jurisdiction: US

text: b" Office of Inspector General\n Corporation for National and\n Community Service\n\n\n\n\nAGREED-UPON PROCEDURES OF CORPORATION\n FOR NATIONAL AND COMMUNITY SERVICE\n GRANTS AWARDED TO POINTS OF LIGHT\n FOUNDATION\n\n OIG REPORT 10-19\n\n\n\n\n Prepared by:\n\n Mayer Hoffman McCann P.C.\n 3 Bethesda Metro Center, Suite 600\n Bethesda, MD 20814\n\n\n\n\n This report was issued to Corporation management on August 18, 2010. Under the\n laws and regulations governing audit follow-up, the Corporation is to make final\n management decisions on the report\xe2\x80\x99s findings and recommendations no later than\n February 14, 2011 and complete its corrective actions by August 17, 2011.\n Consequently, the reported findings do not necessarily represent the final resolution\n of the issues presented.\n\x0c NATlONAL&\n COMMUNITY\n SERVICE ru:t\n OFFICE OF INSPECTOR GENERAL\n\n\n August 18. 2010\n\n\nTO: John Gomperts\n Director, AmeriCorps\xc2\xb7State and National\n\n Margaret Rosenberry\n Director, Office of Grf~5 Ma~agement\n\nFROM : Stuart Axenfeld ~ A~\n Assistant Inspector Genera l for Audit\n\nSUBJECT: OIG Report 10-19, Agreed-Upon Procedures of Corporation for National\n and Community Service Grants Awarded to Points of Light Foundation (POL)\n\n\nAttached is the final report for the above-noted agreed-upon procedures . We contracted with\nthe independent certified public accounting firm of Mayer Hoffma n McCann (M HM) to perfonn\nthe procedures. The contract required MHM to conduct its review in accordance with generally\naccepted govemment auditing standards. .\n\nIn connection with the contract, we reviewed MHM 's report and relate_d documentation and\ninquired of its representative. Our review, as differentiated from an aud it was not intended to\nenable us to express , and we do not express opinions on POL's claimed costs or compliance\nwith grant terms. MHM is responsible for the attached auditor's report dated August 17, 2010,\nand the conclusions expressed therein. However, our review disclosed no instances where\nMHM did not comply, in all material respects, with generally accepted govemment auditing\nstandards.\n\nUnder the Corporation's audit resolution policy, a final management decision on the findings in\nthis report is due by February 14, 2011 . Notice of final action is due by August 17, 2011.\n\n\n\n\n 1201 New York Avenue, NW * Suite 830 *: Washington, DC 20525\n 202-606-9390 *\n Hotline: 800-452-8210 *www.cncsoig.gov\n\n Senior Corps * AmeriCorps * Learn and Serve America\n\x0cIf you have questions pertaining to this report, please call me at (202) 606-9360, or Rick\nSamson, Aud it Manager, at (202) 606-9380.\n\nAttachment\n\n cc: Bernard Milano, POL, Audit Committee Chairman\n Michelle Nunn, POL CEO\n Kris Tecce POL, CFO\n William Anderson, Chief Financial Officer\n Rocco Gaudio, Deputy Chief Financial Officer, Grants & Field Financial\n Management\n Malcolm Coles, Atlantic Area Manager\n Anthony DeColli, Senior Grants Management Specialist\n Claire Moreno, Audit Liaison, Office of Grants Management\n Bridgette Roy, Administrative Assistant\n Greg Allender, Mayer Hoffman McCann P.C., Shareholder\n\x0c AGREED-UPON PROCEDURES REVIEW OF CORPORATION FOR NATIONAL AND COMMUNITY\n SERVICE GRANTS AWARDED TO THE POINTS OF LIGHT FOUNDATION\n\n Table of Contents\n\n Page\n\nExecutive Summary 1\n\nIndependent Accountants\xe2\x80\x99 Report on Applying Agreed-Upon Procedures 5\n\n Results \xe2\x80\x93 Costs Claimed and Questioned Costs 6\n\n Consolidated Schedule of Awards and Claimed Costs 6\n\n Notes to Consolidated Schedule of Awards and Claimed Costs 7\n\n Exhibit A: Schedule of Awards and Claimed Costs 8\n\n Schedule A-1 \xe2\x80\x93 Schedule of Awards and Claimed Costs, Points of Light 10\n Foundation\n\n Schedule A-2 \xe2\x80\x93 Schedule of Award and Claimed Costs, Hands on Miami 14\n\n\n Schedule A-3 \xe2\x80\x93 Schedule of Award and Claimed Costs, Pass It Along 15\n\n Results \xe2\x80\x93 Compliance and Internal Control 16\n\nExhibit B \xe2\x80\x93 Consolidated Schedule of Recommendations and Questioned 37\n Costs\n\nAppendix A \xe2\x80\x93 Points of Light Foundation\xe2\x80\x99s Response to Draft Report\n\nAppendix B \xe2\x80\x93 Corporation for National and Community Service\xe2\x80\x99s Response to\n Draft Report\n\x0c EXECUTIVE SUMMARY\n\n\nThe Office of Inspector General (OIG), Corporation for National and Community Service\n(Corporation), contracted with Mayer Hoffman McCann P.C. (MHM) to perform agreed-upon\nprocedures on grant costs and compliance for Corporation-funded Federal assistance\nprovided to the Points of Light Foundation (POL).\n\nResults\n\nAs a result of applying these procedures, the auditors questioned claimed Federal-share\ncosts of $46,295 and grantee share of $454. A questioned cost is an alleged violation of\nprovision of law, regulation, contract, grant, cooperative agreement, or other agreement or\ndocument governing the expenditure of funds; or a finding that, at the time of testing, such\ncost is not supported by adequate documentation. The cost results of our agreed-upon\nprocedures are summarized in the Consolidated Schedule of Awards and Claimed Costs.\n\nPOL claimed total Federal and match costs of $32,191,136 from December 1, 2005, through\nMarch 31, 2009. As a result of testing a judgmentally selected sample of transactions and\nother testing, we questioned the following costs.\n\n\n Description of Federal Grantee Education\n Questioned Costs Share Share Awards\n Inaccurate\n Accounting Records $8,325\n\n Costs Claimed Not\n Included in Budget 748\n\n Costs Incurred\n Prior to Grant Period 377\n\n Unallowable Costs 22,077\n\n Unsupported Costs 12,163\n\n Costs not in compliance\n with POL Policies 27\n\n Time and Attendance:\n Unsigned Timesheets 2,578 $454 $5,725\n\n Inadequate Citizenship\n Documentation 4,725\n Total $46,295 $454 $10,450\n\nAmeriCorps members who successfully complete their terms of service are eligible for\neducation awards and accrued interest awards funded by the Corporation\xe2\x80\x99s National Service\n\n 1\n\x0cTrust. These award amounts are not funded by Corporation grants and thus are not costs\nclaimed by POL. As part of our agreed-upon procedures, however, the auditors determined\nthe effect of audit findings on eligibility for education and accrued interest awards. Using the\nsame criteria described above, we questioned education awards of $10,450 due to non-\ncompliance with program requirements.\n\nDetails related to these questioned costs and awards appear on page 5 in the Independent\nAccountants\xe2\x80\x99 Report on Applying Agreed-Upon Procedures.\n\nThe results of our agreed-upon procedures revealed instances of non-compliance with grant\nprovisions, regulations, or Office of Management and Budget (OMB) requirements, as\nshown on page 16 in the Compliance and Internal Control section. Issues identified\nincluded:\n\n \xef\x82\xa7 POL\xe2\x80\x99s accounting system is not adequate to account for Federal funds;\n\n \xef\x82\xa7 Affiliate monitoring visits were not performed in accordance with POL policies;\n\n \xef\x82\xa7 Indirect rates were not approved;\n\n \xef\x82\xa7 Costs claimed were not included in original or amended grant budgets, incurred prior\n to the grant period, unallowable, unsupported, or paid in violation of POL policies;\n\n \xef\x82\xa7 Late submission of Financial Status Reports (FSRs), member enrollment forms, and\n exit forms;\n\n \xef\x82\xa7 Missing mid-term and end-of-term member evaluation forms;\n\n \xef\x82\xa7 Members\xe2\x80\x99 contracts signed after beginning of service and timesheets not signed; and\n\n \xef\x82\xa7 Inadequate evidence of members\xe2\x80\x99 citizenship/legal residency.\n\n\nAgreed-Upon-Procedures Scope\n\nThe auditors performed the agreed-upon procedures during the period October 12, 2009,\nthrough April 9, 2010. The agreed-upon procedures tested the allowability, allocability, and\nreasonableness of financial transactions claimed by POL from December 1, 2005, through\nMarch 31, 2009. A sample size of 495 costs transactions and 119 member files were\nselected for testing. The auditors also performed tests to determine POL\xe2\x80\x99s compliance with\nterms and provisions of the following grants:\n\n Program Award Number Award Period Testing Period\n AmeriCorps National 06NDHGA002 9/1/06 \xe2\x80\x93 8/31/09 9/1/06 \xe2\x80\x93 9/30/07\n AmeriCorps National 07NDHGA001 9/1/06 \xe2\x80\x93 8/31/09 9/1/06 \xe2\x80\x93 3/31/09\n Disability Outreach 05DSHDC001 10/1/05 \xe2\x80\x93 9/30/08 4/1/07 - 9/30/08\n Training and Technical\n Assistance 05TAHDC003 10/1/05 \xe2\x80\x93 12/31/08 4/1/07 - 9/30/08\n Training and Technical\n Assistance 05TAHGA001 10/1/05 \xe2\x80\x93 9/30/08 10/1/06 - 9/30/08\n\n 2\n\x0c Program Award Number Award Period Testing Period\n Training and Technical\n Assistance 07TAHGA001 10/1/05 \xe2\x80\x93 12/31/09 10/1/08 - 3/31/09\n Training and Technical\n Assistance 07TAHPA001 1/1/07 \xe2\x80\x93 9/30/08 7/1/07 \xe2\x80\x93 9/30/08\n Martin Luther King Day 06MKADC004 12/1/05 \xe2\x80\x93 11/30/08 12/1/05 - 6/30/08\n Martin Luther King Day 06MKSGA001 12/1/05 \xe2\x80\x93 11/30/08 10/1/06 \xe2\x80\x93 6/30/07\n Martin Luther King Day 08MKHGA001 10/1/05 \xe2\x80\x93 6/30/08 10/1/07 \xe2\x80\x93 6/30/08\n Martin Luther King Day 09MKHDC002 9/1/08 \xe2\x80\x93 8/31/11 9/1/08- 3/31/09\n VISTA State 07VSSGA009 8/3/08 \xe2\x80\x93 8/31/09 8/3/08 - 2/3/09\n VISTA State 08VSNMI002 12/9/07 \xe2\x80\x93 2/28/09 12/9/07 - 12/6/08\n Subtitle H Partnership\n Program 08ERSGA001 4/1/08 \xe2\x80\x93 9-30-10 4/1/08 \xe2\x80\x93 3/31/09\n Points of Light 08PLHDC001 10/1/07 \xe2\x80\x93 9/30/08 10/1/07 \xe2\x80\x93 9/30/08\n\nThe procedures performed, based on the OIG\xe2\x80\x99s agreed-upon-procedures program dated\nMay 2009, have been included in the Independent Accountants\xe2\x80\x99 Report on Applying Agreed-\nUpon Procedures section of this report.\n\n\nBackground\n\nThe Corporation, pursuant to the authority of the National Community Service Trust Act of\n1993, as amended, awards grants and cooperative agreements to National Direct grantees,\nsuch as POL, and other entities to assist in the creation of full-time and part-time national\nand community service programs.\n\nPOL was created in 1990 as a nonprofit organization in Washington, DC, to help promote\nthe spirit of volunteerism expounded by President George H.W. Bush. Effective August 1,\n2007, POL merged with the Atlanta, GA-based Hands on Network, a national volunteer\norganization. Today, the merged organization employs approximately 80 individuals.\n\nPOL awarded funds to 18, 22 and 20 subgrantees or affiliates, during program years\n2006/07, 2007/08 and 2008/09, respectively. The affiliates are independent organizations\nthroughout the country. Funds awarded to the affiliates are allocated in the form of\ncontracts, not as formal subgrants. These contracts require POL to reimburse each affiliate\n85 percent (15 percent is affiliate match) of the following costs incurred during the specific\nprogram year: 1) minimum member stipend allowed, 2) related FICA, and 3) any health\ninsurance costs. In order to be reimbursed, the affiliates are required to submit invoices\ndetailing all charges and the corresponding support for each charge (i.e., payroll register,\ntimesheets, etc.). Each affiliate has a unique accounting code within POL\xe2\x80\x99s general ledger\nand the payments made to each are recorded within those accounts. This allows POL to\ntrack payments to its affiliates. POL utilized up to 23 different affiliates to carry out its\nAmeriCorps National grant during the testing period September 1, 2006, through March 31,\n2009.\n\nAll affiliates maintain their own supporting documentation for claimed costs and member\nfiles. Additionally, original member files and supporting documentation for affiliate expenses\nare maintained at the POL location.\n\n\n 3\n\x0cPOL received grant awards of $15,636,675 and claimed Federal costs of $10,560,525 for\nthe testing period of December 1, 2005, through March 31, 2009.\n\n\nExit Conference\n\nThe contents of this report were discussed with representatives from POL and the\nCorporation at an exit conference held in Atlanta, Georgia on April 29, 2010. In addition, a\ndraft of this report was provided to officials of POL and the Corporation for their comments\non May 26, 2010.\n\nRepresentatives of POL and the Corporation agreed with most of the findings. The POL\nand Corporation responses to the draft are included verbatim as Appendices A and B,\nrespectively, and are summarized in each finding.\n\n\n\n\n 4\n\x0c 3 Bethesda Metro Center, Suite 600\n Bethesda, MD 20814-6332\n 301-951-3636\n 301-951-0425\n www.mhm-pc.com\n\nInspector General\nCorporation for National and Community Service\n\n\n INDEPENDENT ACCOUNTANTS\xe2\x80\x99 REPORT ON\n APPLYING AGREED-UPON PROCEDURES\n\nWe have performed the procedures described below for costs claimed from December 1, 2005,\nthrough March 31, 2009. The procedures were agreed to by the OIG solely to assist it in grant-\ncost and compliance testing of Corporation-funded Federal assistance provided to POL for the\nawards and periods listed below. This agreed-upon procedures engagement was performed in\naccordance with standards established by the American Institute of Certified Public Accountants\nand generally accepted government auditing standards in the United States of America. The\nsufficiency of these procedures is solely the responsibility of the OIG. Consequently, we make\nno representation regarding the sufficiency of the procedures described below, either for the\npurpose for which this report has been requested or any other purpose.