2022-004 Period of Performance Federal Agency: U.S. Department of Health and Human Services Federal Program Title: Child Care and Development Block Grant Assistance Listing Number: 93.575 Award Period: July 1, 2021 to June 30, 2022Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: Costs charged to the grant must be incurred within the period of performance in accordance with 2 CFR section 200.1. Condition: Documentation was not properly maintained to support time and effort for payroll amounts charged to the grant. Additionally, documentation to support approval of general disbursements was not maintained. Context: Twenty-seven out of sixty-five transactions lacked appropriate documentation or approval to substantiate that the expenditures were incurred within the authorized period of performance for the grant. Ten out of twenty payroll disbursements tested for performance period beginning dates during audit period did not have proper evidence to support amounts that were not charged prior to the beginning of the performance period. Questioned Costs: None over $25,000 Cause: Internal controls surrounding allocations were not properly designed and implemented and an audit trail for allocation journal entries/source documentation was not maintained . Effect: The lack of evidence for audit trail and lack of effective internal controls over allocations provides an opportunity for noncompliance and errors. Repeat Finding: No Recommendation: We recommend that the Organization design, implement and monitor internal controls over allocations as well as maintain source documentation to support amounts charged to the grant. Views of Responsible Officials of the Auditee: There is no disagreement with the audit finding.
2022-004 Period of Performance Federal Agency: U.S. Department of Health and Human Services Federal Program Title: Child Care and Development Block Grant Assistance Listing Number: 93.575 Award Period: July 1, 2021 to June 30, 2022Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: Costs charged to the grant must be incurred within the period of performance in accordance with 2 CFR section 200.1. Condition: Documentation was not properly maintained to support time and effort for payroll amounts charged to the grant. Additionally, documentation to support approval of general disbursements was not maintained. Context: Twenty-seven out of sixty-five transactions lacked appropriate documentation or approval to substantiate that the expenditures were incurred within the authorized period of performance for the grant. Ten out of twenty payroll disbursements tested for performance period beginning dates during audit period did not have proper evidence to support amounts that were not charged prior to the beginning of the performance period. Questioned Costs: None over $25,000 Cause: Internal controls surrounding allocations were not properly designed and implemented and an audit trail for allocation journal entries/source documentation was not maintained . Effect: The lack of evidence for audit trail and lack of effective internal controls over allocations provides an opportunity for noncompliance and errors. Repeat Finding: No Recommendation: We recommend that the Organization design, implement and monitor internal controls over allocations as well as maintain source documentation to support amounts charged to the grant. Views of Responsible Officials of the Auditee: There is no disagreement with the audit finding.
2022-004 Period of Performance Federal Agency: U.S. Department of Health and Human Services Federal Program Title: Child Care and Development Block Grant Assistance Listing Number: 93.575 Award Period: July 1, 2021 to June 30, 2022Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: Costs charged to the grant must be incurred within the period of performance in accordance with 2 CFR section 200.1. Condition: Documentation was not properly maintained to support time and effort for payroll amounts charged to the grant. Additionally, documentation to support approval of general disbursements was not maintained. Context: Twenty-seven out of sixty-five transactions lacked appropriate documentation or approval to substantiate that the expenditures were incurred within the authorized period of performance for the grant. Ten out of twenty payroll disbursements tested for performance period beginning dates during audit period did not have proper evidence to support amounts that were not charged prior to the beginning of the performance period. Questioned Costs: None over $25,000 Cause: Internal controls surrounding allocations were not properly designed and implemented and an audit trail for allocation journal entries/source documentation was not maintained . Effect: The lack of evidence for audit trail and lack of effective internal controls over allocations provides an opportunity for noncompliance and errors. Repeat Finding: No Recommendation: We recommend that the Organization design, implement and monitor internal controls over allocations as well as maintain source documentation to support amounts charged to the grant. Views of Responsible Officials of the Auditee: There is no disagreement with the audit finding.
