Audit 395528

2025-001 Submission of Required Performance Reports Federal Agency: Department of Housing and Urban Development Program Game: Community Project Funding Assistance Listing Number: 14.251 Economic Development Initiative Federal Award Identification Number: B-23-CP-CA-0083 B-23-CP-CA-0106 Questioned Costs: $0 Criteria: Under 2 CFR §200.329 (Monitoring and reporting program performance) and the terms and conditions of the federal award agreement, recipients are required to submit periodic performance reports to the federal awarding agency that compare actual accomplishments with the objectives of the federal program. These reports must be submitted according to the schedule established in the grant agreement. Condition: During testing of compliance with federal award requirements, we noted that the auditee did not submit the required performance reports on a semi-annual basis. The reports were due no later than 30 days after the end of each 6 month reporting period beginning the first January or June after the date the grant agreement is signed. The grant agreement was signed in July 2024. Cause: The auditee did not have adequate internal controls in place to ensure that required federal performance reporting deadlines were tracked and reports were prepared and submitted timely. Effect: Failure to submit required performance reports may limit the federal awarding agency’s ability to monitor program performance and determine whether federal funds are being used in accordance with program objectives. Recommendation: We recommend that the auditee implement procedures to ensure compliance with federal performance reporting requirements. Such procedures should include assigning clear responsibility for report preparation and submission, maintaining a reporting calendar for all federal award requirements, and implementing supervisory review to confirm that required reports are submitted timely. Management’s Plan for Corrective Action: Management agrees with the finding and plans to implement procedures to ensure timely submission of required performance reports. We will ensure that the grant administrator develops processes for a reporting calendar, preparing required reports, and documenting submission. Management expects these procedures to be implemented beginning in the next reporting cycle. Management has subsequently completed and submitted all of the required performance reports to remedy the identified deficiency.