Audit 413394

Federal Agency: U.S. Department of Energy Federal Program: Energy Efficiency and Renewable Energy Information Dissemination, Outreach, Training and Technical Analysis/Assistance Assistance Listing Number: 81.117 Federal Award Identification Number(s) and Federal Award Year(s): DE-EE0009951 (2022), DE-EE0011801 (2025), DE-EE0011383 (2024) Pass-Through Entity: Not applicable—direct award Compliance Requirement: C—Cash Management Criteria or Specific Requirements: In accordance with 2 CFR §200.303, non-Federal entities are required to establish and maintain effective internal control over Federal awards that provides reasonable assurance that the entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the award. In addition, 2 CFR §200.305 establishes requirements related to the management of Federal payments. Appropriate internal controls over cash management should include documented review and approval of Federal cash drawdown or reimbursement submissions prior to submission. Condition: During the review of cash management compliance for the major program, we corroborated that responsibility for preparing and reviewing Federal grant submissions was assigned to separate individuals. However, the Organization did not retain documentation evidencing review and approval prior to submission for the items tested. Accordingly, we could not verify that the review and approval control operated for those submissions. Our compliance testing did not identify exceptions to the applicable cash management requirements. Cause: Internal controls over cash management were not operating effectively to ensure that the review and approval of Federal grant submissions was consistently documented and retained. Effect: The lack of documented review and approval increases the risk that inaccurate or unsupported Federal cash drawdown or reimbursement requests could be submitted without timely detection. Perspective Information: We tested 7 Federal grant submissions for the major program during 2025 using a nonstatistical sampling method. None of the submissions tested had retained documentation evidencing review and approval prior to submission. Questioned Costs: None. Repeat Finding: None. Recommendations: We recommend that management formalize and document procedures for the review and approval of Federal cash drawdown or reimbursement submissions. The procedures should require evidence of review and approval, such as documented sign-off prior to submission. Management should also ensure that the evidence of review and approval is retained with the supporting documentation for each submission. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See attached corrective action plan.

Federal Agency: U.S. Department of Energy Federal Program: Energy Efficiency and Renewable Energy Information Dissemination, Outreach, Training and Technical Analysis/Assistance Assistance Listing Number: 81.117 Federal Award Identification Number(s) and Federal Award Year(s): DE-EE0009951 (2022), DE-EE0011801 (2025), DE-EE0011383 (2024) Pass-Through Entity: Not applicable—direct award Compliance Requirement: L—Reporting Criteria or Specific Requirements: Under 2 CFR §200.302(b)(2)–(3), the Organization’s financial management system must provide accurate, current, and complete financial reporting and maintain records supported by source documentation. Additionally, 2 CFR §200.303(a) requires effective internal control over Federal awards. Controls over financial reporting should provide reasonable assurance that reports agree to supporting accounting records and that differences are identified and resolved. Documentation should be retained to demonstrate the reconciliation and review performed. Condition: For the six SF-425 financial reports selected for testing, the Organization did not retain sufficient documentation demonstrating reconciliation of reported amounts to the underlying accounting records or the substantive review of those reconciliations. We corroborated segregation of duties between preparation and review and obtained evidence of approval and timely submission. However, the approval evidence did not demonstrate the procedures performed to verify the completeness and accuracy of the reported amounts. Our compliance testing did not identify reportable noncompliance with the applicable reporting requirements. Cause: The Organization’s reporting procedures did not ensure that supporting reconciliations and evidence of the scope of supervisory review were consistently documented and retained. Effect: Insufficient documentation of reconciliations and supervisory review limits the Organization’s ability to demonstrate that reporting controls operated effectively and increases the risk that inaccurate or unsupported amounts could be reported without timely detection and correction. Perspective Information: We selected six quarterly SF-425 financial reports covering three awards under ALN 81.117. The documentation deficiency described above affected all six selected reports. The selections included two reports each for SolSmart 2.0, Advancing Equity, and SEAC 2.0. Questioned Costs: None. Repeat Finding: None. Recommendations: We recommend that management retain a complete supporting package for each financial report, including the accounting records used at the time of preparation, a reconciliation to the amounts reported, and explanations of reconciling items. A knowledgeable individual other than the preparer should review the report and supporting reconciliation for completeness and accuracy and document the review and resolution of any differences. Management should also evaluate subsequent accounting adjustments to determine whether previously submitted reports require correction under the applicable reporting requirements. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See attached corrective action plan.

Federal Agency: U.S. Department of Energy Federal Program: Conservation Research and Development Assistance Listing Number: 81.086 Federal Award Identification Number(s) and Federal Award Year(s): DE-EE0010632 (2024) Pass-Through Entity: Electric Power Research Institute, Inc. Pass-Through Identification Number: 10017391 Compliance Requirement: B—Allowable Costs/Cost Principles Criteria or Specific Requirements: Under 2 CFR §200.430, salary and wage charges to Federal awards must be supported by records that accurately reflect the work performed. Budget estimates alone do not qualify as support for charges to Federal awards. When budget estimates are used for interim accounting purposes, the Organization must perform periodic after-the-fact reviews and make necessary adjustments so that the final amount charged to the Federal award is accurate, allowable, and properly allocated. Condition: During reconciliation of Federal award revenue to expenditures reported on the SEFA, we identified that the Organization used budgeted compensation rates exceeding actual allowable compensation costs to prepare reimbursement requests under this award. The Organization did not reconcile and adjust the amounts billed to actual allowable costs, resulting in excess reimbursement of $20,997. Cause: The Organization did not have an effective review process to ensure that compensation charges included in reimbursement requests were reconciled to actual allowable compensation costs and that differences were appropriately resolved. Effect: The Organization received $20,997 in reimbursement exceeding actual allowable compensation costs, resulting in noncompliance with the applicable cost principles. An audit adjustment was recorded to reduce government grant revenue and recognize a refundable advance for this amount. Perspective Information: The matter involved the Charging Infrastructure Interconnection Simplification Resource project under one nonmajor Federal program. Federal expenditures reported on the SEFA for this award totaled $97,738 for 2025. The excess reimbursement of $20,997 was identified during SEFA reconciliation procedures rather than major-program compliance testing. Questioned Costs: $20,997, representing compensation reimbursements exceeding actual allowable costs. Repeat Finding: None. Recommendations: We recommend that management establish and document procedures to reconcile compensation charges included in reimbursement requests to actual allowable compensation costs. When budget estimates are used for interim billing, management should perform periodic after-the-fact reviews and promptly adjust subsequent billings or arrange repayment, as appropriate. An individual other than the preparer should review and approve the reconciliations and related adjustments, with documentation retained to support the review. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See attached corrective action plan.