Audit 307907

FY End
2023-06-30
Total Expended
$1.12B
Findings
8
Programs
4
Year: 2023 Accepted: 2024-06-03

Organization Exclusion Status:

Checking exclusion status...

Findings

ID Ref Severity Repeat Requirement
399400 2023-001 Material Weakness Yes L
399401 2023-001 Material Weakness Yes L
399402 2023-002 Significant Deficiency Yes L
399403 2023-002 Significant Deficiency Yes L
975842 2023-001 Material Weakness Yes L
975843 2023-001 Material Weakness Yes L
975844 2023-002 Significant Deficiency Yes L
975845 2023-002 Significant Deficiency Yes L

Contacts

Name Title Type
FFNMUBT6WCM1 Juan R. Rivera Carrillo Auditee
7872742527 Jose Ernesto Diaz Martinez Auditor
No contacts on file

Notes to SEFA

Title: BASIS OF PRESENTATION Accounting Policies: A. Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following, as applicable, the cost principles in Office of Management and Budget Circular A-87, State and Local Governments, or the cost principles contained in Subpart E of Title 2 U.S. Code of Federal Regulation Part 200, wherein certain types of expenditures are not allowable or are limited as to reimbursement. B. Negative amounts, if any, shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. C. Pass-through entity identifying numbers are presented where available and applicable. D. PRDH has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: PRDH has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. The accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal award activities of the Department of Housing of the Commonwealth of Puerto Rico (PRDH) under programs of the Federal government for the fiscal year ended June 30, 2023. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the PRDH, it is not intended to and does not present the financial position, changes in net position, or cash flows of the PRDH. Therefore, some amounts presented in this Schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. PRDH reporting entity is defined in Note (1) (A) to the basic financial statements. All federal financial awards received directly from federal agency as well as federal financial awards passed-through other government agencies, if any, are included on the Schedule.
Title: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting Policies: A. Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following, as applicable, the cost principles in Office of Management and Budget Circular A-87, State and Local Governments, or the cost principles contained in Subpart E of Title 2 U.S. Code of Federal Regulation Part 200, wherein certain types of expenditures are not allowable or are limited as to reimbursement. B. Negative amounts, if any, shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. C. Pass-through entity identifying numbers are presented where available and applicable. D. PRDH has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: PRDH has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. A. Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following, as applicable, the cost principles in Office of Management and Budget Circular A-87, State and Local Governments, or the cost principles contained in Subpart E of Title 2 U.S. Code of Federal Regulation Part 200, wherein certain types of expenditures are not allowable or are limited as to reimbursement. B. Negative amounts, if any, shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. C. Pass-through entity identifying numbers are presented where available and applicable. D. PRDH has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance.
Title: SCHEDULE NOT IN AGREEMENT WITH OTHER FEDERAL AWARD REPORTS Accounting Policies: A. Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following, as applicable, the cost principles in Office of Management and Budget Circular A-87, State and Local Governments, or the cost principles contained in Subpart E of Title 2 U.S. Code of Federal Regulation Part 200, wherein certain types of expenditures are not allowable or are limited as to reimbursement. B. Negative amounts, if any, shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. C. Pass-through entity identifying numbers are presented where available and applicable. D. PRDH has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: PRDH has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. The information included in the Schedule may not fully agree with other federal award reports submitted directly to federal granting agencies.