2022-004 Period of Performance Federal Agency: U.S. Department of Health and Human Services Federal Program Title: Child Care and Development Block Grant Assistance Listing Number: 93.575 Award Period: July 1, 2021 to June 30, 2022Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: Costs charged to the grant must be incurred within the period of performance in accordance with 2 CFR section 200.1. Condition: Documentation was not properly maintained to support time and effort for payroll amounts charged to the grant. Additionally, documentation to support approval of general disbursements was not maintained. Context: Twenty-seven out of sixty-five transactions lacked appropriate documentation or approval to substantiate that the expenditures were incurred within the authorized period of performance for the grant. Ten out of twenty payroll disbursements tested for performance period beginning dates during audit period did not have proper evidence to support amounts that were not charged prior to the beginning of the performance period. Questioned Costs: None over $25,000 Cause: Internal controls surrounding allocations were not properly designed and implemented and an audit trail for allocation journal entries/source documentation was not maintained . Effect: The lack of evidence for audit trail and lack of effective internal controls over allocations provides an opportunity for noncompliance and errors. Repeat Finding: No Recommendation: We recommend that the Organization design, implement and monitor internal controls over allocations as well as maintain source documentation to support amounts charged to the grant. Views of Responsible Officials of the Auditee: There is no disagreement with the audit finding.
2022-004 Period of Performance Federal Agency: U.S. Department of Health and Human Services Federal Program Title: Child Care and Development Block Grant Assistance Listing Number: 93.575 Award Period: July 1, 2021 to June 30, 2022Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: Costs charged to the grant must be incurred within the period of performance in accordance with 2 CFR section 200.1. Condition: Documentation was not properly maintained to support time and effort for payroll amounts charged to the grant. Additionally, documentation to support approval of general disbursements was not maintained. Context: Twenty-seven out of sixty-five transactions lacked appropriate documentation or approval to substantiate that the expenditures were incurred within the authorized period of performance for the grant. Ten out of twenty payroll disbursements tested for performance period beginning dates during audit period did not have proper evidence to support amounts that were not charged prior to the beginning of the performance period. Questioned Costs: None over $25,000 Cause: Internal controls surrounding allocations were not properly designed and implemented and an audit trail for allocation journal entries/source documentation was not maintained . Effect: The lack of evidence for audit trail and lack of effective internal controls over allocations provides an opportunity for noncompliance and errors. Repeat Finding: No Recommendation: We recommend that the Organization design, implement and monitor internal controls over allocations as well as maintain source documentation to support amounts charged to the grant. Views of Responsible Officials of the Auditee: There is no disagreement with the audit finding.
2022-004 Period of Performance Federal Agency: U.S. Department of Health and Human Services Federal Program Title: Child Care and Development Block Grant Assistance Listing Number: 93.575 Award Period: July 1, 2021 to June 30, 2022Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: Costs charged to the grant must be incurred within the period of performance in accordance with 2 CFR section 200.1. Condition: Documentation was not properly maintained to support time and effort for payroll amounts charged to the grant. Additionally, documentation to support approval of general disbursements was not maintained. Context: Twenty-seven out of sixty-five transactions lacked appropriate documentation or approval to substantiate that the expenditures were incurred within the authorized period of performance for the grant. Ten out of twenty payroll disbursements tested for performance period beginning dates during audit period did not have proper evidence to support amounts that were not charged prior to the beginning of the performance period. Questioned Costs: None over $25,000 Cause: Internal controls surrounding allocations were not properly designed and implemented and an audit trail for allocation journal entries/source documentation was not maintained . Effect: The lack of evidence for audit trail and lack of effective internal controls over allocations provides an opportunity for noncompliance and errors. Repeat Finding: No Recommendation: We recommend that the Organization design, implement and monitor internal controls over allocations as well as maintain source documentation to support amounts charged to the grant. Views of Responsible Officials of the Auditee: There is no disagreement with the audit finding.
