FAC Explorer

Audit 325232

FY End
2023-12-31
Total Expended
$1.67M
Findings
6
Programs
11
Organization: Wallowa Resources, Inc. (OR)
Year: 2023 Accepted: 2024-10-18
Auditor: Eide Bailly LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
503175 2023-003 Significant Deficiency - C
503176 2023-004 Significant Deficiency - M
503177 2023-005 Material Weakness - L
1079617 2023-003 Significant Deficiency - C
1079618 2023-004 Significant Deficiency - M
1079619 2023-005 Material Weakness - L

Programs

ALN Program Spent Major Findings
10.902 Soil and Water Conservation $867,860 Yes 3
10.664 Cooperative Forestry Assistance $307,155 - 0
10.699 Partnership Agreements $241,764 - 0
10.665 Schools and Roads - Grants to States $104,380 - 0
84.425 Education Stabilization Fund $47,500 - 0
15.230 Invasive and Noxious Plant Management $39,408 - 0
15.657 Endangered Species Recovery Implementation $29,929 - 0
15.246 Threatened and Endangered Species $19,099 - 0
10.932 Regional Conservation Partnership Program $9,543 - 0
10.717 Infrastructure Investment and Jobs Act Restoration/revegetation $2,187 - 0
10.715 Infrastructure Investment and Jobs Act Collaborative Forest Landscape Restoration Program $739 - 0

Contacts

Name Title Type
G2ZRDL15DZA1 Nils Christoffersen Auditee
5414268053 Barry Weber 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 accrual basis of accounting except for subrecipient expenditures, which are recorded on the cash basis. When applicable, 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. De Minimis Rate Used: N Rate Explanation: Wallowa has not elected to use the 10% de minimis cost rate. The accompanying schedule of expenditures of federal awards (the schedule) includes the federal award activity of Wallowa Resources, Inc. under programs of the federal government for the year ended December 31, 2023. The information 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 Wallowa Resources, Inc., it is not intended to and does not present the financial position, changes in net assets, or cash flows of Wallowa Resources, Inc.
Title: Note 2 - Principles of Consolidation Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting except for subrecipient expenditures, which are recorded on the cash basis. When applicable, 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. De Minimis Rate Used: N Rate Explanation: Wallowa has not elected to use the 10% de minimis cost rate. The schedule of expenditures of federal awards includes the federal grant activity of Wallowa Resources, Inc. and its consolidated subsidiaries. Significant intercompany balances and transactions have been eliminated in the schedule of expenditures of federal awards. The following entity and its associated TIN number is included within the schedule: 91-1794627 Wallowa Resources The accompanying schedule does not include federal grant activity of the following subsidiaries as these organizations did not expend any federal grant dollars during the year: Working Homes LLC, WR Stewardship Center LLC.
Title: Note 3 - Significant Accounting Policies Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting except for subrecipient expenditures, which are recorded on the cash basis. When applicable, 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. De Minimis Rate Used: N Rate Explanation: Wallowa has not elected to use the 10% de minimis cost rate. Expenditures reported on the schedule are reported on the accrual basis of accounting except for subrecipient expenditures, which are recorded on the cash basis. When applicable, 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.
Title: Note 4 - Indirect Cost Rate Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting except for subrecipient expenditures, which are recorded on the cash basis. When applicable, 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. De Minimis Rate Used: N Rate Explanation: Wallowa has not elected to use the 10% de minimis cost rate. Wallowa has not elected to use the 10% de minimis cost rate.

