Delta Human Resource Agency

Finding: Several instances were noted where more hours than worked were turned in for reimbursement from the granting agency. In addition, an instance was noted where a USDA employee's time was charged to the transportation grant. Criteria: The Agency should only request funds they have earned from the granting agency. Cause: The program manager used a spreadsheet to recap the employees' time and did not always reduce the employees' time for the employees' lunch period. As reimbursement requests were prepared the spreadsheet was relied upon instead of the actual timesheet. The instance where the employee's time was charged to the wrong grant was just an oversight. Effect: The Agency received funds in excess of actual earned amounts. Our testing resulted in $694.08 of potential questioned costs. Recommendation: If the program manager is going to use a spreadsheet, extra caution needs to be taken to ensure the amounts are transferred correctly. Also the deputy director should either rely on the actual timesheet or verify the spreadsheet matches the timesheet prior to reimbursement request. The Agency needs to take extra caution reviewing employees time as it relates to each program. Management's Response: We concur with this finding.

Excess Client Benefits Paid (CSBG ? CFDA 93.569) - Significant Deficiency and Noncompliance: Finding: Certain client benefits paid for clothing, utilities, and rent or mortgage assistance exceeded the maximum amount allowed per Delta?s internally established policies. Criteria: Benefits paid should comply with internal policies to ensure payments are valid expenses of the program. Cause: The program manager did not ensure that all client benefit payments met established internal policies, nor were internal policies revised. Effect: A client received benefits exceeding the maximum allowed for the type of aid requested. Recommendation: The program manager should take extra measures to ensure benefit payments do not exceed limits set per internally established policies, such as a second person review of the benefit payments. Management?s Response: We concur with this finding.

MATERIAL WEAKNESS - DEPARTMENT OF AGRICULTURE - Item No. 2020-003: Emergency Food Assistance Program (Commodities)-CFDA 10.569: Grant No. 70712; Grant period - Year ended September 30, 2019 and Grant No. 75645; Grant period - Year ended September 30, 2020. Finding: Delta did not implement adequate internal controls with regard to recordkeeping of commodities inventory. Criteria: The State of Tennessee requires the grantee (Delta) to maintain accurate and complete records of receipt, disposal and inventory of USDA foods. Condition: Delta failed to maintain accurate and complete records of receipts and distributions of commodities inventory or perform adequate inventory reconciliations in order for the auditor to adequately test quantities on hand at June 30, 2020. Cause: Auditor was not engaged to perform the audit until September 10, 2020 and therefore was not able to perform an inventory observation at June 30, 2020. Although the auditor did observe an inventory count at a later date with no exceptions noted, auditor was unable to rollback into client's quantities on hand at June 30, 2020 due to inadequate record keeping of receipts and distributions of commodities and lack of documentation of monthly reconciliations between beginning and ending inventory quantities on hand. Possible Asserted Effect: The value of commodities on hand at June 30, 2020 as reported in the audited financial statements could be materially misstated. Recommendation: The program manager should perform and document monthly reconciliations of beginning and ending inventory based on the current month's receipts, distributions, and adjustments. Management's Response: We concur with the finding. In October of 2020, monthly reporting was reassigned after determining new procedures put in place in July of 2019 still were not being followed by Program Coordinator. Currently, two of more staff members count inventory before and after commodity distributions and reports are reviewed by Executive Director and Program Director. As of July 6, 2021, the Program Coordinator retired and once the position is filled, he/she will be thoroughly trained and all reports will be reviewed for accuracy by Program Director.

SIGNIFICANT DEFICIENCY Item No. 2019-001: Excess Client Benefits Paid (CSBG-CFDA 93.569) Finding: Certain client benefits paid for clothing, utilities and rent or mortgage assistance exceeded the maximum amount allowed per Delta's internally established policies. Criteria: Benefits payments should comply with internal policies in order to ensure such are a valid expense of the program. Cause: The program manager did not revise the internal policy and did not ensure that all client benefits payments met prescribed guidelines. Effect: Certain clients received benefits exceeding the maximum allowed for the type of aid requested and there was one benefit incorrectly charged to the program. Recommendation: The program manager should receive additional training and guidance and procedures should be established to ensure a second party reviews and approves internal policy changes and provisions to ensure that no benefit payment exceeds the established maximum per type of benefit. Management's Response: We concur with this finding.