2022-004 Period of Performance Federal Agency: U.S. Department of Health and Human Services Federal Program Title: Child Care and Development Block Grant Assistance Listing Number: 93.575 Award Period: July 1, 2021 to June 30, 2022Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: Costs charged to the grant must be incurred within the period of performance in accordance with 2 CFR section 200.1. Condition: Documentation was not properly maintained to support time and effort for payroll amounts charged to the grant. Additionally, documentation to support approval of general disbursements was not maintained. Context: Twenty-seven out of sixty-five transactions lacked appropriate documentation or approval to substantiate that the expenditures were incurred within the authorized period of performance for the grant. Ten out of twenty payroll disbursements tested for performance period beginning dates during audit period did not have proper evidence to support amounts that were not charged prior to the beginning of the performance period. Questioned Costs: None over $25,000 Cause: Internal controls surrounding allocations were not properly designed and implemented and an audit trail for allocation journal entries/source documentation was not maintained . Effect: The lack of evidence for audit trail and lack of effective internal controls over allocations provides an opportunity for noncompliance and errors. Repeat Finding: No Recommendation: We recommend that the Organization design, implement and monitor internal controls over allocations as well as maintain source documentation to support amounts charged to the grant. Views of Responsible Officials of the Auditee: There is no disagreement with the audit finding.
2022-004 Period of Performance Federal Agency: U.S. Department of Health and Human Services Federal Program Title: Child Care and Development Block Grant Assistance Listing Number: 93.575 Award Period: July 1, 2021 to June 30, 2022Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: Costs charged to the grant must be incurred within the period of performance in accordance with 2 CFR section 200.1. Condition: Documentation was not properly maintained to support time and effort for payroll amounts charged to the grant. Additionally, documentation to support approval of general disbursements was not maintained. Context: Twenty-seven out of sixty-five transactions lacked appropriate documentation or approval to substantiate that the expenditures were incurred within the authorized period of performance for the grant. Ten out of twenty payroll disbursements tested for performance period beginning dates during audit period did not have proper evidence to support amounts that were not charged prior to the beginning of the performance period. Questioned Costs: None over $25,000 Cause: Internal controls surrounding allocations were not properly designed and implemented and an audit trail for allocation journal entries/source documentation was not maintained . Effect: The lack of evidence for audit trail and lack of effective internal controls over allocations provides an opportunity for noncompliance and errors. Repeat Finding: No Recommendation: We recommend that the Organization design, implement and monitor internal controls over allocations as well as maintain source documentation to support amounts charged to the grant. Views of Responsible Officials of the Auditee: There is no disagreement with the audit finding.
Condition: The Coronavirus State and Local Fiscal Recovery Funds (SLFRF) Compliance Report was not maintained and could not be produced. Federal expenditures as reported could not be tested resulting in unreported costs of $2,280,846. Cause of Condition: Policies and procedures have not been designed and implemented to ensure federal expenditures are made in accordance with federal compliance requirements. Effect of Condition: This condition could result in noncompliance with grant requirements. Recommendation: OSAI recommends the County gain an understanding of the grant requirements for this program and implement internal controls to ensure compliance with these grant requirements. Management Response: Chairman of the Board of County Commissioners: This issue originated under the prior County Clerk’s administration where key reporting processes were not followed. The Board of County Commissioners and the other elected officials have made correcting this a top priority. Together, we are: • developing a comprehensive SOP to ensure accurate and timely tracking and reporting of federal funds, • improving communication and oversight between all county offices to ensure consistent reporting standards, • and ensuring annual compliance with federal reporting requirements. Our collective goal is to implement the policies and structures that will keep Osage County operating with the highest standard of accountability and excellence. County Clerk: I was not the County Clerk in office at this time. To correct this issue, the County plans to develop a SOP to timely and accurately track and report on federal funds. The SOP will be reviewed, adopted, and monitored