Audit 18950

Finding 2022-005 ? Federal Agency Review Significant Deficiency in Internal Controls over Compliance; Noncompliance Federal Agency ? United States Department of Agriculture Food and Nutritional Service Federal Program ? CFDA 10.555 ? National School Lunch Program Criteria: From the USDA?s Food & Nutritional Services (FNS) review conducted in March 2019 over fiscal year 2018, nine findings remain open. Condition and context: Within the USDA FNS report, issues or findings in the following areas were noted: ? Capital Expenditures & Management ? Civil Rights Training ? Civil Rights Complaint Procedures ? Inventory Management ? Meal Counting, Record Keeping ? Procurement ? Reporting, Audit Tracking ? Reporting, Allowable Costs ? Special Dietary Accommodations Cause: Insufficient training and oversight of program personnel with respect to program requirements may have contributed to the lack of compliance with program requirements. Effect: The Territory is not in compliance with the USDA Food & Nutritional Service Requirements. Questioned costs: None Recommendation: The Territory should continue to implement the corrective action provided by the USDA FNS in their report dated March 28, 2019 and await subsequent audit by the USDA FNS for approval completeness of corrective action. Views of responsible officials and corrective action plan: This finding has been addressed in fiscal year 2023. ASGDOE School Lunch Program (SLP) is working with a representative who oversees civil rights for the USDA Western region. Civil rights training for all SLP staff continues yearly with sign-in sheets and agendas for documentation purposes. Reports are submitted to USDA for inventory and mean counts on the 15th of each month. Special dietary accommodations have since been rolled out and schools have been notified of the process should a student require accommodation. USDA is scheduled for a on-site visit soon now that the AS borders are open.

Finding 2022-004 Special Tests and Provisions Significant Deficiency in Internal Controls over Compliance; Noncompliance Federal Agency ? United States Department of Transportation Federal Program ? CFDA 20.205 ? Highway Planning and Construction Criteria: Based on requirements of the 2 CFR Part 200, Appendix XI Compliance Supplement for Highway Planning and Construction grants, there should be a quality assurance program in place, which monitors compliance with the grant requirements. Condition and context: The Territory does not currently have a quality assurance program in place for the Highway Planning and Construction grant. While there were no deviations noted in our sample, there are no monitoring controls in place to prevent, detect and correct potential misstatements on a timely basis. Cause: The Territory is currently working with the Federal Highway Administration to establish a quality assurance program, however it was not completed and implemented at year end. Effect: Potential noncompliance with grant requirements due to lack of monitoring controls and quality assurance in place. Questioned Costs: None Recommendation: The Territory should continue to work with the Federal Highway Administration to complete a plan for, and implement, a quality assurance program. View of responsible officials and corrective action plan: ASG agrees with this finding. The AS Department of Public Works (DPW) Civil Highway Division awaits the approval of its Implementation and Stewardship agreement from FHWA headquarters. The agreement, which outlines the roles and responsibilities of a quality assurance program, is renewed every two years. This finding will remain open until the agreement has been approved.

Finding 2022-006 Reporting Control Deficiency in Internal Controls over Compliance; Noncompliance Federal Agency ? United States Department of Treasury Federal Program ? CFDA 21.023 ? Emergency Rental Assistance Criteria: Based on requirements of the 2 CFR Part 200, Appendix XI Compliance Supplement for Emergency Rental Assistance grants, recipients are required to submit two monthly and quarterly reports to the U.S. Treasury. One for ERA 1 and the other for ERA 2. Monthly reports are due to the Treasury by the 15th day of the month. Condition and context: ERA 1 and ERA 2 reports were not submitted to the U.S. Treasury by its due date. Cause: Late submission were due to a lack of oversight on the part of management. Effect: Late submissions of reports to the U.S. Treasury may cause the U.S. Treasury to discontinue granting ERA money to the Territory. Questioned Costs: None Recommendation: The Territory should work with appropriate departments and management to ensure that oversight controls are in place. All grant reporting should be documented when contracts are in place, and specific reminders be set to file all required reports in a timely manner. View of responsible officials and corrective action plan: The Territory agrees with the finding. The ASG Department of Commerce (DOC) had technical issues with the US Treasury portal and could not submit their reports in a timely manner. However, the issue has since been resolved and DOC was able to file their outstanding reports. This finding will not be repeated in the next fiscal year audit report.

