Audit 355166

U.S. DEPARTMENT OF TREASURY: 2024-009 Compliance with Allowable Costs Fiscal year finding initially occurred: 2024 Coronavirus State and Local Fiscal Recovery Funds (21.027) Criteria In accordance with the Uniform Guidance, the Government is required to have internal controls in place that are properly designed, implemented and operating effectively to ensure compliance with the requirements as they relate to allowable costs. Condition The Government’s internal controls over allowable costs over this major federal program did not allow for the identification of invoices that lacked sufficient evidence to determine the allowability of the cost charged. Cause The Government did not adhere to their established controls over allowable costs. Effect A sample of 29 transactions totaling $6,758,318 was selected for testing. A disbursement transaction with multiple invoices lacked sufficient evidence for certain travel related charges to determine the allowability of the costs. As a result, the Government had questioned costs totaling $1,792. Our sample was a non-statistical sample. Recommendation The Government should review their established controls, policies and procedures for effectiveness and ensure invoices submitted by the vendor include detailed support for all expenses incurred. Additionally, management should ensure all costs charged to the program are allowable under the grant guidelines. Views of Responsible Officials and Planned Corrective Action The Government agrees with this finding. While the actual cost itself is allowable, we acknowledge that the supporting documentation for the transaction was not present at the time of payment. We have discussed the invoice and documentation issues with the vendor, who will modify the invoices to comply in future billing periods. We have also discussed the lack of documentation and corrective action with staff in charge of reviewing and approving these invoices for payment. We do not expect this finding to reoccur.

U.S. DEPARTMENT OF TREASURY: 2024-011 Compliance with Allowable Costs Fiscal year finding initially occurred: 2024 Coronavirus State and Local Fiscal Recovery Funds (21.027) Criteria In accordance with the Uniform Guidance, the Government is required to have internal controls in place that are properly designed, implemented and operating effectively to ensure compliance with the requirements as they relate to allowable costs. Condition The Government’s internal controls over allowable costs over this major federal program did not allow for the identification of invoices that lacked sufficient evidence to determine the allowability of the cost charged. Cause The Government did not adhere to their established controls over allowable costs. Effect A sample of 29 transactions totaling $6,758,318 was selected for testing. A disbursement transaction with multiple invoices lacked sufficient evidence for certain travel related charges to determine the allowability of the costs. As a result, the Government had questioned costs totaling $1,792. Our sample was a non-statistical sample. Recommendation The Government should review their established controls, policies and procedures for effectiveness and ensure invoices submitted by the vendor include detailed support for all expenses incurred. Additionally, management should ensure all costs charged to the program are allowable under the grant guidelines. Views of Responsible Officials and Planned Corrective Action The Government agrees with this finding. While the actual cost itself is allowable, we acknowledge that the supporting documentation for the transaction was not present at the time of payment. We have discussed the invoice and documentation issues with the vendor, who will modify the invoices to comply in future billing periods. We have also discussed the lack of documentation and corrective action with staff in charge of reviewing and approving these invoices for payment. We do not expect this finding to reoccur.

U.S. DEPARTMENT OF TREASURY: 2024-010 Controls over Suspension and Debarment Fiscal year finding initially occurred: 2024 Coronavirus Capital Projects Fund (21.029) Criteria Federal regulation requires the Government to verify vendors are not suspended, debarred or otherwise excluded from doing business with the federal government prior to the Government doing business with them. Condition The Government failed to verify applicable vendors were not suspended, debarred or otherwise excluded from doing business with the federal government prior to the Government doing business with them. Cause The Government did not have internal control policies and procedures in place to ensure that all vendors were verified prior to doing business with them for services funded with federal government grants. Effect Failure to verify vendors are allowed to do business with the Government could lead to non-compliance. Context A sample of twelve vendors was selected from a population of twenty vendors. The testing determined that two of the vendors had not been verified by the Government prior to doing business with them. Our sample was a non-statistical sample. Recommendation The Government should review their established controls, policies and procedures to ensure that the verification of vendors is done prior to doing business with them. Views of Responsible Officials and Planned Corrective Action The Government agrees with this finding. Purchasing is normally alerted to verify suspension and debarment status when PO’s are issued in designated federal grant funds. However, we have a few departments that do not report grants in separate funds. If these departments do not identify that a federal grant is the funding source when initiating the procurement process, then Purchasing is not aware that the verifications need to be made. We will review the documentation requirements with the appropriate departments so that purchases made with grant funds in these departments are properly identified. We do not expect this finding to reoccur.

