NDALC does not follow its policy and procedures for expenditures because it lacks adequate internal controls. As a result, some expenditures incurred during federal fiscal year 1997 may not be allowable under federal guidelines for nonprofit organizations.
NDALC's Board of Directors has not complied with two federal acts and
its Articles of Incorporation because of high turnover and extended vacancies
on the Board. In addition, high staff turnover and vacancies may have contributed
to diminished services being available to individuals with developmental
disabilities or mental illness, including investigations of suspected incidents
of abuse or neglect in Nevada's inpatient facilities. In addition, the
activity measures reported to state and federal granting agencies may not
2. NDALC's controls over travel expenses did not ensure that expenses were processed according to established policy and procedures and that internal control objectives were achieved. (page 13)
3. NDALC has not established appropriate policy and procedures for the use of its charge card, allowing staff to bypass Board control over purchases of equipment and publications. Staff used charge cards to purchase $1,800 in computer equipment and $800 in publications. (page 14)
4. NDALC has not complied with a Legislative Letter of Intent dated July 18, 1997, or its contract with the Department of Business and Industry. (page 14) Specifically, NDALC:
- would not provide the Legislative Auditor access to records necessary to complete the audit.
- did not submit required monthly financial and operational reports to the Interim Finance Committee.
- did not submit to the Interim Finance Committee required monthly status reports on progress toward resolution of coordination issues and development of client protocols involving access to the Division of Mental Hygiene and Mental Retardation's client files and conduct of investigations.
- has not named the Director of the Department of Business and Industry to its Board of Directors.
5. Several key NDALC staff positions have remained vacant for extended periods since July 1995. These vacancies have limited the amount of services available to Nevada's disabled residents. (page 17)
6. NDALC's Board of Directors has not complied with two federal acts or its Articles of Incorporation. The acts require that any vacancy on the Board be filled not later than 60 days after the date on which the vacancy occurs. Board vacancies lasted an average of 253 days. The Articles of Incorporation require that the number of directors shall in no case be less than five. However, for four months the Board had only two members. (page 18)
7. We were not able to verify the accuracy of program information reported to federal granting agencies, the Nevada Legislature, and the Department of Business and Industry. (page 18) However, we did note problems with the information presented, including:
- Some cases appear to be counted for more than one grant or program.
- Former employees said that casual meetings with disabled persons were counted as cases when the advocate or attorney had done little other than meet the person.
- Program performance reports were submitted between 14 and 44 days late to the federal granting agencies.