COMMUNITY CHEST, INCNon-Profit

2023-001: U.S. Department of Health and Human Services, Division of Child and Family Services System of Care for Youth with Serious Emotional Disorders, 93.104 Reporting Significant Deficiency in Internal Control over Compliance Grant Award Number: Affects all grant awards included under assistance listing 93.104 on the Schedule of Expenditures of Federal Awards. Criteria: Title 2 U.S. Code of Federal Regulations (CFR) Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) section 200.303 provides that non-federal entities must establish and maintain effective internal control that provides reasonable assurance that the non-federal entity is managing the federal award in compliance federal statutes, regulations, and the terms and conditions of the Federal award. A key component of effective internal control is the segregation of duties through a review and approval process. Condition: Quarterly progress reports did not have evidence of review and approval by an individual independent of the preparation process. Cause: The Organization did not have adequate internal controls to ensure documented review of report. Effect: Documented review of the reports were not indicated. Questioned Costs: None reported. Context/sampling: A nonstatistical sample of two out of five quarterly progress reports were selected for testing. There was no evidence of review on either of the two reports tested. Report Finding from Prior Year(s): No. Recommendation: We recommend Community Chest, Inc. enhance the internal controls over reporting. Views of Responsible Officials: Community Chest, Inc. agrees with this finding; see corrective action plan.

2023-002: U.S. Department of Health and Human Services, Division of Child and Family Services System of Care for Youth with Serious Emotional Disorders, 93.104 Reporting Material Weakness in Internal Control over Compliance and Material Noncompliance Grant Award Number: Affects all grant awards included under assistance listing 93.104 on the Schedule of Expenditures of Federal Awards. Criteria: Part of the Federal Funding Accountability and Transparency Act (FFATA) requires direct recipients of certain federal awards to report subaward information by the end of the month following the month in which the prime awardee obligates a subgrant award equal to $30,000 (or $25,000 for federal agencies that have not yet adopted amendments effective November 12, 2020). Condition: Required subaward information was not reported in the FFATA Subaward Reporting System (FSRS). Cause: Community Chest, Inc. (the Organization) did not have internal controls to ensure subaward information was submitted in accordance with the FFATA. Effect: Subaward obligations were not reported in the FSRS and therefore not included on the FFATA’s website for public information disclosure. Questioned Costs: None reported. Context/sampling: The entire population of one subaward was selected for testing. Report Finding from Prior Year(s): No. Recommendation: We recommend the Department implement internal controls to ensure subaward information is submitted in accordance with the FFATA. Views of Responsible Officials: Community Chest, Inc. agrees with this finding; see corrective action plan.

2023-003: U.S. Department of Health and Human Services, Division of Child and Family Services System of Care for Youth with Serious Emotional Disorders, 93.104 Subrecipient Monitoring Material Weakness in Internal Control over Compliance and Material Noncompliance Grant Award Number: Affects all grant awards included under assistance listing 93.104 on the Schedule of Expenditures of Federal Awards. Criteria: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) section 200.332 requires that: Pass-through entities ensure every subaward includes certain information at the time of the subaward and the assistance listing number is communicated at the time of disbursement to subrecipients. Condition: Subawards did not contain all the required information and assistance listing numbers were not communicated at disbursement. Cause: Adequate internal controls were not in place to ensure compliance with subrecipient monitoring requirements for the following agencies: • Lyon County Human Services Effect: Noncompliance at the subrecipient level may occur and not be detected by the State. Questioned Costs: None reported. Context/sampling: The entire population of one subrecipient was selected for testing. Report Finding from Prior Year(s): No. Recommendation: We recommend the State agencies listed above enhance internal controls to ensure compliance with subrecipient monitoring requirements. Views of Responsible Officials: Community Chest, Inc. agrees with this finding; see corrective action plan.