\n\n\n Program Award Number Award Period Testing Period\n AmeriCorps National 06NDHGA002 9/1/06 \xe2\x80\x93 8/31/09 9/1/06 \xe2\x80\x93 9/30/07\n AmeriCorps National 07NDHGA001 9/1/06 \xe2\x80\x93 8/31/09 9/1/06 \xe2\x80\x93 3/31/09\n Disability Outreach 05DSHDC001 10/1/05 \xe2\x80\x93 9/30/08 4/1/07 - 9/30/08\n Training and Technical\n Assistance 05TAHDC003 10/1/05 \xe2\x80\x93 12/31/08 4/1/07 - 9/30/08\n Training and Technical\n Assistance 05TAHGA001 10/1/05 \xe2\x80\x93 9/30/08 10/1/06 - 9/30/08\n Training and Technical\n Assistance 07TAHGA001 10/1/05 \xe2\x80\x93 12/31/09 10/1/08 - 3/31/09\n Training and Technical\n Assistance 07TAHPA001 1/1/07 \xe2\x80\x93 9/30/08 7/1/07 \xe2\x80\x93 9/30/08\n Martin Luther King Day 06MKADC004 12/1/05 \xe2\x80\x93 11/30/08 12/1/05 - 6/30/08\n Martin Luther King Day 06MKSGA001 12/1/05 \xe2\x80\x93 11/30/08 10/1/06 \xe2\x80\x93 6/30/07\n Martin Luther King Day 08MKHGA001 10/1/05 \xe2\x80\x93 6/30/08 10/1/07 \xe2\x80\x93 6/30/08\n Martin Luther King Day 09MKHDC002 9/1/08 \xe2\x80\x93 8/31/11 9/1/08- 3/31/09\n VISTA State 07VSSGA009 8/3/08 \xe2\x80\x93 8/31/09 8/3/08 - 2/3/09\n VISTA State 08VSNMI002 12/9/07 \xe2\x80\x93 2/28/09 12/9/07 - 12/6/08\n Subtitle H Partnership\n Program 08ERSGA001 4/1/08 \xe2\x80\x93 9-30/10 4/1/08 \xe2\x80\x93 3/31/09\n Points of Light 08PLHDC001 10/1/07 \xe2\x80\x93 9/30/08 10/1/07 \xe2\x80\x93 9/30/08\n\nWe were not engaged to, and did not perform an examination, the objective of which would be\nthe expression of an opinion on management\xe2\x80\x99s assertions. Accordingly, we do not express\n\n 5\n\x0csuch an opinion. Had we performed other procedures, other matters might have come to our\nattention that would have been reported to you.\n\nThe procedures that we performed included obtaining an understanding of POL and its affiliate\nsite monitoring process; reconciling Federal share and match costs claimed to the accounting\nsystem; reviewing member files to verify that the records supported member eligibility to serve\nand allowability of living allowances and education awards; testing compliance with selected\ngrant provisions and award terms and conditions; and testing claimed grant costs and match\ncosts of POL to ensure: (i) proper recording of grant costs; (ii) that the required match was met;\nand (iii) costs were allowable and supported in accordance with applicable regulations, OMB\ncirculars, grant provisions, and award terms and conditions. Grant drawdowns were compared\nfor consistency to the Federal share reported on POL\xe2\x80\x99s Financial Status Reports.\n\n Results \xe2\x80\x93 Costs Claimed and Questioned Costs\n\nThe results of testing costs claimed are summarized below; affiliate testing results appear in\nExhibit A on page 8.\n\n\n Consolidated Schedule of Awards and Claimed Costs\n Corporation for National and Community Service Award\n Points of Light Foundation\n\n December 5, 2005 to March 31, 2009\n Costs\n Claimed During Questioned\n Award Number Program Awarded Testing Period Costs\n 05DSHDC001 Disability Outreach $1,300,000 $709,628 -\n Training and Technical\n 05TAHDC003 Assistance 396,048 103,437 -\n Training and Technical\n 05TAHGA001 Assistance 565,267 553,798 -\n 06MKADC004 Martin Luther King 265,950 264,050 -\n Training and Technical\n 07TAHPA001 Assistance 763,089 743,986 -\n Training and Technical\n 07TAHGA001 Assistance 351,684 50,783 -\n 06MKSGA001 Martin Luther King Day 208,999 110,499 $748\n 08MKHGA001 Martin Luther King Day 98,500 98,500 -\n 06NDHGA002 AmeriCorps National Direct 1,405,411 1,405,411 22\n\n 07NDHGA001 AmeriCorps National Direct 2,268,367 1,377,970 3,059\n 07VSSGA009 VISTA State 112,500 18,499 -\n 08VSNMI002 VISTA State 75,000 71,264 405\n Subtitle H Partnership\n 08ERSGA001 Program 5,200,860 2,427,700 574\n 09MKHDC002 Martin Luther King 150,000 150,000 -\n 08PLHDC001 Points of Light 2,475,000 2,475,000 41,941\n Totals $15,636,675 $10,560,525 $ 46,749\n\n\n 6\n\x0c Notes to Consolidated Schedule of Awards and Claimed Costs\n\nBasis of Accounting\n\nThe accompanying schedules have been prepared to comply with provisions of the grant\nagreements between the Corporation and POL. The information presented in the schedules\nhas been prepared from reports submitted by POL to the Corporation and accounting records of\nPOL and its affiliates. The basis of accounting used in the preparation of these reports differs\nfrom accounting principles generally accepted in the United States of America as discussed\nbelow.\n\nEquipment\n\nNo equipment was purchased and claimed under Federal or grantee match costs for the period\nwithin our scope.\n\nInventory\n\nMinor materials and supplies were charged to expenses during the period of purchase.\n\n\n\n\n 7\n\x0c EXHIBIT A\n\n Schedule of Awards and Claimed Costs\n Points of Light Foundation\n December 1, 2005 to March 31, 2009\n\n\n\n Questioned\n Claimed Questioned Education\n Awards Costs Costs Awards Reference\n\n06NDHGA002 \xe2\x80\x93 National Direct\n\nPOL \xe2\x80\x93 Grantee (Federal Share\nonly)* $665,446 $22 - Schedule A-1\n Subgrantees\nBoston Cares 9,819 - -\nChicago Cares 30,088 - -\nHands On Atlanta 180,820 - -\nHands on Bay Area* 69,702 - -\nHands On Birmingham 7,924 - -\nHands On Charlotte 10,311 - -\nHands On Greater Portland 29,876 - -\nHands On Greenville 12,857 - -\nHands On Miami* 63,093 - -\nHands On Nashville 33,767 - -\nMake A Difference* 117,128 - -\nMetro Volunteers* 37,324 - -\nNew York Cares 29,328 - -\nPass It Along* 34,115 - $1,000 Schedule A-3\nPittsburgh Cares 17,980 - -\nVolunteer Baton Rouge 9,974 - -\nHands On Sacramento 11,614 - -\nHands On Twin Cities 34,245 - -\n Sub-total $1,405,411 $22 $1,000\n\n07NDHGA001 \xe2\x80\x93 National Direct\n\nPOL \xe2\x80\x93 Grantee (Federal Share $242,089 $1,618 $4,725 Schedule A-1\nonly)*\n Subgrantees\nBoston Cares 15,122 - -\nChicago Cares 50,055 - -\nHands On Atlanta 119,614 - -\nHands on Bay Area* 37,531 - -\nHands On Charlotte 22,849 - -\nHands On Greater Portland 58,313 - -\nHands On Greenville 26,506 - -\n Awards Claimed Questioned Questioned Reference\n\n 8\n\x0c Costs Costs Education\n Awards\nHands On Miami* 116,138 1,441 - Schedule A-2\nHands On Nashville 69,077 - -\nMake A Difference* 160,320 - -\nMetro Volunteers* 67,064 - -\nNew York Cares 50,201 - -\nPass It Along* 77,640 - -\nPittsburgh Cares 30,501 - -\nVolunteer Baton Rouge 10,458 - -\nHands On Sacramento 538 - -\nHands On Twin Cities 55,485 - -\nHands on Hartford 42,445 - -\nJersey Cares \xe2\x80\x93 Newark 51,121 - -\nVol Center North Texas 20,095 - -\nVol Center Orange County 20,781 - -\nVolunteer San Diego 34,027 - -\n Sub-total $1,377,970 $3,059 $4,725\n\n05DSHDC001 $709,628 - - Schedule A-1\n05TAHDC003 103,437 - - Schedule A-1\n05TAHGA001 553,798 - - Schedule A-1\n07TAHGA001 50,783 - - Schedule A-1\n07TAHPA001 743,986 - - Schedule A-1\n06MKADC004 264,050 - - Schedule A-1\n06MKSGA001 110,499 748 - Schedule A-1\n08MKHGA001 98,500 - - Schedule A-1\n09MKHDC002 150,000 - - Schedule A-1\n07VSSGA009 18,499 - 4,725 Schedule A-1\n08VSNMI002 71,264 405 - Schedule A-1\n08ERSGA001 2,427,700 574 - Schedule A-1\n08PLHDC001 2,475,000 41,941 - Schedule A-1\n Total $10,560,525 $ 46,749 $10,450\n\n *Selected for Application of Agreed-Upon Procedures\n\n\n\n\n 9\n\x0c Schedule A-1\n\n Schedule of Awards and Claimed Costs\n Points of Light Foundation\n\n\n Reference\n Grant No 05DSHDC001\nAwarded $1,300,000 Note 1\n\n\nClaimed Federal Costs for Testing Period $709,628 Note 2\n\n\n\n Grant No 05TAHDC003\nAwarded $396,048 Note 1\n\n\nClaimed Federal Costs for Testing Period $103,437 Note 2\n\n\n\n Grant No 05TAHGA001\nAwarded $565,267 Note 1\n\n\nClaimed Federal Costs for Testing Period $553,798 Note 2\n\n\n\n Grant No 07TAHGA001\nAwarded $351,684 Note 1\n\n\nClaimed Federal Costs for Testing Period $50,783 Note 2\n\n `\n Grant No 07TAHPA001\nAwarded $763,089 Note 1\n\n\nClaimed Federal Costs for Testing Period $743,986 Note 2\n\n\n\n Grant No 06MKADC004\nAwarded $265,950 Note 1\n\n\nClaimed Federal Costs for Testing Period $264,050 Note 2\n\n\n\n\n 10\n\x0c Reference\n Grant No 06MKSGA001\nAwarded $208,999 Note 1\n\nClaimed Federal Costs for Testing Period $110,499 Note 2\n\nQuestioned Costs\nUnallowable Rent $748 Note3\n\n Grant No 08MKHGA001\nAwarded $98,500 Note 1\n\nClaimed Federal Costs for Testing Period $98,500 Note 2\n\n\n\n Grant No 09MKHDC002\nAwarded $150,000 Note 1\n\n\nClaimed Federal Costs for Testing Period $150,000 Note 2\n\n\n\n Grant No 07VSSGA009\nAwarded $112,500 Note 1\n\n\nClaimed Federal Costs for Testing Period $18,499 Note 2\n\nQuestioned Education Awards\nInadequate Citizenship/Legal Residency\nDocumentation $4,725 Note 16\n\n\n\n Grant No 07NDHGA001\nAwarded $2,268,367 Note 1\n\nClaimed Federal Costs for Testing Period $1,377,970 Note 2\n\nQuestioned Costs\nEmployee Meal $27 Note 4\nUnsigned Timesheets $1,591 Note 5\n\nTotal Questioned Costs $1,618\n\nQuestioned Education Awards\nUnsigned Timesheets $4,725 Note 6\n\n\n\n 11\n\x0c Reference\n Grant No 06NDHGA002\nAwarded $1,405,411 Note 1\n\nClaimed Federal Costs for Testing Period $1,405,411 Note 2\n\nQuestioned Costs\nLate Fees/Finance Charges $22 Note 7\n\n Grant No 08VSNMI002\nAwarded $75,000 Note 1\n\nClaimed Federal Costs for Testing Period $71,264 Note 2\n\nQuestioned Costs\nExpenses Incurred Prior to Grant Period $377 Note 8\nUnsupported Transactions 28 Note 9\n\nTotal Questioned Costs $405\n\n Grant No 08PLHDC001\nAwarded $2,475,000 Note 1\n\nClaimed Federal Costs for Testing Period $2,475,000 Note 2\n\n\nQuestioned Costs\nLate Fees/Finance Charges $124 Note 10\nEmployee Entertainment 1,250 Note 11\nUnsupported Transactions 12,135 Note 12\nMerger Related Expenses 20,107 Note 17\nCost Charged to Incorrect Grant 8,325 Note 13\nTotal Questioned Costs $41,941\n\n Grant No 08ERSGA001\nAwarded $5,200,860 Note 1\n\nClaimed Federal Costs for Testing Period $2,427,700 Note 2\n\nQuestioned Costs\nEmployee Entertainment $435 Note 14\nAppreciation Gifts to Employees 139 Note 15\nTotal Questioned Costs $574\n\n\n\n\n 12\n\x0cNotes\n\n 1. The amount shown represents the total dollar amount awarded to POL by the\n Corporation for the grant identified.\n\n 2. Claimed costs represent POL\xe2\x80\x99s reported Federal expenditures for the testing period.\n\n 3. POL charged Hands on Bay Area office rent, office supplies, phone, and internet\n expenses to the Martin Luther King Grant #06MKSGA001; however, these expenditures\n were not included in the original or amended budget (see Finding 4).\n\n 4. POL charged $27 unallowable employee meals to the grant (see Finding 4).\n\n 5. Living allowances and related fringe benefits for two members whose timesheets did not\n contain member\xe2\x80\x99s signature and/or supervisor\xe2\x80\x99s signature (see Finding 7).\n\n 6. Education award for one member whose timesheets did not contain member\xe2\x80\x99 signature\n and/or supervisor\xe2\x80\x99s signature (see Finding 7).\n\n 7. POL charged $22 in finance charges/late fees to the grant (see Finding 4).\n\n 8. Five travel-related cost transactions were incurred prior to the grant period of the VISTA\n State grant. The grant period started on December 9, 2007, but the travel expenses\n charged to the grant were incurred prior to that date (see Finding 4).\n\n 9. POL did not provide support for two transactions totaling $28 ($11 phone expense and\n $17 travel expense) (see Finding 4).\n\n 10. POL charged $124 for late payments/finance charges to the grant (see Finding 4).\n\n 11. POL charged $1,250 for staff appreciation meals to the grant (see Finding 4).\n\n 12. POL did not provide support for transactions in the amount of $12,135 (see Finding 4).\n\n 13. Costs of $8,325 were misposted to the general ledger on Grant No. 08PLHDC001 and\n claimed to another grant on the FSR. We were unable to verify that these costs were\n not claimed twice. (see Finding 1).\n\n 14. POL charged the grant unallowable employee meal entertainment costs of $435 ($408\n for staff appreciation dinner and $27 staff lunch) (see Finding 4).\n\n 15. POL charged the grant $139 for unallowable gifts to the staff that planned the 2008\n Conference (see Finding 4).\n\n 16. Citizenship/legal residency documentation for one member did not comply with\n AmeriCorps eligibility requirements (see Finding 8).\n\n 17. POL charged merger related expenses for $20,107 to the grant (see Finding 4).\n\n\n\n\n 13\n\x0c Schedule A-2\n\n Schedule of Award and Claimed Costs\n Hands on Miami (HOM)\n\n\n Award 07NDHGA001\n\n Reference\n\nAwarded $179,231 Note 1\n\nClaimed Federal Costs $116,138 Note 2\n\nQuestioned Costs\nUnsigned Time Sheets $1,441 Note 3\n\nTotal Questioned Costs $1,441\n\nNotes\n\n 1. The amount shown represents POL\xe2\x80\x99s total funding to HOM.\n\n 2. Claimed costs represent HOM\xe2\x80\x99s reported Federal expenditures for the testing period.\n\n 3. Living allowance and related fringe benefits for one member whose timesheets did not\n contain member and/or supervisor\xe2\x80\x99s signatures (see Finding 7).\n\n\n\n\n 14\n\x0c Schedule A-3\n\n Schedule of Award and Claimed Costs\n Pass It Along (PIA)\n\n\n\n Award 06NDHGA002\n\n Reference\n\nAwarded $34,115 Note 1\n\nClaimed Federal Costs $34,115 Note 2\n\n\nQuestioned Education Award\nUnsigned timesheets $1,000 Note 3\n\nTotal Questioned Education Award $1,000\n\n\nNotes\n\n 1. The amount shown represents POL total funding to PIA.\n\n 2. Claimed costs represent PIA \xe2\x80\x99s reported Federal expenditures for the testing period.\n\n 3. We questioned the education award of the member whose timesheets hours were less\n than the hours reported in WBRS (see Finding 7).