2023-002 ACTIVITIES ALLOWED OR UNALLOWED (REPEAT OF PRIOR YEAR FINDING 2022-02)
Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
2 CFR 200.403(g) states that costs must “Be adequately documented.”
Condition: During our testing of activities allowed or unallowed, for 11 of the 60 nonpayroll items tested, management could not provide adequate support that the charges were properly reviewed and approved prior to payment.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not demonstrate that proper internal controls are in place and operating effectively to ensure that unallowable charges to the federal program do not occur.
Effect: Unallowable payments to the federal program may have occurred due to the lack of effective internal controls in place.
Recommendation: We recommend that the Board design and implement controls to ensure that all charges to federal programs are adequately reviewed and approved prior to payment.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-003 EARMARKING (REPEAT OF PRIOR YEAR FINDING 2022-03)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Per the provisions stated in the Uniform Guidance under the WIOA Cluster for Local Areas:
(1) A local area may expend no more than 10 percent of the Adult, Dislocated Worker, and Youth Activities funds allocated to the local area under Sections 128(b) (WIOA, 128 Stat. 1502) and 133(b) (WIOA, 128 Stat. 1516) for within state allocations. The funds provided for administrative costs by one of the three fund sources (Adult, Dislocated Worker, Youth Activities) can be used for administrative costs of the other two sources.
(2) The amount that may be spent on incumbent worker training may not exceed 20 percent of the amount of the combined total of federal funds allocated to local areas to carry out the Adult and Dislocated Worker programs for a program year (20 CFR section 680.800; Section 134(d)(4), WIOA, 128 Stat. 1535).
(3) WIOA authorizes workforce investment areas, with the approval of the governor, to transfer up to 100 percent of the Adult Activities funds to Dislocated Workers Activities, and up to 100 percent of Dislocated Workers Activities funds to Adult Activities (Section 133(b)(4), WIOA, 128 Stat. 1518).
(4) At the discretion of the local board, not more than 10 percent of the total funds allocated to the local area under section 128(b) and under section 133(b)(2)-(3) may be used to implement a pay-for-performance contract strategy as defined in WIOA Section 3(47) (WIOA Section 129(c)(1)(D) and 134(d)(1)(A)(iii)).
(5) As no state has received prior approval for implementation of a PFP contract strategy, no funds from the program years prior to PY 2019 are available for PFP contract strategies or for the accompanying extended disbursement. However, these funds could still be used for other types of performance-based contracting, but the life of those funds remains the normal two-year limit for local WIOA grant funds.
Per the provisions stated in the Uniform Guidance under the WIOA Cluster for Youth Activities:
(1) A minimum of 75 percent of the Youth Activity funds allocated to states and local areas, except for the local area expenditures for administration, must be used to provide services to out-of-school youth (Section 129(a)(4)(A), WIOA, 128 Stat. 1506).
(2) Not less than 20 percent of Youth Activity funds allocated to the local area, except for the local area expenditures for administration, must be used to provide paid and unpaid work experiences (Section 129(c)(4)), WIOA, 128 Stat. 1510).
Condition: Upon inquiry of management, it was noted that the Board did not perform procedures to ensure that the expenditures of the WIOA Cluster were within the earmarking requirements noted in the Uniform Guidance during the fiscal year ended June 30, 2023.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not perform the appropriate procedures to verify that the expenditures of the WIOA Cluster were within the earmarking requirements noted within the Uniform Guidance.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board implement controls and procedures to ensure that all requirements for earmarking within the Uniform Guidance are properly followed.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-004 REPORTING, (REPEAT OF PRIOR YEAR FINDING 2022-05)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
ETA-9130, Financial Report (OMB No. 1205-0461) – All ETA grantees are required to submit quarterly financial reports for each grant award they receive. Reports are required to be prepared using the specific format and instructions for the applicable program(s); in this case, Workforce Innovation and Opportunity Act instructions for the following: Statewide Adult; Workforce Statewide Youth; Statewide Dislocated Worker; Local Adult; Local Youth; and Local Dislocated Worker. Reports are due 45 days after the end of the reporting quarter. Financial data is required to be reported cumulatively from grant inception through the end of each reporting period.
2 CFR 170 Appendix A, as it relates to reporting for the Federal Funding Accountability and Transparency Act, “unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.”
Condition: During our testing of reporting, for all ETA-9130 reports selected for testing management could not provide adequate support that the ETA-9130 reports were properly reviewed and approved prior to being submitted. Additionally, the entity made first tier subawards of greater than $30,000, but could not provide supporting documentation that the necessary reports were filed to satisfy the requirements of the Federal Funding Accountability and Transparency Act (FFATA).
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not have adequate policies and internal controls in place to ensure that all required reports for the WIOA Cluster and FFATA were submitted accurately and in a timely fashion.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board design and implement controls to ensure that all required reporting is submitted accurately and in a timely fashion.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-005 SUBRECIPIENT MONITORING (REPEAT OF PRIOR YEAR FINDING 2022-06)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Recipients must ensure that commercial organizations that are subrecipients under WIOA Title I and expend more than the minimum level specified in 2 CFR Part 200, Subpart F, have either an organization-wide audit conducted in accordance with 2 CFR Part 200 or a program-specific financial and compliance audit (20 CFR section 683.210).
2 CFR 200.332(b) requires that all pass-through entities must:
Evaluate each subrecipient’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section.
Condition: Upon inquiry of management, the Board did not perform any subrecipient monitoring procedures related to the Board’s grant agreement with its subrecipient for the fiscal year ended June 30, 2023.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023, which included $1,350,121 of expenditures to subrecipients.
Cause: Although the Board has policies and procedures in place surrounding the subrecipient monitoring compliance requirements, due to staffing issues during the fiscal year and lack of knowledge of all the federal compliance requirements, no subrecipient monitoring was completed.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board review its policies and procedures for sufficiency and commit the appropriate personnel to subrecipient monitoring to ensure that the Board is in compliance with all federal requirements.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-006 ELIGIBILITY (REPEAT OF PRIOR YEAR FINDING 2022-07)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Per the provisions of the Workforce Innovation and Opportunity Act (WIOA), “A person is eligible to receive services under Youth Activities if they are an out-of-school youth or an in-school youth (Section 129(a)(1), WIOA, 128 Stat. 1504)”, and meet the definition of such as defined in the Uniform Guidance.
Condition: During our testing of WIOA participants, it was noted by management that the eligibility determination for Youth Activities is maintained and conducted by the Board’s subrecipient. According to management, there are no procedures performed at the Board to verify the eligibility of Youth Activities participants to ensure that all federal compliance requirements are being adhered to. Additionally, 2 of the 60 individual adult program applications selected for testing were not reviewed by a case manager.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board does not perform any procedures to ensure that the Youth Activities participants meet all the federal compliance requirements for participation in the program. Further, the Board did not review two individual adult program applications for eligibility.
Effect: A Youth Activities participant(s)/Adult Activities participant(s) may be granted access to the Board’s program when they do not meet the prescribed eligibility requirements.
Recommendation: We recommend that the Board implement policies and procedures to ensure that the necessary controls are in place to properly verify the eligibility of all Youth and Adult Activities participants.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-007 ALLOCATION OF GRANT EXPENSES (REPEAT OF PRIOR YEAR FINDING 2022-08)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Condition: During our testing of WIOA Cluster expenditures, it was noted that the Board did not regularly reconcile expenditures to the appropriate assistance listing numbers within the WIOA Cluster during the year. Further, it was determined that expenses are being split among expired grants as well as active grants in the client accounting software.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: Due to staffing changes during the year, grant expenditures were not regularly reconciled and allocated to the appropriate grant number based on actual expenses.
Effect: Expenses were not properly allocated to the correct Assistance Listing number within the WIOA cluster.