Finding Details

Finding 2023-003
2023-003: U.S. Department of Agriculture Soil and Water Conservation Assistance Listing #10.902 Cash Management Significant Deficiency in Internal Control over Compliance and Non-Compliance Grant Award Number: NR230436XXXXC017 Criteria: The OMB Compliance Supplement requires that reimbursement-based grant recipient submit timely a request for reimbursement (RFR) to the granting agency and that all expenditures included in the RFR were incurred prior to the date of the submitted request. Wallowa Resources may submit monthly RFRs to exFedGrants system or directly to the Farm Production and Conservation (FPAC) Grants and Agreements Division. There is no specified frequency for RFR submission. Condition: RFRs are prepared and submitted by the same employee. Cause: Wallowa Resources did not have adequate internal controls to ensure the RFRs were prepared in accordance with governing requirements. Effect: Though no current year misstatement or material noncompliance was identified, the finding is systematic and therefor is risen to a significant deficiency, as it could become material if not correct. Questioned Costs: None Context/Sampling: There were two RFRs submitted within the scope of this audit. No misstatements or material noncompliance identified. Lack of segregation of duties present in both submissions. Repeat Finding from Prior Year: No Recommendation: The circumstance is not unusual in an organization of Wallowa Resource’s size. It is the responsibility of management and those charged with governance to make the decision whether to accept the degree of risk associated with condition because of cost or other consideration. Views of Responsible Officials: Management agrees with the finding.
Finding 2023-004
2023-004: U.S. Department of Agriculture Soil and Water Conservation Assistance Listing #10.902 Subrecipient Monitoring Significant Deficiency in Internal Control over Compliance and Non-Compliance Grant Award Number: NR230436XXXXC017 Criteria: The OMB Compliance Supplement (2 CFR 200.331) requires that pass-through entities (PTE) disbursing federal funds to subrecipients have a formalized policy for identifying the subrecipient meets the applicable requirements, for evaluating risk, for monitoring subrecipient activity, and for ensuring accountability of For-Profit Subrecipients, if applicable. As part of the risk assessment, entities must ensure subrecipients are not suspended or debarred. During monitoring activities, the PTE is required to obtain the subrecipients’ audit reports so that any findings can be evaluated by the PTE’s management. Condition: Several required elements per 2 CFR 200.331 being absent from the subrecipient agreements, including: - Subrecipients’ unique entity identifier - Federal award date of award to Wallowa Resources by the USDA - ALN number and dollar amount made available by the USDA Wallowa Resources was unable to provide support that subrecipients were assessed for suspension and debarment during the risk assessment. Cause: Wallowa Resources did not have a formalized policy for subrecipient monitoring which resulted in several required elements per 2 CFR 200.331 being absent from the subrecipient agreements, lack of retention for work performed during the risk assessment and monitoring activities. Effect: Certain compliance elements related to subrecipient monitoring not met as a result of ineffective controls. Questioned Costs: None Context/Sampling: There were four subrecipients within the scope of this audit, of which 75% were tested and the above-noted items were consistent. Repeat Finding from Prior Year: No Recommendation: We recommend Wallowa Resources implement a formal subrecipient monitoring policy using the guidance of 2 CFR 200.332. Views of Responsible Officials: Management agrees with the finding.
Finding 2023-005
2023-005: U.S. Department of Agriculture Soil and Water Conservation Assistance Listing #10.902 Reporting Material Weakness in Internal Control over Compliance and Material Non-Compliance Grant Award Number: NR230436XXXXC017 Criteria: The OMB requires that, in accordance with the Federal Funding Accountability and Transparency Act (FFATA), prime award recipients must report on federal funds distributed to first-tied subrecipients no later than the end of the month following the month in which the obligation was made. The information is to be reported using the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Condition: Due to an error with the online submission portal, Wallowa Resources was unable to submit the required information to FSRS. Cause: While Wallowa Resources has a formal policy for ensuring reporting is completed timely, the error with the online submission portal prevented the reports from being submitted. Wallowa Resources contacted the designated federal agreements officer, and has not received a response. Effect: Wallowa Resources is outside the USDA Terms and Conditions included in the Notice of Award. Questioned Costs: None Context/Sampling: There were four subrecipients within the scope of this audit, all of which were assessed and were not submitted. Repeat Finding from Prior Year: No Recommendation: We recommend Wallowa Resources work with the FSRS to resolve the system error and submit the report for activity occurred in the year ended December 31, 2023 and for future obligations to first-tier subrecipients in a timely manner. Views of Responsible Officials: Management agrees with the finding.