\n\n\n\n\n 15\n\x0c Results - Compliance and Internal Control\n\nThe results of our agreed-upon procedures also revealed instances of non-compliance with\ngrant provisions, regulations, and/or OMB requirements, as shown below:\n\nFinding 1. Accounting system is not adequate to account for Federal funds.\n\nAccountability\n\nWe were unable to reconcile the claimed costs in the FSRs to the grantee\xe2\x80\x99s accounting records\nfor each grant and found that there was no clear audit trail between the FSRs and the General\nLedger (GL). Federal and match expenses are comingled in the GL and it is impossible to\nseparate them. As a consequence, we performed our transaction testing by selecting overall\ntransactions from the GL. Additionally; we discovered that not all transactions were reported in\nthe FSRs, as shown in the table below.\n\n\n FSR Claimed During Testing Period Total\n Program Expense\n Federal Match Cumulative per GL Variance\nAmeriCorps National\n07NDHGA001 $1,377,970 $ 657,021 $ 2,034,990 $2,035,076 $(85)\nDisability Outreach\n05DSHDC001 $709,628 $488,984 $1,198,657 $665,403 $533,209\nTraining and\nTechnical Assistance\n05TAHDC003 $103,437 - $103,437 $96,997 $6,440\nTraining and\nTechnical Assistance\n05TAHGA001 $553,798 - $553,798 $683,099 $(129,301)\nTraining and\nTechnical Assistance\n07TAHPA001 $743,986 - $743,986 $678,278 $65,708\nMartin Luther King\nDay\n06MKADC004 $264,050 $1,937,090 $2,201,140 $323,698 $1,877,442\nMartin Luther King\nDay\n06MKSGA001 $110,499 $818,813 $929,312 $185,468 $743,844\nMartin Luther King\nDay\n08MKHGA001 $98,500 $265,462 $363,962 $123,727 $240,235\nVista State\n08VSNMI002 $71,264 $39,898 $111,162 $107,621 $3,541\n\nNote: The grants listed only include those with variances between the FSR\xe2\x80\x99s and the general\nledger.\n\n\n\n\n 16\n\x0cBelow are the explanations provided by POL for the discrepancies:\n\n\n Program Description\nAmeriCorps National Match expenses were under-reported, possibly due to a subsequent\n07NDHGA001 adjusting entry.\nDisability Outreach The difference identified was effective for the period ending March\n05DSHDC001 31, 2009. POL staff stated that an adjustment would be made in the\n September 30, 2009, FSR.\nTraining and Technical\nAssistance Amount was over-reported during the testing period; however, it was\n05TAHDC003 under-reported by $9,569 over the entire grant period.\nTraining and Technical The additional funds reported in this grant correspond to the under\nAssistance reporting on Grant No. 07TAHPA001. The two grants had similar\n05TAHGA001 purposes and outcomes.\nTraining and Technical\nAssistance\n07TAHPA001 See above response.\nMartin Luther King Day Affiliate match and In-kind contributions were not included in the GL\n06MKADC004 because they were maintained in separate documents, such as\n Excel spreadsheets or in the affiliates\xe2\x80\x99 accounting system.\nMartin Luther King Day Affiliate match and In-kind contributions were not included in the GL\n06MKSGA001 because they were maintained in separate documents, such as\n Excel spreadsheets or in the affiliates\xe2\x80\x99 accounting system.\nMartin Luther King Day Affiliate match and In-kind contributions were not included in the GL\n08MKHGA001 because they were maintained in separate documents, such as\n Excel spreadsheets or in the affiliates\xe2\x80\x99 accounting system.\nVista State` Match expenses were over reported, possibly due to a subsequent\n08VSNMI002 adjusting entry.\n\n\nWhen Federal and match transactions are comingled in the general ledger, it is possible for\ntransactions to be misclassified and/or misreported. Grant drawdowns may not agree with\nreported Federal and match costs and could be misstated. Without a clear audit trail, it is\ndifficult to reconcile claimed costs on the FSR to the general ledger.\n\nAn example of this weakness occurred during the reconciliation of Grant No. 05DSHDC001.\nWe discovered that the amount claimed in the FSR exceeded the total reflected in the general\nledger by $533,254. As a result of the AUP effort, POL stated that it will correct the discrepancy\nin the September 30, 2009, FSR. The correction did not occur as a result of POL\xe2\x80\x99s routine\nreconciliation procedures. Not having a formal reconciliation procedure in place could lead to\nexcess drawdown amounts. Moreover, POL drew down $783,283 as of March 31, 2009; an\namount that exceeds the total general ledger amount, Federal and grantee share, of $665,403.\n\nOn grant No. 08ERSGA001, Federal share costs of $570,698 were incorrectly reported as\nmatch costs. The Federal share on the FFR was not reconciled to the funds drawn down on the\ngrant. Misstated financial reports make it difficult for Corporation grants officers to know the\nstatus of the grants and can contribute to misstatements on the Corporation\xe2\x80\x99s financial\nstatements. Additionally, the Federal funds may be used in a manner inconsistent with the\ngrant. The error occurred on the FSR for the period ending March 31, 2009, and was corrected\nSeptember 30, 2009. Moreover, Grant No. 08PLHDC001 did not have a match requirement.\n\n\n 17\n\x0cHowever, POL reported $15,247,333 as match for the aforementioned grant in its financial\nreport.\n\nCriteria\n\nThe 2008 AmeriCorps General Provisions, Section V.B.1. Financial Management Standards, i\nGeneral, states in part, \xe2\x80\x9cThe Grantee must maintain financial management systems that include\nstandard accounting practices, sufficient internal controls, a clear audit trail and written cost\nallocation procedures, as necessary.\xe2\x80\x9d\n\n45 CFR \xc2\xa7 2543, Grants and Agreements with Institutions of Higher Education, Hospitals, and\nOther Non-Profit Organizations, Subpart C, Post-Award Requirements, states in part:\n\n .21. Standards for financial management systems.\n\n * * *\n\n (b) Recipients\xe2\x80\x99 financial management systems shall provide for the following:\n\n (1) Accurate, current and complete disclosure of the financial results of\n each federally-sponsored project or program\xe2\x80\xa6\n\n (2) Records that identify adequately the source and application of funds\n for federally-sponsored activities.\n\nInaccurate Accounting Records\n\nBanners and signage costs, of $16,651, for affiliates participating in the 2008 MLK Day were\nclaimed 50 percent to MLK Day Grant No. 06MKADC004 and 50 percent to MLK Day Grant No.\n08MKHGA001. However, we discovered that $8,325 of the banners and signage cost was\nrecorded on the general ledger of POL Grant No 08PLHDC001. We could not determine if the\n$8,325 was not claimed on Grant No. 08PLHDC001 because of inadequate records supporting\nthe FSR.\n\nWe questioned the $8,325 recorded under Grant No. 08PLHDC001 based upon allocability\nbecause the costs were incurred for the MLK Day grants. POL staff stated that, although the\ntransaction was reported on the grant\xe2\x80\x99s accounting records, it was not claimed on the grant.\nHowever, the reconciliation of general ledger amounts to FSR amounts provided by POL did not\nprovide sufficient evidence demonstrating that the grant was not charged the $8,325.\n\nCriteria\n\nOMB Circular A-122, Cost Principles for Non-Profit Organizations, Attachment A. General\nPrincipals, A. Basic Considerations\n\n a. A cost is allocable to a particular cost objective, such as a grant, contract,\n project, service, or other activity, in accordance with the relative benefit\n received. A cost is allocable to a Federal award if it is treated consistently with\n other costs incurred for the same purpose in like circumstances and if it: (1) Is\n incurred specifically for the award.\n\nThe 2008 AmeriCorps General Provisions, Section V.A. Responsibilities under Grant\nAdministration, Accountability of Grantee, states in part:\n\n 18\n\x0c 1. General: The grantee has full responsibility for managing all aspects of the\n grant and grant-supported activities, subject to the oversight of the Corporation.\n The grantee is accountable to the Corporation for its operation of the\n AmeriCorps Program and the use of Corporation grant funds. The grantee must\n expend grant funds in a judicious and reasonable manner, and it must record\n accurately the service activities and outcomes achieved under the grant.\n Although grantees are encouraged to seek the advice and opinion of the\n Corporation on special problems that may arise, such advice does not diminish\n the grantee\xe2\x80\x99s responsibility for making sound judgments and does not mean\n that the responsibility for operating decisions has shifted to the Corporation.\n\nRecommendations\n\nWe recommend that the Corporation:\n\n 1a. Perform a reconciliation, for each POL grant, between the General Ledger and the PMS\n drawdowns to determine whether the grants were overdrawn and, if so, recover these\n overdrawn amounts;\n\n 1b. Resolve the questioned costs of $8,325 and recover disallowed costs;\n\n 1c. Ensure POL improves its accounting system to record by grant, Federal and match costs\n separately with a record-keeping system to identify the source documentation;\n\n 1d. Ensure POL reconciles the general ledger to the FSRs and drawdowns to the Federal\n share; and\n\n 1e. Provide guidance to POL to include all costs, Federal and match, in its FSRs.\n\nPOL\xe2\x80\x99s Response\n\nPOL disagrees with the conclusion that the accounting system is not adequate to account for\nFederal funds; however, POL concurs with the findings associated with that statement. POL\nstated that the difficulty in reconciliation arose from several situational causes: the lack of a\nclear monthly close, an office relocation, and the consolidation of the Federal funds and match\ninto one account. In addition, accounts for the Federal and grantee share of the match were\npreviously kept in one account. POL stated that it now maintains the grants individually and\nmaintains records of all reports submitted. POL\xe2\x80\x99s responses to the specific findings and\nrecommendations included:\n\n1a. POL indicated that each grant was reconciled at September 30,2009;\n\n1b. POL disagrees with the questioned cost of $8,325. It stated that its system does not allow\nfor entries that do not balance;\n\n1c. POL stated that it is implementing a new tracking system which includes separate accounts\nfor Federal share and match, as well as entering subgrantee match in the general ledger\nsystem;\n\n1d. POL stated that the general ledger, HHS and Federal Financial reports are reconciled at the\ncurrent time; and\n\n\n 19\n\x0c1e. POL stated that it hired staff with significant experience in management and oversight of\nFederal funds and has conducted training for both staff and subgrantees to ensure compliance\nwith Federal regulations and grant provisions.\n\nCorporation\xe2\x80\x99s Response\n\nThe Corporation generally agrees with the recommendations and will determine if the\nquestioned $8,325 was charged twice. It does not agree with recommendation 1a as written. It\nnoted that the issue is related to cash management, not necessarily the reconciliation. The\nCorporation also stated that it will require POL to develop written procedures for determining\nHHS system draw down amounts based on actual expenditures recorded in the general ledger.\n\nAuditor\xe2\x80\x99s Comments\n\nThe Corporation should consider the actions proposed by POL and follow up to ensure that they\nare implemented and effective.\n\nIn response to the Corporation\xe2\x80\x99s disagreement on recommendation 1a, we believe that the\ngrantee should be able to reconcile the amount reported in the FFR to the general ledger for\nany period reported. Timing differences between amounts drawn down and amounts reported\non the FFR were identified during the reconciliation. Amounts reported in the FFR are amounts\nthat have already been paid or are obligated in the general ledger to be paid from Federal funds\nor claimed as match; therefore, we believe that performing a reconciliation will ensure that the\ngeneral ledger is being used appropriately.\n\nRegarding recommendation 1b, we sustain our position as were not able to rule out the\npossibility that the transaction was not charged to both grants on the FSRs.\n\nFinding 2. Affiliate monitoring visits not performed in accordance with the POL policies.\n\nAccording to POL officials, affiliate monitoring visits were conducted during all program years\naudited (2006-2007, 2007-2008, 2008-2009). When we requested the monitoring reports for\nthree program years, POL officials did not provide evidence that site visits were conducted in\nprogram years 2006-2007 and 2007-2008. In addition, we found that, during program year\n2008-2009, POL did not perform monitoring visits to 5 of 20 affiliates: Hands on Bay Area,\nHands on Charlotte, New York Cares, Hands on Twin Cities and Volunteer San Diego.\n\nAs a result of POL not complying with its policies and procedures, affiliates that were not\nmonitored may not be receiving the direction to properly run their programs. POL officials\nindicated that the omission of the five monitoring visits was due to travel and time limitations\nduring the 2008-2009 program year.\n\n\nCriteria\n\n45 C.F.R. \xc2\xa7 2541.400(a), Monitoring and reporting program performance, states in part:\n\n Monitoring by grantees. Grantees are responsible for managing the day-to-day\n operations of grant and subgrant supported activities. Grantees must monitor\n grant and subgrant supported activities to assure compliance with applicable\n Federal requirements and that performance goals are being achieved. Grantee\n monitoring must cover each program, function or activity.