December 19, 2023
To whom it may concern, I am writing regarding our 2022 financial statements and the associated audit. As an organization dedicated to transparency and accountability, I wanted to give context around these audit findings, both to acknowledge the findings identified and why they arose, and to share what we have done to rectify them. In connection with this application for grant funding, I especially wanted to highlight that these findings pertain exclusively to our documentation of federal funds, and do not show any issues related to our use of grant funding from foundations and private grantmakers, nor that funds were misappropriated in any way. Our 2022 audit was our first ever “single audit”, following nine years of audits with no findings conducted under General Accounting Standards (GAS). This larger audit was required in compliance with a six-figure Supplemental Nutrition Assistance Program (SNAP) contract, which grew to over $750,000 in federal funding for the first time in 2022. Throughout our history of handling grants, we have always relied on the guidance from state agencies for billing these funds, and we followed instructions about how to bill and document the services we provided with these funds from the Colorado Department of Human Services (CDHS). The audit process highlighted areas where our revenue recognition from cost-reimbursement grant arrangements, as well as our standard accounting records and controls practices did not meet federal standards. During the audit, we actively engaged in three-way calls with our auditors, the state, and ourselves, underscoring that there was no malintent, and were diligently following the guidelines provided by the state agency. Immediately following the audit we revised our financial control policies and implemented training for our staff to ensure compliance with accounting procedures and federal grant requirements. In recognition of the feedback we each received, the state subsequently revised the procedures and the guidance they provide to agencies receiving funding. Attached to this audit you will find a detailed outline of our procedures and how we have addressed this issue, as well as an explanation from the state that they are satisfied with these changes. Since the audit was performed we have signed and renewed several further contracts with county and state agencies, and we anticipate no further audit findings or issues with compliance. We wanted to note that these findings were only related to our policies and procedures for handling federal funds, not to our handling of grant funds overall, which has consistently been conducted with diligence and adherence to best practices. The audit did not find that funds were misused in any way. We take full responsibility for our part in these errors, and we believe that the revised guidelines will greatly reduce the likelihood of similar issues in the future.