Audit 305670

FY End
2021-12-31
Total Expended
$22.93M
Findings
14
Programs
19
Organization: Orutsararmiut Native Council (AK)
Year: 2021 Accepted: 2024-05-07

Organization Exclusion Status:

Checking exclusion status...

Findings

ID Ref Severity Repeat Requirement
396042 2021-003 Material Weakness Yes L
396043 2021-003 Material Weakness Yes L
396044 2021-003 Material Weakness Yes L
396045 2021-004 Material Weakness - N
396046 2021-005 Significant Deficiency - L
396047 2021-006 Significant Deficiency - AB
396048 2021-003 Material Weakness Yes L
972484 2021-003 Material Weakness Yes L
972485 2021-003 Material Weakness Yes L
972486 2021-003 Material Weakness Yes L
972487 2021-004 Material Weakness - N
972488 2021-005 Significant Deficiency - L
972489 2021-006 Significant Deficiency - AB
972490 2021-003 Material Weakness Yes L

Contacts

Name Title Type
NSWTU39KVD75 Brian Henry Auditee
9075432608 Brian Kupilik Auditor
No contacts on file

Notes to SEFA

Title: Note 1. 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, wherein 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. Orutsararmiut Native Council has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform guidance. De Minimis Rate Used: N Rate Explanation: Orutsararmiut Native Council has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform guidance. The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal award activity of Orutsararmiut Native Council under programs of the federal government for the year ended December 31, 2021. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of Orutsararmiut Native Council, it is not intended to and does not present the basic financial statements of Orutsararmiut Native Council.
Title: Note 2. Summary of Significant Accounting Policies 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, wherein 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. Orutsararmiut Native Council has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform guidance. De Minimis Rate Used: N Rate Explanation: Orutsararmiut Native Council has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform guidance. 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, wherein 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. Orutsararmiut Native Council has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform guidance.
Title: Note 3. Passed Through Awards 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, wherein 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. Orutsararmiut Native Council has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform guidance. De Minimis Rate Used: N Rate Explanation: Orutsararmiut Native Council has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform guidance. No amounts were passed through to subrecipients.

