FINDING 2023-002
Subject: Coronavirus State and Local Fiscal Recovery Funds - Reporting
Federal Agency: U.S. Department of Treasury
Assistance Listing Number: 21.027
Federal Award Number: FY 2022
Pass-Through Entity: N/A
Compliance Requirements: Reporting
Audit Findings: Material Weakness, Modifie...
FINDING 2023-002
Subject: Coronavirus State and Local Fiscal Recovery Funds - Reporting
Federal Agency: U.S. Department of Treasury
Assistance Listing Number: 21.027
Federal Award Number: FY 2022
Pass-Through Entity: N/A
Compliance Requirements: Reporting
Audit Findings: Material Weakness, Modified Opinion
Condition: The City had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties that would likely be effective in preventing, or detecting and correcting, noncompliance. Recipients are required to submit quarterly or annually Project and Expenditure (P&E) reports to the Department of Treasury (Treasury). The reporting periods, as well as the respective due dates, are based upon type of recipient and its population, as well as the recipient's allocation amount. Information to be reported includes projects funded, expenditures, and contracts for the appropriate reporting period.
The City was classified as a metropolitan city with a population below 250,000 residents that received an allocation of less than $10 million in Coronavirus State and Local Fiscal Recovery Funds (CSLFRF). As, annual reports are to cover one calendar year and must be submitted to the Treasury by April 30 each year.
Context: The City submitted one P&E report during the audit period; however, a single employee prepared and submitted the P&E report without a review or oversight process in place to prevent, or detect and correct errors.
In addition, the P&E report was not properly supported by the City’s records. All but $100,000 of the expenditures were reported under the Eligible Use Category of “Administrative Expenses.” However, the City’s expenditures during the audit period consisted of assistance to business and households, sewer infrastructure, and tourism support, none of which qualified as Administrative Expenses. Furthermore, the City reported that it was electing to take the Revenue Loss Standard Allowance, but the amount reported as Revenue Loss was $0.
Views of Responsible Official: We concur with the finding.
Description of Corrective Action Plan: The City of Crawfordsville management will follow the following process.
1. Before processing request from designated organizations the Clerk Treasurer and Mayor or a designated person, will review documentation and approve for payment/claim processing.
2. After approval a claim will be submitted to the Clerk Treasurer office for payment.
3. Clerk Treasurer will prepare and submit monthly expenditure report to the Mayor or designated person.
4. Annually before the Clerk Treasurer, reports to the U.S. Treasury expenditures the Clerk Treasurer and Mayor, or designated person, will review and confirm expenditures.
5. Clerk Treasurer will submit report to U.S. Treasury following prompts.
6. Clerk Treasurer will notify Mayor of the annual report submission.
Responsible Party and Timeline for Completion: Clerk Treasurer and the submission that takes place in 2024 (2023 report).