JEWISH FAMILY SERVICE OF COLORADO, INC.

Assistance Listing, Federal Agency, and Program Name - 19.510, Department of State, U.S. Refugee Admissions Program, Federal Award Identification Number and Year - SPRMCO23CA0007; SPRMCO23CA0371; SPRMCO23CA0368; SPRMCO23CA0189 Pass through Entity - HIAS, Inc. Finding Type - Significant deficiency Repeat Finding - No Criteria - 2 CFR 200.303 requires that recipients of federal awards establish, document and maintain effective internal control that provides reasonable assurance that the recipient is managing the federal award in compliance with federal statutes, regulations and the terms and conditions of the federal award. 2 CFR 200 Appendix XI Part 3. Cash Management requires that recipients establish written procedures to meet the requirements of 2 CFR 200.305 and the terms of the grant award, expenditures must be incurred before reimbursement of federal funds is requested. 2 CFR 200 subpart E Cost Principles requires recipients to follow allowability requirements as defined in the grant award and within general cost principles. 2 CFR 200 requires that costs be expended in accordance with the period of performance defined within the award agreement. Condition - In performing our audit procedures, there was no evidence of a system of internal control over the cash management requirements, including a written policy, related to reimbursement of funds on a per refugee basis. In addition, we noted that reimbursement was requested prior to incurring expenses on a per refugee basis. There were also refugee costs coded incorrectly within the general ledger. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - When gaining an understanding of internal control over compliance for cash management, we noted a lack of internal controls in place to ensure that expenses on a per refugee basis were incurred prior to requesting reimbursement. In testing the compliance requirements for cash management, we were unable to test compliance on a per refugee basis. Each month, funds become available based on the number of refugees who arrived and been allocated to the program. We noted that in one month, $5,300 was available to be spent on new arrivals; however, only $2,285 was spent on the new arrivals and $3,015 was improperly spent on refugees who had arrived previously and for which reimbursement had already been received. In total, over the entire term of the grant, and based on the total number of refugees served, the appropriate amount of funds were requested for reimbursement. In addition, we noted one instance where refugee costs were applied to an incorrect award based on the period of performance and the allowable 90-day resettlement period. These costs were within the total amount allowed for each of the awards, but were not assigned correctly within the general ledger. Cause and Effect - There was not a sufficient cash management policy in place and there were no internal controls in place to ensure reimbursement requests were made only after expenses had been incurred on a per refugee basis. Recommendation - The organization should establish a written cash management policy which encompasses per refugee spending and ensure there is an effective review process in place to ensure that reimbursement is not requested prior to funds being incurred on a per refugee basis. This process should ensure that general ledger expenses are reconciled to per refugee spending and that the correct award funds are utilized for the specified refugee. In addition, the general ledger expenses should be coded in such a manner to facilitate this review on a per-refugee basis. These improvements will ensure that only allowable costs are recorded in the federal grant general ledger codes and are requested for reimbursement. Views of Responsible Officials and Corrective Action Plan - Agree with finding. Financial policies will be updated to include cash management requirements to ensure expenditures are incurred, including any required per client expenditures, prior to reimbursement requests. During the year under audit, there was not a reconciliation between individual refugee spending and the general ledger expenses. Subsequent to year end a new process was put in place to compare the individual refugee ledgers to the reimbursement request to ensure no expenditures were requested in advance and that refugee spending is coded to the appropriate general ledger account based on the specific award funding.