FAC Explorer

Audit 298935

FY End
2023-06-30
Total Expended
$121.01M
Findings
4
Programs
2
Organization: Department of Transportation - Airports Division, State of Hawaii (HI)
Year: 2023 Accepted: 2024-03-27
Auditor: Plante & Moran PLLC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
386618 2023-002 Material Weakness - N
386619 2023-002 Material Weakness - N
963060 2023-002 Material Weakness - N
963061 2023-002 Material Weakness - N

Programs

ALN Program Spent Major Findings
20.106 Airport Improvement Program $74.13M Yes 1
20.106 Covid-19 - Airport Improvement Program $46.89M Yes 1

Contacts

Name Title Type
PAKSNNFXCLV8 Karen Honda Auditee
8088388646 Blake Roe Auditor
No contacts on file

Notes to SEFA

Title: Basis of Presentation Accounting Policies: The accompanying schedule of expenditures of federal awards (the “Schedule") includes the federal grant activity of the Department of Transportation, Airports, State of Hawaii (the "Airports”) under programs of the federal government for the year ended June 30, 2023. The information in the 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 (the "Uniform Guidance”). Because the Schedule presents only a selected portion of the operations of the Airports, it is not intended to and does not present the financial position, changes in net position, or cash flows of the Airports. Expenditures reported in the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited as to reimbursement and frequently asked questions, as outlined in the 2020 Compliance Supplement Addendum. The Airports have elected not to use the 10 percent de minimis indirect cost rate to recover indirect costs, as allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The Airports have elected not to use the 10 percent de minimis indirect cost rate to recover indirect costs, as allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal grant activity of the Department of Transportation, Airports, State of Hawaii (the “Airports”) under programs of the federal government for the year ended June 30, 2023. The information in the 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 (the “Uniform Guidance”). Because the Schedule presents only a selected portion of the operations of the Airports, it is not intended to and does not present the financial position, changes in net position, or cash flows of the Airports.
Title: Summary of Significant Accounting Policies Accounting Policies: The accompanying schedule of expenditures of federal awards (the “Schedule") includes the federal grant activity of the Department of Transportation, Airports, State of Hawaii (the "Airports”) under programs of the federal government for the year ended June 30, 2023. The information in the 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 (the "Uniform Guidance”). Because the Schedule presents only a selected portion of the operations of the Airports, it is not intended to and does not present the financial position, changes in net position, or cash flows of the Airports. Expenditures reported in the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited as to reimbursement and frequently asked questions, as outlined in the 2020 Compliance Supplement Addendum. The Airports have elected not to use the 10 percent de minimis indirect cost rate to recover indirect costs, as allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The Airports have elected not to use the 10 percent de minimis indirect cost rate to recover indirect costs, as allowed under the Uniform Guidance. Expenditures reported in the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, wherein certain types of expenditures are not allowable or are limited as to reimbursement and frequently asked questions, as outlined in the 2020 Compliance Supplement Addendum. The Airports have elected not to use the 10 percent de minimis indirect cost rate to recover indirect costs, as allowed under the Uniform Guidance.

