Office of the Inspector General

U.S. Department of Justice

OVERSIGHT ★ INTEGRITY ★ GUIDANCE

Audit of the Office of Justice 

Programs Cooperative Agreements 

Awarded to Refugee Services of 

Texas, Inc. Dallas, Texas

 

Audit Division 20-046 March 2020
 

 

 

 

 

 

 

 

 

 

 

 

 

Executive Summary 

Audit of the Office of Justice Programs Cooperative Agreements Awarded to 

Refugee Services of Texas, Inc. 

Dallas, Texas 

Objectives 

The Office of Justice Programs (OJP) awarded Refugee 

Services of Texas, Inc. (RST) four cooperative 

agreements totaling $2,730,000 under the 

Comprehensive Services for Victims of Human 

Trafficking program. The objectives of this audit were to 

determine whether costs claimed under the awards were 

allowable, supported, and in accordance with applicable 

laws, regulations, guidelines, and terms and conditions 

of the awards; and to determine whether the grantee 

demonstrated adequate progress towards achieving 

program goals and objectives. 

Results in Brief 

As a result of our audit, we concluded that RST 

demonstrated adequate progress towards achieving the 

awards’ stated goals and objectives and was adequately 

managing its award budgets and drawdowns. However, 

we determined that RST did not comply with essential 

award conditions related to progress reports, special 

conditions, use of award funds, matching funds, and 

Federal Financial Reports (FFRs). In addition, we found 

that RST’s policies and procedures need to be 

strengthened. We also identified unallowable 

expenditures totaling $24,969 and unsupported 

expenditures totaling $275,365. 

Recommendations 

Our report contains 10 recommendations for OJP. We 

requested a response to our draft audit report from RST 

and OJP, which can be found in Appendices 3 and 4, 

respectively. Our analysis of those responses is included 

in Appendix 5. 

Audit Results 

The purpose of the four OJP awards we reviewed was to 

enhance the quality and quantity of services available to 

assist victims of human trafficking. The audit period for 

the awards was from September 2014 through August 

2019. RST drew down a cumulative amount of 

$1,396,580 for all of the awards we reviewed. 

Program Goals and Accomplishments – Based on 

our review, there were no indications that RST was not 

adequately achieving the stated goals and objectives of 

the awards. 

Required Performance Reporting – We found that all 

progress reports we tested were inaccurate or not 

adequately supported. 

Compliance with Special Conditions – We found that 

RST was not in compliance with one special condition 

related to paying a consultant rate in excess of $650 per 

day. 

Award Financial Management – We found that RST’s 

policies and procedures did not have specific language 

regarding matching costs, contract award and 

management, subrecipient award and management, or 

performance measurement and outcome assessment. 

Personnel Costs – We identified $7,285 in unsupported 

personnel costs. We also identified $10,702 in 

unallowable personnel costs related to unauthorized 

positions that were not included in the approved award 

budget. 

Contractor and Consultant Costs – We identified 

$10,855 in unsupported contractor and consultant costs. 

We also identified $9,689 in unallowable contractor and 

consultant costs related to unauthorized services that 

were not included in the approved award budget. 

Other Direct Costs – We identified $8,252 in 

unsupported other direct costs. We also identified 

$4,578 in unallowable questioned costs related to 

unauthorized shredding services, thank you cards, and 

travel expenses that were not included in the approved 

award budget. 

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ii 

Executive Summary 

Audit of the Office of Justice Programs Cooperative Agreements Awarded to 

Refugee Services of Texas, Inc. 

Dallas, Texas 

Matching Costs – We identified $256,975 in 

unsupported matching costs. Subsequent to the 

issuance of the draft report, RST provided sufficient 

documentation to support $8,002 of the initially 

unsupported matching costs. Therefore, our final report 

questions $248,973 in unsupported matching costs. We 

also found that RST did not meet its matching cost 

requirements for the closed awards, and we identified 

concerns related to RST’s ability to meet the required 

match for the ongoing awards. 

Federal Financial Reports – We determined that 

expenditures were inaccurately reported on all of the 

FFRs we tested for two of the four awards included in 

our audit. 
AUDIT OF THE OFFICE OF JUSTICE PROGRAMS 

COOPERATIVE AGREEMENTS AWARDED 

TO REFUGEE SERVICES OF TEXAS, INC. 

DALLAS, TEXAS 

TABLE OF CONTENTS 

INTRODUCTION .............................................................................................1 

The Grantee .........................................................................................1 

OIG Audit Approach ..............................................................................2 

AUDIT RESULTS.............................................................................................3 

Program Performance and Accomplishments ............................................3 

Program Goals and Objectives .......................................................3 

Required Performance Reports ......................................................3 

Compliance with Special Conditions................................................5 

Award Financial Management .................................................................5 

Award Expenditures ..............................................................................6 

Personnel Costs ...........................................................................7 

Contractor Costs..........................................................................8 

Other Direct Costs .......................................................................9 

Subrecipient Costs ..................................................................... 11 

Matching Costs .......................................................................... 11 

Budget Management and Control .......................................................... 13 

Drawdowns ........................................................................................ 13 

Federal Financial Reports ..................................................................... 13 

CONCLUSION AND RECOMMENDATIONS......................................................... 15 

APPENDIX 1: OBJECTIVES, SCOPE, AND METHODOLOGY ................................. 17 

APPENDIX 2: SCHEDULE OF DOLLAR-RELATED FINDINGS................................ 19 

APPENDIX 3: REFUGEE SERVICES OF TEXAS’ RESPONSE TO THE DRAFT AUDIT 

REPORT ............................................................................................. 20 
 

APPENDIX 4: OFFICE OF JUSTICE PROGRAMS RESPONSE TO THE DRAFT AUDIT 

REPORT ............................................................................................. 30 

APPENDIX 5: OFFICE OF THE INSPECTOR GENERAL ANALYSIS AND SUMMARY 

OF THE ACTIONS NECESSARY TO CLOSE THE REPORT ............................ 35 
 

 

 

 

AUDIT OF THE OFFICE OF JUSTICE PROGRAMS 

COOPERATIVE AGREEMENTS AWARDED 

TO REFUGEE SERVICES OF TEXAS, INC. 

DALLAS, TEXAS 

INTRODUCTION 

The U.S. Department of Justice (DOJ) Office of the Inspector General (OIG) 

completed an audit of four cooperative agreements awarded by the Office of Justice 

Programs (OJP) Office for Victims of Crimes (OVC) under the Comprehensive 

Services for Victims of Human Trafficking program, to Refugee Services of Texas, 

Inc. (RST) in Dallas, Texas. RST received four awards totaling $2,730,000, as 

shown in Table 1. 

Table 1 

Cooperative Agreements Awarded to Refugee Services of Texas, Inc. 

Award Number Program 

Office 

Award Date Project 

Period Start 

Date 

Project 

Period End 

Date 

Award 

Amount 

2014-VT-BX-K024 OVC 09/16/2014 10/01/2014 09/30/2016 $455,000 

2016-VT-BX-K062 OVC 09/28/2016 10/01/2016 09/30/2019 $750,000 

2017-VT-BX-K026 OVC 09/28/2017 10/01/2017 09/30/2020 $750,000 

2018-VT-BX-K034 OVC 09/27/2018 10/01/2018 09/30/2021 $775,000 

Total: $2,730,000 

Source: OJP’s Grants Management System 

Funding through the Comprehensive Services for Victims of Human 

Trafficking program enhances the quality and quantity of services available to assist 

victims of human trafficking, as defined by the Trafficking Victims Protection Act of 

2000, by enhancing interagency collaboration and the coordinated community 

response to victims of human trafficking, and through the provision of high-quality 

services that address the individual needs of trafficking victims. The 

Comprehensive Services for Victims of Human Trafficking program also provides 

funding to increase communities’ capacity to respond to human trafficking victims 

through the development of interagency partnerships, professional training, and 

public awareness activities. 

The Grantee 

Founded in 1978, RST is a social service agency dedicated to providing 

assistance to refugees and other displaced persons fleeing persecution based on 

race, religion, nationality, political opinion, or membership in a particular social 

group, as well as to the communities that welcome them. RST provides services to 

hundreds of refugees, asylum seekers, survivors of human trafficking, and related 

vulnerable populations from over 30 different countries of origin each year. 

Originating in Dallas, RST now has service centers in Amarillo, Austin, Dallas, Fort 

Worth, Houston, and Rio Grande Valley, Texas, offering programs uniquely 

designed to assist refugees, asylum seekers, survivors of human trafficking, and 

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other vulnerable populations, helping them to become self-sufficient as quickly as 

possible.1 

OIG Audit Approach 

The objectives of this audit were to determine whether costs claimed under 

the grants were allowable, supported, and in accordance with applicable laws, 

regulations, guidelines, and terms and conditions of the awards; and to determine 

whether the grantee demonstrated adequate progress towards achieving the 

program goals and objectives. To accomplish these objectives, we assessed 

performance in the following areas of award management: program performance, 

financial management, expenditures, budget management and control, drawdowns, 

and federal financial reports. 

We tested compliance with what we consider to be the most important 

conditions of the awards. The 2014 OJP Financial Guide, 2015 and 2017 DOJ 

Grants Financial Guides, and the award documents contain the primary criteria we 

applied during the audit. 

The results of our analysis are discussed in detail later in this report. 

Appendix 1 contains additional information on this audit’s objectives, scope, and 

methodology. The Schedule of Dollar-Related Findings appears in Appendix 2. 

1 Background information on RST has been taken from the organization’s website directly 

(unaudited). 

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AUDIT RESULTS 

Program Performance and Accomplishments 

We reviewed required performance reports, award documentation, and 

interviewed recipient officials to determine whether RST demonstrated adequate 

progress towards achieving the program goals and objectives. We also reviewed 

the progress reports to determine if the required reports were accurate. Finally, we 

reviewed RST’s compliance with the special conditions identified in the award 

documentation. 

Program Goals and Objectives 

The goals and objectives for each award included the following. 

• Award Number 2014-VT-BX-K024 – Enhance the quality and quantity of 

services available to all victims of human trafficking in Central Texas. 

• Award Number 2016-VT-BX-K062 – Enhance the quality and quantity of 

services available to human trafficking victims of Travis, Williamson, 

Hays, McLennan, and Bell Counties, Texas. 

• Award Number 2017-VT-BX-K026 – Enhance the quality and quantity of 

services available to all human trafficking victims of the Texas Panhandle 

and South Plains Region. 

• Award Number 2018-VT-BX-K034 – Enhance the quality and quantity of 

services available for all human trafficking victims of the Texas Rio 

Grande Valley Region. 

Based on our review, there were no indications that RST was not adequately 

achieving the stated goals and objectives of the awards. 

Required Performance Reports 

According to the OJP Financial Guide and the DOJ Grants Financial Guide, the 

funding recipient should ensure that valid and auditable source documentation is 

available to support all data collected for each performance measure specified in 

the program solicitation. In order to verify the information in the progress reports, 

we selected a sample of 16 performance measures for Award Numbers 

2014-VT-BX-K024, 2016-VT-BX-K062, and 2017-VT-BX-K026 from the 2 most 

recent reports submitted for each award for a total sample size of 48.2 We then 

traced the items to supporting documentation maintained by RST. 

