not ultimately billed—represents a significant deficiency in internal control over compliance. Although management asserts that such costs are removed prior to federal reimbursement claims, the absence of preventive controls increases the risk of noncompliance, incorrect cost submissions, and potential disallowed costs during future oversight or audits. Repeat finding: This is not a repeat finding. Questioned costs: None identified as costs were reportedly removed prior to billing; however, the issue represents a control weakness. Perspective: This control deficiency affects the Organization’s system-wide treatment of indirect costs across all federal programs using the provisional rate. Recommendation: We recommend that the Organization: • Implement accounting system enhancements or protocols to flag unallowable costs at the point of entry to ensure proper coding and segregation. • Establish written procedures and staff training to reinforce cost allowability standards under Uniform Guidance. • Consider performing interim reviews of indirect cost pool activity to ensure early identification and removal of unallowable expenses. Management’s response and corrective action plan (unaudited): See corrective action plan.
• CFO will examine feasibility of adding flags to journal entries to ensure unallowable costs are flagged at the point of entry Will conduct training on allowable vs. unallowable costs Grants Accountant will conduct quarterly review of costs to ensure no unallowable costs included – will review first three months of FY26 by 12/31/25
FAC accepted this audit on February 14, 2024 — management decision was due August 14, 2024.
As previously reported at 2022-04, the Organization did not meet the 20% non-federal match requirement for the year ended August 31, 2023, which includes the budget periods from August 1, 2022 through July 31, 2023 and August 1, 2023 through July 31, 2024. Context: It was determined that the matching requirement was not met due to not enough volunteer activity as a result of the COVID-19 pandemic. The Organization has requested a waiver from the agency. Cause: The Organization was not able to meet the non-federal matching contributions due to health department requirements to shut-down the Child Development Centers due to the COVID-19 pandemic. Due to the closures of the centers, there were fewer volunteer hours which the Organization uses to meet the matching requirement. Effect: The Organization is in violation of the matching requirement stipulated in the award agreement. Repeat finding: This is a repeat finding. Questioned costs: There are no questioned costs associated with this finding. Recommendation: We recommend that the Organization ensure that the non-federal matching requirements for each federal award be met every fiscal year or obtain a waiver. Management’s response and corrective action plan (unaudited): See corrective action plan.
Show full finding ▾Hide full finding ▴Finding 2023-001: Reportable Finding - Failure to Meet Matching Requirement Program name: Head Start (Cluster) Assistance Listing: 93.600 Federal awarding agency: United States Department of Health and Human Services Compliance requirement: Matching, level of effort, earmarking Criteria: The grant agreement (03CH010635-05-00 and 03CH012317-01-00) for Head Start requires a non-federal matching of 20% unless a waiver is approved by the agency. Condition: As previously reported at 2022-04, the Organization did not meet the 20% non-federal match requirement for the year ended August 31, 2023, which includes the budget periods from August 1, 2022 through July 31, 2023 and August 1, 2023 through July 31, 2024. Context: It was determined that the matching requirement was not met due to not enough volunteer activity as a result of the COVID-19 pandemic. The Organization has requested a waiver from the agency. Cause: The Organization was not able to meet the non-federal matching contributions due to health department requirements to shut-down the Child Development Centers due to the COVID-19 pandemic. Due to the closures of the centers, there were fewer volunteer hours which the Organization uses to meet the matching requirement. Effect: The Organization is in violation of the matching requirement stipulated in the award agreement. Repeat finding: This is a repeat finding. Questioned costs: There are no questioned costs associated with this finding. Recommendation: We recommend that the Organization ensure that the non-federal matching requirements for each federal award be met every fiscal year or obtain a waiver. Management’s response and corrective action plan (unaudited): See corrective action plan.
