FAC Explorer

Audit 344151

FY End
2024-09-30
Total Expended
$12.87M
Findings
2
Programs
5
Organization: Nybdc Local Development Corporation (NY)
Year: 2024 Accepted: 2025-02-27
Auditor: Uhy LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
524729 2024-001 - - C
1101171 2024-001 - - C

Programs

ALN Program Spent Major Findings
59.046 Microloan Program $1.97M Yes 0
21.033 Community Development Financial Institutions Fund Equitable Recovery Program (cdfi Erp) $797,000 Yes 0
21.020 Community Development Financial Institutions Program $496,551 - 0
59.050 Prime Technical Assistance $250,000 - 0
59.077 Community Navigator Pilot Program $16,451 - 0

Contacts

Name Title Type
L2U5DBNNJTX1 Owen Burns Auditee
5184632268 Eric Hennessey Auditor
No contacts on file

Notes to SEFA

Title: NOTE 1 – BASIS OF PRESENTATION Accounting Policies: NOTE 1 – BASIS OF PRESENTATION The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal grant activity of the NYBDC Local Development Corporation (the Company) under programs of the federal government for the year ended September 30, 2024. The information in the Schedule is presented in accordance with requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Because the Schedule presents only a selected portion of the operations of the Company, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Company. NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying Schedule of Expenditures of Federal Awards (the Schedule) was prepared on the accrual basis of accounting. Loans are disbursed as awards are received; corresponding assets and liabilities arising from the loans are recorded. The amounts reported as federal expenditures in the Schedule represent expenditures of federal funds as obtained from the appropriate federal financial reports for the applicable program and periods. The non-federal share of expenditures, if any, is excluded from the Schedule. The Company elected to utilize the 10% de minimis indirect cost rate as permitted by 2 CFR Section 200.414. De Minimis Rate Used: Y Rate Explanation: The auditee used the de minimis cost rate. The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal grant activity of the NYBDC Local Development Corporation (the Company) under programs of the federal government for the year ended September 30, 2024. The information in the Schedule is presented in accordance with requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Because the Schedule presents only a selected portion of the operations of the Company, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Company.
Title: NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting Policies: NOTE 1 – BASIS OF PRESENTATION The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal grant activity of the NYBDC Local Development Corporation (the Company) under programs of the federal government for the year ended September 30, 2024. The information in the Schedule is presented in accordance with requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Because the Schedule presents only a selected portion of the operations of the Company, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Company. NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying Schedule of Expenditures of Federal Awards (the Schedule) was prepared on the accrual basis of accounting. Loans are disbursed as awards are received; corresponding assets and liabilities arising from the loans are recorded. The amounts reported as federal expenditures in the Schedule represent expenditures of federal funds as obtained from the appropriate federal financial reports for the applicable program and periods. The non-federal share of expenditures, if any, is excluded from the Schedule. The Company elected to utilize the 10% de minimis indirect cost rate as permitted by 2 CFR Section 200.414. De Minimis Rate Used: Y Rate Explanation: The auditee used the de minimis cost rate. The accompanying Schedule of Expenditures of Federal Awards (the Schedule) was prepared on the accrual basis of accounting. Loans are disbursed as awards are received; corresponding assets and liabilities arising from the loans are recorded. The amounts reported as federal expenditures in the Schedule represent expenditures of federal funds as obtained from the appropriate federal financial reports for the applicable program and periods. The non-federal share of expenditures, if any, is excluded from the Schedule. The Company elected to utilize the 10% de minimis indirect cost rate as permitted by 2 CFR Section 200.414.
Title: NOTE 3 – RESTATEMENT Accounting Policies: NOTE 1 – BASIS OF PRESENTATION The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal grant activity of the NYBDC Local Development Corporation (the Company) under programs of the federal government for the year ended September 30, 2024. The information in the Schedule is presented in accordance with requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Because the Schedule presents only a selected portion of the operations of the Company, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Company. NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accompanying Schedule of Expenditures of Federal Awards (the Schedule) was prepared on the accrual basis of accounting. Loans are disbursed as awards are received; corresponding assets and liabilities arising from the loans are recorded. The amounts reported as federal expenditures in the Schedule represent expenditures of federal funds as obtained from the appropriate federal financial reports for the applicable program and periods. The non-federal share of expenditures, if any, is excluded from the Schedule. The Company elected to utilize the 10% de minimis indirect cost rate as permitted by 2 CFR Section 200.414. De Minimis Rate Used: Y Rate Explanation: The auditee used the de minimis cost rate. The accompanying Schedule of Expenditures of Federal Awards (the Schedule) was restated to reflect the new loans made during the audit period ($1,574,700), which was originally reported, plus the balance of loans from previous years at the beginning of the audit period for which the Federal Government imposes continuing compliance requirements.

