FAC Explorer

Audit 23655

FY End
2022-09-30
Total Expended
$1.43M
Findings
4
Programs
2
Organization: Heard Museum (AZ)
Year: 2022 Accepted: 2023-06-28
Auditor: Eide Bailly LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
22514 2022-003 Material Weakness - ABH
22515 2022-004 Significant Deficiency - P
598956 2022-003 Material Weakness - ABH
598957 2022-004 Significant Deficiency - P

Programs

ALN Program Spent Major Findings
59.075 Shuttered Venue Operators Grant Program $1.28M Yes 2
59.008 Disaster Assistance Loans $150,000 - 0

Contacts

Name Title Type
M6VHXSQJKG87 Robin Klung Auditee
6022510221 Pamela Eggert Auditor
No contacts on file

Notes to SEFA

Title: Loan/loan guarantee outstanding balances Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. When applicable, suchexpenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certaintypes of expenditures are not allowable or are limited as to reimbursement. No federal financial assistance hasbeen provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. Expenditures reported in this schedule consist of the beginning of the year outstanding loan balance plusadvances made on the loan during the year. The outstanding balance at September 30, 2022 was $150,000.
Title: Basis of Presentation Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. When applicable, suchexpenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certaintypes of expenditures are not allowable or are limited as to reimbursement. No federal financial assistance hasbeen provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The accompanying consolidated schedule of expenditures of federal awards (the schedule) includes the federal award activity of The Heard Museum and Affiliate (the Museum) under programs of the federal government for the year ended September 30, 2022. The information is presented in accordance with the requirements of Title2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the schedule presents only a selected portion of the operations of the Museum, it is not intended to and does not present the consolidated financial position,changes in net assets, or cash flows of the Museum.

Finding Details

Finding 2022-003
2022-003 Small Business Administration Financial Assistance Listing #59.075 COVID-19 Shuttered Venue Operators Grant Program; SBAHQ21SV007152, July 10, 2021 to December 31, 2021 Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Period of Performance Material Weakness in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the Organization is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. Condition: While the Organization had policies and procedures in place over the review and approval of expenditures, during the testing of expenditures there were certain items that lacked the documentation of such review and approval. The Organization did not retain the required documentation to support the review of expenditures. Cause: The Organization had turnover and limited staffing available. The review and approval process was a collaborative process that took place in face to face meetings without documentation retained. Effect: Lack of documented controls can result in expenditures that are otherwise not an allowable cost or allowable activity. Questioned Costs: None reported Context/Sampling: A nonstatistical sample of 60 transactions out of 1,042 total transactions were selected for testing, which accounted for $108,778 of $1,276,757 of federal program expenditures. Repeat Finding from Prior Year(s): No Recommendation: We recommend the Organization?s management implement a process that allows for documented approval of expenditures to ensure that the audit trail is retained for such expenditures. Views of Responsible Officials: Management agrees with the finding.
Finding 2022-004
2022-004 Small Business Administration Financial Assistance Listing #59.075 COVID-19 Shuttered Venue Operators Grant Program; SBAHQ21SV007152, July 10, 2021 to December 31, 2021 Preparation of Consolidated Schedule of Expenditures of Federal Awards Significant Deficiency in Internal Control over Compliance ? Other Criteria: Proper controls over financial reporting include the ability to prepare the consolidated schedule of expenditures of federal awards (Schedule) and accompanying notes to the Schedule. Condition: The Organization does not have an internal control system designed to provide for the preparation of the Schedule. Cause: The Organization had turnover and limited staffing available. Effect: There is a reasonable possibility that the Organization would not be able to draft the Schedule that is correct without the assistance of auditors. Questioned Costs: None reported Context/Sampling: Sampling was not used. Repeat Finding from Prior Year(s): No Recommendation: While we recognize that this condition is not unusual for an organization with limited staffing, we recommend management be aware of the financial reporting requirements relating to the Organization?s consolidated schedule of expenditures of federal awards and the internal controls that impact financial reporting. Views of Responsible Officials: Management agrees with the finding.
Finding 2022-003
2022-003 Small Business Administration Financial Assistance Listing #59.075 COVID-19 Shuttered Venue Operators Grant Program; SBAHQ21SV007152, July 10, 2021 to December 31, 2021 Activities Allowed or Unallowed, Allowable Costs/Cost Principles, Period of Performance Material Weakness in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the Organization is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. Condition: While the Organization had policies and procedures in place over the review and approval of expenditures, during the testing of expenditures there were certain items that lacked the documentation of such review and approval. The Organization did not retain the required documentation to support the review of expenditures. Cause: The Organization had turnover and limited staffing available. The review and approval process was a collaborative process that took place in face to face meetings without documentation retained. Effect: Lack of documented controls can result in expenditures that are otherwise not an allowable cost or allowable activity. Questioned Costs: None reported Context/Sampling: A nonstatistical sample of 60 transactions out of 1,042 total transactions were selected for testing, which accounted for $108,778 of $1,276,757 of federal program expenditures. Repeat Finding from Prior Year(s): No Recommendation: We recommend the Organization?s management implement a process that allows for documented approval of expenditures to ensure that the audit trail is retained for such expenditures. Views of Responsible Officials: Management agrees with the finding.
Finding 2022-004
2022-004 Small Business Administration Financial Assistance Listing #59.075 COVID-19 Shuttered Venue Operators Grant Program; SBAHQ21SV007152, July 10, 2021 to December 31, 2021 Preparation of Consolidated Schedule of Expenditures of Federal Awards Significant Deficiency in Internal Control over Compliance ? Other Criteria: Proper controls over financial reporting include the ability to prepare the consolidated schedule of expenditures of federal awards (Schedule) and accompanying notes to the Schedule. Condition: The Organization does not have an internal control system designed to provide for the preparation of the Schedule. Cause: The Organization had turnover and limited staffing available. Effect: There is a reasonable possibility that the Organization would not be able to draft the Schedule that is correct without the assistance of auditors. Questioned Costs: None reported Context/Sampling: Sampling was not used. Repeat Finding from Prior Year(s): No Recommendation: While we recognize that this condition is not unusual for an organization with limited staffing, we recommend management be aware of the financial reporting requirements relating to the Organization?s consolidated schedule of expenditures of federal awards and the internal controls that impact financial reporting. Views of Responsible Officials: Management agrees with the finding.