BOARD COMMITTEE MEETING. Jefferson/Franklin Community Action Corporation

Transcription

1 BOARD COMMITTEE MEETING Jefferson/Franklin Community Action Corporation

2 JFCAC Finance Committee Meeting December 16, 2015 Building Our Identity Together Topic of Discussion Bring Meeting to Order Approve October Meeting Minutes Review of October financials* Review of Balance Sheet Review Grant Report Line of Credit Update Update on Go Fund Me and Amazon Brown Smith and Wallace Fiscal Analysis Review of Recommendations Update on Budgeting Facilitator of Discussion Committee Chair Kristin Firle / Jill Lombardo Kristin Firle / Jill Lombardo Kristin Firle / Jill Lombardo Kristin Firle Jill Lombardo Kristin Firle Kristin Firle / Jill Lombardo *Above items will require a committee vote and then will be taken to the full Board for final approval. Jefferson Franklin Community Action Corporation # 2 Merchant Street Hillsboro, Missouri 63050

3 Financial Committee Meeting October 15, 2015 Present Dr. Julia Hampton Rev. Curtis Crumpecker Cynthia Eckelkamp Staff Jill Lombardo Kristin Firle Karen Vance Absent Aaron Arndt The Finance Committee Meeting was called to order by Rev. Curtis Crumpecker at Jefferson Franklin Community Action Corporation, #2 Merchant Drive, Hillsboro, MO, The minutes from August 13, 2015 minutes were read and approved. A motion was made by Cynthia Eckelkamp to approve minutes, seconded by Curtis Crumpecker. There were no abstentions or no votes. Motion carried. Curtis Crumpecker announced that the third Financial Committee Member, Aaron Arndt resigned. Potential replacements were discussed; no decision was made. Kristin Firle presented the financial statements, reviewed the August financials and the new report format. Kristin explained the reporting information that Regional office is requesting; cost allocating vs. indirect cost. Information was discussed JFCAC current indirect (administrative) cost is set at 13.2%.. Education is in process for Directors to be more responsible for their budgets. Overall JFCAC revenue exceeded expenses. A motion to approve the Financial Report was made by Cynthia Eckelkamp, seconded by Curtis Crumpecker. There were no abstentions or no votes. Motion carried. Ron Steinholz from Brown Smith Wallace, LLC has been contacted to review fiscal management policies, procedures, and practices; provide guidance and provide ongoing assistance to Kristin in order for her to obtain her CPA license. Brown, smith and Wallace are currently below expected cost for this service. Brown, Smith Wallace has reviewed our practices and report that JFCAC policies are in line with Federal policies. One concern from Brown, Smith and Wallace is the separation of duties in the fiscal department and having an accountant in the Housing department that does not fall under the CFO; recommendations and concern are being reviewed. Kristin provided an overview of Grants for JFCAC; consultants (Cleo) expenses are included in the Re-compete Grant. A motion to approve the Grant Report was made by Cynthia Eckelkamp, seconded by Curtis Crumpecker. There were no abstentions or no votes. Motion carried. The Line of Credit is being reviewed for approval by our current bank and should be approved for the Board meeting. The additional bank accounts are in place, deposit slips and checks are on order. Jill is completing a Go Fund Me for Head Start based on suggestions from the Financial Committee. The fund will be for Head Start/Early Head Start technology and will be sent out to Board, Committee member and staff when complete. Jill and Kristin request approval to renew the annual ACH agreement with Eagle Bank and Trust Company of Missouri.. A motion to renew the ACH contract was made by Curtis Crumpecker, seconded by Cynthia Eckelkamp. There were no abstentions or no votes. Motion carried. A motion was made for the JFCAC Board to review the August Financials was made by Cynthia Eckelkamp, seconded by Curtis Crumpecker. There were no abstentions or no votes. Motion carried.