U.S. DEPARTMENT OF TREASURY: 2024-009 Compliance with Allowable Costs Fiscal year finding initially occurred: 2024 Coronavirus State and Local Fiscal Recovery Funds (21.027) Criteria In accordance with the Uniform Guidance, the Government is required to have internal controls in place that are properly designed, implemented and operating effectively to ensure compliance with the requirements as they relate to allowable costs. Condition The Government’s internal controls over allowable costs over this major federal program did not allow for the identification of invoices that lacked sufficient evidence to determine the allowability of the cost charged. Cause The Government did not adhere to their established controls over allowable costs. Effect A sample of 29 transactions totaling $6,758,318 was selected for testing. A disbursement transaction with multiple invoices lacked sufficient evidence for certain travel related charges to determine the allowability of the costs. As a result, the Government had questioned costs totaling $1,792. Our sample was a non-statistical sample. Recommendation The Government should review their established controls, policies and procedures for effectiveness and ensure invoices submitted by the vendor include detailed support for all expenses incurred. Additionally, management should ensure all costs charged to the program are allowable under the grant guidelines. Views of Responsible Officials and Planned Corrective Action The Government agrees with this finding. While the actual cost itself is allowable, we acknowledge that the supporting documentation for the transaction was not present at the time of payment. We have discussed the invoice and documentation issues with the vendor, who will modify the invoices to comply in future billing periods. We have also discussed the lack of documentation and corrective action with staff in charge of reviewing and approving these invoices for payment. We do not expect this finding to reoccur.

U.S. DEPARTMENT OF TREASURY: 2024-011 Compliance with Allowable Costs Fiscal year finding initially occurred: 2024 Coronavirus State and Local Fiscal Recovery Funds (21.027) Criteria In accordance with the Uniform Guidance, the Government is required to have internal controls in place that are properly designed, implemented and operating effectively to ensure compliance with the requirements as they relate to allowable costs. Condition The Government’s internal controls over allowable costs over this major federal program did not allow for the identification of invoices that lacked sufficient evidence to determine the allowability of the cost charged. Cause The Government did not adhere to their established controls over allowable costs. Effect A sample of 29 transactions totaling $6,758,318 was selected for testing. A disbursement transaction with multiple invoices lacked sufficient evidence for certain travel related charges to determine the allowability of the costs. As a result, the Government had questioned costs totaling $1,792. Our sample was a non-statistical sample. Recommendation The Government should review their established controls, policies and procedures for effectiveness and ensure invoices submitted by the vendor include detailed support for all expenses incurred. Additionally, management should ensure all costs charged to the program are allowable under the grant guidelines. Views of Responsible Officials and Planned Corrective Action The Government agrees with this finding. While the actual cost itself is allowable, we acknowledge that the supporting documentation for the transaction was not present at the time of payment. We have discussed the invoice and documentation issues with the vendor, who will modify the invoices to comply in future billing periods. We have also discussed the lack of documentation and corrective action with staff in charge of reviewing and approving these invoices for payment. We do not expect this finding to reoccur.

U.S. DEPARTMENT OF TREASURY: 2024-010 Controls over Suspension and Debarment Fiscal year finding initially occurred: 2024 Coronavirus Capital Projects Fund (21.029) Criteria Federal regulation requires the Government to verify vendors are not suspended, debarred or otherwise excluded from doing business with the federal government prior to the Government doing business with them. Condition The Government failed to verify applicable vendors were not suspended, debarred or otherwise excluded from doing business with the federal government prior to the Government doing business with them. Cause The Government did not have internal control policies and procedures in place to ensure that all vendors were verified prior to doing business with them for services funded with federal government grants. Effect Failure to verify vendors are allowed to do business with the Government could lead to non-compliance. Context A sample of twelve vendors was selected from a population of twenty vendors. The testing determined that two of the vendors had not been verified by the Government prior to doing business with them. Our sample was a non-statistical sample. Recommendation The Government should review their established controls, policies and procedures to ensure that the verification of vendors is done prior to doing business with them. Views of Responsible Officials and Planned Corrective Action The Government agrees with this finding. Purchasing is normally alerted to verify suspension and debarment status when PO’s are issued in designated federal grant funds. However, we have a few departments that do not report grants in separate funds. If these departments do not identify that a federal grant is the funding source when initiating the procurement process, then Purchasing is not aware that the verifications need to be made. We will review the documentation requirements with the appropriate departments so that purchases made with grant funds in these departments are properly identified. We do not expect this finding to reoccur.