Finding 2022-005 ? Federal Agency Review Significant Deficiency in Internal Controls over Compliance; Noncompliance Federal Agency ? United States Department of Agriculture Food and Nutritional Service Federal Program ? CFDA 10.555 ? National School Lunch Program Criteria: From the USDA?s Food & Nutritional Services (FNS) review conducted in March 2019 over fiscal year 2018, nine findings remain open. Condition and context: Within the USDA FNS report, issues or findings in the following areas were noted: ? Capital Expenditures & Management ? Civil Rights Training ? Civil Rights Complaint Procedures ? Inventory Management ? Meal Counting, Record Keeping ? Procurement ? Reporting, Audit Tracking ? Reporting, Allowable Costs ? Special Dietary Accommodations Cause: Insufficient training and oversight of program personnel with respect to program requirements may have contributed to the lack of compliance with program requirements. Effect: The Territory is not in compliance with the USDA Food & Nutritional Service Requirements. Questioned costs: None Recommendation: The Territory should continue to implement the corrective action provided by the USDA FNS in their report dated March 28, 2019 and await subsequent audit by the USDA FNS for approval completeness of corrective action. Views of responsible officials and corrective action plan: This finding has been addressed in fiscal year 2023. ASGDOE School Lunch Program (SLP) is working with a representative who oversees civil rights for the USDA Western region. Civil rights training for all SLP staff continues yearly with sign-in sheets and agendas for documentation purposes. Reports are submitted to USDA for inventory and mean counts on the 15th of each month. Special dietary accommodations have since been rolled out and schools have been notified of the process should a student require accommodation. USDA is scheduled for a on-site visit soon now that the AS borders are open.

Finding 2022-004 Special Tests and Provisions Significant Deficiency in Internal Controls over Compliance; Noncompliance Federal Agency ? United States Department of Transportation Federal Program ? CFDA 20.205 ? Highway Planning and Construction Criteria: Based on requirements of the 2 CFR Part 200, Appendix XI Compliance Supplement for Highway Planning and Construction grants, there should be a quality assurance program in place, which monitors compliance with the grant requirements. Condition and context: The Territory does not currently have a quality assurance program in place for the Highway Planning and Construction grant. While there were no deviations noted in our sample, there are no monitoring controls in place to prevent, detect and correct potential misstatements on a timely basis. Cause: The Territory is currently working with the Federal Highway Administration to establish a quality assurance program, however it was not completed and implemented at year end. Effect: Potential noncompliance with grant requirements due to lack of monitoring controls and quality assurance in place. Questioned Costs: None Recommendation: The Territory should continue to work with the Federal Highway Administration to complete a plan for, and implement, a quality assurance program. View of responsible officials and corrective action plan: ASG agrees with this finding. The AS Department of Public Works (DPW) Civil Highway Division awaits the approval of its Implementation and Stewardship agreement from FHWA headquarters. The agreement, which outlines the roles and responsibilities of a quality assurance program, is renewed every two years. This finding will remain open until the agreement has been approved.

Finding 2022-006 Reporting Control Deficiency in Internal Controls over Compliance; Noncompliance Federal Agency ? United States Department of Treasury Federal Program ? CFDA 21.023 ? Emergency Rental Assistance Criteria: Based on requirements of the 2 CFR Part 200, Appendix XI Compliance Supplement for Emergency Rental Assistance grants, recipients are required to submit two monthly and quarterly reports to the U.S. Treasury. One for ERA 1 and the other for ERA 2. Monthly reports are due to the Treasury by the 15th day of the month. Condition and context: ERA 1 and ERA 2 reports were not submitted to the U.S. Treasury by its due date. Cause: Late submission were due to a lack of oversight on the part of management. Effect: Late submissions of reports to the U.S. Treasury may cause the U.S. Treasury to discontinue granting ERA money to the Territory. Questioned Costs: None Recommendation: The Territory should work with appropriate departments and management to ensure that oversight controls are in place. All grant reporting should be documented when contracts are in place, and specific reminders be set to file all required reports in a timely manner. View of responsible officials and corrective action plan: The Territory agrees with the finding. The ASG Department of Commerce (DOC) had technical issues with the US Treasury portal and could not submit their reports in a timely manner. However, the issue has since been resolved and DOC was able to file their outstanding reports. This finding will not be repeated in the next fiscal year audit report.