4 A motion was made for the JFCAC Board to review the Grant report was made by Cynthia Eckelkamp, seconded by Curtis Crumpecker. There were no abstentions or no votes. Motion carried. Jill reported a plan to reconfigure staff raises. Raises will be based on performance; the goal is to align all raises to happen at the same time. Currently they are guided by department and grant monies. A discussion was introduced on the morale and JFCAC changes in the last few months. All agreed that JFCAC is moving in the right direction and have confidence in the current Administration. A motion was made to adjourn the meeting by Cynthia Eckelkamp, second by Curtis Crumpecker. There were no abstentions or no votes. Motion carried. Meeting adjourned. Respectfully submitted by, Karen Vance Karen Vance Corporate Secretary Financial Committee Action items Line of Credit status Progress on grant funding Go Fund me progress New committee member

5 Summary of Financials Through October 31, 2015 Overall: Total Revenue for JFCAC is $11,391,932 year-to-date projected was $11,650, % less revenue than projected. Total Expenses for JFCAC is $10,724,930 year-to-date projected was $11,063, % less than projected. Administration: Revenue: actual revenue $45,758 / projected revenue is not determined, budget is in progress. Expenses: actual expense $46,375 / projected expenses is not determined, budget is in progress. Specific Programs: Housing: Administration Revenue: actual revenue $472,216 / projected revenue $376,092/25.55% more revenue than projected. Expenses: actual expense $441,771/ projected expenses $381,993 / 15.65% more expenses than projected. HAP Revenue: actual revenue $438,434 / projected revenue is not determined, budget is in progress. Expenses: actual expense $420,926 / projected expenses is not determined, budget is in progress. FSS Revenue: actual revenue $40,626 / projected revenue $64,449/36.90% less revenue than projected. Expenses: actual expense $44,806 / projected expenses $64,549 / 33.16% less expenses than projected. Early Head Start: Revenue: actual revenue $615,892/ projected revenue $635,648 /3.10% less revenue than was projected. Expenses: actual expense $629,464 / projected expenses $637,883/ 1.32% less expenses than projected. Head Start: Revenue: actual revenue $1,720,617 / projected revenue $1,820,592 / 5.49% less revenue than projected. Jefferson Franklin Community Action Corporation P.O. Box 920 Hillsboro, MO

6 Expenses: actual expense $1,621,929/ projected expenses $1,841,604 / 11.93% less expenses than projected. USDA: Revenue: actual revenue $16,963 / projected revenue is not determined, budget is in progress. Expenses: actual expense $16,267 / projected expenses is not determined, budget is in progress. Weatherization: Laclede Revenue: actual revenue $48,425 / projected revenue $59,501 /18.58% less than projected. Expenses: actual expense $48,859 / projected expenses $59,501 /17.89% less than projected. Ameren Revenue: actual revenue $105,983 / projected revenue $105,983. No variance. Expenses: actual expense $105,983 / projected expenses $105,983. No variance. LIHEAP Revenue: actual revenue $6,849 / projected revenue is not determined, budget is in progress. Expenses: actual expense $6,849 / projected expenses is not determined, budget is in progress. UTILICARE Revenue: actual revenue $7,758 / projected revenue $4,807 /60.14% more than projected. Expenses: actual expense $7,459 / projected expenses $4,807 /55.17% more than projected. DOE Revenue: actual revenue $144,703 / projected revenue $62,679 /130.65% more than projected. Expenses: actual expense $147,989 / projected expenses $62,679 /136.11% more than projected. WIC: Revenue: actual revenue $71,742 / projected revenue is not determined, budget is in progress. Expenses: actual expense $609,585 / projected expenses is not determined, budget is in progress. Healthy Homes: Revenue: actual revenue $95,000 / projected revenue $95,000 / no variance. Expenses: actual expense $95,225 / projected expenses $95,243 /2.95% more than projected. Desperately Needed Diaper: Revenue: actual revenue $72,000 / projected revenue $72,000 / no variance. Expenses: actual expense actual expense $53,435 / projected expenses $66,000 / 19.04% less than projected American Water: Revenue: actual revenue $750 / projected revenue $1,500 / 46.87% less than projected. Expenses: actual expense $0 / projected expenses $1,575 /100% less than projected. Jefferson Franklin Community Action Corporation P.O. Box 920 Hillsboro, MO

7 ECIP - Utilicare Revenue: actual revenue $94,378 / projected revenue $21,572 / % more than projected. Expenses: actual expense $14,775 / projected expenses $13,296/ 11.03% more than projected. ECIP Revenue: actual revenue $23,608 / projected revenue is not determined, budget is in progress. Expenses: actual expense $18,493 / projected expenses is not determined, budget is in progress. CSBG: Revenue: actual revenue $ / projected revenue is not determined, budget is in progress. Expenses: actual expense $77,879 / projected expenses is not determined, budget is in progress. Jefferson Franklin Community Action Corporation P.O. Box 920 Hillsboro, MO