\n\n\n 20\n\x0cPOL\xe2\x80\x99s Monitoring Tool, states in part:\n\n Site Visits: The annual site monitoring visit will have 4 main goals:\n \xef\x82\xb7 Assess program compliance with applicable program and fiscal\n requirements\n \xef\x82\xb7 Assess program effectiveness\n \xef\x82\xb7 Identify and address specific technical assistance needs and\n \xef\x82\xb7 Provide Service members an opportunity to inform programming\n\nRecommendation\n\nWe recommend that the Corporation:\n\n 2a. Ensure that POL enhance its policies to incorporate alternative procedures, including\n desk reviews, when staff resources adversely affect its ability to perform annual onsite\n monitoring of all affiliates..\n\n 2b. The use of alternative procedures should be documented and approved by a senior POL\n official.\n\nPOL\xe2\x80\x99s Response\n\nPOL concurs with the finding. It stated that the issue of subgrantee monitoring was identified as\nan area for improvement in POL\xe2\x80\x99s FY 2008 internal audit. The organization has worked over\nthe last two years to build an integrated system to support this work and emphasize the\nimportance of successful monitoring.\n\n2a. POL stated that, in regard to National Service, the team has revamped the Host Site\nMonitoring process for VISTA and National Direct. POL has specifically revised the Desk\nReview Tool, On Site Review Tool, Host Site Monitoring Process Overview, and the Report\nTemplate.\n\n2b. POL stated that its CFO meets with all staff that oversees the subgrantees at least twice a\nyear. At these meetings, monitoring plans are created and evaluated, information is shared,\nand progress is reviewed.\n\nCorporation\xe2\x80\x99s Response\n\nThe Corporation concurs with the finding and recommendations and will work with POL to\nimplement corrective action within 120 days.\n\n\nAuditor\xe2\x80\x99s Comments\n\nThe Corporation should consider the actions proposed by POL and follow up to ensure that they\nare implemented and effective.\n\n\n\n\n 21\n\x0cFinding 3. Indirect rates not approved\n\nOn National Direct grants, the Corporation allows the recovery of administrative costs through 5\npercent of Federal share and 10 percent match of total grant cost without additional\ndocumentation. Organizations with administrative costs in excess of 15 percent are required to\nobtain a Negotiated Indirect Cost Rate Agreement (NICRA).\n\nPOL had a NICRA dated May 6, 2004, for Fiscal Year (FY) October 1, 2003, through September\n30, 2004, with a provisional rate of 18 percent. However, final indirect rates were not\nestablished.\n\nPOL had a NICRA dated April 5, 2007, for FY October 1, 2004, through September 30, 2005,\nwith a final rate of 16.2 percent. Final indirect rates were not established for fiscal years after\nSeptember 30, 2005, whereby, POL continued to charge the provisional rate. POL annually\ncalculated a new billing rate from the final general ledger balances and used the new rate to\ncharge indirect costs to the grants. However, these new billing rates were not approved by the\nCorporation. When final rates are approved, they commonly become provisional rates for the\nfollowing year. Final rates are based on actual costs for the period.\n\nFinalizing rates and establishing new provisional rates apparently did not occur because of\nconfusion over how the NICRA was written. For FY 2005 the NICRA states, in part, \xe2\x80\x9cUNTIL\nAMENDED Use same rates and conditions as those cited for fiscal year ending September 30,\n2005.\xe2\x80\x9d While the Corporation has oversight responsibility for grantees, Health and Human\nServices (HHS) is under contract with the Corporation to negotiate indirect rates. Confusion\nover the wording of the NICRA has occurred with other grantees and the Corporation is working\nwith HHS to improve the disclosure. Additionally, we noted this issue was not identified in\nPOL\xe2\x80\x99s OMB Circular A-133 audits performed for FY 2007 and FY 2008.\n\nProvisional rates are estimates. When final indirect cost rates are not calculated based on\nactual costs, the grants may be overcharged or undercharged.\n\nThe draft version of this report questioned indirect costs of $509,536 for charging the indirect\ncost without a NICRA. On June 14, 2010 POL signed a NICRA establishing final rates for\nSeptember 30, 2006, 2007, 2008 and 2009. As a result, the questioned cost of $509,536 is\nremoved from this final report. However, the compliance finding for charging indirect rates\nwithout a NICRA during the audit period remains in this final report.\n\n\n Criteria\n\n45 CFR \xc2\xa72540.110 General Administrative Provisions Limitation on use of Corporation funds for\nadministrative costs.\n\n (a) (1) Not more then five percent of grant funds provided under 45 CFR\n \xc2\xa72516, \xc2\xa72517, \xc2\xa72519 and \xc2\xa72521 for any fiscal year may be used to pay for\n administrative costs as defined in \xc2\xa72510.20 of this chapter.\n\nOMB Circular A-122, Cost Principles for Non-Profit Organizations, Attachment A. General\nPrinciples, E. Negotiation and Approval of indirect Cost Rates, states in part:\n\n 1. Definitions.\n\n * * *\n\n 22\n\x0c d. Final rate means an indirect cost rate applicable to a specified past period\n which is based on actual costs for the period. A final rate is not subject to\n adjustment.\n\n e. Provisional rate or billing rate means a temporary indirect cost rate applicable\n to a specified period which is used for funding, interim reimbursement, and\n reporting indirect cost on awards pending the establishment of a final rate for\n the period.\n\n 2. Negotiation and Approval of Rates\n\n * * *\n\n c. Organizations that have previously established indirect cost rates must submit\n a new indirect cost proposal to the cognizant agency within six months after the\n close of each fiscal year.\n\nRecommendations\n\nWe recommend that the Corporation:\n\n 3a. Ensure that POL develops effective documented control procedures for the submission\n and negotiation of Indirect Cost Proposals; and\n\n 3b. Ensure that Corporation grant officers do not allow recovery of administrative costs in\n excess of the regulatory limit without a NICRA.\n\nPOL\xe2\x80\x99s Response\n\nPOL concurs with the finding and acknowledges that the provisional indirect cost rate\nagreement documentation was not current. POL management stated that it was not aware of\nthis issue until the OIG\xe2\x80\x99s agreed-upon procedures review. POL charges actual indirect costs\nincurred equally to all cost centers. Therefore, since the NICRA agreements are now approved\nand only actual indirect costs were charged, there should be no questioned costs. POL stated\nthat it has subsequently worked with the Corporation and the Department of Health and Human\nService and has received final indirect cost rates for the years in question.\n\n3a. POL stated that as part of itsr annual year-end and audit report preparation, it has included\nthe completion of the annual ICR proposal as an action item.\n\nCorporation\xe2\x80\x99s Response\n\nThe Corporation anticipates allowing the costs based on discussions with the OIG. It will\nrequire POL to develop and implement accounting procedures within 120 days to ensure timely\nproposals are prepared, submitted and rates are negotiated for each year it claims indirect\ncosts.\n\nAuditor\xe2\x80\x99s Comments\n\nBased on POL\xe2\x80\x99s response and documentation provided in response to the draft report, we\ndecided not to question cost as POL was able to obtain final indirect rates for the period under\nreview. Therefore, we removed the original draft recommendation 3a from the final report.\n\n 23\n\x0cThe Corporation did not respond to the recommendation that grants officers not allow recovery\nof administrative cost in excess of the regulatory limit without a NICRA.\n\n\nFinding 4. Costs claimed not included in original or amended budgets, incurred prior to\nthe grant period, unallowable, unsupported, or paid in violation of POL policies.\n\nCosts claimed not included in original or amended budgets\n\nCosts that were not authorized in the budget were paid with Federal funds without obtaining a\nwritten authorization from the Corporation. POL charged Hands on Bay Area office rent, office\nsupplies, phone, and internet expenses to Martin Luther King Grant #06MKSGA001; however,\nthis expenditure of $748 was not included in the original or amended budgets.\n\nAs a result we are questioning the aforementioned amount.\n\nCriteria\n\nThe 2008 AmeriCorps Special Provisions, Section IV. M. Budget and Programmatic Changes,\nstates in part:\n\n 4. Approvals of Programmatic and Budget Changes. The Corporation\xe2\x80\x99s Grants\n Officers are the only officials who have the authority to change the requirements\n of the grant. The Grants Officers will execute written amendments, and\n grantees should not assume approvals have been granted unless\n documentation from the Grants Office has been received.\n\nCosts incurred prior to grant period\n\nWe noted expenses that were incurred prior to the grant period. Five travel-related cost\ntransactions were incurred prior to the grant period of the VISTA State Grant No 08VSNMI002.\nThe grant period started on December 9, 2007, but the travel expenses, totaling $377, were\ncharged to the grant between August 20, 2007, and December 5, 2007. POL incurred these\nexpenses without prior approval and as a result we questioned the total amount of $377. POL\ndid not provide an explanation for this issue.\n\nCriteria\n\n45 CFR Part 2541.230 Period of availability of funds, states in part:\n\n (a) General. Where a funding period is specified, a grantee may charge to the\n award only costs resulting from obligations of the funding period unless\n carryover of unobligated balances is permitted, in which case the carryover\n balances may be charged for costs resulting from obligations of the subsequent\n funding period.\n\nUnallowable Costs\n\nTwo of the transactions tested under Grants Nos. 06NDHGA002 and 08PLHDC001, for $22 and\n$124, respectively, were for finance charges on a POL credit card that were charged to the\ngrants. Additionally, POL charged $1,250 and $435 to Grants Nos. 08PLHDC001 and\n08ERSGA001, respectively, for staff appreciation meals. Lastly, Grant No. 08ERSGA001 was\ncharged with $139 for gifts provided to the POL staff for planning the annual conference.\n\n 24\n\x0cPOL staff stated that it did not consider the appreciation meals unallowable because they were\nrelated to staff development and networking. However, we consider the aforementioned costs\nentertainment; therefore, we are questioning $1,685 associated with these transactions. Total\nfinance charges of $146 are questioned because interest charges are unallowable. The gift\ncost of $139 is questioned because it is considered a donation.\n\nPOL charged five expenses incurred during its merger with the Hands on Network to grant No\n08PLHDC001. The total amount for the five transactions is $20,107 ($4,852 travel expenses,\n$255 advertisement expenses, and a $15,000 consulting fee). These types of transactions are\nonly allowed with prior approval from the awarding agency. According to POL staff, the\nCorporation allowed POL to use the grant funds to cover administrative expenses, including\nsome expenses incurred during the merger process. As a result, POL used grant funds for\nsome merger-related expenses. We consider these charges unallowable organizational costs;\ntherefore, we questioned total costs of $20,107.\n\nCriteria\n\nOMB Circular A-122, Cost Principles for Non-Profit Organizations, Attachment B. Selected\nItems of Cost, states in part:\n\n 12. Donations and Contributions. a.. Contributions or donations rendered.\n Contributions or donations, including cash, property, and services, made by the\n organization, regardless of the recipient, are unallowable.\n\n * * *\n\n 14. Entertainment Costs. Costs of amusement, diversion, social activities,\n ceremonials, and costs relating thereto, such as meals, lodging, rentals,\n transportation, and gratuities are unallowable.\n\n * * *\n\n 23. Interest. a. Cost incurred for interest on borrowed capital, temporary use of\n endowment funds, or use of the non-profit organization\xe2\x80\x99s own funds, however\n represented, are unallowable.\n\n 31. Organization Cost. Expenditures, such as incorporation fees, brokers' fees, fees to\n promoters, organizers or management consultants, attorneys, accountants, or\n investment counselors, whether or not employees of the organization, in connection with\n establishment or reorganization of an organization, are unallowable except with prior\n approval of the awarding agency.\n\nUnsupported Costs\n\nFor the VISTA State Grant No. 08VSNMI002, POL was unable to provide support for 2 out of\nthe 49 transactions reviewed, which totaled $28. Additionally, supporting documentation was\nnot provided for 1 of the 48 transactions tested, which totaled $12,135, under Grant No.\n08PLHDC001. POL could not determine why the documentation was missing. Without the\nsource documents we were not able to determine if the costs are allowable, reasonable and\nallocable. As a result we questioned $12,163.\n\n\n\n 25\n\x0cCriteria\n\n45 CFR Part 2543.53, Retention and access requirements for records, states in part:\n (b) Financial records, supporting documents, statistical reports, and all other\n records pertinent to an award shall be retained for a period of three years from\n the date of submission of the final expenditure report.\n\n45 CFR Part 2543.21 Standards for financial management systems, states in part;\n\n (b) Recipients\xe2\x80\x99 financial management systems shall provide for the following:\n\n * * *\n\n (7) Accounting records including cost accounting records that are supported by\n source documentation.