FAC Explorer

Audit 3718

FY End
2023-06-30
Total Expended
$462.73M
Findings
2
Programs
8
Organization: Indiana Finance Authority (IN)
Year: 2023 Accepted: 2023-11-20
Auditor: Katz Sapper & Miller LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
2156 2023-001 Significant Deficiency - H
578598 2023-001 Significant Deficiency - H

Programs

ALN Program Spent Major Findings
66.958 Water Infrastructure Finance and Innovation (wifia) (e) $307.05M Yes 0
21.027 Coronavirus State and Local Fiscal Recovery Funds $51.60M Yes 1
66.458 Capitalization Grants for Clean Water State Revolving Funds $40.57M - 0
66.468 Capitalization Grants for Drinking Water State Revolving Funds $56,547 - 0
66.204 Multipurpose Grants to States and Tribes $20,531 - 0
66.443 Reducing Lead in Drinking Water (sdwa 1459b) $15,363 - 0
66.817 State and Tribal Response Program Grants $6,379 - 0
66.818 Brownfields Assessment and Cleanup Cooperative Agreements $1,169 - 0

Contacts

Name Title Type
KLL1RKRBEE11 Connie McAfee Auditee
3172344265 Scott Schuster Auditor
No contacts on file

Notes to SEFA

Title: LOAN PROGRAM Accounting Policies: The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal grant activity of Indiana Finance Authority (IFA). The information in the Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administration Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Therefore, some amounts presented in the Schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, or when not applicable the specific federal award agreement, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Expenditures to Subrecipients: The amounts of expenditures to subrecipients represents the actual expenditures incurred by subrecipients and reimbursable by IFA in 2023. De Minimis Rate Used: N Rate Explanation: IFA has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards includes one federal loan disbursed under the Water Infrastructure Finance and Innovation Act (WIFIA). The WIFIA loan agreement provides for continuing compliance requirements through debt maturity or repayment, and therefore, IFA reports the prior year loan balances, plus any additional draws, on the schedule of expenditures of federal awards. WIFIA funds were used to finance two projects: the DigIndy Tunnel System (DigIndy) project and the Integrated Overflow Control Plan (IOCP) project being completed by CWA Authority, Inc. and Evansville Water and Sewer Utility, respectively. The DigIndy project was substantially completed in June 2019, and the IOCP project was substantially completed at June 30, 2023. There were no WIFIA expenditures during fiscal year 2023. The WIFA loan balance outstanding was $299,192,900 as of June 30, 2023.

Finding Details

Finding 2023-001
2023-001 Coronavirus State and Local Fiscal Recovery Funds – Assistance Listing No. 21.027 Significant Deficiency in Internal Control over Compliance and Noncompliance – H. Period of Performance Criteria: Pursuant to the Final Rule at 31 CFR section 35.5(a) for the Coronavirus State and Local Fiscal Recovery Funds, recipients may only use funds to cover costs incurred during the period beginning on March 3, 2021, and ending on December 31, 2024. Condition and Context: During our testing, we noted 1 of the 39 items selected for testing included costs outside of the period of performance. Our sample was not statistically valid. Cause and Effect: We noted internal controls surrounding the disbursement review process were appropriately designed and implemented but did not operate effectively for 1 of 39 disbursements selected for testing. This resulted in reimbursement of costs which occurred outside of the period of performance. Questioned Costs: $165,824 Recommendation: We recommend the IFA implement procedures to ensure the disbursement review process is operating effectively. Views of Responsible Officials and Planned Corrective Actions: The Indiana Finance Authority (IFA) agrees with the recommendation and plans to implement the revised process during 2023. The IFA has procedures in place to address these matters which includes the review of every disbursement. In this instance the IFA reviewed the existing Standard Operating Procedures and have edited them to reflect the date of the period of performance as part of the checklist for the program. The new program manager has been updated on the procedures and the importance of being in compliant with the federal guidelines. The funds were corrected subsequent to year end and paid with operating revenues during fiscal year 2024. The schedule of expenditures of federal award for the year ended June 30, 2023, included in this reporting package was also revised to remove the amount from federal expenditures.
Finding 2023-001
2023-001 Coronavirus State and Local Fiscal Recovery Funds – Assistance Listing No. 21.027 Significant Deficiency in Internal Control over Compliance and Noncompliance – H. Period of Performance Criteria: Pursuant to the Final Rule at 31 CFR section 35.5(a) for the Coronavirus State and Local Fiscal Recovery Funds, recipients may only use funds to cover costs incurred during the period beginning on March 3, 2021, and ending on December 31, 2024. Condition and Context: During our testing, we noted 1 of the 39 items selected for testing included costs outside of the period of performance. Our sample was not statistically valid. Cause and Effect: We noted internal controls surrounding the disbursement review process were appropriately designed and implemented but did not operate effectively for 1 of 39 disbursements selected for testing. This resulted in reimbursement of costs which occurred outside of the period of performance. Questioned Costs: $165,824 Recommendation: We recommend the IFA implement procedures to ensure the disbursement review process is operating effectively. Views of Responsible Officials and Planned Corrective Actions: The Indiana Finance Authority (IFA) agrees with the recommendation and plans to implement the revised process during 2023. The IFA has procedures in place to address these matters which includes the review of every disbursement. In this instance the IFA reviewed the existing Standard Operating Procedures and have edited them to reflect the date of the period of performance as part of the checklist for the program. The new program manager has been updated on the procedures and the importance of being in compliant with the federal guidelines. The funds were corrected subsequent to year end and paid with operating revenues during fiscal year 2024. The schedule of expenditures of federal award for the year ended June 30, 2023, included in this reporting package was also revised to remove the amount from federal expenditures.