Recommendation: We recommend that the Board implement policies and procedures to ensure that all expenses are for actual expenses incurred, and that timely reconciliations are performed to ensure the expenses are properly charged to the correct assistance listing number and grant.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-002 ACTIVITIES ALLOWED OR UNALLOWED (REPEAT OF PRIOR YEAR FINDING 2022-02)
Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
2 CFR 200.403(g) states that costs must “Be adequately documented.”
Condition: During our testing of activities allowed or unallowed, for 11 of the 60 nonpayroll items tested, management could not provide adequate support that the charges were properly reviewed and approved prior to payment.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not demonstrate that proper internal controls are in place and operating effectively to ensure that unallowable charges to the federal program do not occur.
Effect: Unallowable payments to the federal program may have occurred due to the lack of effective internal controls in place.
Recommendation: We recommend that the Board design and implement controls to ensure that all charges to federal programs are adequately reviewed and approved prior to payment.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-003 EARMARKING (REPEAT OF PRIOR YEAR FINDING 2022-03)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Per the provisions stated in the Uniform Guidance under the WIOA Cluster for Local Areas:
(1) A local area may expend no more than 10 percent of the Adult, Dislocated Worker, and Youth Activities funds allocated to the local area under Sections 128(b) (WIOA, 128 Stat. 1502) and 133(b) (WIOA, 128 Stat. 1516) for within state allocations. The funds provided for administrative costs by one of the three fund sources (Adult, Dislocated Worker, Youth Activities) can be used for administrative costs of the other two sources.
(2) The amount that may be spent on incumbent worker training may not exceed 20 percent of the amount of the combined total of federal funds allocated to local areas to carry out the Adult and Dislocated Worker programs for a program year (20 CFR section 680.800; Section 134(d)(4), WIOA, 128 Stat. 1535).
(3) WIOA authorizes workforce investment areas, with the approval of the governor, to transfer up to 100 percent of the Adult Activities funds to Dislocated Workers Activities, and up to 100 percent of Dislocated Workers Activities funds to Adult Activities (Section 133(b)(4), WIOA, 128 Stat. 1518).
(4) At the discretion of the local board, not more than 10 percent of the total funds allocated to the local area under section 128(b) and under section 133(b)(2)-(3) may be used to implement a pay-for-performance contract strategy as defined in WIOA Section 3(47) (WIOA Section 129(c)(1)(D) and 134(d)(1)(A)(iii)).
(5) As no state has received prior approval for implementation of a PFP contract strategy, no funds from the program years prior to PY 2019 are available for PFP contract strategies or for the accompanying extended disbursement. However, these funds could still be used for other types of performance-based contracting, but the life of those funds remains the normal two-year limit for local WIOA grant funds.
Per the provisions stated in the Uniform Guidance under the WIOA Cluster for Youth Activities:
(1) A minimum of 75 percent of the Youth Activity funds allocated to states and local areas, except for the local area expenditures for administration, must be used to provide services to out-of-school youth (Section 129(a)(4)(A), WIOA, 128 Stat. 1506).
(2) Not less than 20 percent of Youth Activity funds allocated to the local area, except for the local area expenditures for administration, must be used to provide paid and unpaid work experiences (Section 129(c)(4)), WIOA, 128 Stat. 1510).
Condition: Upon inquiry of management, it was noted that the Board did not perform procedures to ensure that the expenditures of the WIOA Cluster were within the earmarking requirements noted in the Uniform Guidance during the fiscal year ended June 30, 2023.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not perform the appropriate procedures to verify that the expenditures of the WIOA Cluster were within the earmarking requirements noted within the Uniform Guidance.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board implement controls and procedures to ensure that all requirements for earmarking within the Uniform Guidance are properly followed.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-004 REPORTING, (REPEAT OF PRIOR YEAR FINDING 2022-05)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
ETA-9130, Financial Report (OMB No. 1205-0461) – All ETA grantees are required to submit quarterly financial reports for each grant award they receive. Reports are required to be prepared using the specific format and instructions for the applicable program(s); in this case, Workforce Innovation and Opportunity Act instructions for the following: Statewide Adult; Workforce Statewide Youth; Statewide Dislocated Worker; Local Adult; Local Youth; and Local Dislocated Worker. Reports are due 45 days after the end of the reporting quarter. Financial data is required to be reported cumulatively from grant inception through the end of each reporting period.
2 CFR 170 Appendix A, as it relates to reporting for the Federal Funding Accountability and Transparency Act, “unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.”
Condition: During our testing of reporting, for all ETA-9130 reports selected for testing management could not provide adequate support that the ETA-9130 reports were properly reviewed and approved prior to being submitted. Additionally, the entity made first tier subawards of greater than $30,000, but could not provide supporting documentation that the necessary reports were filed to satisfy the requirements of the Federal Funding Accountability and Transparency Act (FFATA).
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not have adequate policies and internal controls in place to ensure that all required reports for the WIOA Cluster and FFATA were submitted accurately and in a timely fashion.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board design and implement controls to ensure that all required reporting is submitted accurately and in a timely fashion.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-005 SUBRECIPIENT MONITORING (REPEAT OF PRIOR YEAR FINDING 2022-06)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Recipients must ensure that commercial organizations that are subrecipients under WIOA Title I and expend more than the minimum level specified in 2 CFR Part 200, Subpart F, have either an organization-wide audit conducted in accordance with 2 CFR Part 200 or a program-specific financial and compliance audit (20 CFR section 683.210).
2 CFR 200.332(b) requires that all pass-through entities must:
Evaluate each subrecipient’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section.
Condition: Upon inquiry of management, the Board did not perform any subrecipient monitoring procedures related to the Board’s grant agreement with its subrecipient for the fiscal year ended June 30, 2023.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023, which included $1,350,121 of expenditures to subrecipients.
Cause: Although the Board has policies and procedures in place surrounding the subrecipient monitoring compliance requirements, due to staffing issues during the fiscal year and lack of knowledge of all the federal compliance requirements, no subrecipient monitoring was completed.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board review its policies and procedures for sufficiency and commit the appropriate personnel to subrecipient monitoring to ensure that the Board is in compliance with all federal requirements.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-006 ELIGIBILITY (REPEAT OF PRIOR YEAR FINDING 2022-07)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Per the provisions of the Workforce Innovation and Opportunity Act (WIOA), “A person is eligible to receive services under Youth Activities if they are an out-of-school youth or an in-school youth (Section 129(a)(1), WIOA, 128 Stat. 1504)”, and meet the definition of such as defined in the Uniform Guidance.
Condition: During our testing of WIOA participants, it was noted by management that the eligibility determination for Youth Activities is maintained and conducted by the Board’s subrecipient. According to management, there are no procedures performed at the Board to verify the eligibility of Youth Activities participants to ensure that all federal compliance requirements are being adhered to. Additionally, 2 of the 60 individual adult program applications selected for testing were not reviewed by a case manager.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board does not perform any procedures to ensure that the Youth Activities participants meet all the federal compliance requirements for participation in the program. Further, the Board did not review two individual adult program applications for eligibility.
Effect: A Youth Activities participant(s)/Adult Activities participant(s) may be granted access to the Board’s program when they do not meet the prescribed eligibility requirements.
Recommendation: We recommend that the Board implement policies and procedures to ensure that the necessary controls are in place to properly verify the eligibility of all Youth and Adult Activities participants.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-007 ALLOCATION OF GRANT EXPENSES (REPEAT OF PRIOR YEAR FINDING 2022-08)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Condition: During our testing of WIOA Cluster expenditures, it was noted that the Board did not regularly reconcile expenditures to the appropriate assistance listing numbers within the WIOA Cluster during the year. Further, it was determined that expenses are being split among expired grants as well as active grants in the client accounting software.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: Due to staffing changes during the year, grant expenditures were not regularly reconciled and allocated to the appropriate grant number based on actual expenses.
Effect: Expenses were not properly allocated to the correct Assistance Listing number within the WIOA cluster.
Recommendation: We recommend that the Board implement policies and procedures to ensure that all expenses are for actual expenses incurred, and that timely reconciliations are performed to ensure the expenses are properly charged to the correct assistance listing number and grant.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-002 ACTIVITIES ALLOWED OR UNALLOWED (REPEAT OF PRIOR YEAR FINDING 2022-02)
Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
2 CFR 200.403(g) states that costs must “Be adequately documented.”
Condition: During our testing of activities allowed or unallowed, for 11 of the 60 nonpayroll items tested, management could not provide adequate support that the charges were properly reviewed and approved prior to payment.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not demonstrate that proper internal controls are in place and operating effectively to ensure that unallowable charges to the federal program do not occur.
