Audit 300342

FY End
2023-06-30
Total Expended
$37.84M
Findings
4
Programs
34
Organization: New Castle County, Delaware (DE)
Year: 2023 Accepted: 2024-03-29

Organization Exclusion Status:

Checking exclusion status...

Findings

ID Ref Severity Repeat Requirement
389342 2023-003 Significant Deficiency - L
389343 2023-004 Material Weakness Yes L
965784 2023-003 Significant Deficiency - L
965785 2023-004 Material Weakness Yes L

Programs

ALN Program Spent Major Findings
14.871 Section 8 Housing Choice Vouchers $14.99M Yes 1
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $2.09M - 0
21.019 Coronavirus Relief Fund $1.54M - 0
14.239 Home Investment Partnerships Program $1.29M Yes 0
14.231 Emergency Solutions Grant Program $1.19M Yes 0
97.134 Presidential Residence Protection Security Grant $738,538 - 0
66.458 Capitalization Grants for Clean Water State Revolving Funds $478,607 - 0
14.900 Lead-Based Paint Hazard Control in Privately-Owned Housing $313,919 - 0
97.042 Emergency Management Performance Grants $300,290 - 0
16.745 Criminal and Juvenile Justice and Mental Health Collaboration Program $284,174 - 0
45.310 Grants to States $182,175 - 0
97.067 Homeland Security Grant Program $179,335 - 0
21.023 Emergency Rental Assistance Program $169,903 - 0
16.575 Crime Victim Assistance $162,625 - 0
14.913 Healthy Homes Production Program $124,311 - 0
14.228 Community Development Block Grants/state's Program and Non-Entitlement Grants in Hawaii $123,582 - 0
14.251 Economic Development Initiative, Community Project Funding & Misc Grants $111,446 - 0
14.256 Neighborhood Stabilization Program Arra $95,345 - 0
16.710 Public Safety Partnership and Community Policing Grants $93,381 - 0
16.034 Coronavirus Emergency Supplemental Funding Program $80,648 - 0
21.027 Coronavirus State and Local Fiscal Recovery Funds $75,000 Yes 0
14.905 Lead Hazard Reduction Demonstration Grant Program $38,880 - 0
16.607 Bulletproof Vest Partnership Program $15,298 - 0
20.600 State and Community Highway Safety $15,126 - 0
14.218 Community Development Block Grants/entitlement Grants $14,930 Yes 0
16.738 Edward Byrne Memorial Justice Assistance Grant Program $14,862 - 0
16.753 Congressionally Recommended Awards $13,104 - 0
16.922 Equitable Sharing Program $11,928 - 0
20.616 National Priority Safety Programs $11,473 - 0
10.175 Farmers Market and Local Food Promotion Program (b) $10,623 - 0
16.838 Comprehensive Opioid Abuse Site-Based Program $5,982 - 0
20.607 Alcohol Open Container Requirements $2,721 - 0
93.323 Epidemiology and Laboratory Capacity for Infectious Diseases (elc) $1,982 - 0
93.354 Public Health Emergency Response: Cooperative Agreement for Emergency Response: Public Health Crisis Response $-32 - 0

Contacts

Name Title Type
YT6XTK6YAMC1 Karen Wallace Auditee
3023955165 Remi Omisore Auditor
No contacts on file

Notes to SEFA

Title: Basis of Presentation Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance for all awards, with the exception of Assistance Listing Number 21.019, which follows criteria determined by the Department of Treasury for allowability of costs. Under these principles, certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: N Rate Explanation: N/A The accompanying schedule of expenditures of federal awards includes Federal grant activity of New Castle County, Delaware and is presented on the modified accrual basis of accounting. Matching funds are excluded from the schedule and the Program Income generated from Federal Grants is classified as Federal Expenditures when spent. The information on this schedule is presented in accordance with Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. Summary of Significant Account Policies Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance for all awards, with the exception of Assistance Listing Number 21.019, which follows criteria determined by the Department of Treasury for allowability of costs. Under these principles, certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years
Title: Loans Outstanding Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance for all awards, with the exception of Assistance Listing Number 21.019, which follows criteria determined by the Department of Treasury for allowability of costs. Under these principles, certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: N Rate Explanation: N/A New Castle County, Delaware administers low-income housing loan programs under the Community Development Block Grant, Home Investment Partnership Program, and Neighborhood Stabilization Program (NSP). The County had the following loan balances outstanding at June 30, 2023: See the Notes to the SEFA for chart/table.
Title: Indirect Costs Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance for all awards, with the exception of Assistance Listing Number 21.019, which follows criteria determined by the Department of Treasury for allowability of costs. Under these principles, certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: N Rate Explanation: N/A The County did not elect to use the 10% De Minimis cost rate for indirect costs.
Title: Unexpended Balance of Loans Available from Clean Water State Revolving Fund Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance for all awards, with the exception of Assistance Listing Number 21.019, which follows criteria determined by the Department of Treasury for allowability of costs. Under these principles, certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: N Rate Explanation: N/A See the Notes to the SEFA for chart/table.
Title: Reclassification of Prior Year Expenditure Accounting Policies: Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance for all awards, with the exception of Assistance Listing Number 21.019, which follows criteria determined by the Department of Treasury for allowability of costs. Under these principles, certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: N Rate Explanation: N/A Disaster Grants - Public Assistance ALN (97.036) After a Presidential-Declared Disaster, FEMA provides a Public Assistance Grant to reimburse eligible costs. For the year ended June 30, 2023, $1,841,891 of approved eligible expenditures were incurred in a prior year and are included on the Schedule. Presidential Residence Protection Assist Grant (97.134) The PRPA Grant program reimburses extraordinary law enforcement or other emergency personnel costs for protection activities directly and demonstrably associated with any residence of the President. For the year ended June 30, 2023, $608,330 of the approved eligible expenditures were incurred in a prior year and are included on the Schedule.