Finding Details

Federal Agencies: US Department of Treasury and Department of the Interior Federal Programs: CARES Act (CARES), ARPA, ERA and BIA Compact, respectively Assistance Listing Numbers: 21.019, 21.027, 21.023 and 15.022, respectively Award Numbers: None, None, ERA0672, GT-OSGT043-16, respectively Award Years: 2021 (CARES), 2021 (ARPA), 2021 (ERA) and 2021 (BIA Compact), respectively Type of Finding: Material weakness in internal control over compliance and material noncompliance. Criteria: Uniform Guidance requires that the reporting package must be submitted within the earlier of nine months after year end or 30 days after the report issuance in accordance with the provisions of 2 CFR Section 200, subpart F, section 200.512. Condition and Context: The Council did not adhere to the Uniform Guidance requirement of submitting the reporting package within the earlier of submitting the reporting package within the earlier 30 days after receipt of the audit report or nine months later the audit period. Cause: Lack of internal control over Uniform Guidance reporting requirements. Effect: The Council was not in compliance with reporting requirements. Questioned Costs: None noted. Repeat Finding: Yes, this is a repeat finding 2020-001. Since it is a repeat finding we believe this to be systematic issue. Recommendation: We recommend that the Council comply with Uniform Guidance reporting requirements. Management’s Response: Management agrees with this finding. See Corrective Action Plan
Federal Agencies: US Department of Treasury and Department of the Interior Federal Programs: CARES Act (CARES), ARPA, ERA and BIA Compact, respectively Assistance Listing Numbers: 21.019, 21.027, 21.023 and 15.022, respectively Award Numbers: None, None, ERA0672, GT-OSGT043-16, respectively Award Years: 2021 (CARES), 2021 (ARPA), 2021 (ERA) and 2021 (BIA Compact), respectively Type of Finding: Material weakness in internal control over compliance and material noncompliance. Criteria: Uniform Guidance requires that the reporting package must be submitted within the earlier of nine months after year end or 30 days after the report issuance in accordance with the provisions of 2 CFR Section 200, subpart F, section 200.512. Condition and Context: The Council did not adhere to the Uniform Guidance requirement of submitting the reporting package within the earlier of submitting the reporting package within the earlier 30 days after receipt of the audit report or nine months later the audit period. Cause: Lack of internal control over Uniform Guidance reporting requirements. Effect: The Council was not in compliance with reporting requirements. Questioned Costs: None noted. Repeat Finding: Yes, this is a repeat finding 2020-001. Since it is a repeat finding we believe this to be systematic issue. Recommendation: We recommend that the Council comply with Uniform Guidance reporting requirements. Management’s Response: Management agrees with this finding. See Corrective Action Plan
Federal Agencies: US Department of Treasury and Department of the Interior Federal Programs: CARES Act (CARES), ARPA, ERA and BIA Compact, respectively Assistance Listing Numbers: 21.019, 21.027, 21.023 and 15.022, respectively Award Numbers: None, None, ERA0672, GT-OSGT043-16, respectively Award Years: 2021 (CARES), 2021 (ARPA), 2021 (ERA) and 2021 (BIA Compact), respectively Type of Finding: Material weakness in internal control over compliance and material noncompliance. Criteria: Uniform Guidance requires that the reporting package must be submitted within the earlier of nine months after year end or 30 days after the report issuance in accordance with the provisions of 2 CFR Section 200, subpart F, section 200.512. Condition and Context: The Council did not adhere to the Uniform Guidance requirement of submitting the reporting package within the earlier of submitting the reporting package within the earlier 30 days after receipt of the audit report or nine months later the audit period. Cause: Lack of internal control over Uniform Guidance reporting requirements. Effect: The Council was not in compliance with reporting requirements. Questioned Costs: None noted. Repeat Finding: Yes, this is a repeat finding 2020-001. Since it is a repeat finding we believe this to be systematic issue. Recommendation: We recommend that the Council comply with Uniform Guidance reporting requirements. Management’s Response: Management agrees with this finding. See Corrective Action Plan