Effect: Unallowable payments to the federal program may have occurred due to the lack of effective internal controls in place.
Recommendation: We recommend that the Board design and implement controls to ensure that all charges to federal programs are adequately reviewed and approved prior to payment.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-003 EARMARKING (REPEAT OF PRIOR YEAR FINDING 2022-03)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Per the provisions stated in the Uniform Guidance under the WIOA Cluster for Local Areas:
(1) A local area may expend no more than 10 percent of the Adult, Dislocated Worker, and Youth Activities funds allocated to the local area under Sections 128(b) (WIOA, 128 Stat. 1502) and 133(b) (WIOA, 128 Stat. 1516) for within state allocations. The funds provided for administrative costs by one of the three fund sources (Adult, Dislocated Worker, Youth Activities) can be used for administrative costs of the other two sources.
(2) The amount that may be spent on incumbent worker training may not exceed 20 percent of the amount of the combined total of federal funds allocated to local areas to carry out the Adult and Dislocated Worker programs for a program year (20 CFR section 680.800; Section 134(d)(4), WIOA, 128 Stat. 1535).
(3) WIOA authorizes workforce investment areas, with the approval of the governor, to transfer up to 100 percent of the Adult Activities funds to Dislocated Workers Activities, and up to 100 percent of Dislocated Workers Activities funds to Adult Activities (Section 133(b)(4), WIOA, 128 Stat. 1518).
(4) At the discretion of the local board, not more than 10 percent of the total funds allocated to the local area under section 128(b) and under section 133(b)(2)-(3) may be used to implement a pay-for-performance contract strategy as defined in WIOA Section 3(47) (WIOA Section 129(c)(1)(D) and 134(d)(1)(A)(iii)).
(5) As no state has received prior approval for implementation of a PFP contract strategy, no funds from the program years prior to PY 2019 are available for PFP contract strategies or for the accompanying extended disbursement. However, these funds could still be used for other types of performance-based contracting, but the life of those funds remains the normal two-year limit for local WIOA grant funds.
Per the provisions stated in the Uniform Guidance under the WIOA Cluster for Youth Activities:
(1) A minimum of 75 percent of the Youth Activity funds allocated to states and local areas, except for the local area expenditures for administration, must be used to provide services to out-of-school youth (Section 129(a)(4)(A), WIOA, 128 Stat. 1506).
(2) Not less than 20 percent of Youth Activity funds allocated to the local area, except for the local area expenditures for administration, must be used to provide paid and unpaid work experiences (Section 129(c)(4)), WIOA, 128 Stat. 1510).
Condition: Upon inquiry of management, it was noted that the Board did not perform procedures to ensure that the expenditures of the WIOA Cluster were within the earmarking requirements noted in the Uniform Guidance during the fiscal year ended June 30, 2023.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not perform the appropriate procedures to verify that the expenditures of the WIOA Cluster were within the earmarking requirements noted within the Uniform Guidance.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board implement controls and procedures to ensure that all requirements for earmarking within the Uniform Guidance are properly followed.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-004 REPORTING, (REPEAT OF PRIOR YEAR FINDING 2022-05)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
ETA-9130, Financial Report (OMB No. 1205-0461) – All ETA grantees are required to submit quarterly financial reports for each grant award they receive. Reports are required to be prepared using the specific format and instructions for the applicable program(s); in this case, Workforce Innovation and Opportunity Act instructions for the following: Statewide Adult; Workforce Statewide Youth; Statewide Dislocated Worker; Local Adult; Local Youth; and Local Dislocated Worker. Reports are due 45 days after the end of the reporting quarter. Financial data is required to be reported cumulatively from grant inception through the end of each reporting period.
2 CFR 170 Appendix A, as it relates to reporting for the Federal Funding Accountability and Transparency Act, “unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.”
Condition: During our testing of reporting, for all ETA-9130 reports selected for testing management could not provide adequate support that the ETA-9130 reports were properly reviewed and approved prior to being submitted. Additionally, the entity made first tier subawards of greater than $30,000, but could not provide supporting documentation that the necessary reports were filed to satisfy the requirements of the Federal Funding Accountability and Transparency Act (FFATA).
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not have adequate policies and internal controls in place to ensure that all required reports for the WIOA Cluster and FFATA were submitted accurately and in a timely fashion.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board design and implement controls to ensure that all required reporting is submitted accurately and in a timely fashion.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-005 SUBRECIPIENT MONITORING (REPEAT OF PRIOR YEAR FINDING 2022-06)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Recipients must ensure that commercial organizations that are subrecipients under WIOA Title I and expend more than the minimum level specified in 2 CFR Part 200, Subpart F, have either an organization-wide audit conducted in accordance with 2 CFR Part 200 or a program-specific financial and compliance audit (20 CFR section 683.210).
2 CFR 200.332(b) requires that all pass-through entities must:
Evaluate each subrecipient’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section.
Condition: Upon inquiry of management, the Board did not perform any subrecipient monitoring procedures related to the Board’s grant agreement with its subrecipient for the fiscal year ended June 30, 2023.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023, which included $1,350,121 of expenditures to subrecipients.
Cause: Although the Board has policies and procedures in place surrounding the subrecipient monitoring compliance requirements, due to staffing issues during the fiscal year and lack of knowledge of all the federal compliance requirements, no subrecipient monitoring was completed.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board review its policies and procedures for sufficiency and commit the appropriate personnel to subrecipient monitoring to ensure that the Board is in compliance with all federal requirements.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-006 ELIGIBILITY (REPEAT OF PRIOR YEAR FINDING 2022-07)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Per the provisions of the Workforce Innovation and Opportunity Act (WIOA), “A person is eligible to receive services under Youth Activities if they are an out-of-school youth or an in-school youth (Section 129(a)(1), WIOA, 128 Stat. 1504)”, and meet the definition of such as defined in the Uniform Guidance.
Condition: During our testing of WIOA participants, it was noted by management that the eligibility determination for Youth Activities is maintained and conducted by the Board’s subrecipient. According to management, there are no procedures performed at the Board to verify the eligibility of Youth Activities participants to ensure that all federal compliance requirements are being adhered to. Additionally, 2 of the 60 individual adult program applications selected for testing were not reviewed by a case manager.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board does not perform any procedures to ensure that the Youth Activities participants meet all the federal compliance requirements for participation in the program. Further, the Board did not review two individual adult program applications for eligibility.
Effect: A Youth Activities participant(s)/Adult Activities participant(s) may be granted access to the Board’s program when they do not meet the prescribed eligibility requirements.
Recommendation: We recommend that the Board implement policies and procedures to ensure that the necessary controls are in place to properly verify the eligibility of all Youth and Adult Activities participants.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-007 ALLOCATION OF GRANT EXPENSES (REPEAT OF PRIOR YEAR FINDING 2022-08)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Condition: During our testing of WIOA Cluster expenditures, it was noted that the Board did not regularly reconcile expenditures to the appropriate assistance listing numbers within the WIOA Cluster during the year. Further, it was determined that expenses are being split among expired grants as well as active grants in the client accounting software.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: Due to staffing changes during the year, grant expenditures were not regularly reconciled and allocated to the appropriate grant number based on actual expenses.
Effect: Expenses were not properly allocated to the correct Assistance Listing number within the WIOA cluster.
Recommendation: We recommend that the Board implement policies and procedures to ensure that all expenses are for actual expenses incurred, and that timely reconciliations are performed to ensure the expenses are properly charged to the correct assistance listing number and grant.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-002 ACTIVITIES ALLOWED OR UNALLOWED (REPEAT OF PRIOR YEAR FINDING 2022-02)
Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
2 CFR 200.403(g) states that costs must “Be adequately documented.”
Condition: During our testing of activities allowed or unallowed, for 11 of the 60 nonpayroll items tested, management could not provide adequate support that the charges were properly reviewed and approved prior to payment.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not demonstrate that proper internal controls are in place and operating effectively to ensure that unallowable charges to the federal program do not occur.
