EIN: 580660607
UEI: YG9HGE7NRBU7
Data as of August 22, 2026
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on April 16, 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 October 16, 2026 (54 days from today).
What is a management decision? →The Organization is charging payroll costs to the grant and the general ledger through predetermined percentage as entered into the payroll system rather than the actual time spent on the grant through the personal action report (“PAR”) as signed by the employee and supervisor. There are also several instances of no record keeping for certain payroll runs and individuals. Questioned Costs: The Organization switched payroll companies during the year and was unable to provide 5 out of 8 payroll details related to what was allocated to the VA Homeless Providers Grant and Per Diem Program (“VOM”) program which represented $118,085 of payroll expenditures allocated to the program. Out of the 3 payroll registers (15 employees) we were able to test, 2 PAR reports did not match the allocation charged to the grant, and 5 PAR reports were missing which represented $724 of payroll expenditures allocated to the program. Context: This condition occurred on certain employees. We tested 3 payroll period and a total of 15 employees, of which 7 had exceptions. Cause: The Organization has a tracking system in place to monitor the wages by employees charged to federal grants, but the actual time worked on the grant is not updated in the payroll system. Effect: Inaccurate payroll costs may be charged to federal programs. Recommendation: Management should develop a process whereby payroll costs allocated to federal grants are supported by a system of internal controls which provides reasonable assurance that the charges are accurate allowable and properly allocated, reasonably reflect the total activity for which the employee is compensated, and support the distribution of the employee’s wages among specific activities or cost objectives if the employee works on more than one federal award. Management’s Response: Management agrees with the finding and has prepared a corrective action plan.
Show full finding ▾Hide full finding ▴Finding 2025-002 - Allowable Costs/Cost Principles (Allocation of Payroll) Funding Agency: U.S. Department of Veterans Affairs Direct Funding Grant: Homeless Providers Grant and Per Diem Program Assistance Listing Number: 64.024 Type of Finding: Significant deficiency Over Compliance and Compliance Criteria: Uniform Guidance section 200.430(h)(8)(i) indicates that the standards for documentation of personnel expenses are such that (1) Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must:(i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the nonfederal entity and(iii) Reasonably reflect the total activity for which the employee is compensated by the nonfederal entity, not exceeding 100% of compensated activities. Furthermore, subsection (viii) indicates: Budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity are identified and entered into the records in a timely manner and (C) The nonfederal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a federal awards based on budget estimates. Condition: The Organization is charging payroll costs to the grant and the general ledger through predetermined percentage as entered into the payroll system rather than the actual time spent on the grant through the personal action report (“PAR”) as signed by the employee and supervisor. There are also several instances of no record keeping for certain payroll runs and individuals. Questioned Costs: The Organization switched payroll companies during the year and was unable to provide 5 out of 8 payroll details related to what was allocated to the VA Homeless Providers Grant and Per Diem Program (“VOM”) program which represented $118,085 of payroll expenditures allocated to the program. Out of the 3 payroll registers (15 employees) we were able to test, 2 PAR reports did not match the allocation charged to the grant, and 5 PAR reports were missing which represented $724 of payroll expenditures allocated to the program. Context: This condition occurred on certain employees. We tested 3 payroll period and a total of 15 employees, of which 7 had exceptions. Cause: The Organization has a tracking system in place to monitor the wages by employees charged to federal grants, but the actual time worked on the grant is not updated in the payroll system. Effect: Inaccurate payroll costs may be charged to federal programs. Recommendation: Management should develop a process whereby payroll costs allocated to federal grants are supported by a system of internal controls which provides reasonable assurance that the charges are accurate allowable and properly allocated, reasonably reflect the total activity for which the employee is compensated, and support the distribution of the employee’s wages among specific activities or cost objectives if the employee works on more than one federal award. Management’s Response: Management agrees with the finding and has prepared a corrective action plan.
As noted in the audit, a changeover in payroll systems occurred during FY2025. The new system provides improved reporting capabilities that facilitate better oversight of staffing assignment percentages and should help resolve this issue moving forward. In addition, all GA Division locations are being directed to review staffing assignments in the payroll system to verify accuracy. Furthermore, Area Command finance staff will continue to work alongside the staff involved with the Veterans’ program to ensure compliance.