Based on our review, we found that the progress reports we tested were 

generally inaccurate or not supported. RST uses the Trafficking Information 

Management System (TIMS) to track progress report data related to the number of 

2 At the time of our review, no activity was reported on the progress report for Award Number 

2018-VT-BX-K034. 

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client services and referrals for assistance provided; technical assistance and 

training activities; and community outreach and public awareness activities.3 For 

the performance measures we tested related to these activities, RST provided a 

TIMS report; however, RST could not provide documentation supporting the TIMS 

data. As a result, we could not verify the accuracy of the numbers reported. Our 

analysis of the accuracy of the progress report performance measures we tested for 

each award is summarized below. 

• Award Number 2014-VT-BX-K024: For Report Number 4, we determined 

that only one of the eight performance measures tested was adequately 

supported. For six performance measures, we determined that RST 

overstated the numbers reported. We were also unable to verify the 

accuracy of the TIMS data related to the number of community outreach 

and public awareness activities reported. For Report Number 5, we found 

that none of the performance measures tested were adequately 

supported. We could not assess the accuracy of the number of client 

referrals because the TIMS report only included data on Foreign National 

trafficking victims and did not include data for U.S. Citizen trafficking 

victims. We were also unable to verify the accuracy of the TIMS data 

related to the number technical assistance and training activities reported. 

• Award Number 2016-VT-BX-K062: For Report Number 4, we determined 

that only two of the eight performance measures tested were adequately 

supported. For five performance measures, we determined that RST 

overstated the numbers reported. We were also unable to verify the 

accuracy of the TIMS data related to the type and number of requesting 

organizations for technical assistance activities reported. For Report 

Number 5, we determined that only three of the eight performance 

measures tested were adequately supported. We were unable to verify 

the accuracy of the TIMS data related to the number of training, technical 

assistance, and community outreach and public awareness activities 

reported. In addition to the TIMS data, RST provided a summary 

document to support the number of training and community outreach 

activities reported. However, RST could not provide documentation 

supporting the summary report data; as a result, we could not verify the 

accuracy of the numbers reported. 

• Award Number 2017-VT-BX-K026: For Report Number 2, we determined 

that only one of the eight performance measures tested was adequately 

supported. For six performance measures, we determined that RST 

overstated the numbers reported. For the number of hours of technical 

assistance provided by partner organizations reported, the supporting 

documentation provided by RST only included information about the 

3 TIMS is designed to assist the OJP Office for Victims of Crime (OVC) Human Trafficking 

Grantees in gathering, recording, analyzing, and reporting required performance measures. This tool 

serves as a central repository of information related to all activities under the OVC human trafficking 

grant initiative and enables OVC grantees to organize, standardize, and centralize data collection 

efforts on a wide variety of core performance measures. 

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partner organization. RST could not provide documentation supporting 

the total number of hours of technical assistance provided by the partner 

organizations. For Report Number 3, we found that only four of the eight 

performance measures tested were adequately supported. We were also 

unable to verify the accuracy of the TIMS data related to the number of 

community outreach and public awareness activities reported. 

Based on our analysis, we found that the progress reports we tested were 

inaccurate or not adequately supported. Therefore, we recommend that OJP 

coordinate with RST to ensure that progress reports are accurate and fully 

supported. 

Compliance with Special Conditions 

Special conditions are the terms and conditions that are included with the 

awards. We evaluated the special conditions for each award and selected a 

judgmental sample of the requirements that are significant to performance under 

the awards and are not addressed in another section of this report. We evaluated a 

total of eight special conditions for the awards in our scope. 

Based on our review, we found that RST was in compliance with seven of the 

eight special conditions we tested. However, we determined that RST was not in 

compliance with special condition 25 for award 2016-VT-BX-K062, requiring prior 

OJP approval to pay a consultant rate in excess of $650 per day. Therefore, we 

recommend that OJP coordinate with RST to develop policies and procedures that 

ensure it adheres to all special conditions for the awards. This issue is discussed in 

detail in the Contractor Costs section of this report. 

Award Financial Management 

According to the OJP Financial Guide and the DOJ Grants Financial Guide, all 

award recipients and subrecipients are required to establish and maintain adequate 

accounting systems and financial records and to accurately account for funds 

awarded to them. To assess RST’s financial management of the awards covered by 

this audit, we conducted interviews with financial staff, examined policy and 

procedures, and inspected award documents to determine whether RST adequately 

safeguards the award funds we audited. We also reviewed RST’s Single Audit 

Report for the fiscal year ended September 30, 2018, along with the Office of the 

Chief Financial Officer (OCFO) site visit on April 22, 2009, to identify internal control 

weaknesses and significant non-compliance issues related to federal awards. 

Finally, we performed testing in the areas that were relevant for the management 

of the awards, as discussed throughout this report. 

The most recent Single Audit Report identified material weaknesses over 

financial reporting and major programs. Specifically, the auditors found: (1) bank 

accounts, accrued expenses, and prepaid expenses were not properly reconciled at 

year end; (2) 5 of 40 timesheets tested did not contain a supervisor signature and 

1 employee did not maintain a timesheet; and (3) proper documentation of time 

spent by each employee on individual timesheets was not consistently available. 

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The OCFO review identified questioned costs totaling $92,392 in overstated 

expenditures on the Financial Status Reports (FSRs), as well as concerns related to 

RST’s internal controls and accounting practices. Specifically, OCFO found: 

(1) RST’s written accounting procedures did not include specific provisions for 

administering federal grant funds; (2) RST maintained excess cash totaling $5,887; 

(3) Expenditures reported on the FSRs did not reconcile to the amounts recorded in 

RST’s accounting system; (4) RST did not timely submit their FSRs; (5) RST did not 

track expenditures of grant funds by approved budget categories; (6) RST did not 

submit a copy of its Single Audit Report to the Federal Audit Clearinghouse. OCFO 

made six recommendations to RST to address its findings. 

RST submitted corrective action plans to address the findings and 

recommendations identified in the Single Audit Report and OCFO review. However, 

we found that RST has not adequately addressed the Single Audit Report findings 

related to the fact that proper documentation of time spent by each employee on 

individual timesheets was not consistently available. We also found that RST has 

not addressed the OCFO findings related to the lack of specific provisions for 

administering federal grant funds in its written accounting procedures and the 

expenditures reported on the financial reports not reconciling to the amounts 

recorded in the accounting system. In addition, our audit identified additional 

weaknesses in RST’s financial management. Specifically, we found that RST 

charged unsupported contract costs to the OJP award, did not monitor 

subrecipients, did not record matching costs on its general ledgers, and did not 

maintain adequate documentation to support matching costs. 

Finally, we found that RST’s written policies and procedures could be 

strengthened. We noted that RST’s policies and procedures did not have specific 

language regarding matching costs, contract award and management, subrecipient 

award and management, or performance measurement and outcome assessment. 

Therefore, we recommend that OJP coordinate with RST to ensure it develop and 

implement new policies and procedures that include specific language regarding 

matching costs, contract award and management, subrecipient award and 

management, and performance measurement and outcome assessment. These 

deficiencies are discussed in more detail in the Payroll Costs, Contractor Costs, 

Other Direct Costs, Subrecipient Costs, Matching Costs, and Federal Financial 

Reports sections of this report. 

Award Expenditures 

For the awards in our scope, RST’s approved budgets included personnel, 

fringe benefits, travel, equipment, supplies, contractual, subrecipient, and other 

direct costs. In addition, RST was required to provide a total of $910,450 in local 

matching funds, which represents a 25 percent local match. To determine whether 

costs charged to the awards were allowable, supported, and properly allocated in 

compliance with award requirements, we tested a sample of transactions. Our 

sample included 154 transactions totaling $361,243. We also tested all matching 

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costs for the awards.4 We reviewed documentation, accounting records, and 

performed verification testing related to award expenditures. As discussed in the 

following sections, we identified $308,336 in questioned costs, including $24,969 in 

unallowable questioned costs and $283,367 in unsupported questioned costs.5 

Subsequent to the issuance of the draft report, RST provided sufficient 

documentation to support $8,002 of the unsupported matching costs. As a result, 

our final report identifies $300,334 in questioned costs, including $24,969 in 

unallowable questioned costs and $275,365 in unsupported questioned costs. 

Personnel Costs 

As part of our sample, we reviewed 36 payroll transactions totaling $30,802, 

which included all salary expenditures and fringe benefits for 2 non-consecutive pay 

periods for each award in our scope, to determine if labor charges were computed 

correctly, properly authorized, accurately recorded, and properly allocated to the 

award. Based on our review, we identified $17,987 in total questioned costs, 

including $7,285 in unsupported personnel costs and $10,702 in unallowable 

personnel costs charged to Award Numbers 2016-VT-BX-K062, 2017-VT-BX-K026, 

and 2018-VT-BX-K034. 

• For Award Number 2016-VT-BX-K062, we identified one position that was not 

authorized in the award budget and RST could not provide documentation to 

support the time charged to the award for one employee, resulting in $33 in 

unallowable questioned costs and $80 in unsupported questioned costs for 

the award. 

• For Award Number 2017-VT-BX-K026, we identified three positions that were 

not authorized in the award budget. According to an RST official, after the 

Vice President of Programs left the organization, RST decided to use the 

budgeted amount for the position to fund two new positions that were not 

included in the award budget – the Senior Programs Director and Senior 

Regional Director – because they felt that the duties of the former Vice 

President of Programs were too much for one person. RST also created a 

Senior Programs Manager position that was not included in the award budget. 

However, RST did not request or receive OJP approval through a Grant 

Adjustment Notice (GAN) to modify the award budget to include the three 

new positions charged to the award. As a result, we consider the costs for 

the unbudgeted positions unallowable, resulting in question costs totaling 

$2,160. 

• For Award Number 2018-VT-BX-K034, RST could not provide documentation 

to support the time charged to the award for two employees, resulting in 

4 RST did not include matching costs in the general ledgers for the awards and did not 

maintain any supplemental accounting records documenting individual matching cost transactions for 

the awards. Therefore, we requested and reviewed all supporting documentation for the matching 

costs. 

5 Throughout this report, differences in the total amounts are due to rounding. The sum of 

individual numbers prior to rounding may differ from the sum of the individual numbers rounded. 

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unsupported questioned costs totaling $7,205. RST provided documentation 

detailing the award activity each month for these employees. However, the 

documentation did not indicate the amount of time the employees spent 

working on the award activities. 

Based on our analysis, we identified $7,285 in unsupported and $2,193 

unallowable personnel costs. As a result, we expanded our analysis to include all 

salaries and related fringe benefits charged to the award for the unauthorized 

positions that were not included in the award budget, resulting in an additional 

$8,509 in unallowable personnel costs. 

In total, we identified $7,285 in unsupported and $10,702 in unallowable 

personnel costs charged to the awards. Therefore, we recommend that OJP remedy 

the $7,285 in unsupported and $10,702 in unallowable personnel costs. 

Contractor Costs 

As part of our sample, we reviewed 42 contractor transactions totaling 

$32,847 to determine if charges were computed correctly, properly authorized, 

accurately recorded, and properly allocated to the awards.6 In addition, we 

determined if rates, services, and total costs were in accordance with those allowed 

in the approved budgets. Based on our review, we identified $20,544 in questioned 

costs, including $10,855 in unsupported contractor costs and $9,689 in unallowable 

contractor costs charged to Award Numbers 2014-VT-BX-K024, 2016-VT-BX-K062, 

and 2017-VT-BX-K026. We also found that for Award Numbers 2014-VT-BX-K024 

and 2016-VT-BX-K062, a consultant was paid $125 per hour, which exceeds the 

maximum allowable consultant rate of $81.25 per hour. However, we were unable 

to determine the amount of excess consulting fees charged to the award because 

there was no documentation supporting the amount of allocated consultant costs. 