Effect: Unallowable payments to the federal program may have occurred due to the lack of effective internal controls in place.
Recommendation: We recommend that the Board design and implement controls to ensure that all charges to federal programs are adequately reviewed and approved prior to payment.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-003 EARMARKING (REPEAT OF PRIOR YEAR FINDING 2022-03)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Per the provisions stated in the Uniform Guidance under the WIOA Cluster for Local Areas:
(1) A local area may expend no more than 10 percent of the Adult, Dislocated Worker, and Youth Activities funds allocated to the local area under Sections 128(b) (WIOA, 128 Stat. 1502) and 133(b) (WIOA, 128 Stat. 1516) for within state allocations. The funds provided for administrative costs by one of the three fund sources (Adult, Dislocated Worker, Youth Activities) can be used for administrative costs of the other two sources.
(2) The amount that may be spent on incumbent worker training may not exceed 20 percent of the amount of the combined total of federal funds allocated to local areas to carry out the Adult and Dislocated Worker programs for a program year (20 CFR section 680.800; Section 134(d)(4), WIOA, 128 Stat. 1535).
(3) WIOA authorizes workforce investment areas, with the approval of the governor, to transfer up to 100 percent of the Adult Activities funds to Dislocated Workers Activities, and up to 100 percent of Dislocated Workers Activities funds to Adult Activities (Section 133(b)(4), WIOA, 128 Stat. 1518).
(4) At the discretion of the local board, not more than 10 percent of the total funds allocated to the local area under section 128(b) and under section 133(b)(2)-(3) may be used to implement a pay-for-performance contract strategy as defined in WIOA Section 3(47) (WIOA Section 129(c)(1)(D) and 134(d)(1)(A)(iii)).
(5) As no state has received prior approval for implementation of a PFP contract strategy, no funds from the program years prior to PY 2019 are available for PFP contract strategies or for the accompanying extended disbursement. However, these funds could still be used for other types of performance-based contracting, but the life of those funds remains the normal two-year limit for local WIOA grant funds.
Per the provisions stated in the Uniform Guidance under the WIOA Cluster for Youth Activities:
(1) A minimum of 75 percent of the Youth Activity funds allocated to states and local areas, except for the local area expenditures for administration, must be used to provide services to out-of-school youth (Section 129(a)(4)(A), WIOA, 128 Stat. 1506).
(2) Not less than 20 percent of Youth Activity funds allocated to the local area, except for the local area expenditures for administration, must be used to provide paid and unpaid work experiences (Section 129(c)(4)), WIOA, 128 Stat. 1510).
Condition: Upon inquiry of management, it was noted that the Board did not perform procedures to ensure that the expenditures of the WIOA Cluster were within the earmarking requirements noted in the Uniform Guidance during the fiscal year ended June 30, 2023.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not perform the appropriate procedures to verify that the expenditures of the WIOA Cluster were within the earmarking requirements noted within the Uniform Guidance.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board implement controls and procedures to ensure that all requirements for earmarking within the Uniform Guidance are properly followed.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-004 REPORTING, (REPEAT OF PRIOR YEAR FINDING 2022-05)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
ETA-9130, Financial Report (OMB No. 1205-0461) – All ETA grantees are required to submit quarterly financial reports for each grant award they receive. Reports are required to be prepared using the specific format and instructions for the applicable program(s); in this case, Workforce Innovation and Opportunity Act instructions for the following: Statewide Adult; Workforce Statewide Youth; Statewide Dislocated Worker; Local Adult; Local Youth; and Local Dislocated Worker. Reports are due 45 days after the end of the reporting quarter. Financial data is required to be reported cumulatively from grant inception through the end of each reporting period.
2 CFR 170 Appendix A, as it relates to reporting for the Federal Funding Accountability and Transparency Act, “unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.”
Condition: During our testing of reporting, for all ETA-9130 reports selected for testing management could not provide adequate support that the ETA-9130 reports were properly reviewed and approved prior to being submitted. Additionally, the entity made first tier subawards of greater than $30,000, but could not provide supporting documentation that the necessary reports were filed to satisfy the requirements of the Federal Funding Accountability and Transparency Act (FFATA).
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not have adequate policies and internal controls in place to ensure that all required reports for the WIOA Cluster and FFATA were submitted accurately and in a timely fashion.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board design and implement controls to ensure that all required reporting is submitted accurately and in a timely fashion.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-005 SUBRECIPIENT MONITORING (REPEAT OF PRIOR YEAR FINDING 2022-06)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Recipients must ensure that commercial organizations that are subrecipients under WIOA Title I and expend more than the minimum level specified in 2 CFR Part 200, Subpart F, have either an organization-wide audit conducted in accordance with 2 CFR Part 200 or a program-specific financial and compliance audit (20 CFR section 683.210).
2 CFR 200.332(b) requires that all pass-through entities must:
Evaluate each subrecipient’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section.
Condition: Upon inquiry of management, the Board did not perform any subrecipient monitoring procedures related to the Board’s grant agreement with its subrecipient for the fiscal year ended June 30, 2023.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023, which included $1,350,121 of expenditures to subrecipients.
Cause: Although the Board has policies and procedures in place surrounding the subrecipient monitoring compliance requirements, due to staffing issues during the fiscal year and lack of knowledge of all the federal compliance requirements, no subrecipient monitoring was completed.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board review its policies and procedures for sufficiency and commit the appropriate personnel to subrecipient monitoring to ensure that the Board is in compliance with all federal requirements.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-006 ELIGIBILITY (REPEAT OF PRIOR YEAR FINDING 2022-07)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Per the provisions of the Workforce Innovation and Opportunity Act (WIOA), “A person is eligible to receive services under Youth Activities if they are an out-of-school youth or an in-school youth (Section 129(a)(1), WIOA, 128 Stat. 1504)”, and meet the definition of such as defined in the Uniform Guidance.
Condition: During our testing of WIOA participants, it was noted by management that the eligibility determination for Youth Activities is maintained and conducted by the Board’s subrecipient. According to management, there are no procedures performed at the Board to verify the eligibility of Youth Activities participants to ensure that all federal compliance requirements are being adhered to. Additionally, 2 of the 60 individual adult program applications selected for testing were not reviewed by a case manager.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board does not perform any procedures to ensure that the Youth Activities participants meet all the federal compliance requirements for participation in the program. Further, the Board did not review two individual adult program applications for eligibility.
Effect: A Youth Activities participant(s)/Adult Activities participant(s) may be granted access to the Board’s program when they do not meet the prescribed eligibility requirements.
Recommendation: We recommend that the Board implement policies and procedures to ensure that the necessary controls are in place to properly verify the eligibility of all Youth and Adult Activities participants.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-007 ALLOCATION OF GRANT EXPENSES (REPEAT OF PRIOR YEAR FINDING 2022-08)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Condition: During our testing of WIOA Cluster expenditures, it was noted that the Board did not regularly reconcile expenditures to the appropriate assistance listing numbers within the WIOA Cluster during the year. Further, it was determined that expenses are being split among expired grants as well as active grants in the client accounting software.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: Due to staffing changes during the year, grant expenditures were not regularly reconciled and allocated to the appropriate grant number based on actual expenses.
Effect: Expenses were not properly allocated to the correct Assistance Listing number within the WIOA cluster.
Recommendation: We recommend that the Board implement policies and procedures to ensure that all expenses are for actual expenses incurred, and that timely reconciliations are performed to ensure the expenses are properly charged to the correct assistance listing number and grant.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-002 ACTIVITIES ALLOWED OR UNALLOWED (REPEAT OF PRIOR YEAR FINDING 2022-02)
Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
2 CFR 200.403(g) states that costs must “Be adequately documented.”
Condition: During our testing of activities allowed or unallowed, for 11 of the 60 nonpayroll items tested, management could not provide adequate support that the charges were properly reviewed and approved prior to payment.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not demonstrate that proper internal controls are in place and operating effectively to ensure that unallowable charges to the federal program do not occur.
