Finding 2024-001 – Program Reporting Requirements – Internal Control Over Compliance – Significant Deficiency
Federal Programs Information:
Funding Agency: Economic Development Administration
Title: Economic Adjustment Assistance
Assistance Listing Number: 11.307
Award year and number: 2020 and 08-79-05447
Pass-through entity: Not applicable
Type of Finding: Significant Deficiency in internal control over compliance (reporting)
Funding Agency: Department of Treasury
Title: Coronavirus State and Local Fiscal Recovery Funds
Assistance Listing Number: 21.027
Award year and Number(s): 2021 and SLFRP2505 and SLFRP4740
Pass-through entity: Not applicable
Type of Finding: Significant Deficiency in internal control over compliance (reporting)
Criteria or Specific Requirement: Recipients of funds under the Economic Development Administration program are required to submit a “Federal Financial Report” (Form SF-425) on a semi-annual basis (on the fiscal year) for the periods ending March 31 and September 30. The semi-annual Form SF-425 reports are due within 30 days of the end of each period.
States, U.S. territories, metropolitan cities, counties, and Tribal governments were required to submit a one-time interim report with expenditures by expenditure category covering the period from March 3, 2021, through July 31, 2021, by August 31, 2021. Tribal governments that are allocated less than $30 million in Coronavirus State and Local Fiscal Recovery Funds funding are required to submit annual project and expenditure reports. For these recipients, the initial project and expenditure report covered from March 3, 2021, through March 31, 2022, and was required to be submitted to the United States Department of Treasury by April 30, 2022. For these recipients, the subsequent annual reports cover one calendar year and must be submitted to the United States Department of Treasury by April 30.
Condition: During our testing, we noted that the Department’s controls surrounding the reporting function for this program were not operating effectively to ensure that the reports were filed in a timely manner, as required by the terms of the award.
Questioned Costs: None.
Context: The September 30, 2024 semi-annual Form SF-425 report for the Economic Development Administration grant was submitted by the Department on December 19, 2024. Therefore, the semi-annual Form SF-425 for the period ending September 30, 2024, due October 30, 2024, was not filed timely. The United States Department of Treasury project and expenditures report (period of April 1, 2023, through March 31, 2024) due on April 30, 2024 and was submitted on May 9, 2024. The project and expenditures report (period of April 1, 2024, through March 31, 2025) due on April 30, 2025 and was submitted on May 2, 2025.
Effect: The Department was not in compliance with the reporting requirements of the noted program.
Cause: The Department does not have an internal control system designed to ensure all reports are submitted by the required date.
Repeat Finding: This is a repeat finding.
Recommendation: We recommend the Department’s management implement procedures to ensure that all reports are submitted by the required date.
Department’s Response: See accompanying Corrective Action Plan
Finding 2024-001 – Program Reporting Requirements – Internal Control Over Compliance – Significant Deficiency
Federal Programs Information:
Funding Agency: Economic Development Administration
Title: Economic Adjustment Assistance
Assistance Listing Number: 11.307
Award year and number: 2020 and 08-79-05447
Pass-through entity: Not applicable
Type of Finding: Significant Deficiency in internal control over compliance (reporting)
Funding Agency: Department of Treasury
Title: Coronavirus State and Local Fiscal Recovery Funds
Assistance Listing Number: 21.027
Award year and Number(s): 2021 and SLFRP2505 and SLFRP4740
Pass-through entity: Not applicable
Type of Finding: Significant Deficiency in internal control over compliance (reporting)
Criteria or Specific Requirement: Recipients of funds under the Economic Development Administration program are required to submit a “Federal Financial Report” (Form SF-425) on a semi-annual basis (on the fiscal year) for the periods ending March 31 and September 30. The semi-annual Form SF-425 reports are due within 30 days of the end of each period.
States, U.S. territories, metropolitan cities, counties, and Tribal governments were required to submit a one-time interim report with expenditures by expenditure category covering the period from March 3, 2021, through July 31, 2021, by August 31, 2021. Tribal governments that are allocated less than $30 million in Coronavirus State and Local Fiscal Recovery Funds funding are required to submit annual project and expenditure reports. For these recipients, the initial project and expenditure report covered from March 3, 2021, through March 31, 2022, and was required to be submitted to the United States Department of Treasury by April 30, 2022. For these recipients, the subsequent annual reports cover one calendar year and must be submitted to the United States Department of Treasury by April 30.
Condition: During our testing, we noted that the Department’s controls surrounding the reporting function for this program were not operating effectively to ensure that the reports were filed in a timely manner, as required by the terms of the award.
Questioned Costs: None.
Context: The September 30, 2024 semi-annual Form SF-425 report for the Economic Development Administration grant was submitted by the Department on December 19, 2024. Therefore, the semi-annual Form SF-425 for the period ending September 30, 2024, due October 30, 2024, was not filed timely. The United States Department of Treasury project and expenditures report (period of April 1, 2023, through March 31, 2024) due on April 30, 2024 and was submitted on May 9, 2024. The project and expenditures report (period of April 1, 2024, through March 31, 2025) due on April 30, 2025 and was submitted on May 2, 2025.
Effect: The Department was not in compliance with the reporting requirements of the noted program.
Cause: The Department does not have an internal control system designed to ensure all reports are submitted by the required date.
Repeat Finding: This is a repeat finding.
Recommendation: We recommend the Department’s management implement procedures to ensure that all reports are submitted by the required date.