\n\n\nCosts paid in violation of POL policies\n\nDuring our review of cost transactions, we noted that one transaction under Grant No.\n07TAHGA001 was not in compliance with POL\xe2\x80\x99s contractual policy governing a consultant. The\ncontract between POL and the consultant states that payment will be made to the consultant\nwithin 30 days of invoice delivery. However, payment was made before the invoice was\nreceived by POL. The consultant was paid in February 2009 and the invoice for the consulting\nwork performed was received on September 23, 2009.\n\nAdditionally, POL reimbursed employees and charged Grant No. 07NDHGA001 a meal rate that\nexceeded the limit indicated in its travel policy. The policy states that employees can only\ncharge $24 for a single dinner meal. However, during a supervisors\xe2\x80\x99 training in Atlanta, two\nemployees from Metro Volunteers of Denver spent and requested a reimbursement of $75.\nInstead of reimbursing the allowed amount of $48, POL reimbursed the employees and charged\nthe entire amount of $75 to the grant.\n\nPOL officials said the payment to the consultant was based on the date of service stated in the\ncontract. No explanation was provided by POL for the travel expense finding.\n\nMaking payments without following internal policies could expose POL to inaccurate or invalid\npayments and subsequently charge the Government for such payments. Additionally, payments\nmay not be paid consistent with management\xe2\x80\x99s intent.\n\nWe did not question any cost associated with the consulting transaction because the costs are\nvalid and were invoiced after the payment. However, we questioned $27 for the meal expense\nthat exceeded the allowable meal rate.\n\nRecommendations\n\nWe recommend that the Corporation:\n\n 4a. Resolve the questioned costs, $35,392 and recover disallowed costs;\n\n 4b. Ensure that POL provides additional training to its staff and affiliates on the cost\n principals and grant provisions, including the requirements for the budget, donations,\n entertainment, interest and organizational cost;\n\n 26\n\x0c 4c. Ensure that POL maintains adequate support for the Federal and match costs; and\n\n 4d. Provide guidance to POL regarding contractual agreements and internal policies to\n ensure that payments are made in a manner that is consistent with its policies and\n procedures.\n\nPOL\xe2\x80\x99s Response\n\nPOL concurs with the finding, with the exception of the issue related to the merger costs\ncharged. POL stated that it was during the initial merger integration period that the majority of\nthe findings occurred. Having completed integration, POL now has clear policies and\nprocedures for the merged entity. POL stated that it has trained its staff and subgrantees on\ncost principles, implemented internal controls to ensure adequate documentation to support\nexpenses and that it maintains contractual agreements supporting payments that were\nimplemented in January 2009.\n\nRegarding the merger costs being questioned, POL stated that the costs questioned occurred\nafter the merger. There is one invoice from September 2007 and the majority of costs\nquestioned occurred in January and February 2008. The summary ledger provides the\ndescription that the costs were merger related, however the detailed transaction information\nprovides details that these costs are related to organizational development and integration. The\nmerger between Hands On Network and Points of Light occurred in August of 2007. These\ncosts are related to post-merger integration and related to an all staff retreat and Board meeting.\n\nCorporation\xe2\x80\x99s Response\n\nThe Corporation agrees with the recommendations and will disallow any questioned costs that\nare unsupported or for unallowable expenditures. The Corporation agrees that merger-related\ncosts are generally unallowable unless approved in the grant budget or by the awarding agency\nin advance. The Corporation stated that they would not have approved the costs in either case\nand that they are disallowed.\n\nThe Corporation will confirm implementation within 120 days of the actions proposed by POL.\n\nAuditor\xe2\x80\x99s Comments\n\nWe maintain our position regarding POL\xe2\x80\x99s merger with the Hands On Network regardless of\nwhen the cost were incurred before or after the merger date. Integration of the two\norganizations, including automated systems is an organizational costs and therefore should be\ndisallowed.\n\n\n\n\n 27\n\x0cFinding 5. Late submission of Financial Status Reports (FSRs), member enrollment\nforms, and exit forms.\n\nPOL and the affiliates tested did not consistently submit required reports and/or forms by\nstipulated due dates, as shown in the table below.\n\n\n Location Description of Non-Compliance\nPOL \xef\x82\xb7 11 of 42 FSRs submitted late\nVolunteer Frederick \xef\x82\xb7 1 of 6 monthly expense reports submitted late\nHands on Bay Area \xef\x82\xb7 6 of 21 enrollment forms submitted late\n \xef\x82\xb7 7 of 21 exit form submitted late\nHands on Miami \xef\x82\xb7 7 of 14 exit forms submitted late\nMake a Difference \xef\x82\xb7 9 of 21 enrollment forms submitted late\n \xef\x82\xb7 3 of 21 exit forms submitted late\nMetro Volunteers of Denver \xef\x82\xb7 4 of 12 exits forms submitted late\nPass It Along \xef\x82\xb7 9 out of 21 enrollment forms submitted late\n \xef\x82\xb7 3 of 21 exit forms submitted late\n\nWhen FSR\xe2\x80\x99s are submitted late the Corporation cannot review key data in a timely manner and\nmay not be fully aware of the financial status of grants. Moreover, the Corporation\xe2\x80\x99s own\nfinancial information may not be current.\n\nAccording to the Finance/Human Resources Manager of Volunteer Frederick, the expense\nreport was not submitted in a timely manner because of inadequate knowledge of the reporting\nformat.\n\nThe affiliates did not provide explanations for the late submission of the member-related forms.\nThe late submission of financial and programmatic information may preclude the grantee from\nreporting accurate program and expenditure information to the Corporation. These delays can\nresult in the Corporation not having current information on grantees, affiliates, members, and\nprograms.\n\nCriteria\n\nAmeriCorps Special Provisions, Section IV. N. Reporting Requirements, 1. Financial Status and\nProgress Reports, states in part:\n\n a. Financial Status Reports. The grantee shall submit semi-annual cumulative financial\n status reports, summarizing expenditures during the reporting period using eGrants.\n Financial Status Report deadlines are as follows: Reporting period covered from start\n of grant through March 31 is due by April 30.In addition, Reporting period covered\n from April 1 to September 30 is due by October 31\n\nAccording to the grant agreement between POL and Volunteer Frederick, monthly expense\nreports (FSRs) must be submitted by the 15th day of the following month.\n\nThe 2006 and 2007 AmeriCorps Special Provisions, Section IV. C.1. Member Enrollment,\nMember Enrollment Procedures, states in part:\n\n d. Member Enrollment: Within 30 calendar days of the members starting\n service, the program must complete and approve the enrollment form in WBRS.\n\n 28\n\x0cThe 2006 and 2007 AmeriCorps Special Provisions, Section IV. N.2. Reporting Requirements,\nAmeriCorps Member-Related Forms, states in part:\n\n c. Exit/End-of-Term-of-Service Forms. Member Exit/ End-of-Term-of-Service\n Forms must be submitted no later than 30 days after a member exits the\n program or finishes his/her term of service.\n\nThe 2007 AmeriCorps Special Provisions, Section IV.N.2. Reporting Requirements, AmeriCorps\nMember-Related Forms, states in part:\n\n The Grantee is required to submit the following documents to the National\n Service Trust at the Corporation on forms provided by the Corporation.\n Grantees and Sub-Grantees may use WBRS to submit these forms\n electronically. Programs using WBRS must also maintain hard copies of the\n forms:\n\n i. Enrollment Forms. Enrollment forms must be submitted no later than\n 30 days after a member is enrolled.\n\n * * *\n\n iii. Exit/End-of-Term-of-Service Forms. Member Exit/End-of-Term-of-\n Service Forms must be submitted no later than 30 days after a member\n exits the program or finishes his/her term of service.\n\nThe 2008 AmeriCorps Special Provisions, IV. C. Member Recruitment, Selection, and Exit,\nstates in part:\n\n 1. Notice to the Corporation\xe2\x80\x99s National Service Trust. The grantee must notify\n the Corporation\xe2\x80\x99s National Service Trust within 30 days of a member\xe2\x80\x99s selection\n for, completion of, suspension from, or release from, a term of service.\n Suspension of service is defined as an extended period during which the\n member is not serving, nor accumulating service hours or receiving AmeriCorps\n benefits.\xe2\x80\x9d\n\nRecommendations\n\nWe recommend that the Corporation ensure that POL:\n\n 5a. Strengthens its procedures and reminders to affiliates to ensure prompt and complete\n financial reporting, as well as member information; and\n\n 5b. have affiliates submit enrollment and exit forms properly and on time.\n\n\nPOL\xe2\x80\x99s Response\n\nPOL concurs with the finding and stated that it had previously identified the need to strengthen\nprocedures to improve timely submission of information. To ensure timely submission of\nreports, POL has implemented an overall tracking system for all financial reports.\n\n\n\n 29\n\x0c5a. Within all affiliate and partnership Memoranda of Agreements, an additional organizational\ncompliance clause will ensure that all paperwork is submitted in a timely manner.\n\n5b. HandsOn AmeriCorps has revised policies and provides guidance for grantees to ensure\ntimeliness. A Compliance Progressive Action Plan has been developed internally to monitor\nnon-compliant advisory communication with the host site.\n\nCorporation\xe2\x80\x99s Response\n\nThe Corporation agrees and will work with POL to ensure that it provides written guidance and\ntraining to its staff and affiliates on all financial and member reporting requirements and\ndevelops and implements monitoring policies and procedures to ensure compliance with\nreporting due dates.\n\nAuditor\xe2\x80\x99s Comments\n\nThe Corporation should follow up with POL to ensure that corrective action is implemented and\neffective.\n\n\nFinding 6. Missing mid-term and end-of-term member evaluation forms.\n\nThe POL-operated program Hands on Campaign did not perform or maintain a record of mid-\nterm and/or end-of-term written evaluations for six out of seven members tested during Program\nYear 2006-2007. POL did not provide a cause for the missing records.\n\nHands on Bay Area did not perform or maintain a record of end-of-term written evaluations for\none out of seven members tested during Program Year 2007-2008. Hands on Bay Area did not\nprovide a reason for the missing evaluation. It did provide an internship plan of responsibilities\nfor this member. However, this document is not sufficient as a performance evaluation.\n\nMake a Difference did not perform or maintain a record of mid-term and/or end-of-term written\nevaluations for two of seven members tested during Program Year 2006-2007. Also in Program\nYear 2007-2008, it did not maintain a record of a final written evaluation for one member out of\nseven members tested. According to the Director of Operations, one of these members was\nterminated from the program at mid-term, the period when Make a Difference started reviewing\nmid-term evaluations. The affiliate started the mid-term evaluation, but it was never completed\nprior to the member leaving the program. There was no explanation provided for the other two\nmembers with missing performance evaluation records.\n\nAffiliates did not fully adhere to AmeriCorps Provisions governing member performance\nevaluations. This could result in members receiving improper guidance in performing their\nduties. Further, exit evaluations are utilized to determine if a member satisfactorily completed\nthe term of service and is therefore eligible to serve a second term.\n\nCriteria\n\nThe 2006 and 2007 AmeriCorps Special Provisions, Section IV.D. Training, Supervision and\nSupport, states in part:\n\n 6. Performance Reviews. The grantee must conduct and keep a record of at\n least a midterm and end-of-term written evaluation of each member's\n performance for Full and Half-Time members and an end-of-term written\n\n 30\n\x0c evaluation for less than Half-time members. The evaluation should focus on\n such factors as:\n\n a. Whether the member has completed the required number of hours;\n\n b. Whether the member has satisfactorily completed assignments; and\n\n c. Whether the member has met other performance criteria that were\n clearly communicated at the beginning of the term of service.\n\nRecommendations\n\nWe recommend that the Corporation ensure that POL:\n\n 6a. Provide guidance, during its affiliate training, to ensure that required evaluations are\n completed and discussed with the member in a timely manner; and\n\n 6b. Develop procedures to ensure that affiliates conduct and maintain records of mid-term\n and end-of-term evaluations of each member according to AmeriCorps Provisions.\n\nPOL\xe2\x80\x99s Response\n\nPOL concurs with the finding. The POL National Service Department recognizes the importance\nof mid-year and year-end evaluations, and has utilized Big Tent, an internet-based\ncommunications tool, to host HandsOn AmeriCorps\xe2\x80\x99 pertinent documents, host forums on\nfocused issue areas and solutions, and communicate important programmatic updates and\nevents.