Effect: Unallowable payments to the federal program may have occurred due to the lack of effective internal controls in place.
Recommendation: We recommend that the Board design and implement controls to ensure that all charges to federal programs are adequately reviewed and approved prior to payment.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-003 EARMARKING (REPEAT OF PRIOR YEAR FINDING 2022-03)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Per the provisions stated in the Uniform Guidance under the WIOA Cluster for Local Areas:
(1) A local area may expend no more than 10 percent of the Adult, Dislocated Worker, and Youth Activities funds allocated to the local area under Sections 128(b) (WIOA, 128 Stat. 1502) and 133(b) (WIOA, 128 Stat. 1516) for within state allocations. The funds provided for administrative costs by one of the three fund sources (Adult, Dislocated Worker, Youth Activities) can be used for administrative costs of the other two sources.
(2) The amount that may be spent on incumbent worker training may not exceed 20 percent of the amount of the combined total of federal funds allocated to local areas to carry out the Adult and Dislocated Worker programs for a program year (20 CFR section 680.800; Section 134(d)(4), WIOA, 128 Stat. 1535).
(3) WIOA authorizes workforce investment areas, with the approval of the governor, to transfer up to 100 percent of the Adult Activities funds to Dislocated Workers Activities, and up to 100 percent of Dislocated Workers Activities funds to Adult Activities (Section 133(b)(4), WIOA, 128 Stat. 1518).
(4) At the discretion of the local board, not more than 10 percent of the total funds allocated to the local area under section 128(b) and under section 133(b)(2)-(3) may be used to implement a pay-for-performance contract strategy as defined in WIOA Section 3(47) (WIOA Section 129(c)(1)(D) and 134(d)(1)(A)(iii)).
(5) As no state has received prior approval for implementation of a PFP contract strategy, no funds from the program years prior to PY 2019 are available for PFP contract strategies or for the accompanying extended disbursement. However, these funds could still be used for other types of performance-based contracting, but the life of those funds remains the normal two-year limit for local WIOA grant funds.
Per the provisions stated in the Uniform Guidance under the WIOA Cluster for Youth Activities:
(1) A minimum of 75 percent of the Youth Activity funds allocated to states and local areas, except for the local area expenditures for administration, must be used to provide services to out-of-school youth (Section 129(a)(4)(A), WIOA, 128 Stat. 1506).
(2) Not less than 20 percent of Youth Activity funds allocated to the local area, except for the local area expenditures for administration, must be used to provide paid and unpaid work experiences (Section 129(c)(4)), WIOA, 128 Stat. 1510).
Condition: Upon inquiry of management, it was noted that the Board did not perform procedures to ensure that the expenditures of the WIOA Cluster were within the earmarking requirements noted in the Uniform Guidance during the fiscal year ended June 30, 2023.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not perform the appropriate procedures to verify that the expenditures of the WIOA Cluster were within the earmarking requirements noted within the Uniform Guidance.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board implement controls and procedures to ensure that all requirements for earmarking within the Uniform Guidance are properly followed.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-004 REPORTING, (REPEAT OF PRIOR YEAR FINDING 2022-05)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
ETA-9130, Financial Report (OMB No. 1205-0461) – All ETA grantees are required to submit quarterly financial reports for each grant award they receive. Reports are required to be prepared using the specific format and instructions for the applicable program(s); in this case, Workforce Innovation and Opportunity Act instructions for the following: Statewide Adult; Workforce Statewide Youth; Statewide Dislocated Worker; Local Adult; Local Youth; and Local Dislocated Worker. Reports are due 45 days after the end of the reporting quarter. Financial data is required to be reported cumulatively from grant inception through the end of each reporting period.
2 CFR 170 Appendix A, as it relates to reporting for the Federal Funding Accountability and Transparency Act, “unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.”
Condition: During our testing of reporting, for all ETA-9130 reports selected for testing management could not provide adequate support that the ETA-9130 reports were properly reviewed and approved prior to being submitted. Additionally, the entity made first tier subawards of greater than $30,000, but could not provide supporting documentation that the necessary reports were filed to satisfy the requirements of the Federal Funding Accountability and Transparency Act (FFATA).
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not have adequate policies and internal controls in place to ensure that all required reports for the WIOA Cluster and FFATA were submitted accurately and in a timely fashion.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board design and implement controls to ensure that all required reporting is submitted accurately and in a timely fashion.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-005 SUBRECIPIENT MONITORING (REPEAT OF PRIOR YEAR FINDING 2022-06)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Recipients must ensure that commercial organizations that are subrecipients under WIOA Title I and expend more than the minimum level specified in 2 CFR Part 200, Subpart F, have either an organization-wide audit conducted in accordance with 2 CFR Part 200 or a program-specific financial and compliance audit (20 CFR section 683.210).
2 CFR 200.332(b) requires that all pass-through entities must:
Evaluate each subrecipient’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section.
Condition: Upon inquiry of management, the Board did not perform any subrecipient monitoring procedures related to the Board’s grant agreement with its subrecipient for the fiscal year ended June 30, 2023.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023, which included $1,350,121 of expenditures to subrecipients.
Cause: Although the Board has policies and procedures in place surrounding the subrecipient monitoring compliance requirements, due to staffing issues during the fiscal year and lack of knowledge of all the federal compliance requirements, no subrecipient monitoring was completed.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board review its policies and procedures for sufficiency and commit the appropriate personnel to subrecipient monitoring to ensure that the Board is in compliance with all federal requirements.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-006 ELIGIBILITY (REPEAT OF PRIOR YEAR FINDING 2022-07)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Per the provisions of the Workforce Innovation and Opportunity Act (WIOA), “A person is eligible to receive services under Youth Activities if they are an out-of-school youth or an in-school youth (Section 129(a)(1), WIOA, 128 Stat. 1504)”, and meet the definition of such as defined in the Uniform Guidance.
Condition: During our testing of WIOA participants, it was noted by management that the eligibility determination for Youth Activities is maintained and conducted by the Board’s subrecipient. According to management, there are no procedures performed at the Board to verify the eligibility of Youth Activities participants to ensure that all federal compliance requirements are being adhered to. Additionally, 2 of the 60 individual adult program applications selected for testing were not reviewed by a case manager.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board does not perform any procedures to ensure that the Youth Activities participants meet all the federal compliance requirements for participation in the program. Further, the Board did not review two individual adult program applications for eligibility.
Effect: A Youth Activities participant(s)/Adult Activities participant(s) may be granted access to the Board’s program when they do not meet the prescribed eligibility requirements.
Recommendation: We recommend that the Board implement policies and procedures to ensure that the necessary controls are in place to properly verify the eligibility of all Youth and Adult Activities participants.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-007 ALLOCATION OF GRANT EXPENSES (REPEAT OF PRIOR YEAR FINDING 2022-08)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Condition: During our testing of WIOA Cluster expenditures, it was noted that the Board did not regularly reconcile expenditures to the appropriate assistance listing numbers within the WIOA Cluster during the year. Further, it was determined that expenses are being split among expired grants as well as active grants in the client accounting software.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: Due to staffing changes during the year, grant expenditures were not regularly reconciled and allocated to the appropriate grant number based on actual expenses.
Effect: Expenses were not properly allocated to the correct Assistance Listing number within the WIOA cluster.
Recommendation: We recommend that the Board implement policies and procedures to ensure that all expenses are for actual expenses incurred, and that timely reconciliations are performed to ensure the expenses are properly charged to the correct assistance listing number and grant.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-002 ACTIVITIES ALLOWED OR UNALLOWED (REPEAT OF PRIOR YEAR FINDING 2022-02)
Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
2 CFR 200.403(g) states that costs must “Be adequately documented.”
Condition: During our testing of activities allowed or unallowed, for 11 of the 60 nonpayroll items tested, management could not provide adequate support that the charges were properly reviewed and approved prior to payment.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not demonstrate that proper internal controls are in place and operating effectively to ensure that unallowable charges to the federal program do not occur.
Effect: Unallowable payments to the federal program may have occurred due to the lack of effective internal controls in place.
