Ohio Tri-County Food Alliance DBA Second Harvest FoodbankNon-Profit

Payroll Documentation and Approval Deficiencies Condition: During our testing of payroll-related records, deficiencies were identified in the documentation and approval processes for both pay rates and employee timecards. Specifically, in one instance there was no documentation in employee file of approved pay rate, and for a specific pay period following the client’s mid-year transition to a new payroll software system, approved employee timecards were unavailable for six employees. These issues resulted in a lack of approved pay-rate documentation and missing evidence of supervisory approval for hours worked. Criteria: Organization policy and internal control best practices require that (1) all employee pay rates be approved by authorized personnel and documented prior to implementation, and (2) all employee timecards be reviewed and approved by supervisors prior to payroll processing. These controls are essential for ensuring accurate, authorized wage payments and compliance with labor regulations. Cause: The identified deficiencies were due to (1) the termination of an employee during the audit year and the subsequent lack of retention of their employment file, and (2) a temporary disruption in timekeeping and approval workflows resulting from the client’s transition to a new payroll software system, which led to the inability to migrate or retain timecard approvals for the affected pay period. Effect: The absence of approved pay rate and timecard documentation increases the risk of payroll inaccuracies, unauthorized payments, and non-compliance with labor regulations. It also limits the organization’s ability to validate payroll transactions during audits or employee disputes. Recommendation: Management should establish and enforce formal processes for documenting pay rate and timecard approvals. These procedures should include written authorization by appropriate personnel, retention of approval records in a centralized and accessible location, and adherence to document retention policies. Additionally, management should implement measures to ensure continuity of payroll documentation during system transitions, such as retaining historical records, validating data migration, and establishing contingency plans to maintain compliance. Views of Responsible Officials: See attached response

USDA Food Distribution and Authorized Signers Condition: During our audit, it was identified that the Organization did not consistently obtain signatures from "approved shoppers" for USDA food products. Additionally, in at least one instance, the individual signing for a USDA distribution was not listed as an authorized signer. These issues indicate a lack of adherence to required procedures for verifying and documenting authorized individuals who pick up USDA food products. Criteria: The Organization is required to maintain an "approved shopper" list for each partner agency, specifying who is authorized to pick up USDA food products. Furthermore, the Organization must ensure that those signing for deliveries are included on the approved list and that their signatures are properly obtained and cross-referenced. Cause: Staff turnover within the Organization led to lapses in following established procedures, resulting in missed steps such as obtaining and verifying signatures against the approved shopper list. Effect: As a result of these lapses, signatures were not consistently collected or compared to the approved shopper list, increasing the risk that unauthorized individuals may have received USDA food products and that proper records of distribution were not maintained. Recommendation: We recommend that the Organization provide comprehensive training to all relevant staff on the correct procedures for obtaining and cross-referencing signatures for USDA food product distribution. This will help ensure compliance with requirements and improve the integrity of the distribution process. Views of Responsible Officials: See attached response. See

Condition: During our audit it was noted that the Organization was not completing a reporting requirement contained within the American Rescue Plan Act contract. Criteria: The Organization is required to submit various reports on multiple timelines to the Ohio Association of Foodbanks. Cause: The Organization had turnover at the Executive Director and Accounting levels in 2023. Effect: The effect of the turnover caused this reporting requirements on this new grant to not be identified. Recommendation: The recommendation is for the Organization to ensure that all required reporting is being timely submitted. Views of Responsible Officials: See attached response.

Condition: During our audit it was noted the Organization was not obtaining, in various instances, signatures of "approved shoppers" for USDA food product. Criteria: The Organization is required to maintain an "approved shopper" list from each partner agency stating who was authorized from their agency to pick up USDA food product. Cause: The Organization had turnover through-out the organization, and this required step was missed. Effect: The effect of the turnover caused staff to not obtain signatures for USDA food product so these names could be crossed referenced to the "approved shopper" listing. Recommendation: The recommendation is for the Organization to ensure all staff are appropriately trained on obtaining and cross referencing signatures on USDA food product. Views of Responsible Officials: See attached response.

Condition: During our audit it was noted in one instance that the signer for a USDA distribution was not on the authorized signer listing. Criteria: The Organization is required to maintain an "approved shopper" list from each partner agency stating who was authorized from their agency to pick up USDA food product and ensure the signer of a delivery is on the approved list. Cause: The Organization had turnover through-out the organization, and this required step was missed. Effect: The effect of the turnover caused staff to not compare signature to "approved shopper" list. Recommendation: The recommendation is for the Organization to ensure all staff are appropriately trained on obtaining and cross referencing signatures on USDA food product. Views of Responsible Officials: See attached response.

Finding 2022-001 - Federal Audit Clearinghouse (FAC) Condition: During our audit it was noted the FAC reporting package for the December 31, 2022 single audit was not filed timely. Criteria: The Organization is required to file the FAC reporting package 30 days after receipt of the auditors' report or within nine months after the fiscal year-end, which ever comes first, under 2 CFR 200.512. Cause: The Organization had turnover at the Executive Director and Accounting levels in 2023. Effect: The effect of the turnover caused delays in getting the single audit completed timely. Recommendation: The recommendation is for the Organization to ensure that there is a process and procedure in place to ensue timely audit completion so the FAC reporting package can be filed timely. Views of Responsible Officials: See attached response.

Finding 2022-002 - USDA Food Distribution Condition: During our audit it was noted the Organization was not obtaining, in all instances, signatures of "approved shoppers" for USDA food product. Criteria: The Organization is required to maintain an "approved shopper" list from each partner agency stating who was authorized from their agency to pick up USDA food product. Cause: The Organization had turnover through-out the organization, and this required step was missed. Effect: The effect of the turnover caused staff to not obtain signatures for USDA food product so these names could be crossed referenced to the "approved shopper" listing. Recommendation: The recommendation is for the Organization to ensure all staff are appropriately trained on obtaining and cross referencing signatures on USDA food product. Views of Responsible Officials: See attached response.

COMPLIANCE AUDIT Finding 2020-003 - Subrecipient Monitoring Condition: During our audit it was discovered that the Organization's inventory system was not valuing the inventory disbursed with the correct values, therefore the invoices given to subrecipients receiving USDA food were incorrectly valued. Criteria: The Organization should, based on their policies, be valuing inventory based on value per pound developed by Shared Harvest Foodbank Annual Product Valuation Agreed Upon Procedures. Cause: The Organization is newly formed and was not able to program the inventory system to properly value inventory. Effect: The subrecipients would not be able to use these invoices to calculate their federal awards funding. Recommendation: The recommendation is for the Organization to program the inventory system with correct values in a timely manner. Views of Responsible Officials: See attached response.