\n\n6a. Member evaluations guidance to affiliates is provided using several methods, including our\nelectronic system to distribute information, Big Tent grantee agreements and an annual\ncalendar of events.\n\n6b. Member evaluations procedures for compliance are included in a Compliance Progressive\nAction Plan which has been developed internally to monitor non-compliant advisory\ncommunication with the host site.\n\nCorporation\xe2\x80\x99s Response\n\nThe Corporation concurs with the findings and recommendations and will work with POL to\nensure that it issues guidance and trains staff on the requirements to perform and maintain\ndocumentation of mid-term and end-of-term evaluations. Additionally, the Corporation will\nensure that POL has monitoring procedures in place to ensure that affiliates are compliant with\nthe requirement.\n\nAuditor\xe2\x80\x99s Comments\n\nThe Corporation should follow up with POL to ensure the corrective action is implemented.\n\n\n\n\n 31\n\x0cFinding 7. Members\xe2\x80\x99 Contract signed after beginning of service and timesheets not\nsigned.\n\nMembers\xe2\x80\x99 contract signed after beginning service\n\n\n Sample Program Service Days\n Affiliate Size Year Member Before Contract\n Hands on Miami 7 06/07 1 3\n 06/07 2 2\n Metro Volunteer Denver 8 07/08 3 6\n 07/08 4 6\n 07/08 5 6\n 07/08 6 6\n 11 08/09 7 15\n\n\nAccording to Hands on Miami\xe2\x80\x99s Program Director, new employees and AmeriCorps members\noften do not come prepared with all the required documents and paperwork necessary to\ncomplete the enrollment process on their first day.\n\nAccording to the Metro Volunteer of Denver\xe2\x80\x99s Program Director, for Program Year 2007-2008,\nenrollment packages were not available on site when the members began service. In one case\nthe date was inadvertently left off the contract. It was dated when the discrepancy was\ndiscovered, 15 days after the start of service.\n\nWe did not question the service hours performed prior to the members signing their contracts.\nThe Corporation is providing training and other direction on the need to have signed contracts in\nplace before the member starts service. As a result we also did not question any education\nawards.\n\nCriteria\n\nThe 2006 and 2007 AmeriCorps Special Provisions, IV. C.1. Member Enrollment,\nMember Enrollment Procedures, states in part:\n\n\n a. An individual is enrolled as an AmeriCorps member when all of the\n following have occurred:\n\n i. He or she has signed a member contract;\n ii. The program has verified the individual's eligibility to serve;\n iii. The individual has begun a term of service; and\n iv. The program has approved the member enrollment form in WBRS.\n\n b. Prior to enrolling a member in AmeriCorps, programs make\n commitments to individuals to serve. A commitment is defined as\n signing a member contract with an individual or otherwise entering into a\n legally enforceable commitment as determined by state law.\n\n\n\n 32\n\x0cTimesheets not signed\n\nPOL did not provide an explanation for the member unsigned the timesheets.\n\nMember Program Timesheet Hours Unallowable Questioned\n No. Year Hours Required Hours Ed Award Affiliate/ Program\n 1 06/07 1862 1700 174 $4,725 POL-Campaign\n 2 07/08 1741 1700 140 0 Hands on Miami\n 3 07/08 318 300 81 $1,000 Pass it Along\n\nAccording to Hands on Miami\xe2\x80\x99s Senior Program Director, the lack of signatures by the member\nand supervisor on the timesheets was due to an oversight by the AmeriCorps Program\nManager. Other discrepancies were the result of the layoff of that manager in June 2008.\n\nPass it Along did not provide an explanation for the supervisor not signing the timesheet. This\nmember was a minimum-time member and did not receive a living allowance.\n\nIf the program does not ensure that all member timesheets are signed by a supervisor or an\nindividual with oversight responsibilities for the member, unallowable time could be included on\nthe timesheets and therefore charged to the Corporation grants.\n\nAs a result of the unsigned timesheets we questioned a total of 255 member service hours for\nHands on Campaign and Pass It Along. We also questioned living allowance of $2,630 ($2,236\nFederal share and $394 grantee share) and related fringe benefits of $402 ($342 Federal Share\nand $60 grantee share) for the members. Schedules A-1 and A-2 provide the break down of the\nquestioned costs related to each of the two entities.\n\nWe deducted the questioned hours from the members\xe2\x80\x99 total hours per the timesheets. As a\nresult we questioned education awards totaling $5,725 because the members\xe2\x80\x99 service hours did\nnot meet the minimum requirement for an award. The member from Hands on Miami did not\nreceive an education award because two education awards had been earned by that individual\nfor prior service periods.\n\nCriteria\n\nThe 2006 and 2007 AmeriCorps Special Provisions Section IV. C.2. Member Enrollment,\nAmeriCorps Members, states in part:\n\n The Grantee must keep time and attendance records on all AmeriCorps\n members in order to document their eligibility for in-service and post-service\n benefits. Time and attendance records must be signed and dated both by the\n member and by an individual with oversight responsibilities for the member.\n\nRecommendations\n\nWe recommend that the Corporation:\n\n 7a. Resolve the questioned costs, $3,032, questioned education awards of $5,725 and\n recover disallowed costs;\n\n 7b. Ensure POL requires affiliates to have members sign the contract prior to starting\n service; and\n\n 33\n\x0c 7c. Ensure POL trains its affiliates on member timekeeping and attendance records and\n strengthens procedures to ensure that timesheets are signed by members and\n individuals with oversight responsibilities.\n\n\nPOL\xe2\x80\x99s Response\n\nPOL concurs with the finding and acknowledges the errors associated with member service\nagreements and pre-contract service hours. It stated that POL has created policies and\nprocedures to ensure that no member is enrolled without a signed member contract on file. Site\nsupervisors are trained on these and other required enrollment procedures during the summer\ninstitute (3 day training), summer on-boarding webinars, and direct contact with national service\nstaff.\n\nHowever, POL does not agree with the $5,725 questioned costs as a result of the unsigned time\nlogs. It stated that POL has provided the auditors with information from site supervisors that\ncertify that members served the hours in question.\n\nCorporation\xe2\x80\x99s Response\n\nThe Corporation agrees with the finding. It will confirm POL\xe2\x80\x99s implementation of its proposed\ncorrective action plan within 120 days. Additionally, it will disallow the $3,032 in living allowance\nand $5,725 in education awards, unless appropriate support is provided.\n\nAuditor\xe2\x80\x99s Comments\n\nThe Corporation should follow up with POL to ensure corrective action is implemented.\n\nWe maintain our position regarding the questioned education award as the signed timesheets\nwere provided after the fact as a result of our inquiry. The original timesheets provided were not\nsigned or not provided.\n\n\nFinding 8. Inadequate evidence of citizenship/legal residency\n\nDuring the review of 11 VISTA member files, we noted one member did not have proper\ndocumentation of U.S. citizenship or legal residency. The sponsor used a driver\xe2\x80\x99s license and\nSocial Security card as evidence of citizenship. This type of documentation is inadequate due\nto the fact that persons who are not citizens or legal permanent residents can legally obtain\nSocial Security cards and driver\xe2\x80\x99s licenses.\n\nWithout obtaining the required documentation to adequately support U.S. citizenship or legal\nresidence, ineligible persons could be allowed to participate in VISTA. According to POL staff,\nthere is no clear guidance from the Corporation regarding VISTA member eligibility.\n\nWe questioned the member\xe2\x80\x99s education award of $4,725 because documented\ncitizenship/residency status is required in order to qualify for awards from the National Service\nTrust.\n\n\n\n\n 34\n\x0cCriteria:\n\nSection 146 of the National Community Service Act of 1990, as amended (NCSA), 42 U.S.C.\n12602, requires that to be eligible for an education award an individual must be a citizen or\nnational or lawful permanent resident alien of the United States.\n\nSection 123 of the NCSA, 42 U.S.C. 12573, also states that \xe2\x80\x9c[t]he Corporation may approve of\nany of the following service positions as an approved national service position that includes the\nnational service educational award described in subtitle D of this subchapter as one of the\nbenefits to be provided for successful service in the position: \xe2\x80\xa6 [a] position involving service as\na VISTA volunteer under title I of the Domestic Volunteer Service Act of 1973 (42 U.S.C. 4951\net seq.)\xe2\x80\x9d45 C.F.R. \xc2\xa7 2526.10 states to be eligible to receive an education award you must be a\ncitizen, national, or lawful permanent resident alien of the United States.\n\nThe Code of Federal Regulations 45 C.F.R. \xc2\xa7 2526.10(a) Eligibility for an Education Award also\nrequires that \xe2\x80\x9c[a]n individual is eligible to receive an education award from the National Service\nTrust if the individual \xe2\x80\x93 [i]s a citizen, national, or lawful permanent resident alien of the United\nStates\xe2\x80\xa6\xe2\x80\x9d\n\nRecommendation:\n\nWe recommend that the Corporation:\n\n 8a. Resolve the questioned education award and recover disallowed costs;\n\n 8b. Provide POL adequate guidance on VISTA member eligibility and maintenance of\n members\xe2\x80\x99 records; and\n\n 8c. Revise VISTA regulations to describe the documents necessary for establishing\n citizenship and legal permanent residency, similar to Subtitle C programs in 45 CFR \xc2\xa7\n 2522.200.\n\n 8d. Ensure that POL provides additional training to its employees to ensure they are familiar\n with the requirements regarding documentation supporting U.S. citizenship.\n\nPOL\xe2\x80\x99s Response\n\nPOL disagrees with the finding, stating that it followed the requirements for VISTA eligibility\ndocumentation as outlined in My AmeriCorps portal, and requirements provided by its State\nOffice liaison. However, upon learning the documentation was considered insufficient to\nsupport proof of eligibility; POL subsequently obtained the member\xe2\x80\x99s birth certificate.\n\nCorporation\xe2\x80\x99s Response\n\nThe Corporation stated that it worked with POL and secured a birth certificate for the member\nand confirmed that the member is a U.S. citizen.\n\nAuditor\xe2\x80\x99s Comments\n\nThe OIG will verify the birth certificate during the resolution process.\n\n\n\n\n 35\n\x0cThis report is intended for the information and use of the Office of Inspector General,\nCorporation management, POL, and the U.S. Congress. However, this report is a matter of\npublic record and its distribution is not limited.\n\n\n\n\nBethesda, Maryland\nAugust 17, 2010\n\n\n\n\n 36\n\x0c Exhibit B\n\n\n Consolidated Schedule of Recommendations and Questioned Costs\n\n\n Questioned Costs Funds Put to\n 3\nRecommendation Unallowable1 Unsupported2 Better Use\n1b. $8,325\n4a. $23,229 $12,163\n7a. $3,032 $5,725\n8a. $4,725\n\nConsolidated List of Recommendations\n\n\n\n\n_______________\n\n1. Questioned Cost means a cost that is unallowable because of:\n a. an alleged violation of a provision of a law, regulation, contract, grant, cooperative\n agreement, or other agreement or document governing the expenditure of funds;\n b. a finding that, at the time of the audit, such cost is not supported by adequate\n documentation; or\n c. a finding that the expenditure of funds for the intended purpose is unnecessary or\n unreasonable.\n\n2. Unsupported Cost means a cost that is questioned because at the time of the audit, such\ncost is not supported by adequate documentation. Unsupported costs are included in the\ntotal of unallowable costs.\n\n3. Recommendation that funds put to better use means a recommendation that funds could\nbe used more efficiently if management takes actions to implement and complete the\nrecommendation, including:\n a. reductions in outlays;\n b. deobligation of funds from programs or operations;\n c. withdrawal of interest subsidy costs on loans or loan guarantees, insurance, or\n bonds;\n d. costs not incurred by implementing recommended improvements related to the\n operations of the establishment, a contractor or grantee;\n e. avoidance of unnecessary expenditures noted in preaward reviews of contract or\n grant agreements; or\n f. any other savings which are specifically identified.\n\n\n\n\n 37\n\x0c APPENDIX A\n\nPoints of Light Foundation\xe2\x80\x99s Response to Draft Report\n\x0cFinding 1.\nAccounting system is not adequate to account for Federal funds.\n\nPoints of Light Institute (POLI) disagrees with the above statement, yet concurs with the findings associated with\nthe above statement. In regards to the accounting system utilized, POLI has full confidence that Microsoft\xe2\x80\x99s\nDynamics software is adequate to account for federal funds. The difficulty in reconciliation arose from several\nsituational causes: the lack of a clear monthly close, office relocation, and the consolidation of the federal funds\nand match into one account. We were unable to specifically reconcile the individual FSRs to the specific date\nranges due to subsequent entries being posted to prior periods. Due to two physical relocations of the accounting\noffice POLI was unable to locate the original copies of the reports. In addition, previously accounts for the federal\nand grantee share of the match were kept in one account. POLI now maintains the grants individually and\nmaintains records of all reports submitted.