8 Jefferson Franklin Community Action Corporation Expenditure Status As of : October 31, 2015 To Date Amount Spent To Date Amt Budgeted to Spend Over or (Under) Spent % to date Budgeted to Spend % Over or (Under) Spent Notes Month of Month Program Total Budget Amount Ending Date % Spent Administration 572,220 9/30/ ,375-46, % 8.33% #DIV/0! Budget Pending 1 of 12 Housing - Admin 509,993 12/31/ , ,993 59, % 83.33% 15.65% over spent 10 of 12 Housing - FSS 86,116 12/31/ ,806 64,549 (19,743) 52.03% 83.33% % under spent 10 of 12 Housing - HAP 4,622,457 9/30/ , , % 8.33% #DIV/0! Budget Pending 1 of 12 Early HeadStart 1,244,841 2/29/ , ,883 (8,419) 50.57% 66.67% -1.32% under spent 8 of 12 HeadStart 2,527,243 2/29/2016 1,621,929 1,841,604 (219,675) 64.18% 66.67% % under spent 8 of 12 USDA 172,000 9/30/ ,267 16, % 8.33% #DIV/0! Budget Pending 1 of 12 Weatherization - Laclede 59,501 10/31/ ,859 59,501 (10,642) 82.11% % % under spent Grant FY Ended - Carry Over 12 of 12 Approved Weatherization - Ameren 105,983 10/31/ , , % % 0.00% Grant FY Ended 12 of 12 Weatherization - LIHEAP 285,943 9/30/2016 6,849-6, % 8.33% #DIV/0! Budget Pending 1 of 12 Weatherization - Utilicare 16,023 1/31/2016 7,459 4,807 2, % 57.14% 55.17% over spent 4 of 7 Weatherization - DOE 188,037 6/30/ ,989 62,679 85, % 33.33% % over spent Internal Budget Revision in Progress 4 of 12 WIC 532,143 9/30/ , ,884 (593,219) 6.14% 8.33% % under spent 1 of 12 Desperately Needed Diapers 72,000 11/30/ ,435 66,000 (12,565) 74.22% 91.67% % under spent 11 of 12 American Water 3,000 4/30/2016-1,575 (1,575) 0.00% 50.00% % under spent 6 of 12 Healthy Homes 95,000 11/30/ ,503 79,167 2, % 91.67% 2.95% over spent 11 of 12 ECIP Utilicare 94,378 9/30/ ,775 13,414 1, % 8.33% 10.15% over spent 1 of 12 ECIP 1,030,251 9/30/ ,493 18, % 8.33% #DIV/0! Budget Pending 1 of 12 CSBG 839,402 9/30/ ,879 77, % 8.33% #DIV/0! Budget Pending 1 of 12

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47 AREA CITED TO BE IMPROVED Authorization for CEO, CAO, CFO submissions for reimbursement & travel Expense reports Conflict of interest statement Ethics / fraud policy and training Policy & Procedures Employee Handbook - #1 SUGGESTED CHANGE Document processes with specific authorizations identified Identify allotted timeframe for submission of expense reports Ensure all employees are required to sign Implement detailed ethics and fraud policy and related training Revise / consolidate to agree policies, incorporating internal controls, authorizations, processes, and support / documentation required; also, include consistent responsible party titles in each process SUGGESTED STEPS TO MAKE CHANGES Determine appropriate approval process & include in revised policy / procedures Update in conjunction with policy / procedure revisions Detailed review of every policy and update as change in procedures are implemented, i.e. Housing Dept. check issuance consolidation; removing ARRA & ezlabor system references; ADP procedures; and credit card use/authorization/forms. PERSON RESPONSIBLE DEADLINE