For Award Number 2014-VT-BX-K024, we identified seven transactions 

totaling $2,007 for contractor costs that were not supported by a contract or 

engagement letter, an invoice, or an invoice with sufficient detail related to the 

number of hours and services provided. Additionally, we found that RST did not 

have a reliable and documented methodology for allocating contractor costs among 

awards prior to October 2018; as a result, we were unable to verify the accuracy of 

the contractor costs allocated to the award prior to that time. Therefore, we 

consider the contractor costs totaling $1,807 allocated to the award prior to 

October 2018 as unsupported. We also identified three contractor transactions 

totaling $291 for a consultant to review RST’s allocation and billing practices, 

general legal advice and counseling, and media relations services that were not 

included in the approved budget. Based on our sample for Award Number 

2014-VT-BX-K024, we identified $2,007 in unsupported and $291 in unallowable 

questioned contractor costs. As a result, we expanded our analysis to include all 

contractor costs charged to the award for unauthorized services that were not 

6 At the time of our review, there were no contractor expenses for Award Number 

2018-VT-BX-K034. 

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included in the award budget, resulting in an additional $1,203 in unallowable 

questioned costs. 

For Award Number 2016-VT-BX-K062, we identified eight transactions 

totaling $8,346 for contractor costs that were not supported by a contract or 

engagement letter, an invoice, or an invoice with sufficient detail related to the 

number of hours and services provided. Additionally, we were unable to verify the 

accuracy of the contractor costs allocated to the award prior to October 2018; 

resulting in unsupported allocated contractor costs totaling $1,876. We also 

identified three contractor transactions totaling $2,507 for strategic 

communications, auditing, and other consulting services that were not included in 

the approved budget. Based on our sample for Award Number 2016-VT-BX-K062, 

we identified $8,346 in unsupported and $2,507 in unallowable questioned costs. 

As a result, we expanded our analysis to include all contractor costs charged to the 

award for unauthorized services that were not included in the award budget, 

resulting in an additional $4,846 in unallowable questioned costs. 

For Award Number 2017-VT-BX-K026, we identified three transactions 

totaling $502 for contractor costs that were not supported by a contract or 

engagement letter, an invoice, or an invoice with sufficient detail related to the 

number of hours and services provided. We also identified one contractor 

transaction totaling $109 for media relations services that were not included in the 

award budget. Additionally, the invoice from the media relations consultant 

included a monthly retainer fee. However, RST did not receive any documentation 

detailing the hourly rate or the services it received the retainer fee paid to the 

consultant. In our judgement, contractors and consultants should only be paid for 

actual work performed. Based on our sample for Award Number 2017-VT-BX-K026, 

we identified $502 in unsupported and $109 in unallowable questioned costs. As a 

result, we expanded our analysis to include all contractor costs charged to the 

award for unauthorized services that were not included in the award budget, 

resulting in an additional $733 in unallowable questioned costs. 

In total, we identified $10,855 in unsupported and $9,689 in unallowable 

contractor and consultant questioned costs charged to the awards. Therefore, we 

recommend that OJP remedy the $10,855 in unsupported and $9,689 in 

unallowable contractor and consultant questioned costs. Additionally, we 

recommend that OJP coordinate with RST to ensure that: (1) current contract 

agreements are maintained for all contractors and consultants; (2) all contractors 

and consultants provide detailed invoices and are only paid for services rendered. 

Other Direct Costs 

As part of our sample, we reviewed 64 other direct cost transactions, totaling 

$20,099 to determine if charges were computed correctly, properly authorized, 

accurately recorded, and properly allocated to the award. Based on our review, we 

identified $12,830 in questioned costs, including $8,252 in unsupported other direct 

costs and $4,578 in unallowable other direct costs charged to Award Numbers 

2014-VT-BX-K024, 2016-VT-BX-K062, and 2017-VT-BX-K026. 

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For Award Number 2014-VT-BX-K024, we identified 11 transactions totaling 

$2,254 for other direct costs that were not supported. The unsupported other 

direct costs included gift cards purchased for clients for which RST did not require 

the clients to provide any documentation detailing the purchases made using the 

gift cards; as a result, we could not determine if the gift cards were used for 

allowable program costs. For one transaction, the invoice amount did not match 

the amount charged to the award. Finally, we were unable to verify the accuracy of 

the other direct costs allocated to the award prior to October 2018, resulting in 

unsupported allocated other direct costs totaling $1,359. We also identified nine 

other direct costs transactions totaling $1,215 for shredding services, installation of 

a card reader, System for Award Management (SAM) registration fees, room rental 

for a holiday party, thank you cards, and trademark registration frees that were not 

included in the approved budget. In addition, we identified unallowable banking 

services fees and delinquent credit card fees that were charged to the award. 

Based on our sample for Award Number 2014-VT-BX-K024, we identified $2,254 in 

unsupported and $1,215 in unallowable questioned costs. As a result, we expanded 

our analysis to include all unauthorized other direct costs charged to the award for 

expenditures that were not included in the award budget, resulting in an additional 

$1,725 in unallowable questioned costs. 

For Award Number 2016-VT-BX-K062, we identified eight transactions 

totaling $3,548 for other direct costs that were not supported. The unsupported 

other direct costs included petty cash transactions that were not supported by 

receipts or other documentation detailing what was purchased; as a result, we 

could not determine if the petty cash was used for allowable program costs. 

Additionally, we were unable to verify the accuracy of the other direct costs 

allocated to the award prior October 2018, resulting in unsupported allocated other 

direct costs totaling $840. We also identified two other direct costs transactions 

totaling $1,191 for a laptop and a conference that were not included in the 

approved budget. Based on our analysis for Award Number 2016-VT-BX-K062, we 

identified $3,548 in unsupported and $1,191 in unallowable questioned costs. 

For Award Number 2017-VT-BX-K026, we identified six transactions totaling 

$2,449 for other direct costs that were not supported. For one transaction the 

mileage reimbursement amount was calculated incorrectly. Additionally, we were 

unable to verify the accuracy of the other direct costs allocated to the award prior 

to October 2018, resulting in unsupported allocated other direct costs totaling 

$2,029. We also identified two other direct costs transactions totaling $140 for 

travel expenses to a summit and janitorial services that were not included in the 

approved budget. Based on our sample for Award Number 2017-VT-BX-K026, we 

identified $2,449 in unsupported and $140 in unallowable questioned costs. As a 

result, we expanded our analysis to include all unauthorized other direct costs 

charged to the award for expenditures that were not included in the award budget, 

resulting in an additional $307 in unallowable questioned costs. 

10 
 

 

 

 

 

 

 

 

 

 

 

 

 

For Award Number 2018-VT-BX-K034, we did not identify any issues related 

to the one transaction included in our sample.7 

In total, we identified $8,252 in unsupported and $4,578 in unallowable other 

direct questioned costs charged to the awards. As a result, we recommend OJP 

remedy the $8,252 in unsupported and $4,578 in unallowable other direct 

questioned costs. 

Subrecipient Costs 

As part of our sample, we reviewed 12 subrecipient transactions totaling 

$135,369 to determine if costs were supported, approved, allowable, and 

reasonable. In addition, we assessed the role they fulfilled, determined whether 

RST monitored, evaluated, or otherwise assessed the effectiveness of the 

subrecipients’ grant program(s), and determined whether the assessment was 

effective. 

Based on our transaction testing, we did not identify any deficiencies related 

to subrecipient costs. However, we found that RST did not conduct any formal 

monitoring visits with either of its subrecipients. According to an RST official, it has 

had a formal subrecipient monitoring policy since 2017 and RST has plans to 

conduct monitoring visits in 2020. However, since RST has had a monitoring policy 

in place since 2017 but has not conducted any site visits during the period covered 

by our audit, we are not confident that RST will follow through with its plans to 

conduct monitoring visits in 2020. Therefore, we recommend that OJP ensure RST 

adequately monitors its award subrecipients. 

Matching Costs 

Matching costs are the non-federal recipient’s share of the total project costs. 

These costs include cash spent for project-related costs and in-kind costs for 

services, supplies, real property, and equipment. The OJP Financial Guide and the 

DOJ Grants Financial Guides requires recipients to maintain records that clearly 

document the source, amount, and timing for all matching contributions. The 

Financial Guides also state that documentation supporting the market value of 

in-kind match must be maintained in the award recipient files. 

RST’s required match was $151,667 for Award Number 2014-VT-BX-K024; 

$250,450 for Award Number 2016-VT-BX-K062; $250,000 for Award Number 

2017-VT-BX-K026; and $258,333 for Award Number 2018-VT-BX-K034.8 RST used 

a combination of cash, in-kind volunteer services, and donated items in order to 

meet its matching requirements. 

7 At the time of our review, there was only one other direct cost transaction for Award 

Number 2018-VT-BX-K034. 

8 At the time of our review, there were no matching cost transactions for Award Number 

2018-VT-BX-K034. 

11 
 

 

 

 

 

 

 

 

 

 

 

We found that RST did not track matching transactions in its accounting 

records for the awards or on an electronic spreadsheet. As a result, we had to use 

RST’s donation log forms to create an electronic spreadsheet in order to determine 

the total matching costs for each award. We also reviewed the donation log forms 

to determine if the costs were in accordance with matching requirements, properly 

supported, computed correctly, authorized, and accurately reported. Finally, we 

reviewed the total matching costs for each award to determine if RST met its 

matching requirements. Based on our review, we identified $256,975 in 

unsupported matching costs for Award Numbers 2014-VT-BX-K024, 

2016-VT-BX-K062, and 2017-VT-BX-K026. 

For Award Number 2014-VT-BX-K024, we identified $110,184 in unsupported 

matching costs. Based on our analysis of the matching documentation, matching 

costs for the award totaled $51,195, which is $100,472 less than the required 

match. Additionally, we found that $9,712 of the $51,195 in total matching costs 

was not properly supported. Specifically, we found that the donation logs did not 

include any details related to volunteer services; as a result, we could not verify if 

the volunteer time was for project-related services. 

For Award Number 2016-VT-BX-K062, we identified $146,442 in unsupported 

matching costs. Based on our analysis of the matching documentation, matching 

costs for the award totaled $198,834, which is $51,616 less than the required 

match. Additionally, we found that $94,826 of the $198,834 in total matching costs 

was not properly supported. Specifically, we found that the donation logs did not 

include any details related to volunteer services; as a result, we could not verify if 

the volunteer time was for project-related services. We also found that in some 

instances the amounts for volunteer services were calculated incorrectly, meaning 

that the total amount recorded on the donation log did not match the number of 

volunteer hours multiplied by the estimated hourly rate. 

For Award Number 2017-VT-BX-K026, we identified $349 in unsupported 

matching costs. Specifically, we found that the donation logs did not include any 

details related to volunteer services; as a result, we could not verify if the volunteer 

time was for project-related services. Based on our analysis of the matching 

documentation, matching costs for the award as of June 2019 totaled $99,347, 

which is $150,653 less than the required match. We are not questioning the 

$150,653 as unsupported because the award is still open. As a result, RST has 

until September 30, 2020, to meet the match requirement for the award. However, 

based on the inadequate documentation provided and the fact that RST did not 

meet the match requirement for Award Numbers 2014-VT-BX-K024 and 

2016-VT-BX-K062, we are not confident it will meet its match requirement for this 

award. 

