FAC Explorer

Audit 374317

FY End
2025-06-30
Total Expended
$5.79M
Findings
2
Programs
2
Organization: Arts Midwest, Incorporated (MN)
Year: 2025 Accepted: 2025-12-12
Auditor: EIDE BAILLY

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
1164678 2025-001 Material Weakness Yes I
1164679 2025-001 Material Weakness Yes I

Programs

ALN Program Spent Major Findings
45.025 PROMOTION OF THE ARTS PARTNERSHIP AGREEMENTS $1.63M Yes 1
45.024 PROMOTION OF THE ARTS GRANTS TO ORGANIZATIONS AND INDIVIDUALS $31,060 Yes 0

Contacts

Name Title Type
F6JMJXYQPHJ6 Katelyn Shehu Auditee
6122388040 Hannah Horn Auditor
No contacts on file

Notes to SEFA

The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of Arts Midwest, Incorporated (the Organization), under programs of the federal government for the year ended June 30, 2025. The information 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 Organization, it is not intended to, and does not, present the financial position, changes in net assets, or cash flows of the Organization.
Expenditures reported in the schedule are reported on the accrual basis of accounting, except for subrecipient expenditures, which are recorded on the cash basis. When applicable, 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.
The Organization has not elected to use the 10% de minimis cost rate.

Finding Details

Finding 2025-001
National Endowment for the Arts Federal Financial Assistance Listing 45.025, Affects all grant awards included under Federal Financial Assistance Listing 45.025 on the Schedule Promotion of the Arts Partnership Agreements Procurement, Suspension, and Debarment Significant Deficiency in Internal Control Over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. 2 CFR 200.318 maintains that recipients must have and use documented procurement policies and must conform to procurement standards in sections 200.317 through 200.327. Condition: The Organization has documented procurement procedures that conform to applicable federal standards regarding testing vendors for suspension and debarment; however, the procedures were not followed for two vendors selected for testing. Cause: The Organization's internal control process did not identify the two vendors for whom the suspension and debarment verification was not performed. Effect: Payments could be made to recipients who were suspended or debarred. Questioned Costs: None reported. Context/Sampling: A nonstatistical sample of 4 transactions out of 14 total transactions were selected for testing. Two vendors did not have support showing the search for suspension and debarment was performed which accounted for $155,100 of $716,818 of federal awards. Repeat Finding from Prior Year(s): No Recommendation: We recommend the Organization enhance internal control procedures to ensure all suspension and debarment verification procedures are performed prior to entering into the transactions. Views of Responsible Officials: Management agrees with the finding. The Organization takes compliance with federal procurement requirements seriously and has already implemented additional internal controls to address this.