Based on our grant agreement with Head Start, Easter Seals DC | MD | VA is required to provide a 20% contribution of total project costs for each annual budget period, unless a waiver has been requested and approved; any combination of actual cash expended, or in-kind contributions, may be used to meet the matching requirement. Our organization met the 20% non-federal match requirement for the latest program year (Year 2) for our Early Head Start Program in Washington DC. However, we did not meet the match requirement for Year 5 of our Prince George County program. The mandatory annual waivers associated with our organization’s 20% non-federal share matching contribution requirement for the first four years (2019 - 2022) of the individual award periods ended July 31 of our Prince George’s County Head Start Program grant agreement have been submitted. Likewise, the waiver request for the first year (2022) of the individual award period ended June 30, 2022, for our Washington, DC Head Start Program grant agreement has also been submitted. Per Section 640(b)(1)(5) of the Head Start Act, a waiver request for Year 5 (2023) was submitted alongside the original budget narrative. While the budget was approved, we were notified after the program year ended that a standalone/separate waiver request for Year 5 was required. The outstanding waiver requests remain under review by representatives of The Administration of Families and Children, the agency that oversees the Office of Head Start program. We have maintained a constant dialogue with the Office of Head Start, which administers grant funding and oversight, but have yet to receive formal approval for any of the outstanding waiver submissions. However, we believe that amended waiver requests will be required for some of the program years in which we did not meet our 20% non-federal contribution match in Prince George’s County. In December 2023, we provided the Office of Head Start with additional details related to the organization’s annual expenditures, cash receipts, and non-federal share obligations for the first five years of the Prince George’s County grants. We anticipate that final responses to all five required waiver requests our Prince George’s County Program will be obtained no later than the end of the current grant year (July 31, 2024). We expect the outstanding waiver request for Year 1 of our Washington DC program will be considered and approved by the end of the current grant year (July 31, 2024).
2022-001
The Organization did not submit the SF-429 report due during the year ended August 31, 2023. Context: The year under audit was the first year the Organization was subject to these reporting requirements. Cause: The Organization is aware of the requirement and has requested assistance with the preparation of the report from the Federal agency, but has not received assistance as of the date of the audit report. Effect: The Organization did not meet reporting requirements for the award during the year ended August 31, 2023. Repeat finding: This is not a repeat finding. Questioned costs: There are no questioned costs associated with this finding. Recommendation: We recommend that the Organization follow up with the relevant parties to ensure proper reporting requirements are met on a timely basis. Management’s response and corrective action plan (unaudited): See corrective action plan.
Show full finding ▾Hide full finding ▴Finding 2023-002: Reportable Finding Considered a Significant Deficiency - Failure to Meet Reporting Requirement Program name: Head Start (Cluster) Assistance Listing: 93.600 Federal awarding agency: United States Department of Health and Human Services Compliance requirement: Reporting Criteria: The grant agreement (03CH012075-02-02) for Head Start requires the submission of the Real Property Status Report (SF-429), as expenditures for leasehold improvements were reimbursed under the award during the year ended August 31, 2023. Condition: The Organization did not submit the SF-429 report due during the year ended August 31, 2023. Context: The year under audit was the first year the Organization was subject to these reporting requirements. Cause: The Organization is aware of the requirement and has requested assistance with the preparation of the report from the Federal agency, but has not received assistance as of the date of the audit report. Effect: The Organization did not meet reporting requirements for the award during the year ended August 31, 2023. Repeat finding: This is not a repeat finding. Questioned costs: There are no questioned costs associated with this finding. Recommendation: We recommend that the Organization follow up with the relevant parties to ensure proper reporting requirements are met on a timely basis. Management’s response and corrective action plan (unaudited): See corrective action plan.
The status of real property purchased, constructed, or subject to major renovations paid for in whole or in part with federal Head Start funds must be reported annually on standard forms (SF) Real Property Status Reports 429 and SF-429-A. Based on our grant agreement for our Early Head Start Program in Washington, DC , as well as construction activities undertaken throughout Fiscal Year 2023 related to the facility located at 1151 Bladensburg Road, NE, Easter Seals DC | MD | VA is required to file the aforementioned forms no later than 90 days after the program year ends. As noted in the audit report, our organization did not file the required SF-429 Form for the latest program year (FY 2023) for our Washington DC EHS program. The director for the Head Start program was aware of the Real Property Status filing requirement, but apparently misunderstood that the deadline for the Year 2 (FY 2023) filing was September 30, 2023. We anticipate that the required reports will be submitted to the appropriate governing agency by March 31, 2024.
FAC accepted this audit on March 6, 2023 — management decision was due September 6, 2023.