\n\nFinding 1a. POLI provided a reconciliation of our general Ledger and HHS reports as outlined on page 17 of the\ndraft report. Each of the grants was reconciled at 9/30/09; however since it was after the grant period the auditors\ndid not consider the information.\n\nFinding 1b. POLI disagrees with question cost of $8,325. Our accounting system does not allow for entries that\ndo not balance. Because of this software limitation, it is impossible for the\n$8,325 to be entered three times. There are two entries of $8,325 totaling $16,651. In the 08PLHDC001, match\nwas not required. However since there was match reported, POLI provided the auditors with a copy of the entire\nGL detail. It was the option of management at the time to report all allowable expenses that went to support the\norganizational mission as match. The result was $17,247,333 of match expenses reported on a grant with no\nmatch requirement. Both POLI and the auditors realized that there were duplications in the sample provided as\nall federal grants detail, including MLK, VISTA and AmeriCorps, was provided twice, both in the sample for\n08PLHDC001 and 08MKHGA001. At the time the duplications were recognized, the audit was significantly in\nprogress, and the audit firm chose not to review a new population.\n\nFinding 1c. POLI is implementing a new tracking system which includes separate accounts for federal share and\nmatch, as well as entering subgrantee match in the general ledger system.\n\nFinding 1d. The general ledger, HHS and Federal Financial reports are reconciled at the current time. As stated\nabove, due to subsequent entries posted to prior periods, the reconciliation was not possible at the specific\nperiods for the FSR reports the auditors were working with.\n\nFinding 1e. POLI has hired staff with significant experience in management and oversight of federal funds and\nhas conducted training for both staff and grantees to ensure compliance with Federal Regulations and grant\nprovisions.\n\n\nFinding 2.\nAffiliate monitoring visits not performed in accordance with the POL policies.\n\nPOLI concurs with the finding; the issue of subgrantee monitoring was identified as an area for improvement in\nour FY 2008 internal audit. The organization has worked hard over the last two years to build an integrated\nsystem to support this work and emphasize the importance of successful monitoring.\n\n\n Headquarters Office \xe2\x80\xa2 600 Means Street NW \xe2\x80\xa2 Suite 210 \xe2\x80\xa2 Atlanta Georgia 30318 \xe2\x80\xa2 T 404 979 2900\n DC Office \xe2\x80\xa2 1875 K Street \xe2\x80\xa2 5th Floor \xe2\x80\xa2 Washington DC 20006 \xe2\x80\xa2 T 202 729 8000\n www.PointsofLight.org\n\x0cIn an effort to continue to enhance our existing monitoring efforts, and to effectively standardize tools and\npractices, a Monitoring Team has been established consisting of representatives from the various grant programs\nacross the organization to:\n\n \xe2\x80\xa2 Review existing POLI/HON policies and procedures governing monitoring practices.\n\n \xe2\x80\xa2 Understand how these procedures and policies are actualized/implemented across the various grant\n programs (federal and non-federal) to identify areas of strength and weakness (in additional to those\n identified in the audit report).\n\n \xe2\x80\xa2 Update and/or effectively educate and implement monitoring policies and procedures based on the audit\n findings and the review of existing implementation within individual programs to provide consistent\n implementation across the organization.\n\n \xe2\x80\xa2 Create monitoring resources, tools, and best practices that are standardized and consistent across\n granting programs within POLI/HandsOn Network. These will be used as an implementation guide for\n new staff and new grant programs.\n\n \xe2\x80\xa2 Create standard mechanisms within the existing systems of program and financial reviews of\n subgrantees. These new standardized mechanisms will ensure a clear and broad understanding of\n monitoring timeframes within a grant cycle, and why particular grantees are being selected for specific\n types of monitoring. The standardization will also include risk based assessments to determine monitoring\n needs, and to provide a clear monitoring plan for each grant/subgrant.\n\nFinding 2a. In regards to National Service, the team has revamped the Host Site Monitoring process for VISTA\nand National Direct. POLI has specifically revised the Desk Review Tool, On Site Review Tool, Host Site\nMonitoring Process Overview, and Report Template.\n\nFinding 2b. The CFO meets with all staff that oversee the subgrantees at least twice a year. In these meetings\nmonitoring plans are created and evaluated, information is shared, and progress is reviewed.\n\nFinding 3.\nIndirect rates not approved.\n\nPOLI concurs with the finding and acknowledges that the provisional indirect cost rate agreement documentation\nwas not current. POLI management was not aware of this issue until the OIG agreed upon procedures review.\nPOLI charges actual indirect costs incurred equally to all cost centers. Therefore, since the ICR agreements are\nnow approved and only actual indirect costs were charged, there should be no questioned costs. POLI had\nprovided the documentation regarding the ICR to CNCS with each new grant and renewal. The issue that the\ndocument was out of date was never raised by CNCS. We have subsequently worked with the Corporation and\nthe Department of Health and Human Service, and POLI has received final indirect cost rates for the years in\nquestion.\n\nFinding 3a.Currently, we are in compliance and have a predetermined rate for FY2009.\n\nFinding 3b. As part of our annual year-end and audit report preparation, we have included the completion of the\nannual ICR proposal as an action item.\n\n\n\n\n -2-\n\x0cFinding 4.\nCosts claimed not included in original or amended budgets, incurred prior to the grant period,\nunallowable, unsupported, or paid in violation of POL policies.\n\nPOLI concurs with the finding. It was during the initial merger integration period that the majority of the findings\noccurred. On August 1, 2007 the Points of Light Foundation and HandsOn Network (HON) merged. Post\nmerger, there were standard integration activities including the consolidation of legacy POLF and legacy HON\nCNCS grants, finalizing policies and procedures for the newly merged organization, as well as coordination\nacross two locations with different IT systems. Having completed integration, POLI now has clear policies and\nprocedures for the merged entity.\n\nFinding 4a.i VISTA travel reimbursement paid prior to grant period total $377. It is possible that the $377 is a\nreflection of missed efforts related to the sequencing and aligning of the two VISTA grants.\n\nFinding 4a.ii Unallowable costs. The financing charges to the grant were in error POLI acknowledges that the $26\nwas over the allowable reimbursement for meals and will return the funds.\n\nFinding 4a.iii Unsupported expense. POLI was unable to provide support for transaction. We were unable to\nlocate the travel log for the VISTA travel reimbursement that is in question for the $28.\n\nFinding 4a. iv. Unsupported expenses. POLI was unable to provide support for transaction at the time of audit.\nInitially POLI was not able to locate the credit card for the expenses in question. We subsequently obtained a\ncopy of the statement and we are working with the vendors to get copies of the invoices. We anticipate with\nadditional time we will be able to gather supporting documentation.\n\nFinding 4b. POLI has had training for staff and subgrantees on cost principles.\n\nFinding 4c. POLI has implemented internal controls to ensure adequate documentation to support\nexpenses\n\nFinding 4d. POLI maintains contracts and contractual agreements supporting payments that were\nimplemented in January 2009.\n\nFinding 5.\nLate submission of Financial Status Reports (FSRs), member enrollment forms, and exit forms.\n\nPOLI concurs with the finding and had previously identified the need to strengthen procedures to improve timely\nsubmission of information. As a response to ensure timely submission of reports, POLI has implemented an\noverall tracking system for all financial reports.\n\nHandsOn AmeriCorps has strengthened procedural practices to ensure prompt, complete, and accurate financial\nreporting and member information by establishing alerts that heighten as the deadline nears.\n\n5a Within all affiliate and partnership Memoranda of Agreements, an additional organizational\n compliance clause will ensure that all paperwork is submitted in a timely manner.\n\n\n\n\n -3-\n\x0c5b HandsOn AmeriCorps has revised policies and provides guidance for grantees to ensure timeliness. A\n Compliance Progressive Action Plan has been developed internally to monitor non-compliant advisory\n communication with the host site.\n\nFinding 6.\nMissing mid-term and end-of-term member evaluation forms.\n\nPOLI concurs with the finding. The POLI National Service Department recognizes the importance of mid and year\nend evaluations, and has utilized Big Tent, an internet-based communications tool, to host HandsOn AmeriCorps\npertinent documents, host forums on focused issue areas and solutions, and communicate important\nprogrammatic updates and events.\nThe system was designed to alert programs/subgrantees on deadlines and required information.\nTraining is provided to new and existing host site supervisors on how to properly complete the forms. A\ncalendar of important due dates, including the mid-year and final member evaluation due dates, is\nprovided at the mandatory Site Supervisors Training. Due dates are also posted on the OnCorps\nReports member management system whereby Site Supervisors are alerted when evaluations are\nmissing from the member file.\n\n6a Member evaluations guidance to affiliates is provided using a few methods, including our electronic\n system to distribute information, Big Tent grantee agreements and an annual calendar of events.\n6b Member evaluations procedures for compliance are included in a Compliance Progressive Action Plan\n which has been developed internally to monitor non-compliant advisory communication with the host site.\n\nFinding 7.\nMembers\xe2\x80\x99 Contract signed after beginning of service and timesheets not signed.\n\nPOLI concurs with the finding and acknowledges the errors associated with member service agreements and pre\ncontract service hours. We have created policies and procedures to ensure that no member is enrolled without a\nsigned member contract on file. Site supervisors are trained on these and other required enrollment procedures\nduring our summer institute (3 day training), summer onboarding webinars, and direct contact with national\nservice staff.\nPOLI acknowledges the unsigned member timekeeping records. As a result POLI has contracted with OnCorps,\nan online reporting system that brings efficiency to member timekeeping and attendance records and reporting.\nThe online system ensures that time logs are signed by both member and supervisor, and provides greater\nopportunity for oversight at the national office. Members and supervisors are trained at the beginning of the\nservice year, supported during the year by trained national staff, with an OnCorps webinar series available at any\ngiven time. We are confident with these new systems in place that errors will be minimized going forward.\nHowever, POLI does challenge the $5,725 questioned as a result of unsigned time logs. We have provided\ninformation from site supervisors that certify members served the hours in question.\n7a Hands On Miami - The member in question started her term off cycle and due to a language barrier took\n longer to comprehend the agreement.\n Metro Volunteers - The program did not receive the contracts prior to the members engaging in service,\n so they were signed after the members started.\n POL - Campaign- The timesheets for the member were either lost or misplaced.\n Hands On Miami - The timesheet was inadvertently not signed by the program manager.\n Pass it along - The time logs were inadvertently not signed by the AmeriCorps Supervisor at the time for\n all the projects and programs.\n\n\n\n -4-\n\x0c7b POLI has created policies and procedures to ensure that no member is enrolled without a signed member\ncontract on file. Site Supervisors are trained on these and other required enrollment procedures during our\nsummer institute (3 day training), summer on-boarding webinars, and direct contact with national service staff.\n7c POLI has contracted with OnCorps, an online reporting system that brings efficiency to member\ntimekeeping and attendance records and reporting. The online system ensures that time logs are signed by both\nmember and supervisor and provides greater opportunity for oversight at the national office. Members and\nSupervisors are trained at the beginning of the service year, supported during the year by trained national staff\nwith OnCorps webinar series also available at any given time. As a result, we are confident that these types of\nerrors will be minimized going forward. However, POLI challenges the $5,725 questioned as a result of unsigned\ntime logs as we have provided information from site supervisors, who were there at the time, that certify members\nserved those hours.