FAC Explorer

Audit 25409

FY End
2022-09-30
Total Expended
$4.64M
Findings
4
Programs
1
Organization: Nfo Members Dairy Custodial Account (IA)
Year: 2022 Accepted: 2023-02-21
Auditor: Rsm US LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
30453 2022-001 - - H
30454 2022-002 - - L
606895 2022-001 - - H
606896 2022-002 - - L

Programs

ALN Program Spent Major Findings
10.183 Pandemic Market Volatility Assistance Program (pmvap) $4.64M Yes 2

Contacts

Name Title Type
SESAUKPLQBK8 David Reed Auditee
5155984646 Jackie Dammeier Auditor
No contacts on file

Notes to SEFA

Title: Indirect Costs and Administration Compensation Accounting Policies: The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of NFO Members Dairy Custodial Account, an Iowa Trust (the Organization) for the year ended September 30, 2022. The information in this Schedule 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 Schedule presents only a selected portion of the operations of the Organization, it is not intended to, and does not, present the financial position, changes in net assets, or cash flows of the Organization. Expenditures on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance. Under those cost principles, certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The Organization has not elected to use the 10% de minimis indirect cost rate as allowed in the Uniform Guidance. During the year ended September 30, 2022, the Organization incurred indirect costs to administer the federal award program and received $237,650 as administration compensation from the U.S. Department of Agriculture to reimburse such costs. The indirect cost expenditures totaling $237,650 are included in the Schedule for the year ended September 30, 2022.

Finding Details

Finding 2022-001
2022-001: Return of funds not deposited by dairy farmer recipients U.S. Department of Agriculture; Agricultural Marketing Service Pandemic Market Volatility Assistance and Education Program (ALN 10.183) Federal Award Year: 2021-2022 Finding: The Organization did not return Pandemic Market Volatility Assistance and Education Program (PMVAP) monies not deposited by dairy farmer recipients within 180 days of disbursement to the United States Department of Agriculture (USDA). Criteria: Pursuant to the PMVAP agreement with the Agricultural Marketing Service of the USDA, any monies not deposited by the dairy farmer recipient within 180 days of disbursement by the Organization must be remitted to the USDA by October 1, 2022. Condition: The Organization did not timely remit any monies not deposited by dairy farmer recipients to the USDA by October 1, 2022. Cause: As of October 1, 2022, the Organization was investigating if undeposited funds should be voided and re-issued to the dairy farmer recipients through year-end bank statement reconciliation procedures. Effect: The Organization did not timely void any checks not deposited by the dairy farmer recipients or remit such funds to the USDA. Questioned costs: As of October 1, 2022, $43,378 in PMVAP funds were not deposited by dairy farmer recipients or remitted to the USDA. Context: Out of 1,548 dairy farmer recipients, 44 had not deposited their funds as of October 1, 2022. Recommendation: We recommend the Organization monitors and reconciles undeposited federal funds on a more frequent basis. In addition, we recommend the Organization remit any undeposited funds to the USDA as soon as resolution is achieved. View of responsible officials: Management agrees with this finding.
Finding 2022-002
2022-002: Form 1099-MISC was not issued to certain dairy farmer recipients U.S. Department of Agriculture; Agricultural Marketing Service Pandemic Market Volatility Assistance and Education Program (ALN 10.183) Federal Award Year: 2021-2022 Finding: The Organization did not issue a Form 1099-MISC to those dairy farmer recipients who did not provide the Organization with the necessary information to complete and issue the form by the Internal Revenue Service (IRS) deadline date, January 31, 2023. Criteria: Pursuant to the PMVAP agreement with the Agricultural Marketing Service of the USDA, the Organization is required to issue a Form 1099-MISC to each dairy farmer who received a PMVAP payment by the IRS deadline date. Condition: The Organization did not issue a Form 1099-MISC to those dairy farmer recipients who did not provide the Organization with the necessary information required to complete the form by January 31, 2023. Cause: Certain dairy farmer recipients did not provide the necessary information required in order for the Organization to issue a Form 1099-MISC. Effect: The Organization did not issue a Form 1099-MISC to certain dairy farmer recipients by January 31, 2023. Questioned costs: None. Context: One of the 60 dairy farmer recipients subjected to testing did not receive a Form 1099-MISC due to the recipient not providing the necessary information to the Organization by January 31, 2023. Recommendation: We recommend the Organization continues to work with the dairy farmer recipients to track down the necessary information in order to issue the Form 1099-MISC. View of responsible officials: Management agrees with this finding.
Finding 2022-001
2022-001: Return of funds not deposited by dairy farmer recipients U.S. Department of Agriculture; Agricultural Marketing Service Pandemic Market Volatility Assistance and Education Program (ALN 10.183) Federal Award Year: 2021-2022 Finding: The Organization did not return Pandemic Market Volatility Assistance and Education Program (PMVAP) monies not deposited by dairy farmer recipients within 180 days of disbursement to the United States Department of Agriculture (USDA). Criteria: Pursuant to the PMVAP agreement with the Agricultural Marketing Service of the USDA, any monies not deposited by the dairy farmer recipient within 180 days of disbursement by the Organization must be remitted to the USDA by October 1, 2022. Condition: The Organization did not timely remit any monies not deposited by dairy farmer recipients to the USDA by October 1, 2022. Cause: As of October 1, 2022, the Organization was investigating if undeposited funds should be voided and re-issued to the dairy farmer recipients through year-end bank statement reconciliation procedures. Effect: The Organization did not timely void any checks not deposited by the dairy farmer recipients or remit such funds to the USDA. Questioned costs: As of October 1, 2022, $43,378 in PMVAP funds were not deposited by dairy farmer recipients or remitted to the USDA. Context: Out of 1,548 dairy farmer recipients, 44 had not deposited their funds as of October 1, 2022. Recommendation: We recommend the Organization monitors and reconciles undeposited federal funds on a more frequent basis. In addition, we recommend the Organization remit any undeposited funds to the USDA as soon as resolution is achieved. View of responsible officials: Management agrees with this finding.
Finding 2022-002
2022-002: Form 1099-MISC was not issued to certain dairy farmer recipients U.S. Department of Agriculture; Agricultural Marketing Service Pandemic Market Volatility Assistance and Education Program (ALN 10.183) Federal Award Year: 2021-2022 Finding: The Organization did not issue a Form 1099-MISC to those dairy farmer recipients who did not provide the Organization with the necessary information to complete and issue the form by the Internal Revenue Service (IRS) deadline date, January 31, 2023. Criteria: Pursuant to the PMVAP agreement with the Agricultural Marketing Service of the USDA, the Organization is required to issue a Form 1099-MISC to each dairy farmer who received a PMVAP payment by the IRS deadline date. Condition: The Organization did not issue a Form 1099-MISC to those dairy farmer recipients who did not provide the Organization with the necessary information required to complete the form by January 31, 2023. Cause: Certain dairy farmer recipients did not provide the necessary information required in order for the Organization to issue a Form 1099-MISC. Effect: The Organization did not issue a Form 1099-MISC to certain dairy farmer recipients by January 31, 2023. Questioned costs: None. Context: One of the 60 dairy farmer recipients subjected to testing did not receive a Form 1099-MISC due to the recipient not providing the necessary information to the Organization by January 31, 2023. Recommendation: We recommend the Organization continues to work with the dairy farmer recipients to track down the necessary information in order to issue the Form 1099-MISC. View of responsible officials: Management agrees with this finding.