Title: ASSISTANCE LISTING NUMBER Accounting Policies: A. Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following, as applicable, the cost principles in Office of Management and Budget Circular A-87, State and Local Governments, or the cost principles contained in Subpart E of Title 2 U.S. Code of Federal Regulation Part 200, wherein certain types of expenditures are not allowable or are limited as to reimbursement. B. Negative amounts, if any, shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. C. Pass-through entity identifying numbers are presented where available and applicable. D. PRDH has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: PRDH has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. The Assistance Listing Number, formerly known as the Catalog of Federal Domestic Assistance (CFDA) Number, is a five-digit number assigned in the awarding document for all Federal assistance award mechanisms, including Federal grants and cooperative agreements.
Title: COMMUNITY DEVELOPMENT BLOCK GRANTS/STATE’S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII Accounting Policies: A. Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following, as applicable, the cost principles in Office of Management and Budget Circular A-87, State and Local Governments, or the cost principles contained in Subpart E of Title 2 U.S. Code of Federal Regulation Part 200, wherein certain types of expenditures are not allowable or are limited as to reimbursement. B. Negative amounts, if any, shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. C. Pass-through entity identifying numbers are presented where available and applicable. D. PRDH has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: PRDH has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. This Community Development Block Grants/State’s Program and Non-Entitlement Grants in Hawaii (CDBG) program provides annual grants to municipalities to develop viable urban communities by providing decent housing and a suitable living environment, and by expanding economic opportunities, principally for low- and moderate-income persons. The CDBG program includes funds for the Community Development Block Grants/State’s Program and Non-Entitlement Grants in Hawaii – Disaster Recovery Program or CDBG-DR program which provides funds to rebuild areas affected by Presidentially declared disasters and provide crucial seed money to start the recovery process. Expenditures under this program and amounts pass-through to subrecipients for the year ended June 30, 2023 was as follows: Passed ThroughTotal FederalGrant Numberto SubrecipientsExpendituresSub Total Community Development Block Grant/State Program and Non-Entitlement Grants in HawaiiFY 2008 GrantB08DC7201-$ 38,161$ FY 2015 GrantB15DC7201455,899 457,081 FY 2016 GrantB16DC72012,948,575 2,991,178 FY 2017 GrantB17DC72012,257,772 2,342,647 FY 2018 GrantB18DC72013,381,410 3,381,410 FY 2019 GrantB19DC72012,586,921 2,586,960 FY 2020 GrantB20DC7201- 5,151,393 FY 2020 Grant – COVID 19B20WC72019,389,169 9,519,225 FY 2021 GrantB21DC72012,850,244 FY 2022 GrantB22DC7201- 102,272 Sub Total Community Development Block Grant/State Program and Non-Entitlement Grants in Hawaii21,019,746 29,420,571 CDBG Program – Disaster RecoveryB17DM7201436,682,765 1,091,477,744 457,702,511$ 1,120,898,315
Title: RELATIONSHIP TO STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES – GOVERNMENTAL FUNDS Accounting Policies: A. Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following, as applicable, the cost principles in Office of Management and Budget Circular A-87, State and Local Governments, or the cost principles contained in Subpart E of Title 2 U.S. Code of Federal Regulation Part 200, wherein certain types of expenditures are not allowable or are limited as to reimbursement. B. Negative amounts, if any, shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. C. Pass-through entity identifying numbers are presented where available and applicable. D. PRDH has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: PRDH has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. Expenditures of Federal awards are reported in PRDH’s Statement of Revenues, Expenditures and Changes in Fund Balance – Governmental Fund in the Community Development Block Grant Fund, Community Development Block Grant – Disaster Recovery Fund, Self-Contribution Fund, Sales and Acquisition Fund, and Other Governmental Funds columns.
Title: LATE ISSUANCE OF SINGLE AUDIT REPORTING PACKAGE Accounting Policies: A. Expenditures reported on the Schedule are reported on the modified accrual basis of accounting. Such expenditures are recognized following, as applicable, the cost principles in Office of Management and Budget Circular A-87, State and Local Governments, or the cost principles contained in Subpart E of Title 2 U.S. Code of Federal Regulation Part 200, wherein certain types of expenditures are not allowable or are limited as to reimbursement. B. Negative amounts, if any, shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. C. Pass-through entity identifying numbers are presented where available and applicable. D. PRDH has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: PRDH has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. The Single Audit reporting package, as defined and required in 2 CFR 200 for fiscal year ended June 30, 2023, could not be submitted in a timely manner.

