Audit 292400

Subrecipient Monitoring General Information: Grant Title: Airport Improvement Program ALN #: 20.106 Federal Agency: Department of Transportation Condition: We noted during our audit that the Logan County Commission failed to properly monitor subrecipients. Specifically, there was no assurance that the funds sent for reimbursement were expensed by the subrecipients. Criteria: Appendix XI of the 2 CFR Part 200 July 2021 Compliance Supplement states, in part: “Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f))…” Questioned Costs: $993,739 Context: $993,739 of disbursements were made to local governments without the subrecipients activities being monitored to ensure expenditures of the subaward were used for authorized purposes and in accordance with the grant guidelines. Cause: The Logan County Commission did not have procedures in place to ensure this subrecipient monitoring requirement was performed. Effect: Failure to properly monitor subrecipients increases the likelihood of errors or irregularities not being prevented or detected in a timely manner. Additionally, the risk of unallowable activities and unallowable costs is significantly increased. Management failed to comply with all applicable, material compliance requirements of the grant agreement. Recommendation: The Logan County Commission is directed to review this regulation and comply with the provisions set forth therein. Clients’ response See Corrective Action Plan

Timeliness of Single Audit We noted that the County did not submit the single audit reporting package to the Federal Audit Clearinghouse within the prescribed timeframe. Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) section 200.512 State: “The audit must be completed and the data collection form …and reporting package … must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period….” The entity was unable to compile financial statements before the prescribed timeframe had been reached. The Federal awarding agency or pass-through entity may impose additional conditions, or take actions that could include in part; temporarily withhold cash payments, disallow all or part of the cost of the activity, wholly or partly suspend or terminate the Federal award, withhold further Federal awards for the project or program, or take other remedies that may be legally available. For future single audits, the County should endeavor to ensure that financial statements are complete and that the audit is scheduled prior to the single audit deadline Clients’ response See Corrective Action Plan.

Timeliness of Single Audit We noted that the County did not submit the single audit reporting package to the Federal Audit Clearinghouse within the prescribed timeframe. Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) section 200.512 State: “The audit must be completed and the data collection form …and reporting package … must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period….” The entity was unable to compile financial statements before the prescribed timeframe had been reached. The Federal awarding agency or pass-through entity may impose additional conditions, or take actions that could include in part; temporarily withhold cash payments, disallow all or part of the cost of the activity, wholly or partly suspend or terminate the Federal award, withhold further Federal awards for the project or program, or take other remedies that may be legally available. For future single audits, the County should endeavor to ensure that financial statements are complete and that the audit is scheduled prior to the single audit deadline Clients’ response See Corrective Action Plan.

Subrecipient Monitoring General Information: Grant Title: Airport Improvement Program ALN #: 20.106 Federal Agency: Department of Transportation Condition: We noted during our audit that the Logan County Commission failed to properly monitor subrecipients. Specifically, there was no assurance that the funds sent for reimbursement were expensed by the subrecipients. Criteria: Appendix XI of the 2 CFR Part 200 July 2021 Compliance Supplement states, in part: “Monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, complies with the terms and conditions of the subaward, and achieves performance goals (2 CFR sections 200.332(d) through (f))…” Questioned Costs: $993,739 Context: $993,739 of disbursements were made to local governments without the subrecipients activities being monitored to ensure expenditures of the subaward were used for authorized purposes and in accordance with the grant guidelines. Cause: The Logan County Commission did not have procedures in place to ensure this subrecipient monitoring requirement was performed. Effect: Failure to properly monitor subrecipients increases the likelihood of errors or irregularities not being prevented or detected in a timely manner. Additionally, the risk of unallowable activities and unallowable costs is significantly increased. Management failed to comply with all applicable, material compliance requirements of the grant agreement. Recommendation: The Logan County Commission is directed to review this regulation and comply with the provisions set forth therein. Clients’ response See Corrective Action Plan

Timeliness of Single Audit We noted that the County did not submit the single audit reporting package to the Federal Audit Clearinghouse within the prescribed timeframe. Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) section 200.512 State: “The audit must be completed and the data collection form …and reporting package … must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period….” The entity was unable to compile financial statements before the prescribed timeframe had been reached. The Federal awarding agency or pass-through entity may impose additional conditions, or take actions that could include in part; temporarily withhold cash payments, disallow all or part of the cost of the activity, wholly or partly suspend or terminate the Federal award, withhold further Federal awards for the project or program, or take other remedies that may be legally available. For future single audits, the County should endeavor to ensure that financial statements are complete and that the audit is scheduled prior to the single audit deadline Clients’ response See Corrective Action Plan.

Timeliness of Single Audit We noted that the County did not submit the single audit reporting package to the Federal Audit Clearinghouse within the prescribed timeframe. Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) section 200.512 State: “The audit must be completed and the data collection form …and reporting package … must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period….” The entity was unable to compile financial statements before the prescribed timeframe had been reached. The Federal awarding agency or pass-through entity may impose additional conditions, or take actions that could include in part; temporarily withhold cash payments, disallow all or part of the cost of the activity, wholly or partly suspend or terminate the Federal award, withhold further Federal awards for the project or program, or take other remedies that may be legally available. For future single audits, the County should endeavor to ensure that financial statements are complete and that the audit is scheduled prior to the single audit deadline Clients’ response See Corrective Action Plan.