Department’s Response: See accompanying Corrective Action Plan
Finding 2024-001 – Program Reporting Requirements – Internal Control Over Compliance – Significant Deficiency
Federal Programs Information:
Funding Agency: Economic Development Administration
Title: Economic Adjustment Assistance
Assistance Listing Number: 11.307
Award year and number: 2020 and 08-79-05447
Pass-through entity: Not applicable
Type of Finding: Significant Deficiency in internal control over compliance (reporting)
Funding Agency: Department of Treasury
Title: Coronavirus State and Local Fiscal Recovery Funds
Assistance Listing Number: 21.027
Award year and Number(s): 2021 and SLFRP2505 and SLFRP4740
Pass-through entity: Not applicable
Type of Finding: Significant Deficiency in internal control over compliance (reporting)
Criteria or Specific Requirement: Recipients of funds under the Economic Development Administration program are required to submit a “Federal Financial Report” (Form SF-425) on a semi-annual basis (on the fiscal year) for the periods ending March 31 and September 30. The semi-annual Form SF-425 reports are due within 30 days of the end of each period.
States, U.S. territories, metropolitan cities, counties, and Tribal governments were required to submit a one-time interim report with expenditures by expenditure category covering the period from March 3, 2021, through July 31, 2021, by August 31, 2021. Tribal governments that are allocated less than $30 million in Coronavirus State and Local Fiscal Recovery Funds funding are required to submit annual project and expenditure reports. For these recipients, the initial project and expenditure report covered from March 3, 2021, through March 31, 2022, and was required to be submitted to the United States Department of Treasury by April 30, 2022. For these recipients, the subsequent annual reports cover one calendar year and must be submitted to the United States Department of Treasury by April 30.
Condition: During our testing, we noted that the Department’s controls surrounding the reporting function for this program were not operating effectively to ensure that the reports were filed in a timely manner, as required by the terms of the award.
Questioned Costs: None.
Context: The September 30, 2024 semi-annual Form SF-425 report for the Economic Development Administration grant was submitted by the Department on December 19, 2024. Therefore, the semi-annual Form SF-425 for the period ending September 30, 2024, due October 30, 2024, was not filed timely. The United States Department of Treasury project and expenditures report (period of April 1, 2023, through March 31, 2024) due on April 30, 2024 and was submitted on May 9, 2024. The project and expenditures report (period of April 1, 2024, through March 31, 2025) due on April 30, 2025 and was submitted on May 2, 2025.
Effect: The Department was not in compliance with the reporting requirements of the noted program.
Cause: The Department does not have an internal control system designed to ensure all reports are submitted by the required date.
Repeat Finding: This is a repeat finding.
Recommendation: We recommend the Department’s management implement procedures to ensure that all reports are submitted by the required date.
Department’s Response: See accompanying Corrective Action Plan
Finding 2024-001 – Program Reporting Requirements – Internal Control Over Compliance – Significant Deficiency
Federal Programs Information:
Funding Agency: Economic Development Administration
Title: Economic Adjustment Assistance
Assistance Listing Number: 11.307
Award year and number: 2020 and 08-79-05447
Pass-through entity: Not applicable
Type of Finding: Significant Deficiency in internal control over compliance (reporting)
Funding Agency: Department of Treasury
Title: Coronavirus State and Local Fiscal Recovery Funds
Assistance Listing Number: 21.027
Award year and Number(s): 2021 and SLFRP2505 and SLFRP4740
Pass-through entity: Not applicable
Type of Finding: Significant Deficiency in internal control over compliance (reporting)
Criteria or Specific Requirement: Recipients of funds under the Economic Development Administration program are required to submit a “Federal Financial Report” (Form SF-425) on a semi-annual basis (on the fiscal year) for the periods ending March 31 and September 30. The semi-annual Form SF-425 reports are due within 30 days of the end of each period.
States, U.S. territories, metropolitan cities, counties, and Tribal governments were required to submit a one-time interim report with expenditures by expenditure category covering the period from March 3, 2021, through July 31, 2021, by August 31, 2021. Tribal governments that are allocated less than $30 million in Coronavirus State and Local Fiscal Recovery Funds funding are required to submit annual project and expenditure reports. For these recipients, the initial project and expenditure report covered from March 3, 2021, through March 31, 2022, and was required to be submitted to the United States Department of Treasury by April 30, 2022. For these recipients, the subsequent annual reports cover one calendar year and must be submitted to the United States Department of Treasury by April 30.
Condition: During our testing, we noted that the Department’s controls surrounding the reporting function for this program were not operating effectively to ensure that the reports were filed in a timely manner, as required by the terms of the award.
Questioned Costs: None.
Context: The September 30, 2024 semi-annual Form SF-425 report for the Economic Development Administration grant was submitted by the Department on December 19, 2024. Therefore, the semi-annual Form SF-425 for the period ending September 30, 2024, due October 30, 2024, was not filed timely. The United States Department of Treasury project and expenditures report (period of April 1, 2023, through March 31, 2024) due on April 30, 2024 and was submitted on May 9, 2024. The project and expenditures report (period of April 1, 2024, through March 31, 2025) due on April 30, 2025 and was submitted on May 2, 2025.
Effect: The Department was not in compliance with the reporting requirements of the noted program.
Cause: The Department does not have an internal control system designed to ensure all reports are submitted by the required date.
Repeat Finding: This is a repeat finding.
Recommendation: We recommend the Department’s management implement procedures to ensure that all reports are submitted by the required date.
Department’s Response: See accompanying Corrective Action Plan