Finding Details

FINDING REFERENCE NUMBER 2023-001 FEDERAL PROGRAM (ALN – 14.228) COMMUNITY DEVELOPMENT BLOCK GRANT/STATE’S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII (ALN – 14.228) COVID19 – COMMUNITY DEVELOPMENT BLOCK GRANT/STATE’S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT AWARD NUMBERS B-14-DC-7201 ~ B-19-DC-72-0001; B-17-DM-7201; B-18-DP-7201; B-20-DW-72-0001 (Federal Award Years 2014-2023) COMPLIANCE REQUIREMENT REPORTING TYPE OF FINDING MATERIAL NONCOMPLIANCE AND MATERIAL WEAKNESS CRITERIA 2 CFR § 200.512 Report Submission, (a) (1) The audit must be completed and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period. If the due date falls on a Saturday, Sunday, or Federal holiday, the reporting package is due the next business day. STATEMENT OF CONDITION PRDH did not submit the Data Collection Form and Reporting Package to the Federal Audit Clearinghouse of fiscal year ending June 30, 2023 during the required period. QUESTIONED COSTS None PERSPECTIVE INFORMATION PRDH was unable to provide timely financial statements and related supporting documentation in order to apply required audit procedures. STATEMENT OF CAUSE PRDH did not have an effective accounting system and procedures to assure that the required financial statements and supporting documentation was made available for audit purposes within the required period established to comply with the Federal regulations. POSSIBLE ASSERTED EFFECT PRDH did not comply with the submission date required for the Data Collection Form and Reporting Package, this could affect the continuance and new approvals of Federal funds. In addition, for the next two (2) fiscal years PRDH cannot be considered by the auditor as a low risk auditee. IDENTIFICATION AS A REPEAT FINDING This is a repeat finding (Finding Reference No. 2022-001). RECOMMENDATION We recommend the PRDH maintain adequate accounting records related to the non-Federal and Federal funds in order to properly prepare the financial statements accurately and in a timely manner. In addition, PRDH needs to implement adequate internal controls procedures in order to ensure that the supporting documentation is available in a timely manner.
FINDING REFERENCE NUMBER 2023-001 FEDERAL PROGRAM (ALN – 14.228) COMMUNITY DEVELOPMENT BLOCK GRANT/STATE’S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII (ALN – 14.228) COVID19 – COMMUNITY DEVELOPMENT BLOCK GRANT/STATE’S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT AWARD NUMBERS B-14-DC-7201 ~ B-19-DC-72-0001; B-17-DM-7201; B-18-DP-7201; B-20-DW-72-0001 (Federal Award Years 2014-2023) COMPLIANCE REQUIREMENT REPORTING TYPE OF FINDING MATERIAL NONCOMPLIANCE AND MATERIAL WEAKNESS CRITERIA 2 CFR § 200.512 Report Submission, (a) (1) The audit must be completed and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period. If the due date falls on a Saturday, Sunday, or Federal holiday, the reporting package is due the next business day. STATEMENT OF CONDITION PRDH did not submit the Data Collection Form and Reporting Package to the Federal Audit Clearinghouse of fiscal year ending June 30, 2023 during the required period. QUESTIONED COSTS None PERSPECTIVE INFORMATION PRDH was unable to provide timely financial statements and related supporting documentation in order to apply required audit procedures. STATEMENT OF CAUSE PRDH did not have an effective accounting system and procedures to assure that the required financial statements and supporting documentation was made available for audit purposes within the required period established to comply with the Federal regulations. POSSIBLE ASSERTED EFFECT PRDH did not comply with the submission date required for the Data Collection Form and Reporting Package, this could affect the continuance and new approvals of Federal funds. In addition, for the next two (2) fiscal years PRDH cannot be considered by the auditor as a low risk auditee. IDENTIFICATION AS A REPEAT FINDING This is a repeat finding (Finding Reference No. 2022-001). RECOMMENDATION We recommend the PRDH maintain adequate accounting records related to the non-Federal and Federal funds in order to properly prepare the financial statements accurately and in a timely manner. In addition, PRDH needs to implement adequate internal controls procedures in order to ensure that the supporting documentation is available in a timely manner.