In total, we identified $256,975 in unsupported matching questioned costs 

claimed for the awards. Subsequent to the issuance of the draft report, RST 

provided new documentation that supported $8,002 in additional matching costs. 

After receiving OJP’s official response to the draft report, we confirmed with OJP 

that it agreed that $8,002 of the previously unsupported matching costs are now 

supported and remedied. As a result, we consider $8,002 of the $256,975 in 

12 
 

 

 

 

 

 

 

unsupported matching costs to be remedied. Therefore, we recommend that OJP 

remedy the remaining $248,973 in unsupported matching costs. In addition, we 

recommend OJP ensure RST meets its matching requirements, tracks all matching 

transactions on its general ledgers, and implements new policies and procedures to 

ensure matching costs are properly supported. 

Budget Management and Control 

According to the OJP Financial Guide and the DOJ Grants Financial Guide, the 

recipient is responsible for establishing and maintaining an adequate accounting 

system, which includes the ability to compare actual expenditures or outlays with 

budgeted amounts for each award. Additionally, the grant recipient must initiate a 

GAN for a budget modification that reallocates funds among budget categories if 

the proposed cumulative change is greater than 10 percent of the total award 

amount. 

We compared award expenditures to the approved budgets to determine 

whether RST transferred funds among budget categories in excess of 10 percent. 

We determined that the cumulative difference between category expenditures and 

approved budget category totals was not greater than 10 percent for any of the 

awards we tested. 

Drawdowns 

According to the OJP Financial Guide and the DOJ Grants Financial Guide, an 

adequate accounting system should be established to maintain documentation to 

support all receipts of federal funds. If, at the end of the grant award, recipients 

have drawn down funds in excess of federal expenditures, unused funds must be 

returned to the awarding agency. As of July 18, 2019, RST had drawn down a total 

of $1,396,580 from the awards in our scope. To assess whether RST managed 

award receipts in accordance with federal requirements, we compared the total 

amount reimbursed to the total expenditures in the accounting records. 

During this audit, we did not identify significant deficiencies related to the 

recipient’s process for developing drawdown requests. However, we identified 

deficiencies and questioned costs related to compliance of individual expenditures 

with award rules. We address those deficiencies in the Award Expenditures section 

in this report. 

Federal Financial Reports 

According to the OJP Financial Guide and the 2015 DOJ Grants Financial 

Guide, recipients shall report the actual expenditures and unliquidated obligations 

incurred for the reporting period on each financial report as well as cumulative 

expenditures. To determine whether RST submitted accurate Federal Financial 

13 
 

 

 

 

 

 

 

 

 

Reports (FFR), we compared the four most recent reports to RST’s accounting 

records for each award.9 

We found that for 8 of the 15 FFRs tested, the expenditures reported did not 

match RST’s accounting records, as shown in Table 2. 

Table 2 

FFR Accuracy 

Report 

No. 

Quarterly Expenditures Difference 

(Qtr. Exp. Per GL – Qtr. Exp. Per FFR) 

Cumulative Expenditures Difference Per GL 

(Cumulative Exp. Per GL – Cumulative Exp. Per FFR) 

Grant Number: 2016-VT-BX-K062 

8 $30 ($39) 

9 ($72) ($111) 

10 - ($111) 

11 - ($111) 

Grant Number: 2017-VT-BX-K026 

4 - ($4,812) 

5 $4,984 $172 

6 - $172 

7 $14,994 -

Source: OJP’s Grants Management System and RST financial records. 

In addition, we noted that the final FFR for Award Number 2014-VT-BX-K024 

reported $159,358 in matching costs. However, as discussed previously in the 

Matching Costs section of this report, based on our analysis of the matching 

documentation, matching costs for the award totaled $51,195, meaning that RST 

over reported its matching costs on the final FFR for the award by $108,163. We 

also noted that the final FFR for Award Number 2016-VT-BX-K062 reported 

$241,832 in matching expenses. However, based on our analysis of the matching 

documentation, matching costs for the award totaled $198,834 meaning that RST 

over reported its matching costs on the final FFR for the award by $42,998. 

Therefore, we recommend OJP coordinate with RST to ensure that it submits 

accurate FFRs. 

9 Award Number 2018-VT-BX-K034 only had three FFRs at the time of our analysis. 

14 
 

 

 

 

 

CONCLUSION AND RECOMMENDATIONS 

As a result of our audit testing, we found that RST demonstrated adequate 

progress towards achieving the awards’ stated goals and objectives. Additionally, 

we did not identify significant issues regarding RST’s management of the award 

budgets or drawdowns. However, we identified $308,336 in questioned costs, 

including $24,969 in unallowable questioned costs and $283,367 in unsupported 

questioned costs. Subsequent to the issuance of the draft report, RST provided 

new documentation that supported $8,002 in additional matching costs. As a 

result, we consider $8,002 of the unsupported matching costs to be remedied. 

We also found that RST did not comply with essential award conditions related to 

progress reports, compliance with award special conditions, use of award funds, 

matching funds, and FFRs. Additionally, we found that RST’s written policies and 

procedures could be strengthened. We provide 10 recommendations to RST to 

address these deficiencies. 

We recommend that OJP: 

1. Coordinate with RST to ensure that progress reports are accurate and fully 

supported. 

2. Coordinate with RST to develop policies and procedures to ensure it adheres 

to all special conditions of the awards. 

3. Coordinate with RST to develop and implement new policies and procedures 

that include specific language regarding matching costs, contract award and 

management, subrecipient award and management, and performance 

measurement and outcome assessment. 

4. Remedy the $24,969 in unallowable questioned costs related to the $10,702 

in unallowable personnel costs, $9,689 in unallowable contractor and 

consultant costs, and $4,578 in unallowable other direct costs. 

5. Remedy the $26,392 in unsupported questioned costs related to the $7,285 

in unsupported personnel costs, $10,855 in unsupported contractor and 

consultant costs, and $8,252 in unsupported other direct costs. 

6. Coordinate with RST to ensure that it maintains adequate documentation to 

support contractor costs charged to the awards, including current contract 

agreements for all contractors and consultants and detailed invoices, as well 

as ensuring that contractors and consultants are only paid for services 

rendered. 

7. Coordinate with RST to ensure it adequately monitors its award 

subrecipients. 

15 
 

 

8. Remedy the remaining $248,973 of the $256,975 in unsupported matching 

costs.10 

9. Coordinate with RST to ensure it meets its matching requirements, tracks all 

matching transactions on its general ledgers, and implements new policies 

and procedures to ensure matching costs are properly supported. 

10. Coordinate with RST to ensure that it submits accurate FFRs. 

10 As discussed previously, RST provided additional information and documentation supporting 

$8,002 of the previously unsupported matching questioned costs. That amount is not included in the 

$248,973 remaining unsupported matching costs. 

16 
 

 

 

 

 

 

 

 

 

 

 

 

APPENDIX 1 

OBJECTIVES, SCOPE, AND METHODOLOGY 

Objectives 

The objectives of this audit were to determine whether costs claimed under 

the awards were allowable, supported, and in accordance with applicable laws, 

regulations, guidelines, and terms and conditions of the awards; and to determine 

whether the grantee demonstrated adequate progress towards achieving the 

program goals and objectives. To accomplish these objectives, we assessed 

performance in the following areas of award management: program performance, 

financial management, expenditures, budget management and control, drawdowns, 

and federal financial reports. 

Scope and Methodology 

We conducted this performance audit in accordance with Generally Accepted 

Government Auditing Standards. Those standards require that we plan and 

perform the audit to obtain sufficient, appropriate evidence to provide a reasonable 

basis for our findings and conclusions based on our audit objectives. We believe 

that the evidence obtained provides a reasonable basis for our findings and 

conclusions based on our audit objectives. 

This was an audit of the Office of Justice Programs (OJP) cooperative 

agreements awarded to Refugee Services of Texas, Inc. (RST) under the 

Comprehensive Services for Victims of Human Trafficking program. RST was 

awarded a total of $2,730,000 under Award Numbers 2014-VT-BX-K024, 

2016-VT-BX-K062, 2017-VT-BX-K026, and 2018-VT-BX-K034, and as of July 

18, 2019, had drawn down $1,396,580 of the total grant funds awarded. Our audit 

concentrated on, but was not limited to September 16, 2014, the award date for 

Award Number 2014-VT-BX-K024, through August 23, 2019, the last day of our 

audit fieldwork. The project period for Award Number 2014-VT-BX-K024 ended on 

September 30, 2016, prior to the start of our audit and the project period for Award 

Number 2016-VT-BX-K062 ended on September 30, 2019. 

To accomplish our objectives, we tested compliance with what we consider to 

be the most important conditions of RST’s activities related to the audited awards. 

We performed sample-based audit testing for award expenditures including payroll 

and fringe benefit charges, financial reports, and progress reports. In this effort, 

we employed a judgmental sampling design to obtain broad exposure to numerous 

facets of the awards reviewed. This non-statistical sample design did not allow 

projection of the test results to the universe from which the samples were selected. 

The 2014 Office of the Chief Financial Officer (OCFO) Financial Guide, 2015 DOJ 

Grants Financial Guide, and the award documents contain the primary criteria we 

applied during the audit. 

During our audit, we obtained information from OJP’s Grants Management 

System, as well as RST’s accounting system specific to the management of DOJ 

17 
 

 

 

 

 

 

funds during the audit period. We did not test the reliability of those systems as a 

whole, therefore any findings identified involving information from those systems 

were verified with documentation from other sources. 

Internal Controls 

In this audit, we performed testing of internal controls significant within the 

context of our audit objectives. We did not evaluate the internal controls of RST to 

provide assurance on its internal control structure as a whole. RST’s management 

is responsible for the establishment and maintenance of internal controls in 

accordance with 2 C.F.R §200. Because we do not express an opinion on the RST’s 

internal control structure as a whole, we offer this statement solely for the 

information and use of RST and OJP.11 

In planning and performing our audit, we identified the following internal 

control components and underlying principles as significant to the audit objectives: 

Internal Control Components & Principles Significant to the Audit Objectives 

Control Activity Principles 

Management should design control activities to achieve objectives and respond to risks. 

Management should implement control activities through policies. 

Information & Communication Principles 

Management should internally communicate the necessary quality information to achieve the 

entity’s objectives. 

Management should externally communicate the necessary quality information to achieve the 

entity’s objectives. 

We identified deficiencies that we believe could affect RST’s ability to 

effectively and efficiently operate, and to ensure compliance with laws and 

regulations. However, because our review was limited to internal control 

components and underlying principles determined to be significant to the audit 

objectives, it may not have disclosed all deficiencies that may have existed at the 

time of this audit. The internal control deficiencies we found are discussed in the 

Audit Results section of this report. 

11 This restriction is not intended to limit the distribution of this report, which is a matter of 

public record. 