The Organization did not meet the 20% non-federal match requirement for the year ended August 31, 2022, which includes the budget periods from August 1, 2021 through July 31, 2022 and August 1, 2022 through July 31, 2023. Context: It was determined that the matching requirement was not met due to not enough volunteer activity as a result of the COVID-19 pandemic. The Organization has requested a waiver from the agency. Cause: The Organization was not able to meet the non-federal matching contributions due to health department requirements to shut-down the Child Development Centers due to the COVID-19 pandemic. Due to the closures of the centers, there were fewer volunteer hours which the Organization uses to meet the matching requirement. Effect: The Organization is in violation of the matching requirement stipulated in the grant agreement. Repeat finding: This is a repeat finding. Questioned costs: There are no questioned costs associated with this finding. Recommendation: We recommend that the Organization ensure that the non-federal matching requirements for each federal grant be met every fiscal year or apply for a waiver as soon as it becomes apparent that the match will not be met. Management?s response and corrective action plan (unaudited): See Appendix A ? corrective action plan
Show full finding ▾Hide full finding ▴Finding 2022-004: Reportable Finding Considered a Material Weakness - Failure to Meet Matching Requirement Program name: Head Start Assistance Listing: 93.600 Federal awarding agency: United States Department of Health and Human Services Compliance requirement: Matching, level of effort, earmarking Criteria: The grant agreement (03CH010635-04-00 and 03CH010635-05-00) for the Head Start requires a non-federal matching of 20% unless a waiver is approved by the agency. Condition: The Organization did not meet the 20% non-federal match requirement for the year ended August 31, 2022, which includes the budget periods from August 1, 2021 through July 31, 2022 and August 1, 2022 through July 31, 2023. Context: It was determined that the matching requirement was not met due to not enough volunteer activity as a result of the COVID-19 pandemic. The Organization has requested a waiver from the agency. Cause: The Organization was not able to meet the non-federal matching contributions due to health department requirements to shut-down the Child Development Centers due to the COVID-19 pandemic. Due to the closures of the centers, there were fewer volunteer hours which the Organization uses to meet the matching requirement. Effect: The Organization is in violation of the matching requirement stipulated in the grant agreement. Repeat finding: This is a repeat finding. Questioned costs: There are no questioned costs associated with this finding. Recommendation: We recommend that the Organization ensure that the non-federal matching requirements for each federal grant be met every fiscal year or apply for a waiver as soon as it becomes apparent that the match will not be met. Management?s response and corrective action plan (unaudited): See Appendix A ? corrective action plan
Based on our grant agreement with Head Start, Easter Seals DC MD VA is required to provide a 20% contribution of total project costs for each annual budget period, unless a waiver has been requested and approved; any combination of actual cash expended, or in-kind contributions, may be used to meet the matching requirement. As noted in the audit report, our organization did not meet the 20% non-federal match requirement for the latest program year. Our inability to meet the 20% threshold in fiscal year 2022 was, in part, due to a lack of volunteering activity associated with limited operations/required closures of our Head Start locations throughout the COVID pandemic. The mandatory annual waivers associated with our organization?s 20% non-federal share matching contribution requirement for the first four years (ended July 31, 2019, 2020, 2021, and 2022) of our Prince George?s County Head Start Program grant agreement were submitted by the end of the organization?s Fiscal Year 2022. Likewise, the annual waver for the first year (ended June 2022) for our Washington, DC Head Start Program grant agreement was also submitted by the end of Fiscal Year 2022. The outstanding waiver requests are currently under review by representatives of The Administration of Families and Children, the agency that oversees the Office of Head Start program. While we have maintained a constant dialogue with the Office of Head Start over the last several months, which administers grant funding and oversight, we have yet to receive a formal approval for any of the individual submissions. We are hopeful that response to all five waiver requests submitted will be obtained no later than the end of the current grant year for our Prince George?s County Program (July 31, 2023).
2021-002
FAC accepted this audit on April 26, 2022 — management decision was due October 26, 2022.