2022-005: U.S. Department of Justice, State of Nevada Division of Child and Family Services 16.575 Crime Victim Assistance Matching, Level of Effort and Earmarking and Reporting Material Weakness in Internal Control Over Compliance and Material Noncompliance Grant Award Number: 16575-19-010 Criteria: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Matching, Level of Effort and Earmarking, and Audit Requirements for Federal Awards (Uniform Guidance) provides that amounts for matching but be verifiable, allowed under general cost principles, determined in accordance with generally accepted accounting principles and reported on the grant reports. Condition: Amounts for match was not properly reported on the financial report, in addition supporting documentation was not retained for all match and certain match recorded in accordance with generally accepted accounting principles Cause: Community Chest, Inc. (the Organization) did not have adequate internal controls to ensure that the report included match, was documented and recorded correctly. Effect: The Organization could not meet match requirements. Questioned Costs: $20,000 of in-kind rent was incorrectly included in the supporting documentation provided to the grantor for match. However, there was unreported inkind rent at other locations, which was not included and was in excess of the $20,000 included. As a result, there are no questioned costs for match. Context/sampling: A nonstatistical sample was not utilized, total match was compared to the grant report for the period July 1, 2020 to June 30, 2021 and each match item was tested. Report Finding from Prior Year(s): No. Recommendation: We recommend Community Chest, Inc. enhance the internal controls over reporting, documenting and recording match. Views of Responsible Officials: Community Chest, Inc. agrees with this finding; see corrective action plan.

2022-006: U.S. Department of Labor, Nevadaworks, WIOA Cluster: 17.259 WIA Youth Activities, 17.278 WIOA Dislocated Worker Formula Grants and 17.258 WIA Adult Program Grants U.S. Department of Justice, State of Nevada Division of Child and Family Services 16.575 Crime Victim Assistance Allowable Costs/Costs Principles Significant Deficiency in Internal Control Over Compliance Grant Award Number: Affects all grants awards included under the WIOA cluster including CFDA 17.259, 17.278 and 17.258 and Crime Victim Assistance CFDA 16.575. Criteria: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) provides that amounts charged to Federal programs must be for allowable costs. To be allowable under Federal awards, costs must be adequately documented and supported. Condition: Community Chest, Inc. does have an internal control system to properly differentiate between federal and non-federal expenditures, however certain immaterial amounts were not properly classified within the system in accordance with their internal control system. Cause: Community Chest, Inc. did not have adequate internal controls to ensure each federal grant was properly closed out within the accounting system. Effect: The Organization could incorrectly report federal expenditures on the schedule of federal expenditures. Questioned Costs: None reported. Context/sampling: A nonstatistical sample was not utilized, the federal expenditures reimbursed were compared to total expenditures classified to the grant within the accounting system. Report Finding from Prior Year(s): No. Recommendation: We recommend Community Chest, Inc. enhance the internal controls over grant close out within the accounting system. Views of Responsible Officials: Community Chest, Inc. agrees with this finding; see corrective action plan.

2020-002: U.S. Department of Labor, Nevadaworks, WIOA Cluster: 17.259 WIA Youth Activities, 17.278 WIOA Dislocated Worker Formula Grants and 17.258 WIA Adult Program Grants U.S. Department of Justice, State of Nevada Dvision of Child and Family Services 16.575 Crime Victim Assistance Allowable Costs/Costs Principles Significant Deficiency in Internal Control Over Compliance Grant Award Number: Affects all grants awards included under the WIOA cluster including CFDA 17.259, 17.278 and 17.258 and Crime Victim Assistance CFDA 16.575. Criteria: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) provides that amounts charged to Federal programs must be for allowable costs. To be allowable under Federal awards, costs must be adequately documented and supported. Condition: Amounts charged to the Federal program for indirect costs were initially recorded appropriately and timely, however there was a material change due to the PPP loan which required adjustments to previously recorded indirect costs. Review and approval of the indirect cost after the PPP changes did not occur at a level that it should be in order to detect errors. Cause: Community Chest, Inc. (the Organization) did not have adequate internal controls to ensure changes made to expenses that were previously allocated under indirect cost allocations were updated and those allocations adjusted. The Organizations small size and capacity of time of the accounting staff contributed to this condition. Effect: The Organization could draw unallowable direct and indirect costs. Questioned Costs: None reported. Context/sampling: A nonstatistical sample was not utilized, the indirect cost calculation for the entire year was reviewed. Repeat Finding from Prior Year(s): Yes, 2019-003. Recommendation: We recommend Community Chest, Inc. enhance the internal controls over indirect cost allocation to properly review and approve posting of journal entries over indirect cost, including any changes to indirect costs that are changed after the month end close. Views of Responsible Officials: Community Chest, Inc. agrees with this finding; see corrective action plan.