Recommendation: We recommend that the Board design and implement controls to ensure that all charges to federal programs are adequately reviewed and approved prior to payment.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-003 EARMARKING (REPEAT OF PRIOR YEAR FINDING 2022-03)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Per the provisions stated in the Uniform Guidance under the WIOA Cluster for Local Areas:
(1) A local area may expend no more than 10 percent of the Adult, Dislocated Worker, and Youth Activities funds allocated to the local area under Sections 128(b) (WIOA, 128 Stat. 1502) and 133(b) (WIOA, 128 Stat. 1516) for within state allocations. The funds provided for administrative costs by one of the three fund sources (Adult, Dislocated Worker, Youth Activities) can be used for administrative costs of the other two sources.
(2) The amount that may be spent on incumbent worker training may not exceed 20 percent of the amount of the combined total of federal funds allocated to local areas to carry out the Adult and Dislocated Worker programs for a program year (20 CFR section 680.800; Section 134(d)(4), WIOA, 128 Stat. 1535).
(3) WIOA authorizes workforce investment areas, with the approval of the governor, to transfer up to 100 percent of the Adult Activities funds to Dislocated Workers Activities, and up to 100 percent of Dislocated Workers Activities funds to Adult Activities (Section 133(b)(4), WIOA, 128 Stat. 1518).
(4) At the discretion of the local board, not more than 10 percent of the total funds allocated to the local area under section 128(b) and under section 133(b)(2)-(3) may be used to implement a pay-for-performance contract strategy as defined in WIOA Section 3(47) (WIOA Section 129(c)(1)(D) and 134(d)(1)(A)(iii)).
(5) As no state has received prior approval for implementation of a PFP contract strategy, no funds from the program years prior to PY 2019 are available for PFP contract strategies or for the accompanying extended disbursement. However, these funds could still be used for other types of performance-based contracting, but the life of those funds remains the normal two-year limit for local WIOA grant funds.
Per the provisions stated in the Uniform Guidance under the WIOA Cluster for Youth Activities:
(1) A minimum of 75 percent of the Youth Activity funds allocated to states and local areas, except for the local area expenditures for administration, must be used to provide services to out-of-school youth (Section 129(a)(4)(A), WIOA, 128 Stat. 1506).
(2) Not less than 20 percent of Youth Activity funds allocated to the local area, except for the local area expenditures for administration, must be used to provide paid and unpaid work experiences (Section 129(c)(4)), WIOA, 128 Stat. 1510).
Condition: Upon inquiry of management, it was noted that the Board did not perform procedures to ensure that the expenditures of the WIOA Cluster were within the earmarking requirements noted in the Uniform Guidance during the fiscal year ended June 30, 2023.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not perform the appropriate procedures to verify that the expenditures of the WIOA Cluster were within the earmarking requirements noted within the Uniform Guidance.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board implement controls and procedures to ensure that all requirements for earmarking within the Uniform Guidance are properly followed.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-004 REPORTING, (REPEAT OF PRIOR YEAR FINDING 2022-05)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
ETA-9130, Financial Report (OMB No. 1205-0461) – All ETA grantees are required to submit quarterly financial reports for each grant award they receive. Reports are required to be prepared using the specific format and instructions for the applicable program(s); in this case, Workforce Innovation and Opportunity Act instructions for the following: Statewide Adult; Workforce Statewide Youth; Statewide Dislocated Worker; Local Adult; Local Youth; and Local Dislocated Worker. Reports are due 45 days after the end of the reporting quarter. Financial data is required to be reported cumulatively from grant inception through the end of each reporting period.
2 CFR 170 Appendix A, as it relates to reporting for the Federal Funding Accountability and Transparency Act, “unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.”
Condition: During our testing of reporting, for all ETA-9130 reports selected for testing management could not provide adequate support that the ETA-9130 reports were properly reviewed and approved prior to being submitted. Additionally, the entity made first tier subawards of greater than $30,000, but could not provide supporting documentation that the necessary reports were filed to satisfy the requirements of the Federal Funding Accountability and Transparency Act (FFATA).
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not have adequate policies and internal controls in place to ensure that all required reports for the WIOA Cluster and FFATA were submitted accurately and in a timely fashion.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board design and implement controls to ensure that all required reporting is submitted accurately and in a timely fashion.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-005 SUBRECIPIENT MONITORING (REPEAT OF PRIOR YEAR FINDING 2022-06)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Recipients must ensure that commercial organizations that are subrecipients under WIOA Title I and expend more than the minimum level specified in 2 CFR Part 200, Subpart F, have either an organization-wide audit conducted in accordance with 2 CFR Part 200 or a program-specific financial and compliance audit (20 CFR section 683.210).
2 CFR 200.332(b) requires that all pass-through entities must:
Evaluate each subrecipient’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section.
Condition: Upon inquiry of management, the Board did not perform any subrecipient monitoring procedures related to the Board’s grant agreement with its subrecipient for the fiscal year ended June 30, 2023.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023, which included $1,350,121 of expenditures to subrecipients.
Cause: Although the Board has policies and procedures in place surrounding the subrecipient monitoring compliance requirements, due to staffing issues during the fiscal year and lack of knowledge of all the federal compliance requirements, no subrecipient monitoring was completed.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board review its policies and procedures for sufficiency and commit the appropriate personnel to subrecipient monitoring to ensure that the Board is in compliance with all federal requirements.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-006 ELIGIBILITY (REPEAT OF PRIOR YEAR FINDING 2022-07)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Per the provisions of the Workforce Innovation and Opportunity Act (WIOA), “A person is eligible to receive services under Youth Activities if they are an out-of-school youth or an in-school youth (Section 129(a)(1), WIOA, 128 Stat. 1504)”, and meet the definition of such as defined in the Uniform Guidance.
Condition: During our testing of WIOA participants, it was noted by management that the eligibility determination for Youth Activities is maintained and conducted by the Board’s subrecipient. According to management, there are no procedures performed at the Board to verify the eligibility of Youth Activities participants to ensure that all federal compliance requirements are being adhered to. Additionally, 2 of the 60 individual adult program applications selected for testing were not reviewed by a case manager.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board does not perform any procedures to ensure that the Youth Activities participants meet all the federal compliance requirements for participation in the program. Further, the Board did not review two individual adult program applications for eligibility.
Effect: A Youth Activities participant(s)/Adult Activities participant(s) may be granted access to the Board’s program when they do not meet the prescribed eligibility requirements.
Recommendation: We recommend that the Board implement policies and procedures to ensure that the necessary controls are in place to properly verify the eligibility of all Youth and Adult Activities participants.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-007 ALLOCATION OF GRANT EXPENSES (REPEAT OF PRIOR YEAR FINDING 2022-08)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Condition: During our testing of WIOA Cluster expenditures, it was noted that the Board did not regularly reconcile expenditures to the appropriate assistance listing numbers within the WIOA Cluster during the year. Further, it was determined that expenses are being split among expired grants as well as active grants in the client accounting software.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: Due to staffing changes during the year, grant expenditures were not regularly reconciled and allocated to the appropriate grant number based on actual expenses.
Effect: Expenses were not properly allocated to the correct Assistance Listing number within the WIOA cluster.
Recommendation: We recommend that the Board implement policies and procedures to ensure that all expenses are for actual expenses incurred, and that timely reconciliations are performed to ensure the expenses are properly charged to the correct assistance listing number and grant.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-002 ACTIVITIES ALLOWED OR UNALLOWED (REPEAT OF PRIOR YEAR FINDING 2022-02)
Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
2 CFR 200.403(g) states that costs must “Be adequately documented.”
Condition: During our testing of activities allowed or unallowed, for 11 of the 60 nonpayroll items tested, management could not provide adequate support that the charges were properly reviewed and approved prior to payment.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not demonstrate that proper internal controls are in place and operating effectively to ensure that unallowable charges to the federal program do not occur.
Effect: Unallowable payments to the federal program may have occurred due to the lack of effective internal controls in place.