The Organization did not meet the 20% non-federal match requirement for the year ended August 31, 2021. Context: It was determined that the matching requirement was not met due to not enough volunteer activity as a result of the COVID-19 pandemic. The Organization has requested a waiver from the agency. Cause: The Organization was not able to meet the non-federal matching contributions due to health department requirements to shut-down the Child Development Centers due to the COVID-19 pandemic. Due to the closures of the centers, there were fewer volunteer hours which the Organization uses to meet the matching requirement. Effect: The Organization is in violation of the matching requirement stipulated in the grant agreement. Repeat finding: This is a repeat finding. Questioned costs: There are no questioned costs associated with this finding. Recommendation: We recommend that the Organization ensure that the non-federal matching requirements for each federal grant be met every fiscal year or apply for a waiver as soon as it becomes apparent that the match will not be met. Management?s response and corrective action plan (unaudited): See Appendix A ? corrective action plan
Show full finding ▾Hide full finding ▴Finding 2021-002: Reportable Finding Considered a Material Weakness - Failure to Meet Matching Requirement Program name: Head Start Assistance Listing: 93.600 Federal awarding agency: United States Department of Health and Human Services Compliance requirement: Matching, level of effort, earmarking Criteria: The grant agreement for the Head Start requires a non-federal matching of 20% unless a waiver is approved by the agency. Condition: The Organization did not meet the 20% non-federal match requirement for the year ended August 31, 2021. Context: It was determined that the matching requirement was not met due to not enough volunteer activity as a result of the COVID-19 pandemic. The Organization has requested a waiver from the agency. Cause: The Organization was not able to meet the non-federal matching contributions due to health department requirements to shut-down the Child Development Centers due to the COVID-19 pandemic. Due to the closures of the centers, there were fewer volunteer hours which the Organization uses to meet the matching requirement. Effect: The Organization is in violation of the matching requirement stipulated in the grant agreement. Repeat finding: This is a repeat finding. Questioned costs: There are no questioned costs associated with this finding. Recommendation: We recommend that the Organization ensure that the non-federal matching requirements for each federal grant be met every fiscal year or apply for a waiver as soon as it becomes apparent that the match will not be met. Management?s response and corrective action plan (unaudited): See Appendix A ? corrective action plan
Finding Number 2021-002 Planned Corrective Action Anticipated Completion Date June 30, 2022 Responsible Contact Person Jevonna Willis Based on our grant agreement with Head Start, Easter Seals DC/MD/VA is required to provide a 20% contribution of total project costs for each annual budget period, unless a waiver has been requested and approved; any combination of actual cash expended, or in-kind contributions, may be used to meet the matching requirement. As noted in the audit report, our organization did not meet the 20% non-federal match requirement for the latest program year. Our inability to meet the 20% threshold in fiscal year 2021 was, in part, due to a lack of volunteering activity associated with limited operations/required closures of our Head Start locations throughout the COVID pandemic. We also acknowledge that the mandatory annual waivers associated with our organization?s 20% non-federal share matching contribution requirement for the first three years (ended August 31, 2019, 2020, and 2021) of our Head Start grant agreement were not submitted by the end of the fiscal 2021. Our program director for the Head Start program indicated that the requisite 20% non-federal match requirement for the year ended August 31, 2021 (referenced in finding 2021-002) was prepared, and submitted, before the date of the audit report. The outstanding waiver request is currently under review by representatives of The Administration of Families and Children, the agency that oversees the Office of Head Start program. We anticipate that separate waiver requests related to the 20% non-federal match requirement the previous two years ended August 31, 2019 and 2021, respectively (referenced in Finding 2020-002), will be submitted to the appropriate governing agency by the end of June 2022.
2020-002
FAC accepted this audit on April 1, 2021 — management decision was due October 1, 2021.