2019-003: WIOA Cluster: 17.259 WIA Youth Activities and 17.258 WIA Adult Program Grants U.S. Department of Labor 93.959 Block Grants for Prevention and Treatment of Substance Abuse 93.912 Health Resources and Services Administration Allowable Costs/Costs Principles Significant Deficiency in Internal Control Over Compliance Grant Award Number: Affects all grants awards included under the WIA cluster including CFDA 17.259 and 17.258, CFDA 93.959 and CFDA 93.912. Criteria: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) provides that amounts charged to Federal programs must be for allowable costs. To be allowable under Federal awards, costs must be adequately documented and supported. Condition: Amounts charged to the Federal program for indirect costs were recorded to the incorrect account for one month, in addition the year end true up was incorrectly calculated and posted. Review and approval of the indirect cost allocations that verify proper allocations were being made is not at a level that it should be in order to detect errors. In addition, 2 hours were charged in excess of actual time allocated for one employee on CFDA 93.912. Cause: Community Chest, Inc. (the Organization) did not have adequate internal controls to ensure changes made to expenses that were previously allocated under indirect cost allocations were updated and those allocations adjusted. The Organizations small size and capacity of time of the accounting staff contributed to this condition. Effect: The Organization could draw unallowable direct and indirect costs. Questioned Costs: None reported. Context/Sampling: A nonstatistical sample of four monthly allocations out of 12 allocations were selected, representing $29,157 of $142,873 total indirect costs. A nonstatistical sample of four monthly allocations out of 12 allocations were selected, representing $23,400 of $75,450 total direct payroll costs for CFDA 93.912. Repeat Finding from Prior Year: Yes. Recommendation: We recommend Community Chest, Inc. enhance the internal controls over indirect cost allocation to properly review and approve posting of journal entries over indirect cost. Views of Responsible Officials: Community Chest, Inc. agrees with this finding, see corrective action plan.

2019-004: 93.912 Health Resources and Services Administration Cash Management Significant Deficiency in Internal Control Over Compliance Grant Award Number: Affects all grants awards included under CFDA 93.912. Criteria: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) provides that there should be internal control over cash management. Condition: Review and approval of the electronic request for funds of grant awards was not completed as they were for paper requests. Cause: Community Chest, Inc. (the Organization) internal control over cash management did not address a new grant in which the request for funds was completed by an electronic request and therefore was not reviewed and approved prior to submittal. Effect: The Organization could request incorrect funds. Questioned Costs: None reported. Context/Sampling: A nonstatistical sample of four monthly allocations out of 5 monthly request for funds were selected, representing $93,289 of $196,121 total costs. Repeat Finding from Prior Year: No. Recommendation: We recommend Community Chest, Inc. enhance the internal controls over cash management to properly review and approve request for funds. Views of Responsible Officials: Community Chest, Inc. agrees with this finding, see corrective action plan.

2019-005: 93.912 Health Resources and Services Administration Subrecipient Monitoring Material Noncompliance and Material Weakness in Internal Control Over Compliance Grant Award Number: Affects all grants awards included under 93.912 Health Resources and Services Administration Criteria: Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) requires that: A. Pass-through entities have documented subrecipient monitoring policies B. Pass-through entities ensure that every subaward includes certain information at the time of the subaward C. Pass-through entities ensure subrecipients have not been suspended or debarred D. Pass-through entities verify that every subrecipient is audited as required by Uniform Guidance. If an audit was not completed the pass-through entity should certify with a written statement. E. Pass-through entities review audit reports of subrecipients and make appropriate follow up in a timely manner. F. Pass-through entities complete risk assessments for all subrecipients. Condition: Monitoring occurred on all subrecipients; however, there were the following items noted: A. Subrecipient monitoring policies should be documented and updated for new programs as necessary. B. Subawards lacked certain information required by Uniform Guidance. C. Although no subrecipients were suspended or debarred during the period, no documentation of the determination was completed. D. We noted there is no process in place to formally verify that pass-through entities are audited as required by Uniform Guidance. E. Audits of subrecipients were not documented including any action taken on audit findings. F. Risk assessments were not prepared for all subrecipients. Cause: Community Chest, Inc. (the Organization) did not have adequate internal controls to ensure compliance with subrecipient monitoring requirements. Effect: Noncompliance at the subrecipient level may occur and not be detected by the Organization. Questioned Costs: None reported. Context/Sampling: A nonstatistical sample of 4 subawards out of a population of 4 was selected for testing, which includes all funds passed through to subrecipients. Repeat Finding from Prior Year: No. Recommendation: We recommend Community Chest, Inc. enhance the internal controls over subrecipient monitoring. Views of Responsible Officials: Community Chest, Inc. agrees with this finding, see corrective action plan.

GSA_MIGRATION

GSA_MIGRATION