10 Program, Fiscal Monitoring, and Audit, 2605(b)(10) - Assurance 10

10.1. How do you ensure good fiscal accounting and tracking of funds? Subgrantee HEAP awards are contracted for the duration of the federal fiscal year, 10/1 to 9/30. Cash requests are submitted monthly by Subgrantees for their next month’s projected expenditures. The Commonwealth HEAP contract explains the invoice process. The Subgrantee shall submit requests for funds using the online invoice HEAP Cash Request Form through the Commonwealth of Massachusetts Community Software Group (CSG) system by the 5th working day of each month for the Contractor’s cash needs for the upcoming month. The Massachusetts Management Accounting and Reporting System (MMARS) and CSG Grant Management Software system are used to track the receipt of HEAP funding and payments to Subgrantees. Actual incurred monthly program expenditures are entered into the CSG system by Subgrantees via the HEAP Program Expenditure Report and this report is used to reconcile cash receipts with actual program expenditures. Subgrantees that receive weatherization funding are awarded separate contracts for the Heating Emergency Assistance Retrofit Task Weatherization Assistance Program (HEARTWAP). HEARTWAP contracts are contracted for the duration of the federal fiscal year 10/1 to 9/30. Cash requests are submitted monthly by Subgrantees for reimbursement of their booked expenditures. The MMARS and CSG System are used to track the receipt of HEARTWAP funding and payments to Subgrantees. Actual incurred monthly expenditures are entered into the CSG system by Subgrantees via the HEARTWAP monthly system report and this report is used to reconcile cash receipts with actual program expenditures. If a vendor refund is received by a Subgrantee, these funds are returned to the state. Subgrantees specify the HEAP program year the funds originate from and these returns are tracked on an excel spreadsheet by state fiscal staff and are returned to the program to include in the next allocation of funding. The funds are returned to the correct federal program year line in MMARS. If HEAP funds are not spent within the allowable 2-year period, those unspent funds are returned to the Federal Government. 10.1a Provide your definitions of the following: Obligation Obligate funds in a contract with the LAA per earmark/allocation spreadsheet per start and end date of award letter. Funds are allocated per earmark/allocation spreadsheet and documented in the budget, spending authority, and award letter. Expenditures Follow Commonwealth of MA Office of the Comptroller Expenditure Classification Handbook definitions and use MA object codes to classify expenses per Handbook. Expenditure timeframe Follow dates on federal award letter. Administrative costs All direct and indirect costs including those of sub-recipients and contractors necessary to effectively manage the program. Audit Process 10.2. Is your LIHEAP program audited annually under the Single Audit Act and OMB Circular A - 133? Yes No 10.2a - if yes, describe your auditor selection process. The Single Audit is conducted by the Massachusetts Office of the Comptroller (CTR). CTR does an open procurement for an outside accounting firm to conduct the Single Audit. For FY2024 single audit was conducted by ClifonLarsonAllen (CLA). 10.3. Describe any audit findings of the grant recipient (i.e. State/Tribe/Territory) rising to the level of material weakness or reportable condition cited in the single audits, inspector general reviews, or other government agency reviews from the most recently audited fiscal year. No Findings Finding Type Brief Summary Resolved? Action Taken 1 reporting Establish procedures and internal controls to ensure that all required subawards are reported timely and accurately to Federal Subaward Reporting System (FSRS) no later than the end of the month following the month of issuance of each subaward. Yes procedure/policy changes 2 reporting Review and enhance its procedures and internal controls to ensure that special reports are submitted timely and accurately, and that the information reported agrees to supporting documentation. Yes procedure/policy changes 3 other Contracting-Review and enhance internal controls and procedures to ensure that required information is included in its subawards. Yes procedure/policy changes 10.4. Audits of Local Administering Agencies What types of annual audit requirements do you have in place for local administering agencies/district offices? Select all that apply. Local agencies/district offices are required to have an annual audit in compliance with Single Audit Act and OMB Circular A-133 Local agencies/district offices are required to have an annual audit (other than A-133) Local agencies/district offices' A-133 or other independent audits are reviewed by Grant recipient as part of compliance process. Grant recipient conducts fiscal and program monitoring of local agencies/district offices Local agencies and district offices are required to have an annual audit in compliance with Single Audit Act and OMB Circular A-133 Compliance Monitoring 10.5. Describe your monitoring process for compliance at each level below. Check all that apply. Grant recipients have a policy in place for appropriate separation of duties and internal controls. Internal program review Departmental oversight Secondary review of invoices and payments Other program review mechanisms are in place. Describe: Local Administering Agencies/District Offices: On - site evaluation Annual program review Monitoring through central database Desk reviews Client File Testing/Sampling Other program review mechanisms are in place. Describe: The Commonwealth of Massachusetts shall continue to review/modify program monitoring procedures to ensure compliance with all state and federal laws, regulations, and Massachusetts HEAP Administrative Guidances and operating procedures. 10.6 Explain, or attach a copy of your local agency monitoring schedule and protocol. Annually, Massachusetts evaluates each Subgrantee’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward to determine the appropriate type of monitoring. Unless a Subgrantee has been determined to be a “High Risk”, in general, the alternating schedule outlined below applies. It divides the monitoring of the Subgrantees between onsite visits and remote assessments. Each type of assessment has its own protocol and monitoring tool. 10.7. Describe how you select local agencies for monitoring reviews. Attach a risk assessment if subrecipients are utilized. Site Visits: Subgrantees that were programmatically assessed remotely in the last fiscal year will be monitored on site this upcoming fiscal year. For those Subgrantees that were deemed “High Risk” or have a new Program Director, an onsite assessment will be conducted regardless of the type of prior year’s assessment. Fiscally, Subgrantees that are determined “High Risk” during the risk assessment evaluation or have had two or more funding cycles pass since they were last monitored will be selected for an onsite monitoring visit. Desk Reviews: Subgrantees that are determined “Low Risk” during the risk assessment evaluation will not be selected for an onsite monitoring visit. “Low Risk” Subgrantees will be monitored remotely with performance assessed via review of client databases. 10.8. How often is each local agency monitored? Please attach a monitoring schedule if one has been developed. Annually 10.9. How many local agencies are currently on corrective action plans? 0 If any of the above questions require further explanation or clarification that could not be made in the fields provided, attach a document with said explanation here.