2024-002
FAC accepted this audit on June 27, 2025 — management decision was due December 27, 2025.
The Organization is charging payroll costs to the grant and the general ledger through predetermined percentage as entered into the payroll system rather than the actual time spent on the grant through the personal action report (“PAR”) as signed by the employee and supervisor. Questioned Costs: 8 out of 24 payroll period had $19,994 more charged to the grant vs. the signed personal action report. Context: This condition occurred on certain employees. We tested 8 payroll period and a total of 33 employees of which 13 had exceptions. Cause: The Organization has a tracking system in place to monitor the wages by employee charged to federal grants, but the actual time worked on the grant is not updated in the payroll system. Effect: Inaccurate payroll costs may be charged to federal programs. Recommendation: Management should develop a process whereby payroll costs allocated to federal grants are supported by a system of internal controls which provides reasonable assurance that the charges are accurate allowable and properly allocated, reasonably reflect the total activity for which the employee is compensated, and support the distribution of the employee’s wages among specific activities or cost objectives if the employee works on more than one federal award. Management’s Response: See Corrective Action Plan
Show full finding ▾Hide full finding ▴Finding 2024-002 - Allowable Costs/Cost Principles (Allocation of Payroll) Funding Agency: U.S. Department of Veterans Affairs Direct Funding Grant: Homeless Providers Grant and Per Diem Program Assistance Listing Number: 64.024 Type of Finding: Significant deficiency Criteria: Uniform Guidance section 200.430(h)(8)(i) indicates that the standards for documentation of personnel expenses are such that (1) Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must:(i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the nonfederal entity and(iii) Reasonably reflect the total activity for which the employee is compensated by the nonfederal entity, not exceeding 100% of compensated activities. Furthermore, subsection (viii) indicates: Budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity are identified and entered into the records in a timely manner and (C) The nonfederal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a federal awards based on budget estimates. Condition: The Organization is charging payroll costs to the grant and the general ledger through predetermined percentage as entered into the payroll system rather than the actual time spent on the grant through the personal action report (“PAR”) as signed by the employee and supervisor. Questioned Costs: 8 out of 24 payroll period had $19,994 more charged to the grant vs. the signed personal action report. Context: This condition occurred on certain employees. We tested 8 payroll period and a total of 33 employees of which 13 had exceptions. Cause: The Organization has a tracking system in place to monitor the wages by employee charged to federal grants, but the actual time worked on the grant is not updated in the payroll system. Effect: Inaccurate payroll costs may be charged to federal programs. Recommendation: Management should develop a process whereby payroll costs allocated to federal grants are supported by a system of internal controls which provides reasonable assurance that the charges are accurate allowable and properly allocated, reasonably reflect the total activity for which the employee is compensated, and support the distribution of the employee’s wages among specific activities or cost objectives if the employee works on more than one federal award. Management’s Response: See Corrective Action Plan
Effective March 2025, the staff at Red Shield is required to conduct a time study, twice per year. The findings from the study are used to determine percentages of labor hours/pay to be assigned to each program. Any changes are to be immediately relayed to Human Resources and updated in the payroll system.
2023-003
FAC accepted this audit on August 29, 2024 — management decision was due March 1, 2025.
The Uniform Guidance Audit for September 30, 2023, will be completed and submitted to the Federal Clearinghouse after the due date of June 30, 2024. Cause of Condition: While the audit was completed in advance of the due date, the audit was unable to be submitted to the Federal Clearinghouse in a timely manner due to the lengthy review process of the Organization to provide approval of the audit report. Effect of Condition: The effect is that the compliance requirement to file timely with the Federal Clearinghouse was not met. Identification of Repeat Finding: The finding is a repeat of a finding noted in the audit for September 30, 2022 as finding number 2022-001. Recommendation: The Organization should have future audits completed timely and filed timely with the Federal Clearinghouse. Views of Responsible Officials: Management understands and accepts the recommendation as outlined in the Corrective Action Plan.
