Audit 361832

FY End
2023-06-30
Total Expended
$1.28M
Findings
2
Programs
2

Organization Exclusion Status:

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Findings

ID Ref Severity Repeat Requirement
570896 2023-001 Material Weakness Yes L
1147338 2023-001 Material Weakness Yes L

Contacts

Name Title Type
LJ7BB6R9V191 Juan C Rodriguez Rivera Auditee
7877057188 Alfonso Rossy Auditor
No contacts on file

Notes to SEFA

Title: BASIS OF PRESENTATION Accounting Policies: Expenditures reported on the Schedule are reported using the accrual basis of accounting. 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: Y Rate Explanation: The auditee used the de minimis cost rate The accompanying Schedule of Expenditures of Federal Awards (the "Schedule") includes the federal award activity of the Local Redevelopment Authority of the Lands and Facilities of Naval Station Roosevelt Roads (the Authority) for the year ended June 30, 2021. The information in this Schedule 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 the Authority, it is not intended to and does not present the financial position, changes in net position, or cash flows of the Authority.
Title: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting Policies: Expenditures reported on the Schedule are reported using the accrual basis of accounting. 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: Y Rate Explanation: The auditee used the de minimis cost rate Expenditures reported on the Schedule are reported using the accrual basis of accounting. 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: ASSISTANCE LISTING (AL) NUMBER Accounting Policies: Expenditures reported on the Schedule are reported using the accrual basis of accounting. 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: Y Rate Explanation: The auditee used the de minimis cost rate The AL numbers included in the Schedule are determined based on the program name, review of grant contract information, and the Office of Management and Budget's (OMB) Catalog of Federal Domestic Assistance. AL numbers are presented for those programs for which such numbers were available.
Title: GENERAL OBJECTIVES Accounting Policies: Expenditures reported on the Schedule are reported using the accrual basis of accounting. 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: Y Rate Explanation: The auditee used the de minimis cost rate The Authority received grants from the U.S. Department of Defense through the Office of Local Defense Community Cooperation (OLDCC), formerly the Office of Economic Adjustment (OEA), the Authority's cognizant federal agency, to plan and undertake community economic development, base redevelopment, and partner with the Military Departments in response to the proposed or actual expansion, establishment, realignment, or closure of a military installation by the U.S. Department of Defense. In addition, the Authority received funds from the US Department of Agriculture Rural Development to rehabilitate and improve the potable water infrastructure at Naval Station Roosevelt Roads (NRSS).
Title: INDIRECT COSTS Accounting Policies: Expenditures reported on the Schedule are reported using the accrual basis of accounting. 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: Y Rate Explanation: The auditee used the de minimis cost rate The Authority receives funding from federal government agencies for the redevelopment of the Roosevelt Roads naval station of the Roosevelt Roads under various grants and contracts. These grants and contracts provide for reimbursement of indirect costs based on rates to be negotiated with the OLDCC. The Authority has not negotiated fixed rates for indirect costs through the fiscal year ended June 30, 2021, and has not elected to use the 10 percent de minimis cost rates as authorized in §200.414 "Indirect (F&A) costs" of Uniform Guidance.
Title: RELATION TO FEDERAL FINANCIAL REPORTS Accounting Policies: Expenditures reported on the Schedule are reported using the accrual basis of accounting. 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: Y Rate Explanation: The auditee used the de minimis cost rate The regulations and guidelines governing the preparation of federal financial reports vary by federal agency and among programs administered by the same agency. Accordingly, the amounts reported in the federal financial reports do not necessarily agree with the amounts reported in the Schedule, which is prepared using the accrual basis of accounting as explained in Note 2 of the Schedule. The Uniform Guidance requires that federal financial reports for claims for advances and reimbursements contain information that is supported by the books and records from which the basic financial statements have been prepared. The Authority prepares the federal financial reports and claims for reimbursements primarily based on information from the internal accounting records of the Authority.
Title: SUBSEQUENT EVENTS Accounting Policies: Expenditures reported on the Schedule are reported using the accrual basis of accounting. 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: Y Rate Explanation: The auditee used the de minimis cost rate Electrical System Improvements, On July 14, 2022, the Authority rquest a proposal for improvements and replacement of a portion of the electrical power grid system at former Naval Station Roosevelt Roads at the cost of between $30 million and $40 million, an allocation is expected to be received from the Federal Emergency Management Agency (FEMA). As of 30, 2025, the improvement are under planning and design stage.