Finding Details

Federal Agency: U.S. Department of Housing & Urban Development Federal Program: Section 8 Housing Choice Voucher Cluster Assistance Listing Number: 14.871 Award Period: July 1, 2022 – June 30, 2023 Compliance Requirement: Reporting – FDS Reporting Type of Finding: Significant Deficiency in Internal Control Over Compliance, Non-Compliance Condition: The County did not have adequate controls over the financial reporting process and, as a result, prior period adjustments were required in Financial Data Schedule (FDS) line item 11040. Criteria or specific requirement: Compliance: The Uniform Financial Reporting Standards (24 CFR section 5.801) require PHAs to submit timely GAAP-based unaudited and audited financial information electronically to HUD. The Financial Assessment Subsystem (FASS-PH) system is one of HUD’s main monitoring and oversight systems for the HCVP. The accuracy of the following transfer items should be reviewed in conjunction with supporting documentation and/or HUD approvals. For FDS reporting, cash and investments in a cash pool or working capital account should be reported as such and not reflected as due to/due from. Amounts reported on these FDS Lines could represent unallowable costs. a. FDS Line 144 – (Inter Program – Due From) b. FDS Line 10020 – (Operating Transfer Out) c. FDS Line 10030 – (Operating Transfers From/To Primary Government) d. FDS Line 10040 – (Operating Transfer From/To Component Unit) e. FDS Line 11040 – (Prior Period Adjustments, Equity Transfers, and Correction of Errors) Control: Per 2 CFR section 200.303(a), a non-Federal entity must: 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 comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Context: The County identified prior-period errors of $700,797 while preparing the FDS report. Questioned costs: None. Cause: The County did not have the appropriate controls over the financial reporting process to prevent or detect misstatements. Effect: The County recorded adjustments for the corrections of errors related to the overstatement of prior year revenues totaling $700,797. Recommendation: We recommend the County review and enhance its internal controls, policies, and procedures to ensure that the amounts included on the FDS are accurate. Views of responsible officials: Management agrees with the finding. The department will modify its SOP to include a second reviewer before the final FDS figures are submitted. The first submission is due in August and the final submission is due in March.
Federal Agency: U.S. Department of Housing and Urban Development Federal Program: Community Development Block Grant/Entitlement Grants Assistance Listing Number: 14.218 Award Period: June 23, 2009 through September 1, 2029 Compliance Requirement: Reporting – Federal Funding Accountability and Transparency Act (FFATA) Type of Finding: Material Weakness in Internal Control Over Compliance, Material Noncompliance Condition: The County did not report required subaward information to FSRS for first-tier subawards of $30,000 or more. Criteria or specific requirement: Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements. The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. §§ 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.) Control: Per 2 CFR section 200.303(a), a non-Federal entity must: 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 comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Context: Three of five subawards selected for testing were improperly reported to FSRS. Total subawards tested was $801,983, and only $314,269 was reported as required by FFATA requirements. Questioned costs: None noted. Cause: The County’s policies and procedures were not sufficient to ensure that required subaward information was reported to FSRS. Internal controls did not prevent or detect the errors. Effect: Subawards were not reported to FSRS in accordance with FFATA requirements. Recommendation: We recommend that the County subsequently report the subawards not reported in FSRS. We further recommend the County strengthen controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS. Views of responsible officials: Management agrees with the finding. Community Services was made aware of the FFATA issue at the end of FY22. The Department developed and executed a Standard Operating Procedure (SOP) to ensure all awards over $30,000 were submitted to the FSRS system within the required time. In FY23 we entered the FY22 and FY23 sub-recipient awards in FSRS. In FY23 there were expenses for sub-recipient awards that were issued in FY20 and FY21, which was identified by CLA. The Department will modify our SOP to require all sub-recipient awards be entered regardless of the fiscal year they were awarded; this ensures accurate and up-to-date reporting.