Recommendation: We recommend that the Board design and implement controls to ensure that all charges to federal programs are adequately reviewed and approved prior to payment.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-003 EARMARKING (REPEAT OF PRIOR YEAR FINDING 2022-03)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Per the provisions stated in the Uniform Guidance under the WIOA Cluster for Local Areas:
(1) A local area may expend no more than 10 percent of the Adult, Dislocated Worker, and Youth Activities funds allocated to the local area under Sections 128(b) (WIOA, 128 Stat. 1502) and 133(b) (WIOA, 128 Stat. 1516) for within state allocations. The funds provided for administrative costs by one of the three fund sources (Adult, Dislocated Worker, Youth Activities) can be used for administrative costs of the other two sources.
(2) The amount that may be spent on incumbent worker training may not exceed 20 percent of the amount of the combined total of federal funds allocated to local areas to carry out the Adult and Dislocated Worker programs for a program year (20 CFR section 680.800; Section 134(d)(4), WIOA, 128 Stat. 1535).
(3) WIOA authorizes workforce investment areas, with the approval of the governor, to transfer up to 100 percent of the Adult Activities funds to Dislocated Workers Activities, and up to 100 percent of Dislocated Workers Activities funds to Adult Activities (Section 133(b)(4), WIOA, 128 Stat. 1518).
(4) At the discretion of the local board, not more than 10 percent of the total funds allocated to the local area under section 128(b) and under section 133(b)(2)-(3) may be used to implement a pay-for-performance contract strategy as defined in WIOA Section 3(47) (WIOA Section 129(c)(1)(D) and 134(d)(1)(A)(iii)).
(5) As no state has received prior approval for implementation of a PFP contract strategy, no funds from the program years prior to PY 2019 are available for PFP contract strategies or for the accompanying extended disbursement. However, these funds could still be used for other types of performance-based contracting, but the life of those funds remains the normal two-year limit for local WIOA grant funds.
Per the provisions stated in the Uniform Guidance under the WIOA Cluster for Youth Activities:
(1) A minimum of 75 percent of the Youth Activity funds allocated to states and local areas, except for the local area expenditures for administration, must be used to provide services to out-of-school youth (Section 129(a)(4)(A), WIOA, 128 Stat. 1506).
(2) Not less than 20 percent of Youth Activity funds allocated to the local area, except for the local area expenditures for administration, must be used to provide paid and unpaid work experiences (Section 129(c)(4)), WIOA, 128 Stat. 1510).
Condition: Upon inquiry of management, it was noted that the Board did not perform procedures to ensure that the expenditures of the WIOA Cluster were within the earmarking requirements noted in the Uniform Guidance during the fiscal year ended June 30, 2023.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not perform the appropriate procedures to verify that the expenditures of the WIOA Cluster were within the earmarking requirements noted within the Uniform Guidance.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board implement controls and procedures to ensure that all requirements for earmarking within the Uniform Guidance are properly followed.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-004 REPORTING, (REPEAT OF PRIOR YEAR FINDING 2022-05)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
ETA-9130, Financial Report (OMB No. 1205-0461) – All ETA grantees are required to submit quarterly financial reports for each grant award they receive. Reports are required to be prepared using the specific format and instructions for the applicable program(s); in this case, Workforce Innovation and Opportunity Act instructions for the following: Statewide Adult; Workforce Statewide Youth; Statewide Dislocated Worker; Local Adult; Local Youth; and Local Dislocated Worker. Reports are due 45 days after the end of the reporting quarter. Financial data is required to be reported cumulatively from grant inception through the end of each reporting period.
2 CFR 170 Appendix A, as it relates to reporting for the Federal Funding Accountability and Transparency Act, “unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.”
Condition: During our testing of reporting, for all ETA-9130 reports selected for testing management could not provide adequate support that the ETA-9130 reports were properly reviewed and approved prior to being submitted. Additionally, the entity made first tier subawards of greater than $30,000, but could not provide supporting documentation that the necessary reports were filed to satisfy the requirements of the Federal Funding Accountability and Transparency Act (FFATA).
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not have adequate policies and internal controls in place to ensure that all required reports for the WIOA Cluster and FFATA were submitted accurately and in a timely fashion.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board design and implement controls to ensure that all required reporting is submitted accurately and in a timely fashion.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-005 SUBRECIPIENT MONITORING (REPEAT OF PRIOR YEAR FINDING 2022-06)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Recipients must ensure that commercial organizations that are subrecipients under WIOA Title I and expend more than the minimum level specified in 2 CFR Part 200, Subpart F, have either an organization-wide audit conducted in accordance with 2 CFR Part 200 or a program-specific financial and compliance audit (20 CFR section 683.210).
2 CFR 200.332(b) requires that all pass-through entities must:
Evaluate each subrecipient’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section.
Condition: Upon inquiry of management, the Board did not perform any subrecipient monitoring procedures related to the Board’s grant agreement with its subrecipient for the fiscal year ended June 30, 2023.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023, which included $1,350,121 of expenditures to subrecipients.
Cause: Although the Board has policies and procedures in place surrounding the subrecipient monitoring compliance requirements, due to staffing issues during the fiscal year and lack of knowledge of all the federal compliance requirements, no subrecipient monitoring was completed.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board review its policies and procedures for sufficiency and commit the appropriate personnel to subrecipient monitoring to ensure that the Board is in compliance with all federal requirements.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-006 ELIGIBILITY (REPEAT OF PRIOR YEAR FINDING 2022-07)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Per the provisions of the Workforce Innovation and Opportunity Act (WIOA), “A person is eligible to receive services under Youth Activities if they are an out-of-school youth or an in-school youth (Section 129(a)(1), WIOA, 128 Stat. 1504)”, and meet the definition of such as defined in the Uniform Guidance.
Condition: During our testing of WIOA participants, it was noted by management that the eligibility determination for Youth Activities is maintained and conducted by the Board’s subrecipient. According to management, there are no procedures performed at the Board to verify the eligibility of Youth Activities participants to ensure that all federal compliance requirements are being adhered to. Additionally, 2 of the 60 individual adult program applications selected for testing were not reviewed by a case manager.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board does not perform any procedures to ensure that the Youth Activities participants meet all the federal compliance requirements for participation in the program. Further, the Board did not review two individual adult program applications for eligibility.
Effect: A Youth Activities participant(s)/Adult Activities participant(s) may be granted access to the Board’s program when they do not meet the prescribed eligibility requirements.
Recommendation: We recommend that the Board implement policies and procedures to ensure that the necessary controls are in place to properly verify the eligibility of all Youth and Adult Activities participants.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-007 ALLOCATION OF GRANT EXPENSES (REPEAT OF PRIOR YEAR FINDING 2022-08)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Condition: During our testing of WIOA Cluster expenditures, it was noted that the Board did not regularly reconcile expenditures to the appropriate assistance listing numbers within the WIOA Cluster during the year. Further, it was determined that expenses are being split among expired grants as well as active grants in the client accounting software.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: Due to staffing changes during the year, grant expenditures were not regularly reconciled and allocated to the appropriate grant number based on actual expenses.
Effect: Expenses were not properly allocated to the correct Assistance Listing number within the WIOA cluster.
Recommendation: We recommend that the Board implement policies and procedures to ensure that all expenses are for actual expenses incurred, and that timely reconciliations are performed to ensure the expenses are properly charged to the correct assistance listing number and grant.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-002 ACTIVITIES ALLOWED OR UNALLOWED (REPEAT OF PRIOR YEAR FINDING 2022-02)
Federal Program Information: Federal Agency and Program Name Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
2 CFR 200.403(g) states that costs must “Be adequately documented.”
Condition: During our testing of activities allowed or unallowed, for 11 of the 60 nonpayroll items tested, management could not provide adequate support that the charges were properly reviewed and approved prior to payment.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not demonstrate that proper internal controls are in place and operating effectively to ensure that unallowable charges to the federal program do not occur.
Effect: Unallowable payments to the federal program may have occurred due to the lack of effective internal controls in place.
