FINDING 2025-002 Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Period of Performance Federal Agency: Department of the Treasury Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number and Year (or Other Identifying Number): IN0086 Compliance Requirement: Period of Performance Audit Findings: Material Weakness, Modified Opinion Condition and Context An effective internal control system was not in place at the Town to ensure compliance with requirements related to the grant agreement and the Period of Performance compliance requirement. Recipients must liquidate all obligations incurred by December 31, 2024, under the award no later than December 31, 2026, which is the end of the period of performance. As such, program obligations or costs must be incurred from the period beginning on March 3, 2021, and ending on December 31, 2024. No new obligations or costs may be incurred during the period beginning January 1, 2025, and ending on December 31, 2026. During this two-year period from January 1, 2025 through December 31, 2026, recipients are only permitted to expend funds to satisfy obligations incurred by December 31, 2024. An "obligation" includes an order placed for property and services and entry into contracts, subawards, and similar transactions that require payment. A recipient is also considered to have incurred an obligation by December 31, 2024, with respect to a requirement under federal law or regulation or a provision of the COVID-19 - Coronavirus State and Local Fiscal Recovery Funds (SLFRF) award terms and conditions to which the recipient becomes subject as a result of receiving or expending SLFRF funds. INDIANA STATE BOARD OF ACCOUNTS 16 TOWN OF CLARKSVILLE SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Subsequent to December 31, 2024, the Town entered into three contracts on March 6, March 26, and November 26, 2025, respectively. During the audit period, the Town incurred and paid expenses totaling $1,072,479 related to these agreements. We consider $1,072,479 to be questioned costs. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 31 CFR 35.5(a) states: "In general. A recipient may only use funds for the purposes enumerated in § 35.6 (b) through (f) to cover costs incurred during the period beginning March 3, 2021, and ending December 31, 2024, subject to the restrictions set forth in sections 602(c)(2) and 603(c)(2) of the Social Security Act, as applicable. A recipient may only use funds for the purposes enumerated in § 35.6 (g) through (h) to cover costs incurred during the period beginning December 29, 2022, and ending December 31, 2024, subject to the restrictions set forth in sections 602(c)(2), 602(c)(5)(C), 603(c)(2), and 603(c)(6)(B) of the Social Security Act, as applicable." 2 CFR 200.1 states in part: ". . . Financial obligations, when referencing a recipient's or subrecipient's use of funds under a Federal award, means orders placed for property and services, contracts and subawards made, and similar transactions that require payment. . . ." 31 CFR 35.3 states in part: ". . . Obligation means an order placed for property and services and entering into contracts, subawards, and similar transactions that require payment. . . ." Cause The Town's management failed to properly design and implement an internal control system that would have ensured the Period of Performance compliance requirement was adhered to during the audit period. No new obligations or costs were to be incurred during the period beginning January 1, 2025, and ending on December 31, 2026. The Town entered into three contracts, incurred and paid expenses from the program related to these contracts that were awarded subsequent to December 31, 2024. Effect The failure to design and implement an effective internal control system enabled material noncompliance to go undetected. Noncompliance with the grant agreement and the Period of Performance compliance requirement could have resulted in the loss of federal funds to the Town. INDIANA STATE BOARD OF ACCOUNTS 17 TOWN OF CLARKSVILLE SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs Questioned costs in the amount of $1,072,479 were identified as noted in the Condition and Context. Recommendation We recommended that the Town's management establish an effective system of internal controls and to ensure compliance with the grant agreement and the Period of Performance compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
FINDING 2025-003 Subject: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds - Reporting Federal Agency: Department of the Treasury Federal Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listings Number: 21.027 Federal Award Number and Year (or Other Identifying Number): 72270 Pass-Through Entity: Indiana Department of Health Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Condition and Context The Town's Fire Department (Fire Department) was awarded the Health Issues and Challenges Grant through the Indiana Department of Health (IDOH), financed through the COVID-19 - Coronavirus State and Local Fiscal Recovery Funds. The grant was funded through the American Rescue Plan Act that focused on community paramedicine. Metrics and Evaluation of Funded Activities Report The Fire Department was required to submit program specific metrics and funded activities report to the IDOH through the RedCap software on a monthly basis, due 15 days after month end. The Fire Department Office Manager (Office Manager) was responsible for tracking and compiling the necessary information for the monthly reports. Of the 12 reports tested, two reports were submitted 41 and 12 days late. In addition, the monthly reports were submitted by the Office Manager via the RedCap software without a documented oversight, review, or approval process to ensure timely submission. Annual Report on Program Activities The Fire Department was required to submit an annual report on program activities to the IDOH through an infographic report. The Office Manager was responsible for tracking and compiling the necessary information for the annual report on program activities. The annual report on program activities was submitted by the Office Manager, without a documented oversight, review, or approval process to ensure timely submission. INDIANA STATE BOARD OF ACCOUNTS 18 TOWN OF CLARKSVILLE SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.329(c)(1) states in part: "The non-Federal entity must submit performance reports at the interval required by the Federal awarding agency or pass-through entity to best inform improvements in program outcomes and productivity. Intervals must be no less frequent than annually nor more frequent than quarterly except in unusual circumstances, for example where more frequent reporting is necessary for the effective monitoring of the Federal award or could significantly affect program outcomes. Reports submitted annually by the non-Federal entity and/or pass-through entity must be due no later than 90 calendar days after the reporting period. Reports submitted quarterly or semiannually must be due no later than 30 calendar days after the reporting period. . . ." Cause The issues with the monthly Metrics and Evaluation of Funded Activities Reports and the Annual Report on program activities reporting processes stem from the lack of a formal oversight and review procedure to ensure accuracy and timeliness. Without a structured verification process before submission, potential errors and inconsistencies could go undetected, thus increasing the likelihood of inaccurate data reporting. Additionally, the reliance on individual staff members to compile and submit reports without secondary review created inefficiencies and contributed to delays, as evidenced by the late submission of two monthly reports. Effect The lack of oversight and review of the metrics and evaluation of funded activities reports and the annual report on program activities reporting process could result in increased risk of inaccurate data being reported to the IDOH, which could compromise the integrity of the program's performance metrics. The absence of a structed verification process can also lead to inefficiencies, as error or inconsistencies may have required corrections after submission, resulting in inefficient use of time and resources. Additionally, the late submission of two monthly reports indicated a failure to meet reporting deadlines, which could negatively impact compliance with grant requirements and potentially jeopardize future funding opportunities. Questioned Costs There were no questioned costs identified. INDIANA STATE BOARD OF ACCOUNTS 19 TOWN OF CLARKSVILLE SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Recommendation We recommended the Fire Department implement a formal oversight and review process for all data submissions to ensure accuracy and completeness before they are submitted to the IDOH. This would involve a secondary review by a designated individual or team to verify the data. Additionally, improving workflow coordination through clearly defined roles and responsibilities for each team member would help streamline the process and prevent delays. To further improve timeliness, the Fire Department should implement a tracking and reminder system for report due dates to ensure timely submissions. Providing staff with thorough training on reporting protocols and maintaining detailed documentation will help ensure consistent adherence to procedures. Finally, establishing accountability measures through clear roles, deadlines, and regular audits would enhance the efficiency and effectiveness of the reporting process. These steps will help ensure the Fire Department meets grant requirements, maintains data accuracy, and avoids potential delays or issues in future submissions. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.