Audit Finance Committee Meeting. Welcome and call to order... Mark Barry, Chair Action Items:

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1 careersourcepascohernando.com August 20, Forest Oaks Blvd., Spring Hill 8.30 a.m. Dial in: ; participant code # Audit Finance Committee Meeting Welcome and call to order... Mark Barry, Chair Action Items: Action Item 1 Review and approve minutes of 2/12/2015 meeting... Pages 1-2 Action Item 2 Budget Modification #1... Pages 3-5 Information Item: Information Item 3 Audit Plan... Pages 6-12 Public Comments Adjournment info@careersourcepascohernando.com 7361 Forest Oaks Boulevard Spring Hill, FL p: f:

2 ACTION ITEM 1 Approval of Minutes Draft minutes of the February 12, 2015 Audit Finance Committee Meeting are presented for review. Any modifications should be requested prior to approval.

3 careersourcepascohernando.com DRAFT Audit Finance Committee Meeting Minutes February 12, 2015 Committee Members: Present: Mark Barry, Mark Earl, Joelle Neri Absent: Ken Minter, Lex Smith Quorum Present? Yes Others Present: PHWB Staff Jerome Salatino, Dianne Weiss Proceedings: Meeting called to order at 8.35 a.m. by Mark Barry. Action Item 1 Review and approve minutes of May 8, 2014 meeting Mark asked the Committee members to review the minutes from the previous meeting for any corrections or comments. With no corrections or comments, a motion was made to accept the minutes of the meeting. MOTION made by Mark Earl and seconded by Joelle Neri to approve the minutes of the May 8, 2014 meeting. Motion carried. Information Items: Raquel McIntosh of Grau & Associates reviewed the Audit Report for FYE June 30, Dianne Weiss review the Financial Compliance Monitoring Report and the Financial Summary Report, YTD December 31, With no further business to discuss and no public comments, the meeting adjourned. info@careersourcepascohernando.com 7361 Forest Oaks Boulevard Spring Hill, FL p: f:

4 BACKGROUND Action Item MOD #1 TO PLANNING BUDGET FY The Board approved a Preliminary Planning Budget in June, Since that time, the fiscal year 2015 ended and actual carry forward amounts are now known. The attached Mod #1 is presented for approval with current budget allocations. INFORMATION Revenue Budget: The Total Available Revenue Budget increased by $448,639 from $8,112,768 to $8,561,407. Changes in the Revenue Budget are as follows: Difference in Projected and Actual Carry forward - $403,467 Additional TAA Awards for Training and Admin - 45,172 Total Changes in Revenue - $448,639 Planned Expenditures: The Total Planned Expenditure Budget increased by $507,316 from $8,013,514 to $8,520,831. Changes in the Planned Expenditure Budget are as follows: Increase in Payroll and Benefits - $145,476 Increase in Goodwill Industries-Suncoast Contract - 286,841 Increase in Employed Worker Training - 50,000 Increase in Operational Support - 25,000 Total Changes in Planned Expenditures - $507,316 The increase in Payroll and Benefits will be used as follows: Restore two unfilled positions in Business Services Restore hours from 20 to 24 for 12 part-time positions

5 Promote the Assistant Finance Director to Finance Manager with the assumption of supervisory responsibilities and management of customer payments. Set aside funds for employee benefits in order to be compliant under the Affordable Care Act. The increase in Goodwill Industries-Suncoast s contract will be as follows: Increase in Trade Adjustment Assistance Participant Costs - $ 11,841 Increase in WIOA Adult ITA - 50,000 Increase in WIOA Dislocated Worker ITA - 150,000 Increase in WIOA Dislocated Worker Operating - 75,000 RECOMMENDATION: Staff requests that the Audit Finance Committee approve the budget as presented.