Federal Agency: U.S. Department of Housing & Urban Development Federal Program: Section 8 Housing Choice Voucher Cluster Assistance Listing Number: 14.871 Award Period: July 1, 2022 – June 30, 2023 Compliance Requirement: Reporting – FDS Reporting Type of Finding: Significant Deficiency in Internal Control Over Compliance, Non-Compliance Condition: The County did not have adequate controls over the financial reporting process and, as a result, prior period adjustments were required in Financial Data Schedule (FDS) line item 11040. Criteria or specific requirement: Compliance: The Uniform Financial Reporting Standards (24 CFR section 5.801) require PHAs to submit timely GAAP-based unaudited and audited financial information electronically to HUD. The Financial Assessment Subsystem (FASS-PH) system is one of HUD’s main monitoring and oversight systems for the HCVP. The accuracy of the following transfer items should be reviewed in conjunction with supporting documentation and/or HUD approvals. For FDS reporting, cash and investments in a cash pool or working capital account should be reported as such and not reflected as due to/due from. Amounts reported on these FDS Lines could represent unallowable costs. a. FDS Line 144 – (Inter Program – Due From) b. FDS Line 10020 – (Operating Transfer Out) c. FDS Line 10030 – (Operating Transfers From/To Primary Government) d. FDS Line 10040 – (Operating Transfer From/To Component Unit) e. FDS Line 11040 – (Prior Period Adjustments, Equity Transfers, and Correction of Errors) Control: Per 2 CFR section 200.303(a), a non-Federal entity must: 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 comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Context: The County identified prior-period errors of $700,797 while preparing the FDS report. Questioned costs: None. Cause: The County did not have the appropriate controls over the financial reporting process to prevent or detect misstatements. Effect: The County recorded adjustments for the corrections of errors related to the overstatement of prior year revenues totaling $700,797. Recommendation: We recommend the County review and enhance its internal controls, policies, and procedures to ensure that the amounts included on the FDS are accurate. Views of responsible officials: Management agrees with the finding. The department will modify its SOP to include a second reviewer before the final FDS figures are submitted. The first submission is due in August and the final submission is due in March.
Federal Agency: U.S. Department of Housing and Urban Development Federal Program: Community Development Block Grant/Entitlement Grants Assistance Listing Number: 14.218 Award Period: June 23, 2009 through September 1, 2029 Compliance Requirement: Reporting – Federal Funding Accountability and Transparency Act (FFATA) Type of Finding: Material Weakness in Internal Control Over Compliance, Material Noncompliance Condition: The County did not report required subaward information to FSRS for first-tier subawards of $30,000 or more. Criteria or specific requirement: Compliance: Per the Federal Funding Accountability and Transparency Act (FFATA), prime (direct) recipients of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Reports must be filed in FSRS by the end of the month following the month in which the prime recipient awards any sub-grant greater than or equal to $30,000. If the initial award is below $30,000 but subsequent grant modifications result in a total award equal to or over $30,000, the award will be subject to the reporting requirements as of the date the award exceeds $30,000. If the initial award equals or exceeds $30,000 but funding is subsequently de-obligated such that the total award amount falls below $30,000, the award continues to be subject to FFATA reporting requirements. The following key data elements must be reported: Subawardee Name and Data Universal Numbering System (DUNS) number; Amount of Subaward (inclusive of modifications); Subaward Obligation/Action Date; Date of Report Submission; Subaward Number; Project Description; and Names and Compensation of Highly Compensated Officers. (Names and Compensation of Highly Compensated Officers must only be reported when the entity in the preceding fiscal year received 80 percent or more of its annual gross revenues in Federal awards; and $30,000,000 or more in annual gross revenues from Federal awards; and the public does not have access to this information about the compensation of the senior executives of the entity through periodic reports filed under section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. §§ 78m(a), 78o(d)) or section 6104 of the Internal Revenue Code of 1986.) Control: Per 2 CFR section 200.303(a), a non-Federal entity must: 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 comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Context: Three of five subawards selected for testing were improperly reported to FSRS. Total subawards tested was $801,983, and only $314,269 was reported as required by FFATA requirements. Questioned costs: None noted. Cause: The County’s policies and procedures were not sufficient to ensure that required subaward information was reported to FSRS. Internal controls did not prevent or detect the errors. Effect: Subawards were not reported to FSRS in accordance with FFATA requirements. Recommendation: We recommend that the County subsequently report the subawards not reported in FSRS. We further recommend the County strengthen controls and procedures to ensure that all required subawards are reported accurately and timely to FSRS. Views of responsible officials: Management agrees with the finding. Community Services was made aware of the FFATA issue at the end of FY22. The Department developed and executed a Standard Operating Procedure (SOP) to ensure all awards over $30,000 were submitted to the FSRS system within the required time. In FY23 we entered the FY22 and FY23 sub-recipient awards in FSRS. In FY23 there were expenses for sub-recipient awards that were issued in FY20 and FY21, which was identified by CLA. The Department will modify our SOP to require all sub-recipient awards be entered regardless of the fiscal year they were awarded; this ensures accurate and up-to-date reporting.