48 AREA CITED TO BE IMPROVED Policy & Procedures Employee Handbook - #1 (continued) Policy & Procedures Employee Handbook - #2 Policy & Procedures Employee Handbook - #3 Policy & Procedures Employee Handbook - #4 SUGGESTED CHANGE Policy documents that include system screenshots should have personal information redacted Complete copy of procedures available, either paper or electronically General policy updates SUGGESTED STEPS TO MAKE CHANGES Updated policies to include documentation required for processing & approval process Recommend responsible party drafts current policy and procedures for review and approval by Management. New policy / process documentation modified to remove PII from any system screenshots outlining new procedure(s). Once guidelines revised, ensure manuals or websites have accurate and complete policy & procedures for employee access 1) Include update datestamp on every policy; 2) include file location of every key spreadsheet, form, & location of login / passwords 3) Recommend removal of logins / passwords from all policy & PERSON RESPONSIBLE DEADLINE

49 AREA CITED TO BE IMPROVED Policy & Procedures Employee Handbook - #4 (continued) ACH transactions - #1 ACH transactions - #2 Internal Controls - #1a SUGGESTED CHANGE Verify on-line checks does not permit payments to vendor not on master vendor file Specify ACH procedures as related to current operations Ensure consistent controls throughout agency operations SUGGESTED STEPS TO MAKE CHANGES procedure documentation Update in conjunction with policy / procedure revisions New policies to include updated internal controls within procedures outline PERSON RESPONSIBLE DEADLINE Internal Controls - #1b Property & Equipment inventory - #1 Property & Equipment inventory - #2 Property & Equipment inventory - #3 Implement annual review and tracking of P&E Management review of P&E write offs Secure P&E tracking log Implement interim review of key controls by Management, i.e. segregation of duties adhered to Update policy surrounding P&E inventory; calendar & implement process for review Update in conjunction with policy / procedure revisions If not already in use, create log with current P&E and relevant detail

50 AREA CITED TO BE IMPROVED Purchasing - #1 Purchasing - #2 Purchasing - #3 Professional Development - Student financial assistance Repayment Agreements Program conclusion - #1 Program conclusion - #2 SUGGESTED CHANGE Document process for ensuring items do not exceed initial purchase order / authorized amounts Replace purchase guideline narrative in procedures manual Identify individual(s) responsible for receiving purchases: Program inventory, office supplies, other goods Create and implement monitoring process and revise procedures to include activity monitoring and updated controls Verify appropriate measures in place to ensure additional agreements not made with prior defaulting parties Detail related to inventory wrap up once Program concludes Identify responsible party for monitoring, and SUGGESTED STEPS TO MAKE CHANGES Does a control exist to ensure costs do not exceed authorized purchase order amounts? Utilize purchase summary chart for ease of reference Update in conjunction with policy / procedure revisions Does a control exist to ensure development activity is within policy requirements? Are there guidelines included in the Program? Are there guidelines included in the Program? If so, include with Determine Management oversight of Program Director(s) and document PERSON RESPONSIBLE DEADLINE

51 AREA CITED TO BE IMPROVED Program conclusion - #2 (continued) Sub grants Compliance calendar Reporting Requirements - #1 Reporting Requirements - #2 Reporting Requirements - #3 Reporting Requirements - #4 Reporting Requirements - #5 SUGGESTED CHANGE process for, Program conclusion If sub grants commonly utilized, provide additional guidance re: use, authorizations, procedures Verify all reporting items, Program and Governmental, are included and up-to-date Document process ensuring complete and accurate financial data used for reporting Identify individual(s) responsible for ECIP accrual JE and associated review and approval of JE Confirm accuracy of related reporting calculations Weatherization guidelines indicates quarterly and monthly reporting Replace manual calculations with systemgenerated balances SUGGESTED STEPS TO MAKE CHANGES associated internal controls Update in conjunction with policy / procedure revisions Identify support necessary for reporting documents; current policies vague Update in conjunction with policy / procedure revisions Confirm accuracy of reporting requirements and document appropriate processes i.e. PMS guidelines for running a tape of deposits and VMS PERSON RESPONSIBLE DEADLINE