Finding 2023-003
2023-003: U.S. Department of Agriculture Soil and Water Conservation Assistance Listing #10.902 Cash Management Significant Deficiency in Internal Control over Compliance and Non-Compliance Grant Award Number: NR230436XXXXC017 Criteria: The OMB Compliance Supplement requires that reimbursement-based grant recipient submit timely a request for reimbursement (RFR) to the granting agency and that all expenditures included in the RFR were incurred prior to the date of the submitted request. Wallowa Resources may submit monthly RFRs to exFedGrants system or directly to the Farm Production and Conservation (FPAC) Grants and Agreements Division. There is no specified frequency for RFR submission. Condition: RFRs are prepared and submitted by the same employee. Cause: Wallowa Resources did not have adequate internal controls to ensure the RFRs were prepared in accordance with governing requirements. Effect: Though no current year misstatement or material noncompliance was identified, the finding is systematic and therefor is risen to a significant deficiency, as it could become material if not correct. Questioned Costs: None Context/Sampling: There were two RFRs submitted within the scope of this audit. No misstatements or material noncompliance identified. Lack of segregation of duties present in both submissions. Repeat Finding from Prior Year: No Recommendation: The circumstance is not unusual in an organization of Wallowa Resource’s size. It is the responsibility of management and those charged with governance to make the decision whether to accept the degree of risk associated with condition because of cost or other consideration. Views of Responsible Officials: Management agrees with the finding.
Finding 2023-004
2023-004: U.S. Department of Agriculture Soil and Water Conservation Assistance Listing #10.902 Subrecipient Monitoring Significant Deficiency in Internal Control over Compliance and Non-Compliance Grant Award Number: NR230436XXXXC017 Criteria: The OMB Compliance Supplement (2 CFR 200.331) requires that pass-through entities (PTE) disbursing federal funds to subrecipients have a formalized policy for identifying the subrecipient meets the applicable requirements, for evaluating risk, for monitoring subrecipient activity, and for ensuring accountability of For-Profit Subrecipients, if applicable. As part of the risk assessment, entities must ensure subrecipients are not suspended or debarred. During monitoring activities, the PTE is required to obtain the subrecipients’ audit reports so that any findings can be evaluated by the PTE’s management. Condition: Several required elements per 2 CFR 200.331 being absent from the subrecipient agreements, including: - Subrecipients’ unique entity identifier - Federal award date of award to Wallowa Resources by the USDA - ALN number and dollar amount made available by the USDA Wallowa Resources was unable to provide support that subrecipients were assessed for suspension and debarment during the risk assessment. Cause: Wallowa Resources did not have a formalized policy for subrecipient monitoring which resulted in several required elements per 2 CFR 200.331 being absent from the subrecipient agreements, lack of retention for work performed during the risk assessment and monitoring activities. Effect: Certain compliance elements related to subrecipient monitoring not met as a result of ineffective controls. Questioned Costs: None Context/Sampling: There were four subrecipients within the scope of this audit, of which 75% were tested and the above-noted items were consistent. Repeat Finding from Prior Year: No Recommendation: We recommend Wallowa Resources implement a formal subrecipient monitoring policy using the guidance of 2 CFR 200.332. Views of Responsible Officials: Management agrees with the finding.
Finding 2023-005
2023-005: U.S. Department of Agriculture Soil and Water Conservation Assistance Listing #10.902 Reporting Material Weakness in Internal Control over Compliance and Material Non-Compliance Grant Award Number: NR230436XXXXC017 Criteria: The OMB requires that, in accordance with the Federal Funding Accountability and Transparency Act (FFATA), prime award recipients must report on federal funds distributed to first-tied subrecipients no later than the end of the month following the month in which the obligation was made. The information is to be reported using the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). Condition: Due to an error with the online submission portal, Wallowa Resources was unable to submit the required information to FSRS. Cause: While Wallowa Resources has a formal policy for ensuring reporting is completed timely, the error with the online submission portal prevented the reports from being submitted. Wallowa Resources contacted the designated federal agreements officer, and has not received a response. Effect: Wallowa Resources is outside the USDA Terms and Conditions included in the Notice of Award. Questioned Costs: None Context/Sampling: There were four subrecipients within the scope of this audit, all of which were assessed and were not submitted. Repeat Finding from Prior Year: No Recommendation: We recommend Wallowa Resources work with the FSRS to resolve the system error and submit the report for activity occurred in the year ended December 31, 2023 and for future obligations to first-tier subrecipients in a timely manner. Views of Responsible Officials: Management agrees with the finding.