Finding Details

Part III - Findings and Questioned Costs Relating to Federal Awards 2023-001 Late Single Audit Submissions Effect (Continued) (d) Initiate suspension or debarment proceedings as authorized under 2 CFR part 180 and Federal awarding agency regulations (or in the case of a passthrough entity, recommend such a proceeding be initiated by a Federal awarding agency). (e) Withhold further Federal awards for the project or program. (f) Take other remedies that may be legally available. Questioned Costs None Recommendation To comply with the Single Audit submission requirements, the Authority needs to perform and submit the compliance reporting packages in default for the fiscal years ended June 30, 2022, and 2023, on a timely basis. Moving forward, the Authority needs to establish controls to ascertain all Federal reports are filed on time. Prior year finding This finding is similar to a prior year finding identify as 2022-002 Views of Responsible Official (Unaudited) Refer to Corrective Action Plan Compliance Reporting Category Material weakness in Internal Control and Material Noncompliance ALN 12.607 Program Community Economic Adjustment of Establishment, Expansion, Realignment, or Closure of a Military Installation Federal Agency US Department of Defense ALN 97.036 Program Disaster Grants - Public Assistance (Presidentially Declared Disasters) Federal Agency US Department of Homeland Security Criteria 2 CFR §200.512 Report Submission, (a) General (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. (Refer also to 10 CFR § 600.226, Non-Federal audit, 10 CFR §600.126, Non-Federal audits, and 45 CFR §75.501, Audit requirement) Condition The Authority has not timely submitted the Single Audit Reporting Packages for the year ended 2023. Cause Lack of management control activities to ensure compliance with Single Audits timely submissions. Effect If the Federal awarding agency or passthrough entity determines that noncompliance cannot be remedied by imposing additional conditions, the Federal awarding agency or passthrough entity may take one or more of the following actions, as appropriate in the circumstances: (a) Temporarily withhold cash payments pending correction of the deficiency by the non-Federal entity or more severe enforcement action by the Federal awarding agency or passthrough entity. (b) Disallow (that is, deny both use of funds and any applicable matching credit for) all or part of the cost of the activity or action not in compliance. (c) Wholly or partly suspend or terminate the Federal award.
Part III - Findings and Questioned Costs Relating to Federal Awards 2023-001 Late Single Audit Submissions Effect (Continued) (d) Initiate suspension or debarment proceedings as authorized under 2 CFR part 180 and Federal awarding agency regulations (or in the case of a passthrough entity, recommend such a proceeding be initiated by a Federal awarding agency). (e) Withhold further Federal awards for the project or program. (f) Take other remedies that may be legally available. Questioned Costs None Recommendation To comply with the Single Audit submission requirements, the Authority needs to perform and submit the compliance reporting packages in default for the fiscal years ended June 30, 2022, and 2023, on a timely basis. Moving forward, the Authority needs to establish controls to ascertain all Federal reports are filed on time. Prior year finding This finding is similar to a prior year finding identify as 2022-002 Views of Responsible Official (Unaudited) Refer to Corrective Action Plan Compliance Reporting Category Material weakness in Internal Control and Material Noncompliance ALN 12.607 Program Community Economic Adjustment of Establishment, Expansion, Realignment, or Closure of a Military Installation Federal Agency US Department of Defense ALN 97.036 Program Disaster Grants - Public Assistance (Presidentially Declared Disasters) Federal Agency US Department of Homeland Security Criteria 2 CFR §200.512 Report Submission, (a) General (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. (Refer also to 10 CFR § 600.226, Non-Federal audit, 10 CFR §600.126, Non-Federal audits, and 45 CFR §75.501, Audit requirement) Condition The Authority has not timely submitted the Single Audit Reporting Packages for the year ended 2023. Cause Lack of management control activities to ensure compliance with Single Audits timely submissions. Effect If the Federal awarding agency or passthrough entity determines that noncompliance cannot be remedied by imposing additional conditions, the Federal awarding agency or passthrough entity may take one or more of the following actions, as appropriate in the circumstances: (a) Temporarily withhold cash payments pending correction of the deficiency by the non-Federal entity or more severe enforcement action by the Federal awarding agency or passthrough entity. (b) Disallow (that is, deny both use of funds and any applicable matching credit for) all or part of the cost of the activity or action not in compliance. (c) Wholly or partly suspend or terminate the Federal award.