6 Pasco Hernando Workforce Board, Inc. Planning Budget FY Mod # % ITA TOTAL WIOA Adult WIOA Dislocated Worker WIOA Youth Trade Adjustment Assistance SNAP Welfare Transition REA RA VETS WP USDOL H1B USDOL Workforce Innovation Grant Funding: FY15-16 Allocations $ 8,042,712 $ 1,258,827 $ 1,478,253 $ 1,183,782 $ 151,335 $ 153,000 $ 1,761,427 $ 195,932 $ 70,000 $ 317,348 $ 826,449 $ 572,782 $ 73,577 Intertitle Transfer $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Reserve for Second Year $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Incentives $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Carryforward $ 1,075,523 $ 143,206 $ 315,425 $ 402,897 $ (33,332) $ - $ - $ - $ - $ 211,962 $ 35,365 $ - Total Funding $ 9,118,235 $ 1,402,033 $ 1,793,678 $ 1,586,679 $ 118,003 $ 153,000 $ 1,761,427 $ 195,932 $ 70,000 $ 317,348 $ 1,038,411 $ 608,147 $ 73,577 Less DEO Staff Salaries $ (556,828) $ - $ - $ - $ (49,269) $ - $ - $ - $ - $ (225,010) $ (282,549) $ - $ - Total Available Funding $ 8,561,407 $ 1,402,033 $ 1,793,678 $ 1,586,679 $ 68,734 $ 153,000 $ 1,761,427 $ 195,932 $ 70,000 $ 92,338 $ 755,862 $ 608,147 $ 73,577 Budgeted Expenditures: Payroll & Benefits $ 2,146,965 $ 41,565 $ 542,058 $ 673,942 $ - $ 24,232 $ 631,181 $ 16,185 $ 70,000 $ 10,430 $ - $ 134,198 $ 3,173 One Stop Facilities (Net of Rent Receipts of $137,623) $ 321,364 $ - $ - $ - $ - $ - $ - $ - $ - $ 14,637 $ 306,727 $ - $ - Equipment $ 10,000 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 10,000 $ - $ - Operational Support $ 546,055 $ 3,988 $ 61,366 $ (98) $ 1,672 $ 9,200 $ 5,928 $ (0) $ - $ 4,919 $ 411,135 $ 47,945 $ - Board & One-Stop Operating Costs $ 3,024,384 $ 45,553 $ 603,424 $ 673,843 $ 1,672 $ 33,433 $ 637,109 $ 16,185 $ 70,000 $ 29,986 $ 727,862 $ 182,144 $ 3,173 Goodwill Industries Career Services $ 1,382,360 $ 325,000 $ 450,000 $ 572,000 $ 3,500 $ - $ - $ - $ - $ - $ - $ 31,860 $ - PHSC $ 223,419 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 223,419 $ - HMA Hospitals $ 84,883 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 84,883 $ - Reserve for ITAs/OJT (includes GW Training) $ 1,727,161 $ 615,000 $ 725,000 $ 278,000 $ 63,562 $ - $ - $ - $ - $ - $ - $ 45,599 $ - Res - Outreach - Customers w/disabilities $ 25,000 $ 25,000 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Reserve for Employed Worker Training/OJT $ 375,000 $ 375,000 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Contract for Evaluation Svcs. $ 38,569 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 38,569 Contracts $ 3,856,391 $ 1,340,000 $ 1,175,000 $ 850,000 $ 67,062 $ - $ - $ - $ - $ - $ - $ 385,761 $ 38,569 Direct Payroll & Benefits $ 1,160,302 $ 60,631 $ 119,567 $ 702,818 $ 178,207 $ - $ 41,018 $ - $ 26,817 $ 31,243 Direct Operating Costs $ 79,754 $ 16,480 $ 15,254 $ 2,205 $ - $ - $ 21,500 $ 1,540 $ - $ 21,334 $ - $ 849 $ 592 Direct Participant Costs $ 400,000 $ - $ - $ 400,000 $ - $ - $ - $ - $ - $ - Total Direct Program Costs $ 1,640,056 $ 16,480 $ 15,254 $ 62,836 $ - $ 119,567 $ 1,124,318 $ 179,747 $ - $ 62,352 $ - $ 27,666 $ 31,835 Total Planned Expenditures $ 8,520,831 $ 1,402,033 $ 1,793,678 $ 1,586,680 $ 68,734 $ 153,000 $ 1,761,427 $ 195,932 $ 70,000 $ 92,338 $ 727,862 $ 595,571 $ 73,577 Unobligated Funding $ 40,576 $ (0) $ 0 $ (0) $ (0) $ 0 $ (0) $ (0) $ (0) $ 0 $ 28,000 $ 12,576 $ 0

7 INFORMATION ITEM 1 Audit Plan The following item is presented as information for the Committee. No action is required.

8 Pasco-Hernando Workforce Board, Inc. Annual Audit Plan June 30, 2015 Table of Contents Page No. 1 Annual Audit Plan Summary Procurement of Audit Firm Content of Engagement Letter Target dates for implementation Scope of Audit Identification of funds to be audited Listing of Contracts Procedures for Service Provider Audits Procedures for Monitoring Service Providers Procedures for audit coverage in the event a service provider goes out of business or unilaterally cancels a contract Cognizant Agency designation... 6