The Organization did not meet the 20% non-federal match requirement for the year ended August 31, 2020. Context: It was determined that the matching requirement was not met. Effect: The Organization is in violation of the matching requirement stipulated in the grant agreement. Cause: The Organization was not able to meet the non-federal matching contributions due to health requirements to shut-down the Child Development Centers due to the COVID-19 pandemic. Due to the closures of the centers, there were fewer volunteer hours which the Organization uses to meet the matching requirement. Repeat finding: This is a repeat finding. Questioned costs: There are no questioned costs associated with this finding. Recommendation: We recommend that the Organization ensure that the non-federal matching requirements for each federal grant be met every fiscal year or apply for a waiver as soon as it becomes apparent that the match will not be met. Management's response and corrective action plan (unaudited): - See Appendix A
Show full finding ▾Hide full finding ▴Finding 2020-002: Significant Deficiency - Failure to meet matching requirement Program name: Head Start CFDA #: 93.600 Federal awarding agency: United States Department of Health and Human Services Compliance requirement: Matching, level of effort, earmarking Criteria: The grant agreement for the Head Start requires a non-federal matching of 20% unless a waiver is approved. Condition: The Organization did not meet the 20% non-federal match requirement for the year ended August 31, 2020. Context: It was determined that the matching requirement was not met. Effect: The Organization is in violation of the matching requirement stipulated in the grant agreement. Cause: The Organization was not able to meet the non-federal matching contributions due to health requirements to shut-down the Child Development Centers due to the COVID-19 pandemic. Due to the closures of the centers, there were fewer volunteer hours which the Organization uses to meet the matching requirement. Repeat finding: This is a repeat finding. Questioned costs: There are no questioned costs associated with this finding. Recommendation: We recommend that the Organization ensure that the non-federal matching requirements for each federal grant be met every fiscal year or apply for a waiver as soon as it becomes apparent that the match will not be met. Management's response and corrective action plan (unaudited): - See Appendix A
Re: Finding 2020-002: Significant Deficiency ? Failure to Meet Non-Federal Share Matching Requirement Management?s response and corrective action plan (unaudited) ? Based on the advice of OHS (Office of Head Start), Easterseals submitted a formal request on December 23, 2019 to waive the non-federal share matching requirement for the first year of our Head Start Contract (Year ending July 31, 2019). As OHS has apprised us, it is not unusual for first time grantees to be given a waiver for the first year of the contract, especially since construction of our permanent facilities were delayed and thus, we were not able to house our entire student population. Due to changes in personnel and the onset of COVID-19, the waiver Easterseals submitted for the first was not responded to, by the Office of Head Start, until December 2020. They have asked us to provide some additional support to our request and are reviewing it with us prior to asking us to formally update our request. They have reinforced their support that, based on the requested additional support, they believe that our waiver will be granted.
2019-001
The Organization did not report two Community Development construction loans on the SEFA. Context: The loans were obtained in 2005 and 2008, which predates the current management and personnel in the position of oversight. In addition, some of the loan documents could not be located. Effect: The Organization did not prepare a complete SEFA and expenditures of the loan proceeds incurred in 2005 through 2009 where not properly reflected on the SEFA. Cause: The Organization was not aware that the loans were subject to OMB A-133 and needed to continue to be reported on the SEFA as loan balances outstanding. Repeat finding: This is not a repeat finding. Questioned costs: There are no questioned costs associated with this finding. Recommendation: We recommend that the Organization review all funding, grants or loans, for federal sources when compiling the SEFA. Management's response and corrective action plan (unaudited): - See Appendix A
Show full finding ▾Hide full finding ▴Finding 2020-003: Material Weakness- Failure to include Community Development loans on the SEFA Program name: Community Development Block Grant CFDA #: 14.218 Federal awarding agency: United States Department of Housing and Urban Development Pass-through agency: D.C. Department of Housing and Community Development Compliance requirement: Reporting - Preparation of the Schedule of Expenditures of Federal Awards Criteria: The Uniform Guidance requires that a grantee must be able to prepare a Schedule of Expenditures of Federal Awards (SEFA) accurately and completely. Condition: The Organization did not report two Community Development construction loans on the SEFA. Context: The loans were obtained in 2005 and 2008, which predates the current management and personnel in the position of oversight. In addition, some of the loan documents could not be located. Effect: The Organization did not prepare a complete SEFA and expenditures of the loan proceeds incurred in 2005 through 2009 where not properly reflected on the SEFA. Cause: The Organization was not aware that the loans were subject to OMB A-133 and needed to continue to be reported on the SEFA as loan balances outstanding. Repeat finding: This is not a repeat finding. Questioned costs: There are no questioned costs associated with this finding. Recommendation: We recommend that the Organization review all funding, grants or loans, for federal sources when compiling the SEFA. Management's response and corrective action plan (unaudited): - See Appendix A
Re: Finding 2020-003: Material Weakness -Failure to Include Community Development Loans on the SEFA Management?s response and corrective action plan (unaudited) ? We learned from our Audit Partner that two block loans awarded through DC Dept. of Housing and Community Development in 2005 and 2008, respectively, should have been included on the Easterseals SEFA. Prior to this admonition, we were not aware that these type of loans needed to be recorded on the SEFA. Now that we are aware of the requirement, we have taken steps to include this requirement in our accounting policies and procedures and our audit checklist, to ensure that we report these loans on the SEFA going forward.
FAC accepted this audit on February 13, 2019 — management decision was due August 13, 2019.
GSA_MIGRATION
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GSA_MIGRATION
2014-003, 2015-003
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