52 AREA CITED TO BE IMPROVED Reporting Requirements-#5 (continued) Reporting Requirements - #6 Reporting Requirements - #7 Participant payments Housing Assistance Payments (HAP) - #1 Housing Assistance Payments (HAP) - #2 Housing Assistance Payments (HAP) - #3 Housing Assistance Payments (HAP) - #4 Housing Assistance Payments (HAP) - #5 SUGGESTED CHANGE Include links to form reporting guidance Identify individual(s), beyond CFO, responsible for completing government filings Process to ensure agreement not made to defaulting parties Verify accuracy of fund transfer calculation and related process Apply threshold for payments Review appropriate reissuance of voided (returned) payments Discontinue void check copy made for Housing files Confirm refund process SUGGESTED STEPS TO MAKE CHANGES procedure for backing out void check amounts Links to instruction detail found online to be included with policy documentation Update in conjunction with policy / procedure revisions Is this already included in Program guidelines? Detailed review and update of funds transfer regarding HAPs Confirm necessity and appropriateness of issuing $1 utility checks Utilize A/P check log or excel spreadsheet to track Review and update process surrounding HAP refund PERSON RESPONSIBLE DEADLINE

53 AREA CITED TO BE IMPROVED In-Kind Contributions - #1 In-Kind Contributions - #2 Interest Travel per diem - #1 Travel per diem - #2 Depreciation - #1 Depreciation - #2 SUGGESTED CHANGE Specify if Program Director approval necessary on receipt voucher Identify agency response to In-Kind Contribution Identify individual responsible for preparing interest JV, as well as review and approval of JV Guidelines in various manuals do not agree Confirmation that any electronic versions of policy are current & accurate Identify functional areas that depreciation pertains to Specify review and approval process for monthly depreciation SUGGESTED STEPS TO MAKE CHANGES Include with Program Director responsibility summary Include portion for Director s approval on receipt voucher If there is a process in place, i.e. letter to contributor acknowledging gift, should document procedure Update in conjunction with policy / procedure revisions Document accurate per diem rates and required timely submission for travel reimbursement Update in conjunction with policy / procedure revisions PERSON RESPONSIBLE DEADLINE

54 AREA CITED TO BE IMPROVED Cash Flow monitoring Vendor Master file Contracts - #1 Contracts - #2 Maintenance Contracts Cost Allocation - #1 Cost Allocation - #2 Electronic documents - #1 Electronic documents - #2 SUGGESTED CHANGE Document high-level process for monitoring cash flows at Agency and Program levels Process for monitoring no unauthorized changes to vendor file(s) Create contract tracking system for key term identification, monitoring & ease of reference Ensure contract noncompliance communicated to CFO Identify individual responsible for executing and monitoring Outline review and approval process for indirect rate preparation Identify individual responsible for indirect rate JV and related review and approval process Implement consistent document naming convention Procedures for document management electronic storage SUGGESTED STEPS TO MAKE CHANGES Update in conjunction with policy / procedure revisions Determine if system is set up to limit access to vendor master file Update in conjunction with policy / procedure revisions Update in conjunction with policy / procedure revisions Update in conjunction with policy / procedure revisions Organized storage aids in document destruction and logging destroyed records PERSON RESPONSIBLE DEADLINE

55 AREA CITED TO BE IMPROVED MIP System Requirements - #1 MIP System Requirements - #2 MIP System Requirements - #3 MIP System Requirements - #3 (continued) Payroll / Timekeeping Payroll / Timekeeping with HeadStart - #1 Payroll / Timekeeping with HeadStart - #2 SUGGESTED CHANGE Ensure access to MIP system is restricted to individuals who need access MIP Bank reconciliation module install, review other modules already installed Restrict access inside of MIP to allow only modules to individuals who need those access points Work with HR to get a timekeeping system in place Ensure compliance with HeadStart rules regarding people recording time based upon time spent in each program Ensure compliance with DOL standards related to employees working off the clock, including volunteer hours SUGGESTED STEPS TO MAKE CHANGES Review access requirements and access to accounting system to ensure users are authorized Contact Abila and see pricing on Bank module and install before 1/1/16, check to see if any other modules are charged that are not needed Review internal access to see which modules are needed by person and restrict access (even at the CFO level) System is currently manually entered, the system needs to have individuals clock in/out HR and Finance to review documentation to see if there is any compliance issues. HR and Finance to review policies and practices to eliminate a whistle blowing effect due to employees being told to PERSON RESPONSIBLE DEADLINE