9 1 Annual Audit Plan Summary Pasco-Hernando Workforce Board, Inc. Annual Audit Plan June 30, 2015 The Pasco-Hernando Workforce Board, Inc. (PHWB) is a private not-for-profit organization registered under Section 501(c)(3) of U.S. Internal Revenue Code. The PHWB serves Pasco and Hernando counties by administering local workforce development and welfare reform programs as part of the State of Florida and the Federal Government's initiatives. Joint oversight is provided through an agreement with the Board of County Commissioners from both Pasco and Hernando counties. As recipient of funding allocations from a variety of employment, training, and educational program sources, the PHWB must assure the provision of high quality services for residents and employers in Pasco and Hernando counties. The PHWB selects providers of service through appropriate procurement, and is responsible for overseeing the implementation and quality of the services delivered by those providers All audits are conducted in accordance with the Single Audit Act of 1984 (Public Law ) and the Federal Single Audit Act Amendments of 1996 (P.L ), which require an independent financial, and compliance audit of each non-federal entity or subrecipient that has cumulative expenditures of federal funds of $500,000 or more. The Acts further state that the audits are to be conducted in accordance with applicable auditing standards set forth in Government Auditing Standards, revised June 2003 issued by the Comptroller General of the United States. The requirements for audits of government organizations and non-profit organizations are contained in OMB Circular A-133, revised June 24, Also, each Auditee is responsible for complying with the Florida Single Audit Act, if applicable ( F.S. and Chapter , Rules of the Auditor General and Chapter 691-5, Rules of the Department of Financial Services). In addition, WIA regulations 20 CFR (b)(ii) require Commercial organizations which are subrecipients under WIA Title I and which expend more than the minimum level specified in OMB Circular A-133 ($500,000 as of December 31, 2003) must have either an organization-wide audit conducted in accordance with OMB Circular A-133 or a program specific financial and compliance audit. Each subrecipient contract with Pasco-Hernando Workforce Board, Inc., (the Board) includes a contract provision that requires submission of a financial and compliance audit in accordance with OMB Circular A-133. The Audit/Finance Committee for the Board will ensure that the audit and corrective action plan is transmitted to the Department of Economic Opportunity (DEO) within 30 days after completion of the audit. All audits and corrective action plans must be completed and submitted within the earlier of 30 days after receipt or nine months after the end of the audit period March 31, 2016.

10 2 Procurement of Audit Firm Pasco-Hernando Workforce Board, Inc. Annual Audit Plan June 30, 2015 No procurement was necessary for the audit for fiscal year ended June 30, This is the second year the audit will be performed by Grau & Associates. The PHWB selected Grau & Associates in response to a formal bid process to perform their audit for the fiscal year ended June 30, The agreement was to be extended annually for three years if performance was acceptable. 3 Content of Engagement letter A copy of the engagement letter signed by the Board Chair is attached. 4 Target dates for implementation Target dates for completion and submission of the audit reports and resolution of findings: August 15, 2015 Submit annual audit plan to the Department of Economic Opportunity September 14, 2015 Audit commencement November 1, 2015 Audit report completed and draft presented to PHWB staff for review November 12, 2015 Final audit report presented to Audit/Finance and Executive Committees for approval December 14, Scope of the Audit Submit two copies of the audit report to DEO and U.S. Department of Labor (DOL) along with management s corrective action plan, management letter (if applicable) and the audit transmittal letter. The Board shall have an organization-wide Single Audit conducted in accordance with Section.500 of OMB A-133. The audit shall be conducted annually, unless otherwise approved in writing by DEO. An independent auditor in accordance with Generally Accepted Government Auditing Standards (GAGAS) covering financial and compliance audits shall perform the audit. The auditor shall determine whether: (a) The financial statements of the organization fairly present its financial position and the results of its financial operations in accordance with generally accepted accounting principles. (b) The organization has an internal control structure and other control systems to provide reasonable assurance that it is managing federal financial assistance programs in compliance with applicable laws and regulations that could have a material impact on the financial statements. (c) In addition, the auditor must determine if the organization has complied with laws and regulations that may have material effects on its financial statements and on each major federal assistance program.

