FAC Explorer

Audit 250048

FY End
2022-08-31
Total Expended
$7.16M
Findings
4
Programs
8
Organization: Ser-Jobs for Progress of the Texas Gulf Coast, Inc. and Subsidiary (TX)
Year: 2022 Accepted: 2023-03-27
Auditor: McConnell & Jones LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
199936 2022-001 Significant Deficiency - L
199937 2022-022 Significant Deficiency - L
776378 2022-001 Significant Deficiency - L
776379 2022-022 Significant Deficiency - L

Programs

ALN Program Spent Major Findings
11.307 Economic Adjustment Assistance $3.96M Yes 2
17.259 Wia Youth Activities $1.34M - 0
14.228 Community Development Block Grants/state's Program and Non-Entitlement Grants in Hawaii $578,230 - 0
17.274 Youthbuild $477,600 - 0
17.701 Women in Apprenticeship and Nontraditional Occupations (wanto) Technical Assistance Grant Program (b) $183,343 - 0
17.805 Homeless Veterans Reintegration Project $37,830 - 0
17.285 Apprenticeship USA Grants $29,734 - 0
17.270 Reentry Employment Opportunities $22,337 - 0

Contacts

Name Title Type
PSHWPYAJ8XL6 Gerald Eaton, Cpa, Mba, Cgma Auditee
7137736000 Marlon Williams, CPA Auditor
No contacts on file

Notes to SEFA

Title: Basis of Presentation Accounting Policies: The Schedule of Expenditures of Federal Awards is presented on the accrual basis of accounting, which is described in Note 2 to the consolidated financial statements. Therefore, expenditures reported on the SEFA are presented on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Subpart E of the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: SER-Jobs has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. SER-Jobs has a negotiated indirect costs rate agreement with the U.S. Department of Labor The Schedule of Expenditures of Federal Awards ("SEFA") include federal grant activities of SER-Jobs for Progress of the Texas Gulf Coast, Inc. under programs of the federal government for the year ended August 31, 2022. The information in the SEFA is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the SEFA presents only a selected portion of the operations of SER-Jobs, it is not intended to and does not present the financial position, changes in net assets or cash flows of SER-Jobs.
Title: Contingencies Accounting Policies: The Schedule of Expenditures of Federal Awards is presented on the accrual basis of accounting, which is described in Note 2 to the consolidated financial statements. Therefore, expenditures reported on the SEFA are presented on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Subpart E of the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: SER-Jobs has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. SER-Jobs has a negotiated indirect costs rate agreement with the U.S. Department of Labor Federal grants received by SER-Jobs are subject to review and audit by grantor agencies. SER-Jobs management believes that the results of such audits will not have a material effect on the Schedule of Expenditures of Federal Awards.