18 
 

 

 

 

 

 

 

 

 

 

APPENDIX 2 

SCHEDULE OF DOLLAR-RELATED FINDINGS 

Description Amount Page 

Questioned Costs:12 

Unallowable Costs 

Personnel Costs $10,702 8 

Contractor and Consultant Costs $9,689 10 

Other Direct Costs $4,578 11 

Total Unallowable Costs $24,969 

Unsupported Costs 

Personnel Costs $7,285 8 

Contractor and Consultant Costs $10,855 10 

Other Direct Costs $8,252 11 

Matching Costs $256,975 13 

Total Unsupported Costs $283,367 

Gross Questioned Costs $308,336 

Less Duplicate Questioned Costs13 ($4,475) 

Less Remedied Costs14 ($8,002) 

Net Questioned Costs $295,859 

12 Questioned Costs are expenditures that do not comply with legal, regulatory, or 

contractual requirements, or are not supported by adequate documentation at the time of the audit; 

or are unnecessary or unreasonable. Questioned costs may be remedied by offset, waiver, recovery 

of funds, or the provision of supporting documentation. 

13 Some costs were questioned for more than one reason. Net questioned costs exclude the 

duplicate amount, which includes $2,907 in contractor and consultant costs and $1,568 in other direct 

costs that were both unallowable and unsupported. 

14 Prior to the issuance of the final report, RST provided additional information and 

documentation supporting previously unsupported costs that we identified during our audit. 

19 
REFUGEE SERVICES 

Op,11 Hearts. f TEXAS f,e,I, Slarts. 

APPENDIX 3 

REFUGEE SERVICES OF TEXAS’ 

RESPONSE TO THE DRAFT AUDIT REPORT 

13, 2020 

David M. Sheeren 

Regional Audit Manager 

Denver Regional Audit Office 

Office of the Inspector General 

U.S. Department of J ustice 112 0 

Lincoln Street, Suite 150 0 Denver, 

C080203 

Dear Mr. Sheeren: 

Refugee Se1vices of Texas is submitting this official response to the draft audit report on the 

Audit of the Office of Justice Programs Cooperative Agreements Awarded to Refugee Services 

of Texas, Inc. (RS11 dated February 28, 2020. RST's response and concurrence/ nonconcurrence with the ten findings are outlined below. Our transmittal letter is attached 

separately. In addition, RST is submitting additional documentation of matching costs (for 

finding #8). The additional documentation will be emailed separately, and will be included in a 

package mailed to you with the signed transmittal letter and a hard copy of this responsP.. 

"~ellA sm;~ 

CEO 

• www.rstx.org • SOC E. St. John's Avenue, Suite 1.280, Austin, TX 787S2 • (S12) 472-9472 • 

20 
e Services of Texas' Response to Draft Audit Report 

1. Coordinate with RST to ensw·e that progress reports are accurate and fully suppo,.ted. 

Progress reports will be fully accurate and supported moving forward through a two-fold 

process. First, RST requested that software changes be made to Refugee Management System 

(RMS), RST's electronic database, on February 6, 2020. Changes will ensure better data 

capturing of OVC and other federally funded programs that serve survivors of trafficking by 

requiring that case managers mark the funder's service units, performance measures completed, 

etc. at the same time they writ e case notes. This wiU allow the review process between TIMS 

reporting and case notation to occur side by side without the need to track down a physical file 

or interpret why a service was entered into TIMS. The RMS programmers were receptive and 

requested a month to develop the infrastructure. As of March 5, 2020, the programmers had 

minor updates to make to RMS before scheduling a training with staff. The training will equip 

staff to enter fu nder performance measures alongside case notation. 

RST Programs Department conducts internal monitorings of OVC-funded programs once a year. 

These have been restricted to a review of the local case files, staff interviews, and observation of 

staff-client interactions. Moving forward, RST Programs Department will integrate an 

additional component into its internal monitorings where TIMS reports (for both individual 

cases as well as training/outreach) are reviewed against case files and local documentation, 

allowing the organization to better gauge the progress a site is making towards the stated 

program goals and objectives. 

2. Coordinate with RST to develop policies and procedures to ensure it adheres to all 

special conditions of the awards. 

Upon receiving an OVC award agreement, RST senior leadership will conduct a full review of the 

document to identify and make a plan for addressing any Special Conditions listed. Should RST 

recognize any part of its proposed project, programmatic or fiscal, is out of compliance with the 

Code of Federal Regulations, the organization will take immediate steps to refine its practices 

and submit any necessary project adjustment to OVC. 

Additionally, RST will hold a grants opening meeting with everyone involved in the project's 

execution upon receiving a new award. The purpose of the meeting will be to walk through the 

21 
program goals and outcomes, staffing, and any remaining Special Conditions that need 

to be removed prior to starting the project. 

Lastly, RST is currently assessing its ability to hire an internal monitor to assist RST in 

researching best practices and drafting new protocols and procedures, all with the ultimate goal 

of ensuring the organization remains in compliance with the CFR and its federal grants. 

3. Coordinate with RST to develop and implement new policies and procedures that 

include specific language regarding matching costs, contract award and management, 

subrecipie11t award a11d ma11ageme11t, and pe1forma11ce measurement and outcome 

assessment. 

a) Matching Costs 

Refugee Services of Texas (RST) matching funds are restricted to the same uses as the federal 

funds. Direct client match can be counted towards OVC match if it is supporting a direct client 

or the STEP or 806 ACT'S program and most often includes emergency food/shelter/basic 

needs, bus passes, care bags, and gift cards to ensure basic needs are met. 

Volunteer rates for donated services used to satisfy a matching or cost-sharing requirement are 

consistent with those paid for similar work at Refugee Services of Texas (RST). When a 

volunteer fulfills a case management/employment services/interpretation services/ELT role, 

etc. that is already maintained by the organization, the average hourly rate plus benefits totals 

$22.50. This is consistent with the wage for a RST resettlement case manager, employment case 

manager, or ELT instructor; all bilingual and multilingual staff provide interpretation services 

as needed. When a specialized skill set does not exist within the organization, rates are 

consistent with those paid for similar work in the labor market in which RST would compete for 

the kind of services involved. The labor market dictates the volunteer rate utilized for the match 

requirement. If a volunteer or intern is not 100% dedicated to the anti-trafficking program, 

his/her time will be counted at whatever percentage is reflective of the time spent suppo1ting 

survivors of trafficking enrolled in OVC. 

Mileage is counted towards match if a volunteer or intern is transporting a client to an 

appointment where a staff would otherwise need to provide transportation. Mileage is also 

counted if a volunteer or intern is providing a service to the anti-trafficking program, such as 

22 
in-kind donations from community members or dropping those donations off at 

survivors' homes. 

RST considers donated space as match if it is used to house donations before they are connected 

to survivors or when space is given at a free or reduced rate for support groups, life skills classes, 

language classes, financial literacy sessions, and other events. 

Any match collected is documented on a RST Donation Log that requires the following to be 

recorded: the funder, type of match, value of the match, justification for match, and a donor and 

client signature. A staff training on how to properly complete the Donation Log form is 

scheduled for the first week of April and will be conducted by the RST Programs Department. 

b) Contract award and management 

RST will have a completed contract award and management protocol drafted by mid-April 2020 

and submitted to RST's OVC Grants Manager that clearly describes how the organization will 

effectively administer any federal award it is granted. Successful contract management will 

begin with a full review of the award agreement and Special Conditions. A grants opening 

meeting will then be held with all involved parties to ensure full understanding of allowable and 

unallowable costs, any Special Conditions that need to be removed before the contract can 

begin, staffing, required programmatic and fi nancial reporting deadlines, data tracking, any 

program evaluation component, match requirements, project timeline and management, and 

closeout of the award. RST is currently assessing its ability to hire an internal monitor to assist 

RST in drafting best practices, new protocols and procedures, all with the ultimate goal of 

ensuring the organization remains in compliance with the CFR and its federal grants. 

c) Subrecipient award and management 

Pre-Award: Refugee Services of Texas' (RST) sub-recipient award process begins with a preaward process of ensuring the proposed sub-recipients are not suspended or debarred by the 

federal government, the list of data elements that must be included in the subrecipient 

agreement is clear and matches the 2 C.F.R. Part 200.331, and that appropriate federal special 

conditions are passed down to the sub-recipient awards. 

Post-Award: RST's post-award process includes a grants opening meeting, monitoring process 

(see Sub-Recipient Monitoring Process and Monitoring Plan), and regular communication and 

23 
. The grants opening meeting is typically held at RST with sub-recipients within 60 

days of award notice. The following is discussed: 

Project plan of operation 

- Timeline 

Establish benchmarks for ourselves for the year 

- Allowable costs 

Ensure sub-agreements are executed 

Nature of collaboration including any desired branding 

Direct response coverage (ex. 24/7) 

- Match collection, if required 

RST solidifies subaward agreements after the grants opening meeting and once all parties are in 

agreement about the parameters and expectations of the partnership. 

Reporting: Programmatic reporting includes a discussion around progress reports and data 

entry on a qua1terly basis. Financial reporting specifically discusses monthly requests for 

reimbursement. Each month agencies submit to RST their Requests for Reimbursements 

(RFRs) for the respective federal program. Before fulfilling each RFR, RST will monitor the 

following for each line item and total: 

- Total Expenses to Date 

Expense Allowability 

Percent age of Obligated Amount spent 

Percent age of Estimated Budget spent 

- Spending trends 

Remaining funds 

During the review process, RST may communicate with each provider any adjustments 

regarding their spending and possible courses of action (e.g. a budget revision). 

As stated in the subaward contracts, RST reserves the right to withhold reimbursements above 

the approved budget amount. 

Closeout: The process for closing out a subaward with RST includes a final financial 

reconciliation of the initial award amount against the final, submitted RFR including adequate 

source documentation, to be completed no later than 15 days following t he end of the grant. 

24 
nal match collection and documentation as well as progress reports that reflect completion of 

all program objectives and goals are due no later than 15 days following the end of the grant. 

cl) Performance measurement and outcome assessment: 

STEP case files and data are reviewed by the program supei:visor and Area Director on a 

trimester basis with results tied directly to a staffs yearly performance evaluation. This 

increases the accuracy and timely ently of all project related data. Additionally, RST Programs 

Department conducts internal monitorings of OVC-funded programs once a year. These have 

been restricted to a review of the local case files, staff interviews, and observation of staff-client 

interactions. Moving forward, RST Programs Department will integrate an additional 

component where TIMS reports (for both individual cases as well as training/outreach) are 

reviewed against case files and local documentation on the progress a site is making towards the 

program goals and objectives. If at any point the RST Programs Department determines that a 

site is behind in reaching its expected outcomes, Programs and the local site will create a 

strategic plan for closing the gap in clients to serve, outreach or trainings to conduct, match to 

raise, etc. with the remaining months of the grant. 

4. Remedy the $24,969 in unallowable questioned costs related to the $10,702 in 

unallowable personnel costs, $9,689 in unallowable contractor and consultant costs, 

and $4,578 in unallowable other di,·ect costs. 

RST acknowledges $33 of unallowable personnel cost and with an approval of a new budget the 

remaining $10,669 can be rectified. RST feels the positions in question are a necessity and 

mission critical work to help reach the goals of the program. Therefore, RST does not concur 

with $10,669 in unallowable personnel costs and will submit a budget adjustment to resolve this 

finding. 

RST does not concur on the unallowable contractor costs. Many of the items were contracts that 

were entered into prior to the award period and are long standing vendors for RST. In addition, 

items like an audit, are required by the federal government and door locks were installed as a 

safety concern for the survivors of trafficking. Items with regard to media, RST concurs as 

unallowable. Therefore, RST does not concur on $9,689 in unallowable contractor and 

consultant costs. 