56 AREA CITED TO BE IMPROVED Payroll / Timekeeping with HeadStart - #2 (continued) Exempt / Non-exempt employees Access to computer systems (IT) - #1 Access to computer systems (IT) - #2 Signature Stamp SUGGESTED CHANGE Ensure compliance with D.O.L. regulations with non-exempt employees Access to systems seem to be an issue eliminate possible IT threats by ensuring access to individuals no longer associated with organization ( s, Server access, etc.) Certain remote sites do not have access to systems, and may need to remote in. Ensure that all individuals that need access have authority and access to available files Review use and policy of signature stamp, along with access and follow up with authorization SUGGESTED STEPS TO MAKE CHANGES work and record a certain number of hours, but working more hours than reported Ensure each job description specially identifies whether the position is exempt and qualifies for that exempt status IT to work with management to determine who has access and terminate access with all individuals who should not have access. This should be updated each time an employee is hired or terminated IT to work with management to determine needs of organization and provide alternatives to allow access to authorized individuals Review internal access to see which modules are needed by person and restrict access (even at the CFO level) PERSON RESPONSIBLE DEADLINE

57 AREA CITED TO BE IMPROVED Signature Stamp (continued) HeadStart Compliance HeadStart Indirect Cost Rate (renegotiate) Reporting deadlines internal SUGGESTED CHANGE procedures following use of the stamp Ensure the any over or under spending in each program is reviewed on a quarterly basis and after the 3 rd quarter of the Grant period, a revision to adjust spending is forecasted and submitted to HeadStart At the next renewal of the cost rate, incorporate changes to the indirect cost rate that include all categories these categories were given to us by HeadStart Come up with consistent deadlines for internal financial statement deadlines and due dates for month end close and reporting to the board, board committees and management. SUGGESTED STEPS TO MAKE CHANGES Start reviewing HeadStart at least quarterly, and forecast after 3 rd quarter to see if adjustments are required Currently, certain costs / positions are directly costed to the grants, instead of in the indirect cost rate In the next year cost rate, include those salaries and associated benefit costs Come up with a calendar of dates that items are due and to whom, this includes items due to the CFO to accomplish the month end close PERSON RESPONSIBLE DEADLINE

58 AREA CITED TO BE IMPROVED Calendar of Due Dates / Report due dates / Checklist (external) Segregation of duties Clear process documentation of accounting processes SUGGESTED CHANGE Reporting requirements need to be listed, along with who receives the information, and where the information is located. Complete a checklist for the year and sign off as each item is completed Review all accounting duties to ensure that duties are properly segregated, also include documentation on who is the backup for each duty in a segregation of duties matrix. Overall, the documentation of processes and policies are somewhat unorganized and not consistent in the documentation received. When the new accountant and part time accounting clerk has been hired, then each individual will need to document their processes to ensure each activity is being processed properly SUGGESTED STEPS TO MAKE CHANGES Review what is currently in place and update to reflect all reporting requirements (grants, federal, state, IRS, etc.) Currently, there are drastic changes being made to positions in the Finance/Accounting/HR area, therefore, once those changes are in place, new documentation is going to be necessary to outline proper segregation of duties and authority Rewrite processes that are incomplete and update processes that have been changed, ensuring that positions are mentioned in the documentation (instead of people s specific names) who are completing certain accounting duties. PERSON RESPONSIBLE DEADLINE

59 AREA CITED TO BE IMPROVED Physical Inventory of Fixed Assets Internal Audit process Super circular process documentation SUGGESTED CHANGE Review when physical inventories are required (every 2 years?) to ensure compliance with Federal Standards. It is suggested that before the next fiscal year ends, an internal audit is completed to ensure compliance with items listed above and to ensure that auditors have more confidence in the new staff that has been hired, due to additional controls installed Review super circular language regarding new procurement policies and other processes to ensure new rules are included while updating processes and policies listed above SUGGESTED STEPS TO MAKE CHANGES Document when the last fixed asset physical inventory was done and note if there were adjustments to the accounting records. Plan to implement specific timeline to accomplish this task per the Federal guidelines Review what this internal audit process would look like. BSW requested that Kristin forward all working documents (PBC list items) to BSW to review prior to sending to audit, along with reviewing bank statements and cash activity for June October Kristin went to training on this topic, along with information given by BSW to update policies and procedures PERSON RESPONSIBLE DEADLINE