Federal Agency: US Department of the Interior Federal Program: BIA Compact Assistance Listing Number: 15.022 Award Number: GT-OSGT043-16 Award Year: 2021 Type of Finding: Material weakness in internal control over compliance and material noncompliance. Criteria: Funds received in advance are required to be (1) invested only in obligations of the United States or in obligations or securities that are guaranteed or insured by the United States, or mutual (or other) funds registered with the Securities and Exchange Commission and which only invest in obligations of the United States or securities that are guaranteed or insured by the United States; or (2) deposited only in accounts that are insured by an agency or instrumentality of the United States, or are fully collateralized to ensure protection of the advance funds, even in the event of bank failure. Condition and Context: During our testing of special tests and provisions, management was unable to provide sufficient documentation to indicate that advance funds were being held in allowable investment securities or within fully insured and/or collateralized bank accounts. Cause: Lack of internal control over compliance and material noncompliance with the special tests and provisions requirement of the program. Effect: The lack of internal control over advance funds resulted in material noncompliance with the special tests and provisions requirements of the program. Questioned Costs: None noted. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Council adheres to its internal control policies to ensure compliance requirements are met. Management’s Response: Management concurs with the finding. See Corrective Action Plan.
Federal Agencies: U.S. Department of the Treasury Federal Programs: Emergency Rental Assistance Program Assistance Listing Numbers: 21.023 Award Numbers: ERA0672 Award Years: 2021 Type of Finding: Significant deficiency in internal control over compliance. Criteria: Adequate internal control over reporting should be in place to ensure that quarterly financial reports are reviewed and approved by a member of management prior to submission. Such approval processes should be clearly documented and maintained. These reports should also be in agreement with the underlying accounting system. Condition and Context: During our testing of quarterly financial reporting, the council was unable to produce sufficient documentation to indicate that quarterly financial reports were reviewed and approved by management prior to submission. Additionally, the two quarterly reports that were reviewed did not agree to the Council’s general ledger. Cause: Lack of internal control over reporting. Effect: Lack of internal control over reporting could result in inaccurate and unauthorized reporting of program expenditures. Questioned Costs: None noted. Repeat Finding: This is not a repeat finding for the major federal program noted above, therefore, we believe this is not a systemic issue. Recommendation: We recommend that management strictly adheres to adopted internal control procedures related to grant reporting. Management’s Response: Management agrees with this finding. See Corrective Action Plan.
Federal Agency: US Department of the Interior Federal Program: BIA Compact Assistance Listing Number: 15.022 Award Number: GT-OSGT043-16 Award Year: 2021 Type of Finding: Significant deficiency in internal control over compliance. Criteria: Adequate internal control over payroll transactions should be in place to ensure that personnel files are complete with all necessary documentation, which includes proof of approved pay rates. Condition and Context: During our testing of payroll transactions, we noted 10 out of a sample of 25 payroll transactions which lacked necessary documentation to support management’s approval of the employee’s rate of pay. Cause: Lack of internal control over payroll transactions, specifically related to personnel files. Effect: The lack of supporting documentation or approval for rates of pay allows for the potential for misstatement of expenditures or for employees to have incorrect rates of pay. Questioned Costs: None noted. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Council adheres to its internal control policies to ensure accurate reporting of payroll transactions. Management’s Response: Management concurs with the finding. See Corrective Action Plan.
Federal Agencies: US Department of Treasury and Department of the Interior Federal Programs: CARES Act (CARES), ARPA, ERA and BIA Compact, respectively Assistance Listing Numbers: 21.019, 21.027, 21.023 and 15.022, respectively Award Numbers: None, None, ERA0672, GT-OSGT043-16, respectively Award Years: 2021 (CARES), 2021 (ARPA), 2021 (ERA) and 2021 (BIA Compact), respectively Type of Finding: Material weakness in internal control over compliance and material noncompliance. Criteria: Uniform Guidance requires that the reporting package must be submitted within the earlier of nine months after year end or 30 days after the report issuance in accordance with the provisions of 2 CFR Section 200, subpart F, section 200.512. Condition and Context: The Council did not adhere to the Uniform Guidance requirement of submitting the reporting package within the earlier of submitting the reporting package within the earlier 30 days after receipt of the audit report or nine months later the audit period. Cause: Lack of internal control over Uniform Guidance reporting requirements. Effect: The Council was not in compliance with reporting requirements. Questioned Costs: None noted. Repeat Finding: Yes, this is a repeat finding 2020-001. Since it is a repeat finding we believe this to be systematic issue. Recommendation: We recommend that the Council comply with Uniform Guidance reporting requirements. Management’s Response: Management agrees with this finding. See Corrective Action Plan