25 
concurs with OIG on unallowable other direct costs. RST will work to educate staff on items 

that can not be charged to federal awards. RST will credit the open award back for all 

unallowable costs. 

In summary, on this item, RST concurs with $4,611 in unallowable questioned costs and does 

not concur on $20,358 in unallowable questioned costs. 

5- Remedy the $26,392 in unsupported questioned costs related to the $7,285 in 

unsupported personnel costs, $10,855 in unsupported contractor and consultant costs, 

and $8,252 in unsupp01·ted other di,·ect· costs. 

RST concurs with this finding. For items on current grants, RST will credit the grant back. RST 

has implemented an allocation policy that is currently being used and will continue to work on 

process improvements. 

6. Coordinate with RST to ensure that it maintains adequate documentation to support 

contractor costs charged to the awards, including current contract agreements for all 

contractors and consultants and detailed invoices, as well as ensuring that contractors 

and consultants are only paidfor services rendered. 

RST will work to educate staff on proper contractor agreements, including educating operation 

t eams for what is necessary on a contract. RST will also implement a contractor approval 

process that requires the sign off of Finance, Programs, and Operations. 

7. Coo,·dinate with RST to ensure it adequately monitors its award sub,·ecipients. 

Refugee Services of Texas (RST) conducts onsite monitorings with subrecipients one time 

during the grant cycle to ensure the subgrantees' capacity to effectively manage the project and 

administer the award funds, to ensure compliance with federal regulations and all provisions of 

the Subaward Agreement, and to verify that the subgrantees have in place effective internal 

controls to achieve these goals. 

Monitorings of tl1e sub-recipients typically does not occur in the first year of a multi-year grant, 

since RST focuses on providing technical assistance and ensuring sub-recipients have the tools 

in place to effectively run a federally funded program. 

26 
monitorings, RST will review the financial and performance reports submitted by the 

sub-recipient. RST will meet with various staff to learn how the sub-recipient executes the 

subaward as well as hear best practices and challenges. Each monitoring will include an 

introduction meeting and an exit meeting during which initial findings will be shared with the 

sub-recipient. 

RST will then draft a monitoring report that is sent to the sub-recipient within 30 days following 

the monitoring. The sub-recipient will then have 30 days to submit a response. RST will return a 

final monitoring report in two weeks and will arrange any phone calls in between to ensure 

clarity and understanding of the monitoring findings and expectations to address them. 

Substandard performance or response to monitoring findings as determined will constitute noncompliance. The subgrantees shall adhere to any monitoring and evaluation plans developed 

and specifically required by RST as a result of any and all monitoring activities. 

As a part of its ongoing monitoring process, RST will evaluate subgrantee progress and project 

goal attainment based on repo1ts prepared by the subgrantees, as well as through ongoing 

discussions with subgrantee project staff. 

RST reserves the right to require additional monitoring and evaluation measures to ensure that 

the subgrantees fulfill the identified project goals and objectives and/or addresses any findings 

revealed during a monitoring. 

8. Remedy the $256,975 in unsupported matching costs. 

RST does not concur with this finding. 

a. Refugee Services of Texas has reviewed the documentation from the OIG auditor that 

identified $256,975 in unsupported matching costs. RST is 1) disputing certain amounts 

that were flagged as unsupported, and 2) submitting additional match (and 

comprehensive documentation) that was documented during the grant periods but was 

not reviewed by the auditor. 

b. We appreciate the thoroughness of the auditor in reviewing the documentation we did 

submit but realize that a large volume of matching costs and documentation were not 

included in what the auditor reviewed. RST acknowledges that in the first few years of 

the audited OVC grants our systems needed improvement, and we are confident that the 

changes we have made and continue to make to our systems and processes will ensure 

27 
tracking and documentation into the future. 

c. RST disputes the following as unsupported matching costs. Much of the match that was 

flagged as unsupported was based on volunteer time that the auditor felt had inadequate 

explanation of specifics of services performed. RST has explored each questioned cost 

and provided an explanation for each that we dispute. An annotated spreadsheet (OIC 

Audit Response - RST- Item #8) includes the notes and disputed match costs. We have 

noted the items we do not dispute, and provided a response for every item highlighted by 

the auditor. 

1. 2014-VT-BX-Ko24 RST disputes $13,990.37 in match marked as unsuppo1ted. 

See Tab labeled "Rec. #8 (2014 Match)" in accompanying spreadsheet "OIC 

Audit Response - RST- Item #8". 

11. 2016-VT-BX-Ko62 RST disputes $94,683.27 in match marked as unsupported. 

See Tab labeled "Rec. #8 (2016 Match)" in accompanying spreadsheet "OIG 

Audit Response - RST- Item #8". 

iii. 2017-VT-BX-Ko26 RST disputes $348.75 in match marked as unsupported. See 

Tab labeled "Rec. #8 (2017 Match)" in accompanying spreadsheet "OIG Audit 

Response - RST- Item #8". 

iv. Total amount RST disputes from the report as "unsupported": $109,022 .39 

d. RST is submitting additional match and documentation that was not considered during 

the audit. The summary of the additional match is included in the annotated 

spreadsheet (OIG Audit Response - RST- Item #8), in the tabs marked "2014 Additional 

Match", "2016 Additional Match", and "2017 Additional Match." The amounts of 

additional match being submitted include: 

i. 2014-Vf-BX-Ko24 $49,555.01. Documentation is included in pdfform in the 

following: "RST Additional Match 2014-VT-BX-Ko24'' 

ii. 2016-VT-BX-Ko62 $232,553.54. Documentation is included in pdfform in the 

following: "RST Additional Match 2016-Vf-BX-Ko62" 

iii. TOTAL Additional Match submitted: $282,108 .55 

In summary: 

Grant Missing Match Questioned Match Disputed/ Additional from RST 

2014-VT-BX-Ko24 $100,472 $ 9,712 $ 63,545.38 

2016-VT-BX-Ko62 $51,616 $94,826 $327,236.81 

2017-Vf-BX-Ko26 $ 349 $ 349.00 

While RSTwas unable to produce documentation demonstrating completion of the 2014-VT28 
match requirement, the organization had already made tremendous improvements by 

the end of the 2016-Vl'-BX-Ko62 grant that resulted in $232,553.54 additional match that was 

not reviewed by the auditor (in addition to the disputed $94,683.27 in match marked as 

unsupported). These improvements include better documentation on donation logs, additional 

quality control measures to ensure allowable and supported match are well documented, and 

introducing strategic planning at the senior leadership level as needed if a local site is identified 

as struggling to raise its match requirement. Senior leadership will know planning needs to sta1t 

as a result of reviewing monthly reports generated by local sites and used for financial reporting 

in GMS. Though RST is currently behind in the match it has raised for the 2017-Vf-BX-Ko26 

contract, it is confident the entire match requirement will be met by September 2020. 

9. Coordinate with RST to ensure it meets its matching requirements, tmcks all matching 

transactions on its general ledgers, and implements new policies and procedures to 

ensure matching costs are p1·operly supported. 

RST will share monthly match progress with the Programs and Finance department on all OVC 

grants to ensure that, if at any point, a site is behind in reaching its expected match 

contribution, senior leadership and the local site will create a strategic plan for closing the gap in 

match to raise with the remaining months of the grant. Additional detail and justification will be 

added to all donation logs moving fo1ward, including: the funder, type of match, value of the 

match, full justification for match, and donor and client signature. A staff training on how to 

properly complete the Donation Log form is scheduled for the first week of April and will be 

conducted by the RST Programs Department. A Finance staff member began reviewing all 

match documentation in October 2019 to ensure match raised is allowable and supported, and 

the impact of this improved quality and internal control measure can be seen on more recent 

donation logs. Lastly, federal match requirements were added to RST's General Ledger with the 

start of fiscal year 2020 as an additional measure to track progress towards expected match 

outcomes. 

10. Coordinate with R.ST to ensure that it submits accurate FFRs. 

RST feels FFRs were submitted correctly at the time of submission and that there were later 

corrections in accounting. RST has improved it's month-end close process and controls on 

corrections to ensure corrections are not back-dated and take place in the current period to help 

remedy the small discrepancies in the RFRs. 

29 
APPENDIX 4 

OFFICE OF JUSTICE PROGRAMS’ 

RESPONSE TO THE DRAFT AUDIT REPORT 

U.S. Oepartment of Justice 

Office ofJustice Programs 

Office of Audit, Assessment, and Management 

Wa.sliinston, D.C. 20JJJ 

19, 2020 

MEMORANDUM TO: David M. Sheeren 

Regional Audit Manager 

Denver Regional Audit Office 

Office of the Inspector General 

FROM: 

Director 

Ralph E. Martin ~ ~ 

SUBJECT: Response to the Draft Audit Report, Audit of the Office ojJustice 

Programs, Cooperative Agreements Awarded to the Refiigee 

Services of Texas, inc., Dallas, Texas 

TI1is memorandum is in reference to your correspondence, dated February 28, 2020, transmitting 

the above-referenced draft audit report for the Refugee Services of Texas, Inc. (RST). We 

consider the subject report resolved and request written acceptance of this action from your 

office. 

TI1e draft report contains 10 recommendations and $303,861 1 in net questioned costs. 'J11e 

following is Office of Justice Programs' (OJP) analysis of the draft audit report 

recommendations. For ease of review, !he recommendations are restated in bold and are 

followed by our response. 

1. We reconunend that OJP coordinate with RST to ensm·e that pro gress reports are 

accurate and fully suppo11.ed. 

OJP agrees with this recommendation. We will coordinate with RST to obtain a copy of 

written policies and procedures, developed and implemented, to ensiu-e that semi-annual 

progress reports are acciu-ate; and are fully supported by source documentation, that is 

maintained for future auditing purposes. 

1 Some costs were questioned for more than one reason. Net questioned costs exclude the duplicate amounts. 

30 
We recommend that OJP coo1·dinate ,'l'ith RST to develop policks and p1·ocedures to 

ensure it :ldheres to all special conditions ol'the :lmlnls. 

OJP agrees with this recommendation. We will coordinate with RST to obtain a copy of 

written policies and procedures, developed and implemented, to ensure compliance with 

all award special conditions. 

3. We recommend that OJP coo1·dinate with RST to develop and implement new 

polides and procedures that include specific language reg:u-ding matching costs, 

contract. award and management, subrecipient award and management., and 

performance measurement and outcome assessment. 

OJP agrees with this recommendation. We will coordinate with RST to obtain a copy of 

written policies and procedures, developed and implemented, to ensure that they include 

specific language regarding matching costs, contract award and management, 

subrecipient award and management, and perfonnance measurement and outcome 

assessment. 

4. \Ve recommend that OJP remedy the $24,969 in unallowable questioned costs 

related to the $10,702 in wtallowable perso1mcl costs, $9,689 in unallowable 

conh·actor and consultant costs, and $4,578 in wtallowable other· direct costs. 

OJP agrees with this recommendation. We will review the $24,969 in questioned costs, 

charged to Cooperative Agreement Numbers 2016-VT-BX-K062, 2017-VT-BX-K026, 

and 2018-VT-BX-K034, and will work with RSTto remedy, as appropriate. 

5. We reconunend that OJP remedy the $26,392 in w1supported questioned costs 

related t.o the $7,285 01 wtsupported persmmel costs, $10,855 01 misupported 

contract.or and consultant costs, and $8,252 in unsupported other direct costs. 

