Restoring Continuity, Rebuilding Systems, and Regaining Funder Confidence

THE CLIENT

A CENTURY-OLD NONPROFIT with an $8M budget serving the Hispanic community through education, workforce development, prevention, emergency services, and immigration support. The organization experienced complete turnover in its finance department, limited operational controls, and a federal funding pause due to grant compliance issues.

THE OPPORTUNITY

• PROVIDING customized, flexible services to meet rapidly changing client needs
• RESTORING federal funding and REBUILDING funder trust after repeated single-audit findings threatened ongoing funding
• RESTRUCTURED accounting department staffing to better serve the organization, stabilizing the finance function and supporting ongoing financial department health
• ESTABLISHING best-practice systems, procedures, and reporting to ensure compliance with grant funder requirements, Uniform Guidance, and the organization’s management needs

OUR APPROACH

WEEK 1: INITIAL ENGAGEMENT

The client’s newly appointed interim CEO requested YPTC’s support to create a grant tracking matrix for managing dozens of grants across multiple programs and funders. During the initial meeting, three critical issues emerged:

• The organization’s Federal funding (representing a third of the organization’s budget) was paused after three consecutive single audits with material weaknesses.
• Four out of five accounting staff members left the organization just days before the meeting.
• The organization received notice of an upcoming desk audit from the state’s Department of Education

PHASE 1: EMERGENCY SUPPORT (FIRST SIX MONTHS)

Over the next few months, YPTC focused on stabilizing operations and addressing immediate risks:

• INTERIM ACCOUNTING SERVICES: YPTC provided full-cycle accounting support, ensuring that essential expenses were paid, deposits were recorded, accounts were reconciled, and monthly financial statements were prepared for management and the board.
• CASH FLOW ASSESSMENT: Within two weeks, YPTC identified that the funding pause would lead to a cash crunch within one month, risking inadequate cash for payroll. YPTC identified a $3 million board-designated reserve and (with support from the CEO) formally advised the board of the immediate necessity to allocate 1 million of the reserve as interim funding to support financial stability.
• AUDIT PREPARATION: YPTC met with Department of Education officials, gathered documentation to support expenditures, and helped the client develop and implement a corrective action plan after the audit findings were reported.

PHASE 2: EDUCATION, STREAMLINING, AND SYSTEMS IMPROVEMENTS (MONTHS 6-18)

Over the following year, YPTC implemented lasting improvements while continuing full accounting department support:

• ACCOUNTS PAYABLE PROCESS: Transitioned from paper checks to an electronic payables solution, reducing payment delas and audit anomalies. YPTC trained staff on the new system, leading to faster approvals and fewer compliance issues.
• TIME & EFFORT TRACKING: Worked with HR and program staff to align timekeeping with financial records, simplifying compliance and educating staff on best practices.
• GRANT REPORTING COMPLIANCE: Adjusted month-end procedures to ensure timely, accurate grant reporting. Program staff learned to track expenses accurately and submit budget modifications as needed, with support from the YPTC team.
• ACCOUNTING PERSONNEL SCREENING: Assisted in recruiting and screening new accounting staff, helping to rebuild the department with qualified professionals.

PHASE 3: 

• FINANCIAL REPORTING: Provide consistent monthly account reconciliations and financial reporting, supporting the organization’s in-house CFO.
• GRANT MANAGEMENT: Prepare monthly grant reimbursement request calculations, assist with budget modification requests, and prepare end-of-year grant close-out reports.

THE RESULTS

• CLEAN AUDITS: Achieved two consecutive single audits with no findings, demonstrating major compliance improvement.
• RELIABLE REPORTING: Management and the board now receive clear program-level reports and rolling cash forecasts to support timely decisions.
• PROCESS IMPROVEMENT: Automated accounts payable, standardized time & effort practices, and improved month-end and grant reporting workflows.
• RESTORED FUNDING: Regaining credibility with core funders and reactivated federal funding streams.