Federal Agencies: US Department of Treasury and Department of the Interior Federal Programs: CARES Act (CARES), ARPA, ERA and BIA Compact, respectively Assistance Listing Numbers: 21.019, 21.027, 21.023 and 15.022, respectively Award Numbers: None, None, ERA0672, GT-OSGT043-16, respectively Award Years: 2021 (CARES), 2021 (ARPA), 2021 (ERA) and 2021 (BIA Compact), respectively Type of Finding: Material weakness in internal control over compliance and material noncompliance. Criteria: Uniform Guidance requires that the reporting package must be submitted within the earlier of nine months after year end or 30 days after the report issuance in accordance with the provisions of 2 CFR Section 200, subpart F, section 200.512. Condition and Context: The Council did not adhere to the Uniform Guidance requirement of submitting the reporting package within the earlier of submitting the reporting package within the earlier 30 days after receipt of the audit report or nine months later the audit period. Cause: Lack of internal control over Uniform Guidance reporting requirements. Effect: The Council was not in compliance with reporting requirements. Questioned Costs: None noted. Repeat Finding: Yes, this is a repeat finding 2020-001. Since it is a repeat finding we believe this to be systematic issue. Recommendation: We recommend that the Council comply with Uniform Guidance reporting requirements. Management’s Response: Management agrees with this finding. See Corrective Action Plan
Federal Agencies: US Department of Treasury and Department of the Interior Federal Programs: CARES Act (CARES), ARPA, ERA and BIA Compact, respectively Assistance Listing Numbers: 21.019, 21.027, 21.023 and 15.022, respectively Award Numbers: None, None, ERA0672, GT-OSGT043-16, respectively Award Years: 2021 (CARES), 2021 (ARPA), 2021 (ERA) and 2021 (BIA Compact), respectively Type of Finding: Material weakness in internal control over compliance and material noncompliance. Criteria: Uniform Guidance requires that the reporting package must be submitted within the earlier of nine months after year end or 30 days after the report issuance in accordance with the provisions of 2 CFR Section 200, subpart F, section 200.512. Condition and Context: The Council did not adhere to the Uniform Guidance requirement of submitting the reporting package within the earlier of submitting the reporting package within the earlier 30 days after receipt of the audit report or nine months later the audit period. Cause: Lack of internal control over Uniform Guidance reporting requirements. Effect: The Council was not in compliance with reporting requirements. Questioned Costs: None noted. Repeat Finding: Yes, this is a repeat finding 2020-001. Since it is a repeat finding we believe this to be systematic issue. Recommendation: We recommend that the Council comply with Uniform Guidance reporting requirements. Management’s Response: Management agrees with this finding. See Corrective Action Plan
Federal Agencies: US Department of Treasury and Department of the Interior Federal Programs: CARES Act (CARES), ARPA, ERA and BIA Compact, respectively Assistance Listing Numbers: 21.019, 21.027, 21.023 and 15.022, respectively Award Numbers: None, None, ERA0672, GT-OSGT043-16, respectively Award Years: 2021 (CARES), 2021 (ARPA), 2021 (ERA) and 2021 (BIA Compact), respectively Type of Finding: Material weakness in internal control over compliance and material noncompliance. Criteria: Uniform Guidance requires that the reporting package must be submitted within the earlier of nine months after year end or 30 days after the report issuance in accordance with the provisions of 2 CFR Section 200, subpart F, section 200.512. Condition and Context: The Council did not adhere to the Uniform Guidance requirement of submitting the reporting package within the earlier of submitting the reporting package within the earlier 30 days after receipt of the audit report or nine months later the audit period. Cause: Lack of internal control over Uniform Guidance reporting requirements. Effect: The Council was not in compliance with reporting requirements. Questioned Costs: None noted. Repeat Finding: Yes, this is a repeat finding 2020-001. Since it is a repeat finding we believe this to be systematic issue. Recommendation: We recommend that the Council comply with Uniform Guidance reporting requirements. Management’s Response: Management agrees with this finding. See Corrective Action Plan