OJP agrees with this recommendation. We will review the $26,392 in unsupported 

questioned costs, charged to Cooperative Agreement Numbers 2014-VT-BX-K024, 

2016-VT-BX-K062, and 2017-VT-BX-K026, and will work with RST to remedy, as 

appropriate. 

6. We l'ecommend that OJP coordinate witJ1 RST to ensure that it maintains adequate 

docwnentation to support contractor costs charged to the awards, includo1g cm·r·ent 

contract agreements for all contractors and consultants and detailed invoices, as 

well as ensuring that contractol'S and consultants a.re only paid fol' sel'vices 

rendered. 

OJP agrees with this recommendation. We will coordinate with RST to obtain a copy of 

written policies and procedures, developed and implemented, to ensure that adequate 

documentation is maintained to support contractor costs charged to the awards, including 

current contract agreements for all contractors and consultants, and detailed i1ivoices, as 

well as ensuring that contractors and consultants are only paid for services rendered. 

2 

31 
7 . We recommend that OJP coo1·dinate ,'l'ith RST to ensure it adequately monito1-s its 

award subrecipients. 

OJP agrees with this recommendation. We will coordinate with RST to obtain a copy of 

written policies and procedures, developed and implemented, to ensure adequate 

oversight and monitoring of its award subrecipients. 

8. We recommend that OJP rem edy the $256,975 in unsupportt'tl matching costs. 

OJP agrees with this recommendation. We will review the $256,975 in questioned costs, 

related to unsupported matching costs, charged to Cooperative Agreement Numbers 

2014-VT-BX-K024, 2016-VT-BX-K062, and 2017-VT-BX-K026, and will work with 

RST to remedy, as appropriate. 

9. We recommend that OJP coordinate with RST to ensure it meets its matching 

requirements, tracks all matching transactions on its geneml ledgers, and 

implements new policies and proccdm·es to e11sm·c matching costs arc pl'Opcrly 

suppo1ted. 

OJP agrees with this recommendation. We will coordinate with RST to obtain a copy of 

written policies and procedures, developed and implemented, to ensure that all matching 

requirements are met, properly recorded in its grant accounting records, and adequately 

supported. 

10. We reconm1end that OJP coordinate with RST to ensure that it submit.s accurate 

FFRs. 

OJP agrees with this recommendation. We will coordinate with RST to obtain a copy of 

written policies and procedures, developed and implemented, to ensure that Federal 

Financial Reports are accurate and properly supported, and the supporting documentation 

is maintained for future auditing purposes. 

We appreciate the opportunity to review and comment on the draft audit report. If you have any 

questions or require additional information, please contact Jeffery A. Haley, Deputy Director, 

Audit and Review Division, on (202) 616-2936. 

cc: Katharine T. Sullivan 

Principal Deputy Assistant Attorney General 

Maureen A. Henneberg 

Deputy Assistant Attorney General 

for Operations and Management 

Le Toya A. Johnson 

Senior Advisor 

Office of the Assistant Attorney General 

3 

32 
Jeffery A. Haley 

Deputy Director, Audit and Review Division 

Office of Audit, Assessment, and Management 

Bill Woolf 

Senior Advisor 

Office for Victims of Crime 

Katherine Darke-Schmitt 

Deputy Director 

Office for Victims of Crime 

Kathrin a S. Peterson 

Acting Deputy Director 

Office for Victims of Crime 

James Simonson 

Associate Director for Operations 

Office for Victims of Crime 

Kristin Weschler 

Grants Mimagement Specialist 

Office for Victims of Crime 

Charlotte Grzebien 

Deputy General Counsel 

Phillip K. Merkle 

Acting Director 

Office of Communications 

Leigh A. Benda 

Chief Financial Officer 

Christal McNeil-\:\lright 

Associate Chief Financial Officer 

Grants Financial Management Division 

Office ofthe Chief Financial Officer 

Joanne M. Suttington 

Associate Chief Financial Officer 

Finance, Accounting, and Analysis Division 

Office ofthe Chief Financial Officer 

4 

33 
Aida Bmmme 

Manager, Evaluation and Oversight Branch 

GranL~ Financial Management Division 

Office ofthe Chief Financial Officer 

Louise Duhamel 

Acting Assistant Director, Audit Liaison Group 

Internal Review and Evaluation Office 

Justice Management Division 

OJP Executive Secretariat 

Control Number IT20200302II4830 

5 

34 
 

 

 

 

 

 

 

 

 

 

APPENDIX 5 

OFFICE OF THE INSPECTOR GENERAL ANALYSIS AND 

SUMMARY OF THE ACTIONS NECESSARY TO CLOSE THE REPORT 

The OIG provided a draft of this audit report to Refugee Services of Texas, 

Inc. (RST) and the Office of Justice Programs (OJP) for review and official comment. 

RST’s response is incorporated in Appendix 3 and OJP’s response is incorporated in 

Appendix 4 of this final report. In response to our draft audit report, OJP concurred 

with our recommendations, and as a result, the status of the audit report is 

resolved. The following provides the OIG analysis of the response and summary of 

actions necessary to close the report. 

Recommendations for OJP: 

1. Coordinate with RST to ensure that progress reports are accurate and 

fully supported. 

Resolved. OJP agreed with our recommendation and stated in its response 

that it will coordinate with RST to obtain a copy of written policies and 

procedures, developed and implemented, to ensure that semi-annual 

progress reports are accurate; and are fully supported by source 

documentation that is maintained for future auditing purposes. 

RST did not agree or disagree with our recommendation. In its response, 

RST stated that it is in the process of implementing changes to ensure 

progress reports are accurate and supported moving forward. Specifically, 

RST stated that it is making software changes to its Refugee Management 

System (RMS) that will require case managers to enter performance data at 

the same time they enter case notes. Additionally, RST stated that during its 

internal annual monitoring, its Programs Department will review TIMS reports 

for individual cases, training, and outreach against case files and local 

documentation. 

This recommendation can be closed when we receive documentation showing 

that RST has written policies and procedures, developed and implemented, to 

ensure that semi-annual progress reports are accurate; and are fully 

supported by source documentation that is maintained for future auditing 

purposes. 

2. Coordinate with RST to develop policies and procedures to ensure it 

adheres to all special conditions of the awards. 

Resolved. OJP agreed with our recommendation and stated in its response 

that it will coordinate with RST to obtain a copy of written policies and 

procedures, developed and implemented, to ensure compliance with all 

award special conditions. 

35 
 

 

 

 

 

 

 

RST did not agree or disagree with our recommendation. In its response, 

RST included detailed actions that it will take to identify and address award 

special conditions. RST also stated that it is currently assessing its ability to 

hire an internal monitor to assist RST in researching best practices and 

drafting new protocols and procedures to ensure it is in compliance with the 

Code of Federal Regulations and its federal grants. 

This recommendation can be closed when we receive documentation showing 

that RST has written policies and procedures, developed and implemented, to 

ensure compliance with all award special conditions. 

3. Coordinate with RST to develop and implement new policies and 

procedures that include specific language regarding matching costs, 

contract award and management, subrecipient award and 

management, and performance measurement and outcome 

assessment. 

Resolved. OJP agreed with our recommendation and stated in its response 

that it will coordinate with RST to obtain a copy of written policies and 

procedures, developed and implemented, to ensure that they include specific 

language regarding matching costs, contract award and management, 

subrecipient award and management, and performance measurement and 

outcome assessment. 

RST did not agree or disagree with our recommendation. In its response, 

RST included detailed information about its current practices related to 

matching costs, subrecipient award and management; and performance 

measurement and outcome assessment. RST also stated that it will have a 

draft contract award and management protocol by mid-April 2020. 

This recommendation can be closed when we receive documentation showing 

that RST has written policies and procedures, developed and implemented, to 

ensure that they include specific language regarding matching costs, contract 

award and management, subrecipient award and management, and 

performance measurement and outcome assessment. 

4. Remedy the $24,969 in unallowable questioned costs related to the 

$10,702 in unallowable personnel costs, $9,689 in unallowable 

contractor and consultant costs, and $4,578 in unallowable other 

direct costs. 

Resolved. OJP agreed with our recommendation and stated in its response 

that it will review the $24,969 in questioned costs, charged to Cooperative 

Agreement Numbers 2016-VT-BX-K062, 2017-VT-BX-K026, and 

2018-VT-BX-K034, and will work with RST to remedy, as appropriate. 

RST partially agreed with our recommendation. RST did not concur with 

$10,669 of the $10,702 in unallowable personnel costs. In its response, RST 

stated that it feels the positions in question are a necessity and mission 

36 
 

 

 

 

 

 

 

 

 

 

critical; as a result, RST stated that it will submit a budget adjustment to 

resolve this finding. Although RST stated that it did not concur with our 

recommendation related to unallowable personnel costs, we noted that RST’s 

response and proposed remedy indicate agreement with our finding and 

recommendation. 

RST also did not concur with the $9,689 in unallowable contractor and 

consultant costs. In its response, RST stated that many of the questioned 

items were contracts that were entered into prior to the award period. RST’s 

assertion that many of the contracts in question were entered into prior to 

the award period does not address the fact that these costs were not 

included in the approved budget. RST concurred with the unallowable costs 

related to media expenditures charged to the awards but indicated that 

some of the questioned costs for required federal audits and to address 

safety concerns were necessary program expenditures. However, as stated 

in the Contractor Costs section of this report, these costs were not included 

in the approved budget; as a result, the costs are not allowable. 

Additionally, the questioned costs that RST indicated were necessary to 

address safety concerns were unallowable other direct costs for which RST 

concurred with our finding and recommendation, as noted below. 

RST concurred with the $4,578 in unallowable other direct questioned costs 

and stated that it will educate staff on items that cannot be charged to the 

awards, and credit the open award back for all unallowable costs. 

This recommendation can be closed when we receive documentation that OJP 

has remedied the $24,969 in unallowable questioned costs related to the 

$10,702 in unallowable personnel costs, $9,689 in unallowable contractor 

and consultant costs, and $4,578 in unallowable other direct costs. 

5. Remedy the $26,392 in unsupported questioned costs related to the 

$7,285 in unsupported personnel costs, $10,855 in unsupported 

contractor and consultant costs, and $8,252 in unsupported other 

direct costs. 

Resolved. OJP agreed with our recommendation and stated in its response 

that it will review the $26,392 in unsupported questioned costs, charged to 

Cooperative Agreement Numbers 2014-VT-BX-K024, 2016-VT-BX-K062, and 

2017-VT-BX-K026, and will work with RST to remedy, as appropriate. 

RST concurred with our recommendation. In its response, RST that it will 

credit the current awards back for all unsupported costs. RST also stated 

that it has implemented an allocation policy that is currently being used and 

will continue to work on process improvements. 

This recommendation can be closed when we receive documentation that OJP 

has remedied the $26,392 in unsupported questioned costs related to the 

$7,285 in unsupported personnel costs, $10,855 in unsupported contractor 

and consultant costs, and $8,252 in unsupported other direct costs. 

37 
 

 

 

 

 

 

 

 

 

6. Coordinate with RST to ensure that it maintains adequate 

documentation to support contractor costs charged to the awards, 

including current contract agreements for all contractors and 

consultants and detailed invoices, as well as ensuring that 

contractors and consultants are only paid for services rendered. 