Finding Details

Finding 2024-001
Federal Agency: U.S. Small Business Administration Federal Program: Microloan Program (59.046) Federal Award Numbers: Federal Award Years: Reference: 2024-01 Criteria Microloan Program Standard Operating Procedures Manual (SOP 52 00 B), effective July 1, 2018, section 3.D.4 Microloan Revolving Fund (MRF) states all SBA Microloan payments must be transferred from the operating account to the MRF within two weeks (10 working days) of receipt or by the end of the quarter, whichever occurs first. Condition During the fiscal year ended September 30, 2024, we selected a sample of 40 SBA Microloan payments. We traced the flow of funds from receipt of the payments from the borrower to the date of transfer into the MRF account. All 40 loans in the sample had transfers beyond the 10 working day threshold ranging from 17 to 29 working days after receipt of the SBA Microloan Payment. Cause Monitoring procedures implemented by the Company to ensure compliance with the Microloan Program did not include a review of the MRF account to ensure funds are transferred in accordance with the 10 working day requirement. Possible Asserted Effect Without established monitoring procedures over the 10 working day requirement for transfers, non-compliance may continue. Questioned Costs Cannot be determined. Statistical Sampling The sample was not intended to be, and was not, a statistically valid sample. Repeat Finding No Recommendation We recommend that the Company review its monitoring procedures to ensure that funds are transferred to the MRF account within 10 working days from payment receipt from the borrower to the transfer into the MRF account. Views of Responsible Individuals We acknowledge the auditor’s comments and can confirm that the following corrective action has been implemented as of December 2024: Management has revised the process for identifying, segregating, and transferring Microloan repayments from a monthly process to a weekly process. This change will ensure Microloan repayments received by our operating account are transferred to the appropriate MRF accounts within 10 working days. By changing the frequency of this task, we will enhance our compliance with Microloan requirements and more effectively manage Microloan program funds.
Finding 2024-001
Federal Agency: U.S. Small Business Administration Federal Program: Microloan Program (59.046) Federal Award Numbers: Federal Award Years: Reference: 2024-01 Criteria Microloan Program Standard Operating Procedures Manual (SOP 52 00 B), effective July 1, 2018, section 3.D.4 Microloan Revolving Fund (MRF) states all SBA Microloan payments must be transferred from the operating account to the MRF within two weeks (10 working days) of receipt or by the end of the quarter, whichever occurs first. Condition During the fiscal year ended September 30, 2024, we selected a sample of 40 SBA Microloan payments. We traced the flow of funds from receipt of the payments from the borrower to the date of transfer into the MRF account. All 40 loans in the sample had transfers beyond the 10 working day threshold ranging from 17 to 29 working days after receipt of the SBA Microloan Payment. Cause Monitoring procedures implemented by the Company to ensure compliance with the Microloan Program did not include a review of the MRF account to ensure funds are transferred in accordance with the 10 working day requirement. Possible Asserted Effect Without established monitoring procedures over the 10 working day requirement for transfers, non-compliance may continue. Questioned Costs Cannot be determined. Statistical Sampling The sample was not intended to be, and was not, a statistically valid sample. Repeat Finding No Recommendation We recommend that the Company review its monitoring procedures to ensure that funds are transferred to the MRF account within 10 working days from payment receipt from the borrower to the transfer into the MRF account. Views of Responsible Individuals We acknowledge the auditor’s comments and can confirm that the following corrective action has been implemented as of December 2024: Management has revised the process for identifying, segregating, and transferring Microloan repayments from a monthly process to a weekly process. This change will ensure Microloan repayments received by our operating account are transferred to the appropriate MRF accounts within 10 working days. By changing the frequency of this task, we will enhance our compliance with Microloan requirements and more effectively manage Microloan program funds.