Federal Agency: US Department of the Interior Federal Program: BIA Compact Assistance Listing Number: 15.022 Award Number: GT-OSGT043-16 Award Year: 2021 Type of Finding: Material weakness in internal control over compliance and material noncompliance. Criteria: Funds received in advance are required to be (1) invested only in obligations of the United States or in obligations or securities that are guaranteed or insured by the United States, or mutual (or other) funds registered with the Securities and Exchange Commission and which only invest in obligations of the United States or securities that are guaranteed or insured by the United States; or (2) deposited only in accounts that are insured by an agency or instrumentality of the United States, or are fully collateralized to ensure protection of the advance funds, even in the event of bank failure. Condition and Context: During our testing of special tests and provisions, management was unable to provide sufficient documentation to indicate that advance funds were being held in allowable investment securities or within fully insured and/or collateralized bank accounts. Cause: Lack of internal control over compliance and material noncompliance with the special tests and provisions requirement of the program. Effect: The lack of internal control over advance funds resulted in material noncompliance with the special tests and provisions requirements of the program. Questioned Costs: None noted. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Council adheres to its internal control policies to ensure compliance requirements are met. Management’s Response: Management concurs with the finding. See Corrective Action Plan.
Federal Agencies: U.S. Department of the Treasury Federal Programs: Emergency Rental Assistance Program Assistance Listing Numbers: 21.023 Award Numbers: ERA0672 Award Years: 2021 Type of Finding: Significant deficiency in internal control over compliance. Criteria: Adequate internal control over reporting should be in place to ensure that quarterly financial reports are reviewed and approved by a member of management prior to submission. Such approval processes should be clearly documented and maintained. These reports should also be in agreement with the underlying accounting system. Condition and Context: During our testing of quarterly financial reporting, the council was unable to produce sufficient documentation to indicate that quarterly financial reports were reviewed and approved by management prior to submission. Additionally, the two quarterly reports that were reviewed did not agree to the Council’s general ledger. Cause: Lack of internal control over reporting. Effect: Lack of internal control over reporting could result in inaccurate and unauthorized reporting of program expenditures. Questioned Costs: None noted. Repeat Finding: This is not a repeat finding for the major federal program noted above, therefore, we believe this is not a systemic issue. Recommendation: We recommend that management strictly adheres to adopted internal control procedures related to grant reporting. Management’s Response: Management agrees with this finding. See Corrective Action Plan.
Federal Agency: US Department of the Interior Federal Program: BIA Compact Assistance Listing Number: 15.022 Award Number: GT-OSGT043-16 Award Year: 2021 Type of Finding: Significant deficiency in internal control over compliance. Criteria: Adequate internal control over payroll transactions should be in place to ensure that personnel files are complete with all necessary documentation, which includes proof of approved pay rates. Condition and Context: During our testing of payroll transactions, we noted 10 out of a sample of 25 payroll transactions which lacked necessary documentation to support management’s approval of the employee’s rate of pay. Cause: Lack of internal control over payroll transactions, specifically related to personnel files. Effect: The lack of supporting documentation or approval for rates of pay allows for the potential for misstatement of expenditures or for employees to have incorrect rates of pay. Questioned Costs: None noted. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Council adheres to its internal control policies to ensure accurate reporting of payroll transactions. Management’s Response: Management concurs with the finding. See Corrective Action Plan.
Federal Agencies: US Department of Treasury and Department of the Interior Federal Programs: CARES Act (CARES), ARPA, ERA and BIA Compact, respectively Assistance Listing Numbers: 21.019, 21.027, 21.023 and 15.022, respectively Award Numbers: None, None, ERA0672, GT-OSGT043-16, respectively Award Years: 2021 (CARES), 2021 (ARPA), 2021 (ERA) and 2021 (BIA Compact), respectively Type of Finding: Material weakness in internal control over compliance and material noncompliance. Criteria: Uniform Guidance requires that the reporting package must be submitted within the earlier of nine months after year end or 30 days after the report issuance in accordance with the provisions of 2 CFR Section 200, subpart F, section 200.512. Condition and Context: The Council did not adhere to the Uniform Guidance requirement of submitting the reporting package within the earlier of submitting the reporting package within the earlier 30 days after receipt of the audit report or nine months later the audit period. Cause: Lack of internal control over Uniform Guidance reporting requirements. Effect: The Council was not in compliance with reporting requirements. Questioned Costs: None noted. Repeat Finding: Yes, this is a repeat finding 2020-001. Since it is a repeat finding we believe this to be systematic issue. Recommendation: We recommend that the Council comply with Uniform Guidance reporting requirements. Management’s Response: Management agrees with this finding. See Corrective Action Plan