FINDING REFERENCE NUMBER 2023-002 FEDERAL PROGRAM (ALN – 14.228) COMMUNITY DEVELOPMENT BLOCK GRANT/STATE’S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII (ALN – 14.228) COVID19 – COMMUNITY DEVELOPMENT BLOCK GRANT/STATE’S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT AWARD NUMBERS B-14-DC-7201 ~ B-19-DC-72-0001; B-17-DM-7201; B-18-DP-7201; B-20-DW-72-0001; B-21-DZ-72-0001 (Federal Award Years 2014-2023) COMPLIANCE REQUIREMENT REPORTING TYPE OF FINDING NONCOMPLIANCE AND SIGNIFICANT DEFICIENCY CRITERIA In accordance with 2 CFR Part 170, establish that recipients (i.e., 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). The non-Federal entity or Federal agency must report each obligating action to http://www.fsrs.gov. For subaward information, report no later than the end of the month following the month in which the obligation was made. STATEMENT OF CONDITION The audit revealed that the PRDH did not adhere to the FFATA reporting procedures during the fiscal year. We found that all required reports were submitted after fiscal year end. The summary of our tests results is: SubawardSubawardTransactionsSubaward NotReport NotAmountMissing KeyTestedReportedTimelyIncorrectElements2502500Dollar Amount ofSubawardSubawardTestedSubaward NotReport NotAmountMissing KeyTransactionsReportedTimelyIncorrectElements$270,191,453$0$270,191,453$0$0 QUESTIONED COSTS Not applicable. PERSPECTIVE INFORMATION The PRDH did provide a detail of those awards or contracts subject to the FFATA requirements, totaled about 136 contracts with a grant total of $1,629,865,755.12. Although they acquired the necessary knowledge later in the fiscal year, the reports were still submitted after the 2022-2023 fiscal year. STATEMENT OF CAUSE The PRDH staff were unaware of the requirements related to the Federal Funding Accountability and Transparency Act (FFATA) applicable to the CDGB funds they manage. POSSIBLE ASSERTED EFFECT The PRDH is in non-compliance with the requirements to report through the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS) platform. This condition does not allow for the transparency that this report requires. IDENTIFICATION OF REPEAT FINDING This is a repeat finding (Finding Reference No. 2022-002). RECOMMENDATIONS We recommend that the PRDH provide training and technical assistance to the personnel they designate to monitor all the funds delegation contracts that meet the requirements to be reported on the FSRS portal, and to be able to keep track of when they had to be reported, the date in which they submitted the information to the portal, and all the elements required to be submitted on the platform.
FINDING REFERENCE NUMBER 2023-002 FEDERAL PROGRAM (ALN – 14.228) COMMUNITY DEVELOPMENT BLOCK GRANT/STATE’S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII (ALN – 14.228) COVID19 – COMMUNITY DEVELOPMENT BLOCK GRANT/STATE’S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT AWARD NUMBERS B-14-DC-7201 ~ B-19-DC-72-0001; B-17-DM-7201; B-18-DP-7201; B-20-DW-72-0001; B-21-DZ-72-0001 (Federal Award Years 2014-2023) COMPLIANCE REQUIREMENT REPORTING TYPE OF FINDING NONCOMPLIANCE AND SIGNIFICANT DEFICIENCY CRITERIA In accordance with 2 CFR Part 170, establish that recipients (i.e., 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). The non-Federal entity or Federal agency must report each obligating action to http://www.fsrs.gov. For subaward information, report no later than the end of the month following the month in which the obligation was made. STATEMENT OF CONDITION The audit revealed that the PRDH did not adhere to the FFATA reporting procedures during the fiscal year. We found that all required reports were submitted after fiscal year end. The summary of our tests results is: SubawardSubawardTransactionsSubaward NotReport NotAmountMissing KeyTestedReportedTimelyIncorrectElements2502500Dollar Amount ofSubawardSubawardTestedSubaward NotReport NotAmountMissing KeyTransactionsReportedTimelyIncorrectElements$270,191,453$0$270,191,453$0$0 QUESTIONED COSTS Not applicable. PERSPECTIVE INFORMATION The PRDH did provide a detail of those awards or contracts subject to the FFATA requirements, totaled about 136 contracts with a grant total of $1,629,865,755.12. Although they acquired the necessary knowledge later in the fiscal year, the reports were still submitted after the 2022-2023 fiscal year. STATEMENT OF CAUSE The PRDH staff were unaware of the requirements related to the Federal Funding Accountability and Transparency Act (FFATA) applicable to the CDGB funds they manage. POSSIBLE ASSERTED EFFECT The PRDH is in non-compliance with the requirements to report through the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS) platform. This condition does not allow for the transparency that this report requires. IDENTIFICATION OF REPEAT FINDING This is a repeat finding (Finding Reference No. 2022-002). RECOMMENDATIONS We recommend that the PRDH provide training and technical assistance to the personnel they designate to monitor all the funds delegation contracts that meet the requirements to be reported on the FSRS portal, and to be able to keep track of when they had to be reported, the date in which they submitted the information to the portal, and all the elements required to be submitted on the platform.