Show full finding ▾Hide full finding ▴Finding No. 2023-001: Significant Deficiency: Criteria: The Organization is required to file the Uniform Guidance Audit with the Federal Clearinghouse within nine months of the year-end of the Organization. Statement of Condition: The Uniform Guidance Audit for September 30, 2023, will be completed and submitted to the Federal Clearinghouse after the due date of June 30, 2024. Cause of Condition: While the audit was completed in advance of the due date, the audit was unable to be submitted to the Federal Clearinghouse in a timely manner due to the lengthy review process of the Organization to provide approval of the audit report. Effect of Condition: The effect is that the compliance requirement to file timely with the Federal Clearinghouse was not met. Identification of Repeat Finding: The finding is a repeat of a finding noted in the audit for September 30, 2022 as finding number 2022-001. Recommendation: The Organization should have future audits completed timely and filed timely with the Federal Clearinghouse. Views of Responsible Officials: Management understands and accepts the recommendation as outlined in the Corrective Action Plan.
Recommendation: The Salvation Army, Louisville Area Command should have future audits completed and filed timely with the Federal Clearinghouse. Action Taken: The Salvation Army, Louisville Area Command understands and accepts the recommendation and will work with the audit firm to ensure that the future audits will be completed and filed timely.
2022-001
During the course of the auditing procedures we noted that The Operating Fund did not have expenditures to support the total amount drawn down under the grant. Questioned costs: $37,883 Context: Of the $906,065 drawn down under the grant, the Organization only had detail and supporting accounting records to support qualifying expenses of $770,585. Prior to year-end, the Operating fund became aware that amounts were being overdrawn and opted to not submit reimbursement requests for expenses incurred in September of 2023, leaving a remaining overdrawn amount as of September 30, 2023 of $37,883. Effect: The excess amounts drawn down could be deemed to be unallowable and have to be returned to the grantor. Cause: Due to an ineffective review process of the costs charged to the grant compared to the total recognized as revenue and reported as expenditures. Recommendation: Management should ensure all cost expenditures are properly documented and supported before being charged to the grant. Any funds received more than actual federal expenditures should be recorded as a refundable advance. Grantee Comment: Refer to Corrective Action Plan
Show full finding ▾Hide full finding ▴Finding 2023-002- Allowable Costs/Activities Allowed Funding Agency: U.S. Department of Veterans Affairs Direct Funding Grant: Homeless Providers Grant and Per Diem Program Assistance Listing Number: 64.024 Criteria: Funds spent under the grant must be allowed under Title 2 U.S. Code of Federal Regulations Part 200 Subpart E, Cost Principles (“Cost Principles”). Condition: During the course of the auditing procedures we noted that The Operating Fund did not have expenditures to support the total amount drawn down under the grant. Questioned costs: $37,883 Context: Of the $906,065 drawn down under the grant, the Organization only had detail and supporting accounting records to support qualifying expenses of $770,585. Prior to year-end, the Operating fund became aware that amounts were being overdrawn and opted to not submit reimbursement requests for expenses incurred in September of 2023, leaving a remaining overdrawn amount as of September 30, 2023 of $37,883. Effect: The excess amounts drawn down could be deemed to be unallowable and have to be returned to the grantor. Cause: Due to an ineffective review process of the costs charged to the grant compared to the total recognized as revenue and reported as expenditures. Recommendation: Management should ensure all cost expenditures are properly documented and supported before being charged to the grant. Any funds received more than actual federal expenditures should be recorded as a refundable advance. Grantee Comment: Refer to Corrective Action Plan
Financial records were submitted to and reviewed by the Veteran’s Administration. Instructions were received from the VA, regarding repayment of the overpayment in FY2023. Reimbursement has been made to the Veteran’s Administration, in accordance with the due date and instructions received from the Veteran’s Administration. Further, a revised per diem rate request has been submitted to and approved by the Veteran’s Administration, reducing the per diem rate to more accurately reflect current expenditures. Red Shield has recently filled a critical grants compliance position, which allows proper staffing for reviewing monthly financial reports, to ensure all allowable costs are being captured, and adjusting per diem rates, as needed. Red Shield VOM staff, MAAC grants staff, and MAAC finance staff have begun monthly meetings to review the current financial status of the VOM program, in relation to invoiced grant income and recorded expenditures.
