Audit 9528

2023-002 Program: COVID-19 Coronavirus State and Local Fiscal Recovery Funds Federal Financial Assistance Listing: 21.027 Federal Agency: U.S. Department of the Treasury Passed-through: N/A Award Year: 2022-2023 Compliance Requirement: Reporting Grant Award Number: Applies to all awards with findings and no specific grant award. Type of Finding: Material Instance of Noncompliance, Material Weakness in Internal Controls over Compliance. Criteria: Per 2 CFR 200.303, the non-Federal entity must 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. This includes internal controls over maintaining records of the preparer and approver of required reports. 2 CFR 200.329(b) requires that reports submitted to the federal awarding agency include all activity of the reporting period, are supported by applicable accounting or performance records, and are fairly presented in accordance with program requirements. The County must submit an annual Project and Expenditure Report that contains costs incurred during the covered period. Critical information pertaining to the annual Project and Expenditure Report specifically includes: • Subawards • Detailed information on any loans issued; contracts and grants awarded; transfers made to other government entities; and direct payments made by the recipient that are greater than $50,000. For amounts less than $50,000, the recipient must report in the aggregate for these same categories of loans issued; contracts and grants awarded; transfers made by the recipient. Condition found: As a result of audit procedures, we identified that the annual Project and Expenditure Report had 3 instances where the project expenditure category and subcategory was not correctly classified. The project category of, (6-Revenue Replacement) and the subcategory of, (6.1- Provision of Government Services) were reported for projects that were either related to capital projects or other COVID-19 related projects that would result in this being classified incorrectly within the annual report. A different classification should have been used to report these project expenditures in the annual report. Context: The County filed the annual Project and Expenditure Report under project expenditure category, (6-Revenue Replacement) and subcategory, (6.1-Provision of Government Services). We identified expenditures for subrecipient awards in the amount of $629,387 and $7,939, respectively, and COVID-19 economic assistance expenditures in the amount of $60,000. All 3 instances should have been reported under a different category and subcategory in the report and not (6.1-Provision of Government Services). While the expenditures were deemed to be allowable under the terms and conditions of the award, the expenditures were not for general government services; therefore, they were not classified correctly. Cause: The County’s procedures did not ensure that the classification of expenditures was reported correctly in the annual Project and Expenditure Report. Effect: The County did not comply with the requirements of 2 CFR 200.303 and inaccurate information was reported to the federal awarding agency. Repeat Finding from Prior Year(s): This is not a repeat finding. Recommendation: We recommend the County enhance internal controls to ensure that the annual Project and Expenditure Reports are prepared in accordance with program requirements. Views of Responsible Officials and Corrective Action: Management agrees. See the County's separately issued Corrective Action Plan.

2023-002 Program: COVID-19 Coronavirus State and Local Fiscal Recovery Funds Federal Financial Assistance Listing: 21.027 Federal Agency: U.S. Department of the Treasury Passed-through: N/A Award Year: 2022-2023 Compliance Requirement: Reporting Grant Award Number: Applies to all awards with findings and no specific grant award. Type of Finding: Material Instance of Noncompliance, Material Weakness in Internal Controls over Compliance. Criteria: Per 2 CFR 200.303, the non-Federal entity must 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. This includes internal controls over maintaining records of the preparer and approver of required reports. 2 CFR 200.329(b) requires that reports submitted to the federal awarding agency include all activity of the reporting period, are supported by applicable accounting or performance records, and are fairly presented in accordance with program requirements. The County must submit an annual Project and Expenditure Report that contains costs incurred during the covered period. Critical information pertaining to the annual Project and Expenditure Report specifically includes: • Subawards • Detailed information on any loans issued; contracts and grants awarded; transfers made to other government entities; and direct payments made by the recipient that are greater than $50,000. For amounts less than $50,000, the recipient must report in the aggregate for these same categories of loans issued; contracts and grants awarded; transfers made by the recipient. Condition found: As a result of audit procedures, we identified that the annual Project and Expenditure Report had 3 instances where the project expenditure category and subcategory was not correctly classified. The project category of, (6-Revenue Replacement) and the subcategory of, (6.1- Provision of Government Services) were reported for projects that were either related to capital projects or other COVID-19 related projects that would result in this being classified incorrectly within the annual report. A different classification should have been used to report these project expenditures in the annual report. Context: The County filed the annual Project and Expenditure Report under project expenditure category, (6-Revenue Replacement) and subcategory, (6.1-Provision of Government Services). We identified expenditures for subrecipient awards in the amount of $629,387 and $7,939, respectively, and COVID-19 economic assistance expenditures in the amount of $60,000. All 3 instances should have been reported under a different category and subcategory in the report and not (6.1-Provision of Government Services). While the expenditures were deemed to be allowable under the terms and conditions of the award, the expenditures were not for general government services; therefore, they were not classified correctly. Cause: The County’s procedures did not ensure that the classification of expenditures was reported correctly in the annual Project and Expenditure Report. Effect: The County did not comply with the requirements of 2 CFR 200.303 and inaccurate information was reported to the federal awarding agency. Repeat Finding from Prior Year(s): This is not a repeat finding. Recommendation: We recommend the County enhance internal controls to ensure that the annual Project and Expenditure Reports are prepared in accordance with program requirements. Views of Responsible Officials and Corrective Action: Management agrees. See the County's separately issued Corrective Action Plan.