FINDING REFERENCE NUMBER 2023-001 FEDERAL PROGRAM (ALN – 14.228) COMMUNITY DEVELOPMENT BLOCK GRANT/STATE’S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII (ALN – 14.228) COVID19 – COMMUNITY DEVELOPMENT BLOCK GRANT/STATE’S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT AWARD NUMBERS B-14-DC-7201 ~ B-19-DC-72-0001; B-17-DM-7201; B-18-DP-7201; B-20-DW-72-0001 (Federal Award Years 2014-2023) COMPLIANCE REQUIREMENT REPORTING TYPE OF FINDING MATERIAL NONCOMPLIANCE AND MATERIAL WEAKNESS CRITERIA 2 CFR § 200.512 Report Submission, (a) (1) The audit must be completed and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period. If the due date falls on a Saturday, Sunday, or Federal holiday, the reporting package is due the next business day. STATEMENT OF CONDITION PRDH did not submit the Data Collection Form and Reporting Package to the Federal Audit Clearinghouse of fiscal year ending June 30, 2023 during the required period. QUESTIONED COSTS None PERSPECTIVE INFORMATION PRDH was unable to provide timely financial statements and related supporting documentation in order to apply required audit procedures. STATEMENT OF CAUSE PRDH did not have an effective accounting system and procedures to assure that the required financial statements and supporting documentation was made available for audit purposes within the required period established to comply with the Federal regulations. POSSIBLE ASSERTED EFFECT PRDH did not comply with the submission date required for the Data Collection Form and Reporting Package, this could affect the continuance and new approvals of Federal funds. In addition, for the next two (2) fiscal years PRDH cannot be considered by the auditor as a low risk auditee. IDENTIFICATION AS A REPEAT FINDING This is a repeat finding (Finding Reference No. 2022-001). RECOMMENDATION We recommend the PRDH maintain adequate accounting records related to the non-Federal and Federal funds in order to properly prepare the financial statements accurately and in a timely manner. In addition, PRDH needs to implement adequate internal controls procedures in order to ensure that the supporting documentation is available in a timely manner.
FINDING REFERENCE NUMBER 2023-001 FEDERAL PROGRAM (ALN – 14.228) COMMUNITY DEVELOPMENT BLOCK GRANT/STATE’S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII (ALN – 14.228) COVID19 – COMMUNITY DEVELOPMENT BLOCK GRANT/STATE’S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT AWARD NUMBERS B-14-DC-7201 ~ B-19-DC-72-0001; B-17-DM-7201; B-18-DP-7201; B-20-DW-72-0001 (Federal Award Years 2014-2023) COMPLIANCE REQUIREMENT REPORTING TYPE OF FINDING MATERIAL NONCOMPLIANCE AND MATERIAL WEAKNESS CRITERIA 2 CFR § 200.512 Report Submission, (a) (1) The audit must be completed and the data collection form described in paragraph (b) of this section and reporting package described in paragraph (c) of this section must be submitted within the earlier of 30 calendar days after receipt of the auditor’s report(s), or nine months after the end of the audit period. If the due date falls on a Saturday, Sunday, or Federal holiday, the reporting package is due the next business day. STATEMENT OF CONDITION PRDH did not submit the Data Collection Form and Reporting Package to the Federal Audit Clearinghouse of fiscal year ending June 30, 2023 during the required period. QUESTIONED COSTS None PERSPECTIVE INFORMATION PRDH was unable to provide timely financial statements and related supporting documentation in order to apply required audit procedures. STATEMENT OF CAUSE PRDH did not have an effective accounting system and procedures to assure that the required financial statements and supporting documentation was made available for audit purposes within the required period established to comply with the Federal regulations. POSSIBLE ASSERTED EFFECT PRDH did not comply with the submission date required for the Data Collection Form and Reporting Package, this could affect the continuance and new approvals of Federal funds. In addition, for the next two (2) fiscal years PRDH cannot be considered by the auditor as a low risk auditee. IDENTIFICATION AS A REPEAT FINDING This is a repeat finding (Finding Reference No. 2022-001). RECOMMENDATION We recommend the PRDH maintain adequate accounting records related to the non-Federal and Federal funds in order to properly prepare the financial statements accurately and in a timely manner. In addition, PRDH needs to implement adequate internal controls procedures in order to ensure that the supporting documentation is available in a timely manner.