The Organization is allocating payroll costs to grants based upon budgeted amounts/percentages submitted to the funding agency and does not currently have a system for ensuring that the estimates used produce reasonable approximations of the activity actually performed. Questioned Costs: Unknown Context: This condition occurred in all payroll transactions selected for testing, and based on inquiries with program administrators, regular review of these allocations was not being performed consistently throughout the year. Cause: The Organization has a tracking system in place to monitor the wages by employee charged to federal grants to avoid over-allocation of individual employee wages per the grant budget, but this tracking system does not contain a process for identifying and allocating wages based on submitted time records or actual time spent on various programs. Effect: Inaccurate payroll costs may be charged to federal programs if the Organization does not have procedures in place to monitor and record employee time devoted to federal programs. Recommendation: Management should develop a process whereby payroll costs allocated to federal grants are supported by a system of internal controls which provides reasonable assurance that the charges are accurate allowable and properly allocated, reasonably reflect the total activity for which the employee is compensated, and support the distribution of the employee’s wages among specific activities or cost objectives if the employee works on more than one federal award.
Show full finding ▾Hide full finding ▴Finding 2023-003 - Allowable Costs/Cost Principles (Allocation of Payroll) Funding Agency: U.S. Department of Veterans Affairs Direct Funding Grant: Homeless Providers Grant and Per Diem Program Assistance Listing Number: 64.024 Criteria: Uniform Guidance section 200.430(h)(8)(i) indicates that the standards for documentation of personnel expenses are such that (1) Charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must:(i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the nonfederal entity and(iii) Reasonably reflect the total activity for which the employee is compensated by the nonfederal entity, not exceeding 100% of compensated activities. Furthermore, subsection (viii) indicates: Budget estimates alone do not qualify as support for charges to federal awards, but may be used for interim accounting purposes, provided that: (A) The system for establishing the estimates produces reasonable approximations of the activity actually performed; (B) Significant changes in the corresponding work activity are identified and entered into the records in a timely manner and (C) The nonfederal entity’s system of internal controls includes processes to review after-the-fact interim charges made to a federal awards based on budget estimates. Condition: The Organization is allocating payroll costs to grants based upon budgeted amounts/percentages submitted to the funding agency and does not currently have a system for ensuring that the estimates used produce reasonable approximations of the activity actually performed. Questioned Costs: Unknown Context: This condition occurred in all payroll transactions selected for testing, and based on inquiries with program administrators, regular review of these allocations was not being performed consistently throughout the year. Cause: The Organization has a tracking system in place to monitor the wages by employee charged to federal grants to avoid over-allocation of individual employee wages per the grant budget, but this tracking system does not contain a process for identifying and allocating wages based on submitted time records or actual time spent on various programs. Effect: Inaccurate payroll costs may be charged to federal programs if the Organization does not have procedures in place to monitor and record employee time devoted to federal programs. Recommendation: Management should develop a process whereby payroll costs allocated to federal grants are supported by a system of internal controls which provides reasonable assurance that the charges are accurate allowable and properly allocated, reasonably reflect the total activity for which the employee is compensated, and support the distribution of the employee’s wages among specific activities or cost objectives if the employee works on more than one federal award.
The Executive Director over the VOM program has reviewed the allocation percentages for all employees working with the Veteran’s program. The adjusted percentages have been submitted to the payroll department and updated in Ceridian, accordingly. Further, the staff at Red Shield has determined a streamlined calculation process for allocation of payroll between VOM and other government programs, which will be used going forward. The director of Red Shield, along with his grants compliance team will review the allocation percentages for payroll related to all programs/grants at a minimum of once per quarter, to ensure that information in Ceridian matches true staffing allocations and is properly recorded in the financial record.
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