Audit 368026

FY End
2024-12-31
Total Expended
$3.15M
Findings
1
Programs
11
Year: 2024 Accepted: 2025-09-26

Organization Exclusion Status:

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Contacts

Name Title Type
MLKKJ9MNDN63 Scott Gall Auditee
2813646014 Tami Preece Auditor
No contacts on file

Notes to SEFA

Basis of presentation – The schedule of expenditures of federal awards is prepared on the accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of Title 2 U. S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Federal expenditures include allowable costs funded by federal grants. Allowable costs are subject to the cost principles of the Uniform Guidance and include both costs that are capitalized and costs that are recognized as expenses in HARC’s financial statements in conformity with generally accepted accounting principles. HARC does not utilize the 10% de minimus indirect rate, but uses a rate equal to or less than the indirect rate approved by the U. S. Department of Energy. There were no subrecipient expenditures in fiscal year 2024. Because the schedule presents only a selected portion of the operations of HARC, it is not intended to and does not present the financial position, changes in net assets, or cash flows of HARC. Major program – All of HARC’s programs fall within the Research and Development Cluster, which as a result, is the major program.

Finding Details

Finding #2024-001 – Other Noncompliance. Applicable federal program: U. S. Environmental Protection Agency, Passed through Texas Commission on Environmental Quality, Nonpoint Source Implementation Grants, Low Impact Development 2020, Assistance Listing #66.460, Contract period: 11/06/20 – 04/30/26, Contract number: 582-21-10148. Criteria: Allowable costs – Uniform Guidance, Subpart E Cost Principles, §200.434 states that the value of services and property donated to the recipient or subrecipient may not be charged to the federal award either as a direct or indirect cost. Condition and context: Under the terms of its agreement with the Texas Commission in Environmental Quality, HARC receives reimbursement for a percentage of the expenditures incurred in performance of the funded program. Donated services utilized in performance of the program were included in reimbursement submitted to the grantor. Cause: A lack of understanding that in-kind donations may not be charged to the federal award as reimbursable costs. Effect: As a result of not following federal grant requirements for the allowability of in-kind donations, unallowed costs were charged to the program. Questioned costs: $140,545. Recommendation: Re-emphasize to program and accounting personnel federal grant requirements for the allowability of in-kind donations. Views of responsible officials and planned corrective actions: Management agrees with the finding. See Corrective Action Plan.