FINDING REFERENCE NUMBER 2023-002 FEDERAL PROGRAM (ALN – 14.228) COMMUNITY DEVELOPMENT BLOCK GRANT/STATE’S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII (ALN – 14.228) COVID19 – COMMUNITY DEVELOPMENT BLOCK GRANT/STATE’S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT AWARD NUMBERS B-14-DC-7201 ~ B-19-DC-72-0001; B-17-DM-7201; B-18-DP-7201; B-20-DW-72-0001; B-21-DZ-72-0001 (Federal Award Years 2014-2023) COMPLIANCE REQUIREMENT REPORTING TYPE OF FINDING NONCOMPLIANCE AND SIGNIFICANT DEFICIENCY CRITERIA In accordance with 2 CFR Part 170, establish that recipients (i.e., 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). The non-Federal entity or Federal agency must report each obligating action to http://www.fsrs.gov. For subaward information, report no later than the end of the month following the month in which the obligation was made. STATEMENT OF CONDITION The audit revealed that the PRDH did not adhere to the FFATA reporting procedures during the fiscal year. We found that all required reports were submitted after fiscal year end. The summary of our tests results is: SubawardSubawardTransactionsSubaward NotReport NotAmountMissing KeyTestedReportedTimelyIncorrectElements2502500Dollar Amount ofSubawardSubawardTestedSubaward NotReport NotAmountMissing KeyTransactionsReportedTimelyIncorrectElements$270,191,453$0$270,191,453$0$0 QUESTIONED COSTS Not applicable. PERSPECTIVE INFORMATION The PRDH did provide a detail of those awards or contracts subject to the FFATA requirements, totaled about 136 contracts with a grant total of $1,629,865,755.12. Although they acquired the necessary knowledge later in the fiscal year, the reports were still submitted after the 2022-2023 fiscal year. STATEMENT OF CAUSE The PRDH staff were unaware of the requirements related to the Federal Funding Accountability and Transparency Act (FFATA) applicable to the CDGB funds they manage. POSSIBLE ASSERTED EFFECT The PRDH is in non-compliance with the requirements to report through the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS) platform. This condition does not allow for the transparency that this report requires. IDENTIFICATION OF REPEAT FINDING This is a repeat finding (Finding Reference No. 2022-002). RECOMMENDATIONS We recommend that the PRDH provide training and technical assistance to the personnel they designate to monitor all the funds delegation contracts that meet the requirements to be reported on the FSRS portal, and to be able to keep track of when they had to be reported, the date in which they submitted the information to the portal, and all the elements required to be submitted on the platform.
FINDING REFERENCE NUMBER 2023-002 FEDERAL PROGRAM (ALN – 14.228) COMMUNITY DEVELOPMENT BLOCK GRANT/STATE’S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII (ALN – 14.228) COVID19 – COMMUNITY DEVELOPMENT BLOCK GRANT/STATE’S PROGRAM AND NON-ENTITLEMENT GRANTS IN HAWAII U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT AWARD NUMBERS B-14-DC-7201 ~ B-19-DC-72-0001; B-17-DM-7201; B-18-DP-7201; B-20-DW-72-0001; B-21-DZ-72-0001 (Federal Award Years 2014-2023) COMPLIANCE REQUIREMENT REPORTING TYPE OF FINDING NONCOMPLIANCE AND SIGNIFICANT DEFICIENCY CRITERIA In accordance with 2 CFR Part 170, establish that recipients (i.e., 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). The non-Federal entity or Federal agency must report each obligating action to http://www.fsrs.gov. For subaward information, report no later than the end of the month following the month in which the obligation was made. STATEMENT OF CONDITION The audit revealed that the PRDH did not adhere to the FFATA reporting procedures during the fiscal year. We found that all required reports were submitted after fiscal year end. The summary of our tests results is: SubawardSubawardTransactionsSubaward NotReport NotAmountMissing KeyTestedReportedTimelyIncorrectElements2502500Dollar Amount ofSubawardSubawardTestedSubaward NotReport NotAmountMissing KeyTransactionsReportedTimelyIncorrectElements$270,191,453$0$270,191,453$0$0 QUESTIONED COSTS Not applicable. PERSPECTIVE INFORMATION The PRDH did provide a detail of those awards or contracts subject to the FFATA requirements, totaled about 136 contracts with a grant total of $1,629,865,755.12. Although they acquired the necessary knowledge later in the fiscal year, the reports were still submitted after the 2022-2023 fiscal year. STATEMENT OF CAUSE The PRDH staff were unaware of the requirements related to the Federal Funding Accountability and Transparency Act (FFATA) applicable to the CDGB funds they manage. POSSIBLE ASSERTED EFFECT The PRDH is in non-compliance with the requirements to report through the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS) platform. This condition does not allow for the transparency that this report requires. IDENTIFICATION OF REPEAT FINDING This is a repeat finding (Finding Reference No. 2022-002). RECOMMENDATIONS We recommend that the PRDH provide training and technical assistance to the personnel they designate to monitor all the funds delegation contracts that meet the requirements to be reported on the FSRS portal, and to be able to keep track of when they had to be reported, the date in which they submitted the information to the portal, and all the elements required to be submitted on the platform.