Finding Details

Finding 2023-002
Assistance Listing Number, Federal Agency, and Program Name - 20.106 Federal Aviation Administration - Airport Improvement Program Federal Award Identification Number and Year - N/A Pass-through Entity - N/A Finding Type - Material weakness Repeat Finding - No Criteria - 29 CFR Sections 5.5 and 5.6 establish certain requirements for wage rate requirements. This includes a requirement for the contractor or subcontractor to submit to the nonfederal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). The Airports are responsible for monitoring compliance by any third-party contractor to ensure compliance requirements are being met. Condition - During the audit, it was determined that there is no control function in place by the Airports staff to ensure that wage rate compliance with weekly certified payrolls is occurring. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - The Airports have hired a third-party consultant to perform compliance work regarding obtaining weekly certified payrolls from contractors, and subcontractors as required under the wage rate requirements. The third party has access to upload the certified payrolls to a shared folder with the Airports. The Airports do not have internal controls to monitor or review the work of the third-party consultant. Without this review, the Airports may not be able to detect if a noncompliance by the contractors or subcontractors has occurred. During our testing, we did not note any noncompliance matters related to the wages that were paid for a sample of expenditures that were tested. Cause and Effect - Due to the Airports' lack of monitoring or review of the certified payrolls obtained by the third-party consultant, they did not maintain the proper internal controls to ensure compliance with the wage rate requirement. Recommendation - Internal controls should be implemented and formalized to ensure proper monitoring and reviews of the information provided by the third party are occurring in regards to wage rate requirements. Views of Responsible Officials and Corrective Action Plan - Certified payroll registers that are uploaded in the Airports' web-based databases will be checked monthly by HDOT staff to detect and correct matters related to wage rate requirements. Noncompliance notices will be issued to the third-party consultants when missing information or errors are identified.
Finding 2023-002
Assistance Listing Number, Federal Agency, and Program Name - 20.106 Federal Aviation Administration - Airport Improvement Program Federal Award Identification Number and Year - N/A Pass-through Entity - N/A Finding Type - Material weakness Repeat Finding - No Criteria - 29 CFR Sections 5.5 and 5.6 establish certain requirements for wage rate requirements. This includes a requirement for the contractor or subcontractor to submit to the nonfederal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). The Airports are responsible for monitoring compliance by any third-party contractor to ensure compliance requirements are being met. Condition - During the audit, it was determined that there is no control function in place by the Airports staff to ensure that wage rate compliance with weekly certified payrolls is occurring. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - The Airports have hired a third-party consultant to perform compliance work regarding obtaining weekly certified payrolls from contractors, and subcontractors as required under the wage rate requirements. The third party has access to upload the certified payrolls to a shared folder with the Airports. The Airports do not have internal controls to monitor or review the work of the third-party consultant. Without this review, the Airports may not be able to detect if a noncompliance by the contractors or subcontractors has occurred. During our testing, we did not note any noncompliance matters related to the wages that were paid for a sample of expenditures that were tested. Cause and Effect - Due to the Airports' lack of monitoring or review of the certified payrolls obtained by the third-party consultant, they did not maintain the proper internal controls to ensure compliance with the wage rate requirement. Recommendation - Internal controls should be implemented and formalized to ensure proper monitoring and reviews of the information provided by the third party are occurring in regards to wage rate requirements. Views of Responsible Officials and Corrective Action Plan - Certified payroll registers that are uploaded in the Airports' web-based databases will be checked monthly by HDOT staff to detect and correct matters related to wage rate requirements. Noncompliance notices will be issued to the third-party consultants when missing information or errors are identified.
Finding 2023-002
Assistance Listing Number, Federal Agency, and Program Name - 20.106 Federal Aviation Administration - Airport Improvement Program Federal Award Identification Number and Year - N/A Pass-through Entity - N/A Finding Type - Material weakness Repeat Finding - No Criteria - 29 CFR Sections 5.5 and 5.6 establish certain requirements for wage rate requirements. This includes a requirement for the contractor or subcontractor to submit to the nonfederal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). The Airports are responsible for monitoring compliance by any third-party contractor to ensure compliance requirements are being met. Condition - During the audit, it was determined that there is no control function in place by the Airports staff to ensure that wage rate compliance with weekly certified payrolls is occurring. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - The Airports have hired a third-party consultant to perform compliance work regarding obtaining weekly certified payrolls from contractors, and subcontractors as required under the wage rate requirements. The third party has access to upload the certified payrolls to a shared folder with the Airports. The Airports do not have internal controls to monitor or review the work of the third-party consultant. Without this review, the Airports may not be able to detect if a noncompliance by the contractors or subcontractors has occurred. During our testing, we did not note any noncompliance matters related to the wages that were paid for a sample of expenditures that were tested. Cause and Effect - Due to the Airports' lack of monitoring or review of the certified payrolls obtained by the third-party consultant, they did not maintain the proper internal controls to ensure compliance with the wage rate requirement. Recommendation - Internal controls should be implemented and formalized to ensure proper monitoring and reviews of the information provided by the third party are occurring in regards to wage rate requirements. Views of Responsible Officials and Corrective Action Plan - Certified payroll registers that are uploaded in the Airports' web-based databases will be checked monthly by HDOT staff to detect and correct matters related to wage rate requirements. Noncompliance notices will be issued to the third-party consultants when missing information or errors are identified.
Finding 2023-002
Assistance Listing Number, Federal Agency, and Program Name - 20.106 Federal Aviation Administration - Airport Improvement Program Federal Award Identification Number and Year - N/A Pass-through Entity - N/A Finding Type - Material weakness Repeat Finding - No Criteria - 29 CFR Sections 5.5 and 5.6 establish certain requirements for wage rate requirements. This includes a requirement for the contractor or subcontractor to submit to the nonfederal entity weekly, for each week in which any contract work is performed, a copy of the payroll and a statement of compliance (certified payrolls). The Airports are responsible for monitoring compliance by any third-party contractor to ensure compliance requirements are being met. Condition - During the audit, it was determined that there is no control function in place by the Airports staff to ensure that wage rate compliance with weekly certified payrolls is occurring. Questioned Costs - None Identification of How Questioned Costs Were Computed - N/A Context - The Airports have hired a third-party consultant to perform compliance work regarding obtaining weekly certified payrolls from contractors, and subcontractors as required under the wage rate requirements. The third party has access to upload the certified payrolls to a shared folder with the Airports. The Airports do not have internal controls to monitor or review the work of the third-party consultant. Without this review, the Airports may not be able to detect if a noncompliance by the contractors or subcontractors has occurred. During our testing, we did not note any noncompliance matters related to the wages that were paid for a sample of expenditures that were tested. Cause and Effect - Due to the Airports' lack of monitoring or review of the certified payrolls obtained by the third-party consultant, they did not maintain the proper internal controls to ensure compliance with the wage rate requirement. Recommendation - Internal controls should be implemented and formalized to ensure proper monitoring and reviews of the information provided by the third party are occurring in regards to wage rate requirements. Views of Responsible Officials and Corrective Action Plan - Certified payroll registers that are uploaded in the Airports' web-based databases will be checked monthly by HDOT staff to detect and correct matters related to wage rate requirements. Noncompliance notices will be issued to the third-party consultants when missing information or errors are identified.