\n\nFinding 8.\nInadequate evidence of citizenship/legal residency\n\nPOLI disagrees with the finding as we followed the requirements for VISTA eligibility documentation as outlined in\nMy AmeriCorps portal, and requirements provided from our State Office liaison. However, upon learning the\ndocumentation was considered insufficient to support proof of eligibility; we subsequently reached out to the\nMember to collect the member\xe2\x80\x99s birth certificate.\n\nFinding 9.\nUnallowable costs related to merger\nPOLI disagrees with the finding. The legal costs associated with the actual merger were not charged to CNCS.\nThe costs that are being questioned are from significantly after the merger occurred, there is one invoice from\nSeptember 2007 and the majority of costs questioned occurred in January and February 2008. The summary\nledger provides the description that the costs were merger related, however the detailed transaction information\nprovides details that these costs that are being questioned are related to organizational development and\nintegration. The merger between HandsOn Network and Points of Light occurred in August of 2007. These costs\nare related to post-merger integration and related to an all staff retreat and Board meeting.\n\n\n\n\n -5-\n\x0c APPENDIX B\n\nCorporation for National and Community Service\xe2\x80\x99s Response to Draft Report\n\x0c NATIONAL &\n COMMUNITY\n SERVICEtttt:\nTo:\n\n.From:\n\nDate:\n\nSubject: Response to OIG Draft of Agreed-Upon Procedures of Grants Awarded to the Points of\n Light Foundation\n\n\nThank you for the opportunity to review the Office of the Inspector General draft Agreed-Upon\nProcedures report of the Corporation's grants awarded to the Points of Light Foundation (POL). The\nCorporation reviewed the OIG report, met with the auditors and the grantee and reviewed the POL draft\nresponse to the audit. We are addressing aU draft fmdings at this time. In general, we agree with the OIG\nrecommendations and reviewed a preliminary corrective action plan from POL. The plan does not\nadequately address the audit fmdings and we are working with POL to strengthen the plan before we\napprove it. Once approved, we will require POL to implement it within 120 days.\n\nFinding 1. Accounting system is not adequate to account Cor Federal fuods.\n\nRecommendation 1: The auditors recommend that the Corporation:\n\nI a. Perform a reconciliation, for each POL grant, between the General Ledger and the PMS drawdowns\n to determine whether the grants were over-drawn and recover these amounts;-\nlb. Resolve the questioned costs of$8 ,325 and recover disallowed costs;\n1c. Ensure POL improves its accounting system to record by grant, Federal and match costs separately\n with a record-keeping system to identify the source documentation;\nId. Ensure POL reconciles the general ledger to the Financial Reports and drawdowns to the Federal\n share; and\nIe. Provide guidance to POL to include all costs, Federal and match, in its Financial Reports.\n\n Corporation Response: The Corporation generally agrees with the recommendations and will\n determine if the questioned $8,325 was charged twice. Ifso, we will disallow duplicate costs. POL\n needs to fully use the capabilities of its accounting system to properly track and segregate its Federal\n grants and accurately reconcile and report expenses between the Federal Financial Report and its\n general ledger. Their procedures should incorporate requirements to perform a full reconciliation of\n the general ledger to the FFR and to include all costs when completing and submitting FFRs.\n However. we don 't agree with Recommendation la as written. The issue is related to cash\n management, not necessarily reconcitiation. Under Federal rules, grantees may not draw funds from\n the Payment Management System in excess of immediate needs. POL must ensure that it draws\n funds from the IlliS system only as it needs them. ID-IS monitors cash management through the\n disbursement report grantees submit quarterly to the payment system. At the end of the grant. the\n Corporation ensures that grant expenditures as reported on the FFR reconcile to amounts drawn down\n from IllIS. To ensure POL complies with cash drawdown and expenditure requirements. we will\n require the organization to develop written procedures for detennining amounts to access in the llliS\n system based on actual expenditures as recorded in the general ledger.\n\x0cFinding 2. Affiliate monitoring visits Dot performed in accordance with the POL policies.\n\nRecommendation 2: The auditors recommend that the Corporation:\n\n2a, Ensure that POL enhance its policies to incorporate alternative procedures when staff resources\n adversely affect its ability to perform annual onsite monitoring of all affiliates. Alternative\n procedures could include desk reviews.\n\n2b. Ensure that POL's use of alternative procedures be documented and approved by a senior POL\n official.\n\n Corporation Response: During a review of POL's site monitoring documentation, the auditor found\n that POL did not comply with its own site monitoring policies and procedures and failed to perform\n or fully perform site visits in three consecutive program years. The Corporation concurs with the\n finding and recommendations and will work with POL to implement them within 120 days.\n\nFinding 3. Indirect rates not approved\n\nRecommendation 3: The auditors recommend that the Corporation:\n\n38. Resolve the questioned costs of$509,536, and recover disallowed costs;\n3b. Ensure that POL develops effective documented control procedures for the submission and\n negotiation of Indirect Cost Proposals; and\n3c. Ensure that Corporation grant officers do not a110w recovery of administrative cost in excess of the\n, regulatory limit without a NlCRA ,\n\n Corporation Response: The auditors questioned $509,536 of Federal claimed indirect costs because\n they were based on a provisionaJ, rather than a final indirect cost rate, The Corporation agrees that\n POL should have finalized its provisional rates each year and it has now done so, On May 28, 2010,\n we received notification of the fmal rates from HHS for the periods covering the dates of the audit.\n DIG staff also received the final rate and has indicated they will confIrm the rate application when\n they issue this report as fmaL We will base our detennination of allowable amounts on the DIG\n confinnation. From discussions with OIO to date, we anticipate aHowing the costs, The Corporation\n will require POL to develop and implement accounting procedures within 120 days to ensure timely\n proposals are prepared and submitted and rates are negotiated for each year it claims indirect costs.\n\nFinding 4. Cosu claimed oot included in Original or amended budgets, incurred prior to the grant\nperiod, unaUowable, unsupported, or paid in violation of POL policies.\n\nRecommendation 4: The auditors recommend that the Corporation:\n\n4a, Resolve the questioned costs, $15,285 and recover disallowed costs;\n4b, Ensure that POL provides additiona1 training to its staff and affiliates on the Cost Principles and grant\n prOVisions, including the requirements for the budget, donations, entertainment. and interest;\n4c. Ensure that POL maintains adequate support for the Federal and match costs; and\n4d. Provide guidance to POL regarding contractual agreements and internal policies to ensure that\n payments are made in a manner that is consistent with its policies and procedures.\n\n Corporation Response: The Corporation agrees with the recommendations and will disallow any\n questioned costs that are unsupported or for unallowable expenditures. To date, POL bas not\n provided supporting documentation that was unavailable during the audit that would allow the\n\x0c Corporation to approve the costs. POL has also indicated that it has trained its staff on the Cost\n Principles and implemented internal controls to ensure adequate documentation for expenditures and\n procedures for contracting and payment processing. The Corporation will confirm implementation\n within 120 days.\n\nFinding 5. Late submissioo of Fin8ncial Status Reports (FSRs), member enrollment forms, and exit\nforms.\n\nRecommendation 5: The auditors recommend that the Corporation ensure that POL:\n\nSa. Strengthens its procedures and reminders to affiliates to ensure prompt and complete financial\n reporting, as well as member information; and\n5b. Provides guidance, during its affiliate training. on proper and timely completion and submission of\n enrollment and exit fonns.\n \xe2\x80\xa2\n Corporation Response: In the course of the audit, auditors found numerous instances of late\n financial and member entrance and exit reporting. The Corporation agrees and will work with POL to\n ensure that it provides written guidance and training to its staff and affiliates on all frnancial and\n member reporting requirements and develops and implements monitoring policies and procedures to\n ensure affiliate compliance with reporting due dates.\n\nFinding 6. Missing mid~term and end-of-term member evaluation forms.\n\nRecommendation 6: The auditors recommend that the Corporation ensure that POL:\n\n6a. Provide guidance, during its affiliate training, to ensure that required evaluations are completed and\n djscussed with the member in a timely manner; and\n6b, Develop procedures to ensure that affLliates conduct and maintain records of iDid-tenn and end-of-\n term evaluations of each member according to AmeriCorps Provisions.\n\n Corporation Response: The Corporation concurs with the fmding and recommendations and will\n work with POL to ensure that it issues guidance and trains staff on the requirements to perfonn and\n maintain documentation of mid-term and end-of-tenn evaluations. AdditionaUy. the Corporation will\n ensure that POL has monjtoring procedures in place to ensure that affiliates are compliant with the\n requirement.\n\nFinding 7. Members' contract signed after beginning of service and timesbeets not signed.\n\nRecommendation 7: The auditors recommend that the Corporation:\n\n7a. Resolve the questioned costs, $3,032, questioned education awards of$S, 72S and recover disallowed\n costs;\n7b. Ensure POL requires affiliates to have members sign the contract prior to starting service; and\n7c. Ensure POL trains its afftliates on member timekeeping and attendance records and strengthens\n procedures to ensure that timesheets are signed by members and individuals with oversight\n responsibilities.\n\n Corporation Response: The Corporation agrees that member contracts need to be signed as\n members begin their service to ensure they understand their rights and responsibilities. POL has\n indicated it created policies to ensure member contracts are signed before members begin service and\n is implementing a new on-line timekeeping system. We will confirm implementation with 120 days.\n\x0c We also agree that timesheets must be signed by both the member and supervisor and maintained to\n document completion of service hours. To date. POL has not provided sufficient documentation,\n such as conftrmation from the supervisor. to determine the hours were served. Unless we get\n appropriate support, we will disallow the $3.032 in living allowance payments and $5,725 in\n education awards.\n\nFinding 8. laadequate evidence of citizenshipllegal residency\n\nRecommendation 8: The auditors recommend that the Corporation:\n\n8a. Resolve the questioned education award and recover disallowed costs;\n8b. Provide POL adequate guidance on VISTA member eligibility and maintenance of members ' records;\n8c. Revise VISTA regulations to describe the documents necessary for establishing Citizenship and legal\n permanent residency, similar to Subtitle C programs in 45 CFR ~ 2522.200; and\n8d. Ensure that POL provides additional training to its employees to ensure they are familiar with the\n requirements regarding documentation supporting U.S. citizenship.\n\n Corporation Response: The VISTA citizenship documentation requirements were different from\n the AmeriCotps StatefNational requirements and POL was following the VISTA eligibility policies as\n previously directed. However, in response to another audit. the Corporation recognized that VISTA\n must follow the AmeriCorps StatelNational citizenship documentation requirements for eligibility for\n the education award. We are currently revising the requirements as recommended by DIG. We also\n worked with POL to secure a birth certificate for the member and confmned the member is a U.S.\n citizen. Therefore the education award is allowed.\n\nFinding 9. Unallowable organization costs related to tbe merger oftbe Points of Light Foundation\nand tbe Hands On Network.\n\nRecommendation 9: The auditors recommend that the Corporation:\n\n9a. Resolve the questioned costs, $20, I 07, and recover disallowed costs; and\n9b. Ensure that Points of Light provides additional training to its staff on allowable and unallowable\n costs.\n\n Corporation Response: The Corporation agrees that the $20.017 claimed for expenditures related to\n the merger are genemlly unallowable unless approved in the grant budget or by the awarding agency\n in advance. We would not have approved the costs in either case and they are disallowed. We will\n ensure POL trains its staff trains its staff appropriately and also establishes better controls over budget\n amendments and cost approvals.\n\n\nCc: William Anderson, Chief FinanciaJ Officer\n Frank Trinity, General Counsel\n John Gomperts, Director of AmeriCorps\n Bridgette Roy, Administrative Assistant, OCFO\n\x0c"