Audit 28982

FY End
2022-09-30
Total Expended
$2.54M
Findings
2
Programs
1
Organization: McAllen Chamber of Commerce INC (TX)
Year: 2022 Accepted: 2023-06-28

Organization Exclusion Status:

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Findings

ID Ref Severity Repeat Requirement
28848 2022-001 Significant Deficiency - I
605290 2022-001 Significant Deficiency - I

Programs

ALN Program Spent Major Findings
21.027 Coronavirus State and Local Fiscal Recovery Funds $2.54M Yes 1

Contacts

Name Title Type
JNK6DLE3KME9 Josh Mejia Auditee
9566822871 Ricky Longoria Auditor
No contacts on file

Notes to SEFA

Title: RELATIONSHIP TO FEDERAL FINANCIAL REPORTS Accounting Policies: GENERAL: The accompanying Schedule of Expenditures of Federal Awards (SEFA) presents the federal grant activity for the McAllen Chamber of Commerce, Inc. (the Chamber) for the year ended September 30, 2022. The reporting entity is defined in Note A of the Chambers financial statements. The information in this 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 the Chamber, it is not intended and does not present the financial position, changes in net assets, or cash flows of the Chamber. BASIS OF PRESENTATION: The accompanying SEFA is presented using the accrual basis of accounting, which is described in Note A of the Chambers financial statements. Such expenditures are recognized following cost principles contained in the Uniform Guidance wherein certain types of expenditures are not allowed or may be limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. Amounts reported on the accompanying SEFA do not agree with the amount reported on the Statement of Activities because the amounts reported on the SEFA exclude other revenues unrelated to federal sources. See table below:Program revenue: Federal $ 2,542,002Program revenue: Other 1,422,540Total program revenue $ 3,964,542
Title: AMOUNTS PASSED THROUGH TO SUB-RECIPIENTS Accounting Policies: GENERAL: The accompanying Schedule of Expenditures of Federal Awards (SEFA) presents the federal grant activity for the McAllen Chamber of Commerce, Inc. (the Chamber) for the year ended September 30, 2022. The reporting entity is defined in Note A of the Chambers financial statements. The information in this 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 the Chamber, it is not intended and does not present the financial position, changes in net assets, or cash flows of the Chamber. BASIS OF PRESENTATION: The accompanying SEFA is presented using the accrual basis of accounting, which is described in Note A of the Chambers financial statements. Such expenditures are recognized following cost principles contained in the Uniform Guidance wherein certain types of expenditures are not allowed or may be limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. No amounts were passed through to sub-recipients for the year ended September 30, 2022.
Title: FORGIVABLE LOANS Accounting Policies: GENERAL: The accompanying Schedule of Expenditures of Federal Awards (SEFA) presents the federal grant activity for the McAllen Chamber of Commerce, Inc. (the Chamber) for the year ended September 30, 2022. The reporting entity is defined in Note A of the Chambers financial statements. The information in this 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 the Chamber, it is not intended and does not present the financial position, changes in net assets, or cash flows of the Chamber. BASIS OF PRESENTATION: The accompanying SEFA is presented using the accrual basis of accounting, which is described in Note A of the Chambers financial statements. Such expenditures are recognized following cost principles contained in the Uniform Guidance wherein certain types of expenditures are not allowed or may be limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The Chamber administered a total of $2,542,002 in Coronavirus State and Local Fiscal Relief Fund support within the year ended September 30, 2022. Assistance was administered to qualifying small businesses in denominations of $10,000 (Tier I), $20,000 (Tier II) or $30,000 (Tier III). Tier II and Tier III assistance levels Included a portion that was considered to be a grant ($10,000), and the remaining portion was considered to be a forgivable loan, subject to ongoing compliance monitoring. Forgivable loan balances outstanding under Tier II and Tier III assistance levels totaled $480,043 and $99,974, respectively at September 30, 2022.

Finding Details

CRITERIA AND CONDITION: In accordance with 2 CFR 200, recipients of federal grants are required to conduct suspension and debarment verification for vendors and/or contractors that received $25,000 or more in federal funds to ensure that individuals or entities involved in the grant are not suspended, debarred, or otherwise excluded from participating in federal assistance programs. Our audit revealed that the Chamber failed to perform the necessary suspension and debarment verification for the federal grant awarded to them, in violation of 2 CFR 200 requirements. CAUSE AND EFFECT: The Chamber has not established policies or procedures to verify vendors and/or contractors receiving $25,000 or more in federal funds were not suspended or debarred from participating in federal assistance programs. Failure to comply with suspension and debarment verification requirements exposes the Chamber to significant risks, including the potential for engaging with ineligible parties, which could result in legal or financial consequences to the Chamber. QUESTIONED COST: None REPEAT FINDING FROM PRIOR YEAR: N/A RECOMMENDATION: We recommend the Chamber establish a written policy that clearly defines the procedures and requirements for suspension and debarment verification, in alignment with 2 CFR 200. This policy should outline the roles and responsibilities of personnel involved in grant management and provide guidance on conducting the verification process.
CRITERIA AND CONDITION: In accordance with 2 CFR 200, recipients of federal grants are required to conduct suspension and debarment verification for vendors and/or contractors that received $25,000 or more in federal funds to ensure that individuals or entities involved in the grant are not suspended, debarred, or otherwise excluded from participating in federal assistance programs. Our audit revealed that the Chamber failed to perform the necessary suspension and debarment verification for the federal grant awarded to them, in violation of 2 CFR 200 requirements. CAUSE AND EFFECT: The Chamber has not established policies or procedures to verify vendors and/or contractors receiving $25,000 or more in federal funds were not suspended or debarred from participating in federal assistance programs. Failure to comply with suspension and debarment verification requirements exposes the Chamber to significant risks, including the potential for engaging with ineligible parties, which could result in legal or financial consequences to the Chamber. QUESTIONED COST: None REPEAT FINDING FROM PRIOR YEAR: N/A RECOMMENDATION: We recommend the Chamber establish a written policy that clearly defines the procedures and requirements for suspension and debarment verification, in alignment with 2 CFR 200. This policy should outline the roles and responsibilities of personnel involved in grant management and provide guidance on conducting the verification process.