Resolved. OJP agreed with our recommendation and stated in its response 

that it will coordinate with RST to obtain a copy of written policies and 

procedures, developed and implemented, to ensure that adequate 

documentation is maintained to support contractor costs charged to the 

awards, including current contract agreements for all contractors and 

consultants, and detailed invoices, as well as ensuring that contractors and 

consultants are only paid for services rendered. 

RST did not agree or disagree with our recommendation. However, in its 

response, RST stated that it will work to educate staff on proper contractor 

agreements, including educating operation teams for what is necessary on a 

contract. RST also stated that it will implement a contractor approval 

process that requires the sign off of finance, programs, and operations. 

This recommendation can be closed when we receive documentation showing 

that RST has written policies and procedures, developed and implemented, to 

ensure that adequate documentation is maintained to support contractor 

costs charged to the awards, including current contract agreements for all 

contractors and consultants, and detailed invoices, as well as ensuring that 

contractors and consultants are only paid for services rendered. 

7. Coordinate with RST to ensure it adequately monitors its award 

subrecipients. 

Resolved. OJP agreed with our recommendation and stated in its response 

that it will coordinate with RST to obtain a copy of written policies and 

procedures, developed and implemented, to ensure adequate oversight and 

monitoring of its award subrecipients. 

RST did not agree or disagree with our recommendation. In its response, 

RST included detailed information about its subrecipient monitoring 

procedures. However, as stated in the Subrecipient Costs section of this 

report, although RST has had a formal subrecipient monitoring policy since 

2017, RST has not conducted any site visits during the period covered by our 

audit. As a result, we are not confident that RST will follow through with its 

plans to conduct monitoring visits in 2020. 

This recommendation can be closed when we receive documentation showing 

that RST has written policies and procedures, developed and implemented, to 

ensure adequate oversight and monitoring of its award subrecipients. 

38 
 

 

 

 

 

 

 

 

 

 

 

 

 

8. Remedy the remaining $248,973 of the $256,975 in unsupported 

matching costs. 

Resolved. OJP agreed with our recommendation and stated in its response 

that it will review the $256,975 in questioned costs, related to unsupported 

matching costs, charged to Cooperative Agreement Numbers 2014-VT-BX-K024, 

2016-VT-BX-K062, and 2017-VT-BX-K026, and will work with RST to 

remedy, as appropriate. 

RST did not concur with our recommendation. In its response, RST stated 

that it has reviewed the documentation from the OIG auditor that identified 

$256,975 in unsupported matching costs and it is disputing $109,022 in 

matching costs that were flagged as unsupported. We disagree with RST 

assertion that $109,022 of the previously questioned $256,975 in matching 

costs is supported. As stated in the Matching Costs section of this report, 

RST did not track matching transactions in its accounting records for the 

awards or on an electronic spreadsheet. As a result, we had to use RST’s 

donation log forms to create an electronic spreadsheet in order to determine 

the total matching costs for each award. After which, we reviewed the 

donation log forms to determine if the costs were in accordance with 

matching requirements, properly supported, computed correctly, authorized, 

and accurately reported. Based on our analysis, we determined that 

$256,975 in matching cost were unsupported. Specifically, we found that the 

donation logs only listed the number of volunteer hours and mileage claimed 

but did not include any details related to volunteer services provided, despite 

the fact that RST’s donation logs include a section to describe the services 

provided or items donated and the number of hours or items donated. We 

found that this section of the donation logs was not completed for donated 

services even though the form specifically instructs the section be completed 

for all donations. As a result, as stated in the Matching Costs section of the 

report, we could not verify if the volunteer time was for project-related 

services. This is further complicated by the fact that in addition to its Human 

Trafficking Program, RST has several other programs for which it receives 

funding from other sources, as well as donated services and items. In 

response to the draft report, RST did not provide any additional 

documentation to support the disputed matching costs that we questioned as 

unsupported. Instead, RST provided comments on the electronic 

spreadsheet we created from its donation logs that included a general 

description of the types of services provided by its volunteers, which we do 

not consider supporting documentation. Therefore, we disagree with RST’s 

assertion that the $109,022 in matching costs it disputed is adequately 

supported. 

RST also stated in its response that it is submitting additional comprehensive 

matching cost documentation that was documented during the award periods 

but was not reviewed by the auditor. However, we made numerous attempts 

to ensure that RST provided us with all supporting documentation related to 

its matching costs for the awards and we received verbal confirmation from 

an RST official that we were provided all available matching cost 

39 
 

 

 

 

 

 

 

 

 

 

 

 

 

 

documentation. Despite these assurances, along with its response to the 

draft report, RST provided over 200 pages of additional matching cost 

documentation that was not previously provided. 

We reviewed the additional new matching cost documentation and 

determined that only $8,002 of additional matching costs were fully 

supported. For Award Number 2014-VT-BX-K024, we found that none of the 

additional $43,295 in matching costs claimed were supported. The additional 

matching costs were based largely on a typed list of donations prepared by 

RST in response to the draft report, for which no documentation was 

provided to support the donated items and cash that RST listed. We also 

found that RST did not provide sufficient supporting documentation for 

volunteer and unpaid intern services that it claimed as additional matching 

costs for the award. For example, the donation logs or other documentation 

did not include a description of the services provided or were missing specific 

details such as the date, number of hours, and a detailed description of 

services provided by unpaid interns. For Award Number 2016-VT-BX-K062, 

we found that only $8,002 of the additional $104,289 in matching costs 

claimed was fully supported. For the remaining additional matching costs 

claimed, RST did not provide any documentation or sufficient documentation, 

as described previously, to support the additional matching costs claimed. 

We also identified concerns related to specific items that RST claimed as 

additional matching costs. 

• The additional documentation provided by RST included monetary 

donations totaling $16,367 that it considers matching costs for the 

awards. However, in addition to the fact that RST did not provide any 

documentation to support that it received the monetary donations 

listed, RST’s comments stated that the donations were to support the 

Survivors of Trafficking Empowerment Program, as well as unrestricted 

RST administration. Finally, and most importantly, is the fact that 

even if RST provided documentation to support that it received the 

cash donations listed, the receipt of cash donations in and of itself is 

not a matching cost. RST would also need to provide documentation 

showing that the cash donations were used for allowable program 

costs. 

• RST also claimed matching costs totaling $17,181 in donated space to 

temporarily store donated items until they are distributed to its clients. 

However, the donation form provided did not include a donor name or 

signature. Additionally, RST claimed the full estimated monthly costs 

for the donated space even though the donated space was for the 

temporary storage of donated items. Finally, despite the fact that the 

donation logs for the donated space were incomplete, it appears that 

the donated space RST is claiming as matching costs is actually a 

portion of RST’s office space. If our assumption is correct, it is 

important to note that RST allocates its rental costs among its award 

programs as direct costs charged to the awards, meaning that they are 

40 
 

 

 

 

 

 

 

 

 

 

charging the allocated rental costs to the awards as both a direct cost 

expenditures and matching costs. 

Finally, despite the fact that RST stated in its response that it disputed 

$109,022 in matching costs that we identified as unsupported, RST also 

acknowledges in its response that it was unable to produce documentation 

demonstrating completion of the match requirement for Award Number 

2014-VT-BX-K024. RST’s response to Recommendation 9 also indicates that 

it is aware of the fact that its donation logs do not currently include sufficient 

information to fully support the matching costs it is claiming for the awards. 

Specifically, in its response to Recommendation 9, RST stated that additional 

detail and justification will be added to all donation logs moving forward, staff 

will receive training on how to properly complete the donation log forms, and 

its finance department will review all matching documentation to ensure its 

matching costs are allowable and supported. 

Overall, based on the additional matching cost documentation that RST 

provided in response to the draft report, we consider $8,002 of the $256,975 

in unsupported matching costs remedied. Therefore, we recommend that 

OJP Remedy the remaining $248,973 in unsupported matching costs. 

This recommendation can be closed when we receive documentation that OJP 

has remedied the remaining $248,973 in unsupported matching costs. 

9. Coordinate with RST to ensure it meets its matching requirements, 

tracks all matching transactions on its general ledgers, and 

implements new policies and procedures to ensure matching costs 

are properly supported. 

Resolved. OJP agreed with our recommendation and stated in its response 

that it will coordinate with RST to obtain a copy of written policies and 

procedures, developed and implemented, to ensure that all matching 

requirements are met, properly recorded in its grant accounting records, and 

adequately supported. 

RST did not agree or disagree with our recommendation. In its response, 

RST stated that it will share monthly match progress with the programs and 

finance departments on all OVC grants to ensure that, if at any point, a site 

is behind in reaching its expected matching contribution, senior leadership 

and the local site will create a strategic plan for meeting the required match. 

RST also stated that additional detail and justification will be added to all 

donation logs moving forward, including: the funder, type of match, value of 

the match, full justification for match, and donor and client signatures. 

Additionally, RST stated that staff training on how to properly complete the 

donation log form is scheduled for the first week of April and will be 

conducted by its programs department. Additionally, RST stated that in 

October 2019, its finance department began reviewing all match 

documentation to ensure its matching costs are allowable and supported. 

RST also stated that starting in fiscal year 2020, federal match requirements 

41 
 

 

 

were added to its general ledgers for the awards as an additional measure to 

track progress towards expected match outcomes. 

This recommendation can be closed when we receive documentation showing 

that RST is meeting its matching requirements, tracking all matching 

transactions on its general ledgers, and implemented new policies and 

procedures to ensure matching costs are properly supported. 

10. Coordinate with RST to ensure that it submits accurate FFRs. 

Resolved. OJP agreed with our recommendation and stated in its response 

that it will coordinate with RST to obtain a copy of written policies and 

procedures, developed and implemented, to ensure that Federal Financial 

Reports are accurate and properly supported, and the supporting 

documentation is maintained for future auditing purposes. 

RST did not agree or disagree with our recommendation. In its response, 

RST stated that it believes the FFRs were correct at the time of submission 

and the differences were due to later corrections in accounting records. We 

disagree with this statement. As stated in the Federal Financial Reports 

section of this report, the award expenditures for 8 of the 15 FFRs tested did 

not match RST’s accounting. Additionally, we noted that RST over reported 

matching costs on the final FFR for Award Number 2014-VT-BX-K024 by 

$108,163 and over reported matching costs on the final FFR for Award 

Number 2016-VT-BX-K062 by $42,998. In its response, RST also stated that 

it has improved it's month-end close process and controls on corrections to 

ensure corrections are not back-dated and take place in the current period to 

help remedy the discrepancies in its FFRs. 

This recommendation can be closed when we receive documentation showing 

that RST is submitting accurate FFRs. 

42 
 

 

 

-

The Department of Justice Office of the Inspector General (DOJ OIG) is a 

statutorily created independent entity whose mission is to detect and deter 

waste, fraud, abuse, and misconduct in the Department of Justice, and to

promote economy and efficiency in the Department’s operations.

To report allegations of waste, fraud, abuse, or misconduct regarding DOJ 

programs, employees, contractors, grants, or contracts please visit or call the

DOJ OIG Hotline at oig.justice.gov/hotline or (800) 869-4499.

U.S. DEPARTMENT OF JUSTICE OFFICE OF THE INSPECTOR GENERAL

950 Pennsylvania Avenue, NW

Washington, DC 20530 0001

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oig.justice.gov

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Also at Oversight.gov