Lutheran Social Services of Colorado

Finding 2024-001 Material Weakness, Compliance and Internal Control Over Procurement, Suspension and Debarment Compliance CFDA 93.676 - Unaccompanied Children Program Federal Agency: U.S. Department of Health and Human Services Pass-Through Entity: Global Refuge and Lutheran Immigration and Refugee Services Criteria Or Specific Requirement: The organization must adhere to the procurement methods outlined in 2 CFR 200.320, using informal procedures for small purchases, formal methods (sealed bids or proposals) for larger ones, or noncompetitive methods as appropriate. The organization is responsible for establishing processes and procedures for each method and maintaining relevant documentation. Additionally, as per 2 CFR 200.213, the organization must not contract with suspended or debarred parties. Before entering into a covered transaction, the organization must verify the eligibility of the potential contractor. Condition: The Organization has not ensured compliance with appropriate procurement methods, retention of necessary documents and decisions, or pre-contractual review for suspension and debarment requirements. Cause: The Organization lacks sufficient policies and controls to ensure compliance with Federal procurement, suspension, and debarment regulations. Effect: The Organization's failure to fully comply with procurement, suspension and debarment requirements could have led to contracts with suspended or debarred parties or contracts awarded through improper methods. Questioned Costs: Not applicable Context: Three of the five contracts reviewed lacked sufficient documentation to support the procurement methodology used. While no payments were made to debarred parties, the absence of a policy or procedure to prevent such occurrences poses a significant risk. Identification As A Repeat Finding: N/A Recommendation: We recommend that Organization implement internal policies to identify appropriate procurement methodologies, conduct regular suspension and debarment checks, maintain adequate file documentation to ensure compliance with procurement and suspension/debarment regulations and prevent contracts with ineligible parties. Views Of Responsible Officials And Planned Corrective Action: The Organization agrees with the finding and has put together a corrective action plan for the finding. See corrective action plan included in this report.

CFDA Number, Federal Agency, and Program Name: Assistance Listing Number 93.566, Refugee and Entrant Assistance State Administered Programs Federal Award Identification Number and Year: 21 IHGA 163411; October 1, 2020 September 30, 2021 Pass through Entity: U.S. Department of Health and Human Services Pass through State of Colorado Department of Human Services Finding Type: Significant deficiency and material noncompliance with laws and regulations Repeat Finding: No Criteria: Per 2 CFR 200.329, an auditee is responsible for oversight of the operations of the Federal award supported activities. As appropriate, the Federal awarding agency must require the recipient to relate financial data and accomplishments to performance goals and objectives of the Federal award. The non Federal entity must submit performance reports at the interval required by the Federal awarding agency or pass through entity to best inform improvements in program outcomes and productivity. Condition: Controls in place were not adequate to ensure the reports submitted met the required data elements Questioned Costs: None Context: Out of a sample of 16 reports, 1 report did not contain the required data elements. Cause and Effect: Failure to submit reports without the required data elements do not allow the Federal awarding agency to monitor performance. Recommendation: The Organization should implement a more robust review process over the reports filed to ensure required information is included. Views of Responsible Officials and Corrective Action Plan: Reports will be reviewed by the Division Director or the Senior Vice President of Programs prior to be submitted.

2020 002 CFDA Number, Federal Agency, and Program Name CFDA 93.566, Refugee and Entrant Assistance State Administered Programs; CFDA 93.576, Refugee and Entrant Assistance Discretionary Grants; CFDA 93.045, Aging Cluster National Family Caregiver Support; and CFDA 93.052, National Family Caregiver Support Title III, Part E Federal Award Identification Number and Year CFDA 93.566 Award Number 19 IHGA 112336, 19 IHGA 113269, 19 IHGA 112337, 19 IHGA 127027, 20 IHGA 140909, 20 IHGA 141106, 20 IHGA 141184, IHGA 2020 2382, 20 IGHA 140855, 20 IHGA 140900; October 1, 2018 September 30, 2019 and October 1, 2019 September 30, 2020 CFDA 93.576 N/A CFDA 93.045 Award Number EX19041; July 1, 2019 June 30, 2020 CFDA 93.052 Award Number EX19041; July 1, 2019 June 30, 2020 Pass through Entity CFDA 93.566 U.S. Department of Health and Human Services Passed through State of Colorado Department of Human Services CFDA 93.576 N/A CFDA 93.045 U.S. Department of Health and Human Services Passed through Denver Regional Council of Governments CFDA 93.052 U.S. Department of Health and Human Services Passed through Denver Regional Council of Governments Finding Type Material weakness Repeat Finding No Criteria Per 2 CFR 200.508(b), an auditee must prepare appropriate financial statements, including the schedule of expenditures of federal awards, in accordance with 200.510 financial statements. Per 2 CFR 200.510(b), the auditee must also prepare a schedule of expenditures of federal awards for the period covered by the auditee's financial statements, which must include the total federal awards expended, as determined in accordance with 200.502 basis for determining federal awards expended. Condition Controls in place were not adequate to ensure the schedule of federal expenditures was accurate. Questioned Costs None Context The initial schedule of expenditures of federal awards (SEFA) erroneously reported expenditures of $181,045 related to CFDA 93.566 under CFDA 93.576 and expenditures of $16,832 related to CFDA 93.045 under CFDA 93.052. Management subsequently corrected the SEFA. Cause and Effect The Organization expended approximately $6,200,000 in the current fiscal year from various funding sources. The misreporting of $197,877 under incorrect CFDA numbers did not impact major program determination; however, based on the initial SEFA, the expenditures related to major program CFDA 93.566, Refugee and Entrant Assistance State Administered Programs, would have been excluded from being tested. Recommendation The Organization should implement a review process over the preparation of the schedule of expenditures of federal awards to ensure it is accurate. Views of Responsible Officials and Corrective Action Plan The Organization is going to begin having the Accounting Director complete the schedule of federal expenditures, including e mailing funders when there is not a clearly defined CFDA number on the contract, and then have a second employee review all lines on the schedule of federal expenditures.