Finding Details

Finding 2022-001
ASSISTANCE LISTING 11.307 - ECONOMIC ADJUSTMENT ASSISTANCE DIRECT AWARD FROM U.S. DEPARTMENT OF COMMERCE GRANT AWARD NUMBERS: 08-79-05298; 113048 FINDING NO. 2022-001: NON-COMPLIANCE AND SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER NONCOMPLIANCE WITH REPORTING REQUIREMENTS Condition: SER-Jobs did not submit its quarterly program progress reports and semi-annual financial report (SF-425) within the timelines specified in the criteria section below. For instance, quarterly program progress reports for the quarters ended December 2021 and June 2022 were submitted on March 1, 2022, and September 13, 2022, respectively, whereas the semi-annual financial report (SF-425) for the period ended September 30, 2021 was submitted on November 11, 2021. Criteria: Per the terms and conditions of the grant agreement, quarterly program progress reports and semi-annual financial report (SF-425) are required to be submitted within 30 days of the end of each quarter or semi-annual period, as applicable. Cause: Management executed the grant agreement in October 2019 but first utilized other funding sources in the initial years to fund construction activities for the workforce training center for which Economic Adjustment Assistance (EAA) grant was awarded. The third-party project manager hired by management to prepare all reports was entirely focused on providing all required reports to those other funding sources. Per management, project staff turnover at the grantor agency due to the COVID-19 pandemic also created difficulties to maintain contact during this period. As funding from the EAA was used for construction activities, in later part of 2021 fiscal year, management became more focused on provision of reports required under the grant agreement. Perspective Information: For testing reporting compliance, we selected two (2) quarterly program progress reports out of the four (4) quarterly reports that were submitted during the fiscal year 2022. A single semi-annual report was due in fiscal year 2022. Questioned Costs: None noted. Effect or Potential Effect: SER-Jobs is not in compliance with the terms and conditions of the grant award document. Identification of Repeat Finding: Not applicable since this is a new finding. Recommendation: We recommend that SER-Jobs strengthen its oversight over preparation and submission of the required reports under EAA grant agreement and establish adequate procedures to ensure timely submission of all reports within the expected timelines specified in the grant agreement. Views of Responsible Officials: Management does not disagree with this finding. See management?s corrective action plan on page 33.
Finding 2022-022
ASSISTANCE LISTING 11.307 - ECONOMIC ADJUSTMENT ASSISTANCE DIRECT AWARD FROM U.S. DEPARTMENT OF COMMERCE GRANT AWARD NUMBERS: 08-79-05298; 113048 FINDING NO. 2022-002: NON-COMPLIANCE AND SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER NONCOMPLIANCE WITH REPORTING REQUIREMENTS. Condition: SER-Jobs, as a direct recipient of the Economic Adjustment Assistance (EAA) grant, did not comply with the reporting requirements under The Federal Funding Accountability and Transparency Act (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, (hereafter referred as the ?Transparency Act?) that are codified in 2 CFR Part 170. SER-Jobs did not register with the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS) and did not report contractual payments of $30,000 or more made from use of federal funds provided under EAA grant. Criteria: Under the Transparency Act codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards and subcontracts of $30,000 or more to the FSRS. Cause: Program compliance manager was not aware of the reporting requirements under the Transparency Act. Perspective Information: SER-Jobs executed the grant agreement with U.S. Department of Commerce in October 2019. Per management, the terms of the grant agreement did not clearly indicate compliance with the reporting requirements under the Transparency Act and came to know about this requirement during the audit. Questioned Costs: None noted. Effect or Potential Effect: SER-Jobs is not in compliance with the requirements of the Transparency Act. Identification of Repeat Finding: Not applicable since this is a new finding. Recommendation: We recommend that SER-Jobs register with FSRS and report subaward data through FSRS to comply with the requirements of the Transparency Act. Views of Responsible Officials: Management does not disagree with this finding. See management?s corrective action plan on page 33.
Finding 2022-001
ASSISTANCE LISTING 11.307 - ECONOMIC ADJUSTMENT ASSISTANCE DIRECT AWARD FROM U.S. DEPARTMENT OF COMMERCE GRANT AWARD NUMBERS: 08-79-05298; 113048 FINDING NO. 2022-001: NON-COMPLIANCE AND SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER NONCOMPLIANCE WITH REPORTING REQUIREMENTS Condition: SER-Jobs did not submit its quarterly program progress reports and semi-annual financial report (SF-425) within the timelines specified in the criteria section below. For instance, quarterly program progress reports for the quarters ended December 2021 and June 2022 were submitted on March 1, 2022, and September 13, 2022, respectively, whereas the semi-annual financial report (SF-425) for the period ended September 30, 2021 was submitted on November 11, 2021. Criteria: Per the terms and conditions of the grant agreement, quarterly program progress reports and semi-annual financial report (SF-425) are required to be submitted within 30 days of the end of each quarter or semi-annual period, as applicable. Cause: Management executed the grant agreement in October 2019 but first utilized other funding sources in the initial years to fund construction activities for the workforce training center for which Economic Adjustment Assistance (EAA) grant was awarded. The third-party project manager hired by management to prepare all reports was entirely focused on providing all required reports to those other funding sources. Per management, project staff turnover at the grantor agency due to the COVID-19 pandemic also created difficulties to maintain contact during this period. As funding from the EAA was used for construction activities, in later part of 2021 fiscal year, management became more focused on provision of reports required under the grant agreement. Perspective Information: For testing reporting compliance, we selected two (2) quarterly program progress reports out of the four (4) quarterly reports that were submitted during the fiscal year 2022. A single semi-annual report was due in fiscal year 2022. Questioned Costs: None noted. Effect or Potential Effect: SER-Jobs is not in compliance with the terms and conditions of the grant award document. Identification of Repeat Finding: Not applicable since this is a new finding. Recommendation: We recommend that SER-Jobs strengthen its oversight over preparation and submission of the required reports under EAA grant agreement and establish adequate procedures to ensure timely submission of all reports within the expected timelines specified in the grant agreement. Views of Responsible Officials: Management does not disagree with this finding. See management?s corrective action plan on page 33.
Finding 2022-022
ASSISTANCE LISTING 11.307 - ECONOMIC ADJUSTMENT ASSISTANCE DIRECT AWARD FROM U.S. DEPARTMENT OF COMMERCE GRANT AWARD NUMBERS: 08-79-05298; 113048 FINDING NO. 2022-002: NON-COMPLIANCE AND SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER NONCOMPLIANCE WITH REPORTING REQUIREMENTS. Condition: SER-Jobs, as a direct recipient of the Economic Adjustment Assistance (EAA) grant, did not comply with the reporting requirements under The Federal Funding Accountability and Transparency Act (Pub. L. No. 109-282), as amended by Section 6202 of Public Law 110-252, (hereafter referred as the ?Transparency Act?) that are codified in 2 CFR Part 170. SER-Jobs did not register with the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS) and did not report contractual payments of $30,000 or more made from use of federal funds provided under EAA grant. Criteria: Under the Transparency Act codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards and subcontracts of $30,000 or more to the FSRS. Cause: Program compliance manager was not aware of the reporting requirements under the Transparency Act. Perspective Information: SER-Jobs executed the grant agreement with U.S. Department of Commerce in October 2019. Per management, the terms of the grant agreement did not clearly indicate compliance with the reporting requirements under the Transparency Act and came to know about this requirement during the audit. Questioned Costs: None noted. Effect or Potential Effect: SER-Jobs is not in compliance with the requirements of the Transparency Act. Identification of Repeat Finding: Not applicable since this is a new finding. Recommendation: We recommend that SER-Jobs register with FSRS and report subaward data through FSRS to comply with the requirements of the Transparency Act. Views of Responsible Officials: Management does not disagree with this finding. See management?s corrective action plan on page 33.