BETHESDA CENTER FOR THE HOMELESS, INC.Non-Profit

2021-001 ? Segregation of Duties and Cash Disbursements Condition: Lack of proper segregation of duties related to cash disbursements were noted in the current year. No questioned cost related to this finding were noted in our testing of the Organization?s major federal program. Criteria: To the extent possible, accounting duties should be properly segregated to ensure proper oversight and approval of cash disbursements. Cause and effect: Because proper segregation of duties was not in place, certain expenses were paid by the Organization that that did not appear to be part of the normal course of business for the Organization. Also, certain invoices paid by the Organization to a media company, which was a related party due to the Executive Director?s involvement in the management of the media company, were not approved by the board of directors. Recommendation: This issue was also noted in prior year audits, and we recommended the following actions take place. We recommended that a board member be a co-signatory on all checks greater than $500, rather the previous limit of $5,000. Historically, the Executive Director had been the main and only signer on all checks lower than $5,000. We also recommended that the Organization consider establishing a fraud hotline. The very existence of a fraud hotline would serve as a deterrent to misconduct by creating among employees a perception that fraud would be detected and reported. It would also demonstrate the Organization's serious intent to prevent and detect fraud. In addition, the hotline could also be used to report incidents of harassment, unsafe working conditions, violence, or violations of laws or regulations. This would allow the Organization to address such situations in a timely manner and could help prevent or minimize fines, lawsuits, legal liability, or adverse publicity by demonstrating that the Organization has procedures for receiving and addressing complaints. A means of ensuring round-the-clock availability and confidentiality is to use the services of a third-party provider. This way, employees could be assured that they would not be talking to anyone within the Organization, who could possibly be involved in the fraud or could guess the whistle-blower's identity. Also, the service provider could maintain the hotline 24-hours a day and staff it with professionals trained to listen effectively, ask relevant questions, document the information received, and quickly report it back to the Organization. Views of Responsible Officials and Planned Corrective Actions: The Organization agrees with the finding and implemented the recommended procedures in February 2021.

2021-002 ? Filing of Data Collection Form and Reporting Package Condition: The June 30, 2021 data collection form for the Organization was not filed within the time period required by the Uniform Guidance. Criteria: The Uniform Guidance requires that non-federal entities that expend $750,000 or more in a year in federal awards shall have a single audit conducted and that the audit shall be completed, and the data collection form and reporting package shall be submitted within the earlier of 30 days after receipt of the auditors' report or nine months after the end of the audit period. Cause: The Organization?s audit was delayed due to turnover in the accounting department as well as the executive director position. As a result, the board was unable to perform an adequate review of the financial statements as well as the single audit report in a timely manner to ensure the data collection form was filed by the required deadline. Recommendation: In future periods the Organization should take steps to ensure the audit can be performed in a timely manner to ensure adequate time for the board to approve the financial statements to meet any required filing deadlines. Views of Responsible Officials and Planned Corrective Actions: The Organization agrees with the finding and has implemented the recommended procedures by contracting with a third party accounting firm to help perform closing and other reconciliation procedures to ensure an audit can be performed in a timely manner.