Recommendation: We recommend that the Board design and implement controls to ensure that all charges to federal programs are adequately reviewed and approved prior to payment.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-003 EARMARKING (REPEAT OF PRIOR YEAR FINDING 2022-03)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Per the provisions stated in the Uniform Guidance under the WIOA Cluster for Local Areas:
(1) A local area may expend no more than 10 percent of the Adult, Dislocated Worker, and Youth Activities funds allocated to the local area under Sections 128(b) (WIOA, 128 Stat. 1502) and 133(b) (WIOA, 128 Stat. 1516) for within state allocations. The funds provided for administrative costs by one of the three fund sources (Adult, Dislocated Worker, Youth Activities) can be used for administrative costs of the other two sources.
(2) The amount that may be spent on incumbent worker training may not exceed 20 percent of the amount of the combined total of federal funds allocated to local areas to carry out the Adult and Dislocated Worker programs for a program year (20 CFR section 680.800; Section 134(d)(4), WIOA, 128 Stat. 1535).
(3) WIOA authorizes workforce investment areas, with the approval of the governor, to transfer up to 100 percent of the Adult Activities funds to Dislocated Workers Activities, and up to 100 percent of Dislocated Workers Activities funds to Adult Activities (Section 133(b)(4), WIOA, 128 Stat. 1518).
(4) At the discretion of the local board, not more than 10 percent of the total funds allocated to the local area under section 128(b) and under section 133(b)(2)-(3) may be used to implement a pay-for-performance contract strategy as defined in WIOA Section 3(47) (WIOA Section 129(c)(1)(D) and 134(d)(1)(A)(iii)).
(5) As no state has received prior approval for implementation of a PFP contract strategy, no funds from the program years prior to PY 2019 are available for PFP contract strategies or for the accompanying extended disbursement. However, these funds could still be used for other types of performance-based contracting, but the life of those funds remains the normal two-year limit for local WIOA grant funds.
Per the provisions stated in the Uniform Guidance under the WIOA Cluster for Youth Activities:
(1) A minimum of 75 percent of the Youth Activity funds allocated to states and local areas, except for the local area expenditures for administration, must be used to provide services to out-of-school youth (Section 129(a)(4)(A), WIOA, 128 Stat. 1506).
(2) Not less than 20 percent of Youth Activity funds allocated to the local area, except for the local area expenditures for administration, must be used to provide paid and unpaid work experiences (Section 129(c)(4)), WIOA, 128 Stat. 1510).
Condition: Upon inquiry of management, it was noted that the Board did not perform procedures to ensure that the expenditures of the WIOA Cluster were within the earmarking requirements noted in the Uniform Guidance during the fiscal year ended June 30, 2023.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not perform the appropriate procedures to verify that the expenditures of the WIOA Cluster were within the earmarking requirements noted within the Uniform Guidance.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board implement controls and procedures to ensure that all requirements for earmarking within the Uniform Guidance are properly followed.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-004 REPORTING, (REPEAT OF PRIOR YEAR FINDING 2022-05)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
ETA-9130, Financial Report (OMB No. 1205-0461) – All ETA grantees are required to submit quarterly financial reports for each grant award they receive. Reports are required to be prepared using the specific format and instructions for the applicable program(s); in this case, Workforce Innovation and Opportunity Act instructions for the following: Statewide Adult; Workforce Statewide Youth; Statewide Dislocated Worker; Local Adult; Local Youth; and Local Dislocated Worker. Reports are due 45 days after the end of the reporting quarter. Financial data is required to be reported cumulatively from grant inception through the end of each reporting period.
2 CFR 170 Appendix A, as it relates to reporting for the Federal Funding Accountability and Transparency Act, “unless the auditee is exempt as provided in paragraph d. of this award term, the auditee must report each action that equals or exceeds $30,000 in Federal funds for a subaward to a non-Federal entity or Federal agency as noted in paragraph e. no later than the end of the month following the month in which the obligation was made.”
Condition: During our testing of reporting, for all ETA-9130 reports selected for testing management could not provide adequate support that the ETA-9130 reports were properly reviewed and approved prior to being submitted. Additionally, the entity made first tier subawards of greater than $30,000, but could not provide supporting documentation that the necessary reports were filed to satisfy the requirements of the Federal Funding Accountability and Transparency Act (FFATA).
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board did not have adequate policies and internal controls in place to ensure that all required reports for the WIOA Cluster and FFATA were submitted accurately and in a timely fashion.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board design and implement controls to ensure that all required reporting is submitted accurately and in a timely fashion.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-005 SUBRECIPIENT MONITORING (REPEAT OF PRIOR YEAR FINDING 2022-06)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Recipients must ensure that commercial organizations that are subrecipients under WIOA Title I and expend more than the minimum level specified in 2 CFR Part 200, Subpart F, have either an organization-wide audit conducted in accordance with 2 CFR Part 200 or a program-specific financial and compliance audit (20 CFR section 683.210).
2 CFR 200.332(b) requires that all pass-through entities must:
Evaluate each subrecipient’s risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section.
Condition: Upon inquiry of management, the Board did not perform any subrecipient monitoring procedures related to the Board’s grant agreement with its subrecipient for the fiscal year ended June 30, 2023.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023, which included $1,350,121 of expenditures to subrecipients.
Cause: Although the Board has policies and procedures in place surrounding the subrecipient monitoring compliance requirements, due to staffing issues during the fiscal year and lack of knowledge of all the federal compliance requirements, no subrecipient monitoring was completed.
Effect: The Board is not in compliance with the federal statutes, regulations, and terms and conditions of the federal award.
Recommendation: We recommend that the Board review its policies and procedures for sufficiency and commit the appropriate personnel to subrecipient monitoring to ensure that the Board is in compliance with all federal requirements.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-006 ELIGIBILITY (REPEAT OF PRIOR YEAR FINDING 2022-07)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Per the provisions of the Workforce Innovation and Opportunity Act (WIOA), “A person is eligible to receive services under Youth Activities if they are an out-of-school youth or an in-school youth (Section 129(a)(1), WIOA, 128 Stat. 1504)”, and meet the definition of such as defined in the Uniform Guidance.
Condition: During our testing of WIOA participants, it was noted by management that the eligibility determination for Youth Activities is maintained and conducted by the Board’s subrecipient. According to management, there are no procedures performed at the Board to verify the eligibility of Youth Activities participants to ensure that all federal compliance requirements are being adhered to. Additionally, 2 of the 60 individual adult program applications selected for testing were not reviewed by a case manager.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: The Board does not perform any procedures to ensure that the Youth Activities participants meet all the federal compliance requirements for participation in the program. Further, the Board did not review two individual adult program applications for eligibility.
Effect: A Youth Activities participant(s)/Adult Activities participant(s) may be granted access to the Board’s program when they do not meet the prescribed eligibility requirements.
Recommendation: We recommend that the Board implement policies and procedures to ensure that the necessary controls are in place to properly verify the eligibility of all Youth and Adult Activities participants.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.
2023-007 ALLOCATION OF GRANT EXPENSES (REPEAT OF PRIOR YEAR FINDING 2022-08)
Federal Program Information:, Federal Agency and Program Name, Federal Assistance Listing Number
U.S. Department of Labor, WIOA Cluster, 17.258/17.259/17.278
Criteria: 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”
Condition: During our testing of WIOA Cluster expenditures, it was noted that the Board did not regularly reconcile expenditures to the appropriate assistance listing numbers within the WIOA Cluster during the year. Further, it was determined that expenses are being split among expired grants as well as active grants in the client accounting software.
Questioned Costs: Unknown
Context: Total federal expenditures for the WIOA Cluster were $4,165,604 for the year ended June 30, 2023.
Cause: Due to staffing changes during the year, grant expenditures were not regularly reconciled and allocated to the appropriate grant number based on actual expenses.
Effect: Expenses were not properly allocated to the correct Assistance Listing number within the WIOA cluster.
Recommendation: We recommend that the Board implement policies and procedures to ensure that all expenses are for actual expenses incurred, and that timely reconciliations are performed to ensure the expenses are properly charged to the correct assistance listing number and grant.
Views of Responsible Officials: We agree with the finding and will take the necessary corrective actions as noted in the corrective action plan attached.