Boys & Girls Club of the Northern Plains, Inc.Non-Profit

Department of Education and Passed through State of South Dakota Department of Education FFAL #84.287C, S287C220042 Twenty-First Century Community Learning Centers Activities Allowed or Unallowed and Allowable Costs/Cost Principles Significant Deficiency in Internal Control over Compliance Criteria: The Club is required to have procedures in place to ensure that federal awards are expended only for allowable costs in accordance with Subpart E – Cost Principles of the Uniform Guidance. Allowable costs are supported by appropriate documentation and correctly charged as to account, amount, and period. 2 CFR 200.430(i) establishes requirements for documentation of personnel expenses. 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: Our testing over expenditures noted the following items: - Two instances where timesheets or bi-weekly activity reports were unable to be provided. - Three instances where the employee’s paid time off and holiday pay was not allocated nor submitted for reimbursement under the federal program, which was inconsistent with other pay periods. - One instance where support did not agree to the amount and time allocated. Cause: Tracking of grant-related payroll is a manual process which increases the likelihood of error. Effect: The Club’s controls did not detect or correct the errors identified, which results in a reasonable possibility that the Club could submit disallowed costs under the federal awards. Questioned Costs: No questioned costs over $25,000. Context/Sampling: A nonstatistical sample of 60 transactions out of approximately 830 total transactions were selected testing, of which 51 of those transactions were payroll transactions and accounted for $45,055 out of $272,463 of total payroll transactions. Repeat Finding from Prior Year: No Recommendation: We recommend management continue to review the process over tracking payroll related to federal programs and consider incorporating a secondary review of any manual spreadsheets or consider if the payroll can be allocated directly within the payroll system. Views of Responsible Officials: Management is in agreement.

2022-002 Department of Education and Passed through State of South Dakota Department of Education Federal Financial Assistance Listing #84.425C, 2021G-797, 03/13/2020 ? 09/30/2022 COVID-19 Education Stabilization Fund - Governor?s Emergency Education Relief (GEER) Fund Equipment and Real Property Management Significant Deficiency in Internal Control over Compliance and Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. The non-Federal entity must conform with equipment and real property management procedures identified in 2 CFR 200.313 (c) through (e). Condition: In our sample of expenditures selected for testing, we noted the following items: a) No support to substantiate a physical inventory of federal-funded equipment was performed within the last two years. b) Federal-funded equipment is not distinguished separately from non-federal-funded equipment within the Club?s fixed asset listing. Cause: The Club has not implemented controls over equipment and real property management to comply with federal requirements. Effect: Without established controls over equipment and real property management, the risk is increased that equipment could be misappropriated or that the federal agency would not be reimbursed if federal funded equipment was disposed. Questioned Costs: None reported Context: There were two fixed asset purchases, totaling $444,129, charged to the federal award, which were both tested. Repeat Finding from Prior Year: No Recommendation: We recommend that management implement control processes to conform with the Uniform Guidance equipment and real property management requirements noted above. Views of Responsible Officials: Management is in agreement.