11 Pasco-Hernando Workforce Board, Inc. Annual Audit Plan June 30, 2015 In addition, the auditor will be required to test the following Board functions: (1) Reconciliation of its financial records to the One Stop Management Information System (OSMIS) maintained by DEO. The notes to the financial statements must confirm whether such a reconciliation was done by the RWB in a satisfactory manner. (2) Compliance with Federal cash management requirements and report any material problems. (3) Compliance with state and federal laws government structure, functions, and mission of the board and report any material noncompliance Identification of funds to be audited by program and CFDA# The Schedule of Expenditure of Federal and State Awards to be audited for the period from July 1, 2014 to June 30, 2015 is projected as follows: Program Title/Description CFDA/CFSA * Number(s) Projected Funds Workforce Investment Act $ 4,552, H1B Technical Skills ,523 Workforce Innovation ,662 Welfare Transition Program ,715,480 Wagner Peyser ,029 Food Stamp Employment Training ,332 Unemployment Insurance ,707 Disabled Veterans' Outreach ,501 Program (DVOP) Local Veterans' Employment ,501 Representative Program (LVER) Trade Adjustment Assistance ,669 Total Federal and State Awards $ 8,359,770

12 Pasco-Hernando Workforce Board, Inc. Annual Audit Plan June 30, Listing of Contracts The following is a listing of contracts or grants issued by the PHWB for the fiscal year ended June 30, Service Provider Contract Amount Subrecipient Vendor OMB A-133 Audit Goodwill Industries-Suncoast $ 4,031,099 X The ARC of the Nature Coast 7,500 X Total contracts or grants awarded $4,038, Procedures for Service Provider Audits The Board is responsible for the appropriate audit of all Service Providers including governmental, nonprofit and commercial entities that require audits. Regardless of the method of procurement or the contract type, providers that have a financial or performance requirement related to eligibility or selection of participants is carrying out a federal program and is subject to audit if meeting the Federal expenditure threshold. An entity that provided generally required goods or services that are related to the administrative support of the federal assistance program is a vendor. The Board s written procedures include, but are not limited to, the following: (1) Identify Federal awards made by informing each Service Provider of CFDA title and number, award name and number, award year, if the award is R&D, and name of Federal agency. When some of this information is not available, the Board shall provide the best information available to describe the Federal award. (2) Advise Service Providers of requirements imposed on them by Federal laws, regulations, and the provisions of contracts or grant agreements as well as any supplemental requirements imposed by the pass-through entity. (3) Monitor the activities of Service Provider as necessary to ensure that Federal awards are used for authorized purposes in compliance with laws, regulations, and the provisions of contracts or grant agreements and that performance goals are achieved. (4) Ensure that Service Providers expending $500,000 or more in Federal awards during the Service Provider's fiscal year have met the audit requirements of OMB Circular A-133 for that fiscal year. (5) Issue a management decision on audit findings within six months after receipt of the Services Provider s audit report and ensure that the service provider takes appropriate and timely corrective action. Also, determine whether or not questioned and/or recommended for disallowance costs are allowed and corrective actions regarding any administrative findings are adequate. A statement will be included in the Management Decision that all findings are subject to State and Federal review. (6) Consider whether service provider audits necessitate adjustment of the Board's own records.

13 Pasco-Hernando Workforce Board, Inc. Annual Audit Plan June 30, 2015 (7) Require each service provider to permit the Board and auditors to have access to the records and financial statements as necessary for the Board to comply with OMB Circular A Procedures for Monitoring Service Providers The Board s written procedures include, but are not limited to, the following: (1) Issuing timely management decisions for audit and monitoring findings to inform the Service Provider whether the corrective action planned is acceptable; (2) Maintaining a system to track and follow-up on reported deficiencies to ensure that timely corrective action is taken; (3) Contacting Service Providers regularly and making appropriate inquiries concerning the program; (4) Reviewing Service Providers reports and following-up on areas of concern (5) Comparison of actual accomplishments with the goals and objectives established for the period; (7) Monitoring Service Providers budgets; (8) Performing site visits to Service Providers to review financial and programmatic records and to observe operations. (9) Offering Service Providers technical assistance as needed. 6 Procedures for audit coverage in the event a service provider goes out of business or unilaterally cancels a contract In the event a service provider that requires audit goes out of business or unilaterally cancels a contract, the service provider shall notify the Board immediately, and the Board shall become custodian of all program-related records where federal financial assistance has been provided. Upon notification of the possibility of such an occurrence, the Board will arrange for immediate audit, which could be a grant specific audit, of the service provider. 7 Cognizant Agency designation The PHWB does not meet the expenditure level of $50 million required in OMB Circular A-133, Subpart D Section.400 for designation of a cognizant agency.