2023-002 Program: COVID-19 Coronavirus State and Local Fiscal Recovery Funds Federal Financial Assistance Listing: 21.027 Federal Agency: U.S. Department of the Treasury Passed-through: N/A Award Year: 2022-2023 Compliance Requirement: Reporting Grant Award Number: Applies to all awards with findings and no specific grant award. Type of Finding: Material Instance of Noncompliance, Material Weakness in Internal Controls over Compliance. Criteria: Per 2 CFR 200.303, the non-Federal entity must 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. This includes internal controls over maintaining records of the preparer and approver of required reports. 2 CFR 200.329(b) requires that reports submitted to the federal awarding agency include all activity of the reporting period, are supported by applicable accounting or performance records, and are fairly presented in accordance with program requirements. The County must submit an annual Project and Expenditure Report that contains costs incurred during the covered period. Critical information pertaining to the annual Project and Expenditure Report specifically includes: • Subawards • Detailed information on any loans issued; contracts and grants awarded; transfers made to other government entities; and direct payments made by the recipient that are greater than $50,000. For amounts less than $50,000, the recipient must report in the aggregate for these same categories of loans issued; contracts and grants awarded; transfers made by the recipient. Condition found: As a result of audit procedures, we identified that the annual Project and Expenditure Report had 3 instances where the project expenditure category and subcategory was not correctly classified. The project category of, (6-Revenue Replacement) and the subcategory of, (6.1- Provision of Government Services) were reported for projects that were either related to capital projects or other COVID-19 related projects that would result in this being classified incorrectly within the annual report. A different classification should have been used to report these project expenditures in the annual report. Context: The County filed the annual Project and Expenditure Report under project expenditure category, (6-Revenue Replacement) and subcategory, (6.1-Provision of Government Services). We identified expenditures for subrecipient awards in the amount of $629,387 and $7,939, respectively, and COVID-19 economic assistance expenditures in the amount of $60,000. All 3 instances should have been reported under a different category and subcategory in the report and not (6.1-Provision of Government Services). While the expenditures were deemed to be allowable under the terms and conditions of the award, the expenditures were not for general government services; therefore, they were not classified correctly. Cause: The County’s procedures did not ensure that the classification of expenditures was reported correctly in the annual Project and Expenditure Report. Effect: The County did not comply with the requirements of 2 CFR 200.303 and inaccurate information was reported to the federal awarding agency. Repeat Finding from Prior Year(s): This is not a repeat finding. Recommendation: We recommend the County enhance internal controls to ensure that the annual Project and Expenditure Reports are prepared in accordance with program requirements. Views of Responsible Officials and Corrective Action: Management agrees. See the County's separately issued Corrective Action Plan.

2023-002 Program: COVID-19 Coronavirus State and Local Fiscal Recovery Funds Federal Financial Assistance Listing: 21.027 Federal Agency: U.S. Department of the Treasury Passed-through: N/A Award Year: 2022-2023 Compliance Requirement: Reporting Grant Award Number: Applies to all awards with findings and no specific grant award. Type of Finding: Material Instance of Noncompliance, Material Weakness in Internal Controls over Compliance. Criteria: Per 2 CFR 200.303, the non-Federal entity must 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. This includes internal controls over maintaining records of the preparer and approver of required reports. 2 CFR 200.329(b) requires that reports submitted to the federal awarding agency include all activity of the reporting period, are supported by applicable accounting or performance records, and are fairly presented in accordance with program requirements. The County must submit an annual Project and Expenditure Report that contains costs incurred during the covered period. Critical information pertaining to the annual Project and Expenditure Report specifically includes: • Subawards • Detailed information on any loans issued; contracts and grants awarded; transfers made to other government entities; and direct payments made by the recipient that are greater than $50,000. For amounts less than $50,000, the recipient must report in the aggregate for these same categories of loans issued; contracts and grants awarded; transfers made by the recipient. Condition found: As a result of audit procedures, we identified that the annual Project and Expenditure Report had 3 instances where the project expenditure category and subcategory was not correctly classified. The project category of, (6-Revenue Replacement) and the subcategory of, (6.1- Provision of Government Services) were reported for projects that were either related to capital projects or other COVID-19 related projects that would result in this being classified incorrectly within the annual report. A different classification should have been used to report these project expenditures in the annual report. Context: The County filed the annual Project and Expenditure Report under project expenditure category, (6-Revenue Replacement) and subcategory, (6.1-Provision of Government Services). We identified expenditures for subrecipient awards in the amount of $629,387 and $7,939, respectively, and COVID-19 economic assistance expenditures in the amount of $60,000. All 3 instances should have been reported under a different category and subcategory in the report and not (6.1-Provision of Government Services). While the expenditures were deemed to be allowable under the terms and conditions of the award, the expenditures were not for general government services; therefore, they were not classified correctly. Cause: The County’s procedures did not ensure that the classification of expenditures was reported correctly in the annual Project and Expenditure Report. Effect: The County did not comply with the requirements of 2 CFR 200.303 and inaccurate information was reported to the federal awarding agency. Repeat Finding from Prior Year(s): This is not a repeat finding. Recommendation: We recommend the County enhance internal controls to ensure that the annual Project and Expenditure Reports are prepared in accordance with program requirements. Views of Responsible Officials and Corrective Action: Management agrees. See the County's separately issued Corrective Action Plan.