by the Board of County Commissioners. County Treasurer: The County was under the understanding that once we established we were reporting as revenue loss, we would not have to submit the report annually. The final reporting was submitted prior to deadline. Criteria: Compliance and Reporting Guidance, State and Local Fiscal Recovery Funds (10. Reporting.) reads as follows: All recipients of federal funds must complete financial, performance, and compliance reporting as required and outlined in Part 2 of this guidance. Expenditures may be reported on a cash or accrual basis, as long as the methodology is disclosed and consistently applied. Reporting must be consistent with the definition of expenditures pursuant to 2 CFR 200.1. Your organization should appropriately maintain accounting records for compiling and reporting accurate, compliant financial data, in accordance with appropriate accounting standards and principles.In addition, where appropriate, you organization needs to establish controls to ensure completion and timely submission of all mandatory performance and/or compliance reporting. Further, 2 CFR § 200.329 Monitoring and Reporting Program Performance (c)(1) reads as follows: 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. Alternatively, the Federal awarding agency or pass-through entity may require annual reports before the anniversary dates of multiple year Federal awards. The final performance report submitted by the non-Federal entity and/or pass-through entity must be due no later than 120 calendar days after the period of performance end date. A subrecipient must submit to the pass-through entity, no later than 90 calendar days after the period of performance end date, all final performance reports as required by the terms and conditions of the Federal award. See also § 200.344. If a justified request is submitted by a non-Federal entity, the Federal agency may extend the due date for any performance report.
2021-003: Period of Performance: Federal Program: Assistance Listing Nos.: 14.267 Continuum of Care Program Condition: The organization was unable to demonstrate controls over the period of performance for five items selected for testing. Criteria: The requirements for the period of performance are contained in 2 CFR section 200.1 Definitions for “budget period,” “financial obligations,” “period of performance,” 2 CFR section 200.308 (revision of budget and program plans), 2 CFR section 200.309 (modifications to period of performance), 2 CFR section 200.344 (closeout), program legislation, federal awarding agency regulations; and the terms and conditions of the award. Questioned Costs: There were six expenses that no support could be provided to support the expense took place during grant period as such there is a question cost of $2,447. Effect: The Organization could have grant expenses outside the grant period. Cause: The Organization did not have good controls on ensuring the period of performance requirement was meet due to staff turn over and being unable to locate documentation. Recommendation: In order to prevent future occurrences of this deficiency, we recommend that management enhance a set of controls to ensure that they are able to demonstrate the period of performance. Perspective: This is a systemic issue in that controls over the requirement are not being adhered to ensure no issues arise. Repeat: This is not a repeat finding. Responsible Official’s View: The Organization agrees with the finding. See attached corrective action plan.
2021-003: Period of Performance: Federal Program: Assistance Listing Nos.: 14.267 Continuum of Care Program Condition: The organization was unable to demonstrate controls over the period of performance for five items selected for testing. Criteria: The requirements for the period of performance are contained in 2 CFR section 200.1 Definitions for “budget period,” “financial obligations,” “period of performance,” 2 CFR section 200.308 (revision of budget and program plans), 2 CFR section 200.309 (modifications to period of performance), 2 CFR section 200.344 (closeout), program legislation, federal awarding agency regulations; and the terms and conditions of the award. Questioned Costs: There were six expenses that no support could be provided to support the expense took place during grant period as such there is a question cost of $2,447. Effect: The Organization could have grant expenses outside the grant period. Cause: The Organization did not have good controls on ensuring the period of performance requirement was meet due to staff turn over and being unable to locate documentation. Recommendation: In order to prevent future occurrences of this deficiency, we recommend that management enhance a set of controls to ensure that they are able to demonstrate the period of performance. Perspective: This is a systemic issue in that controls over the requirement are not being adhered to ensure no issues arise. Repeat: This is not a repeat finding. Responsible Official’s View: The Organization agrees with the finding. See attached corrective action plan.
2021-003: Period of Performance: Federal Program: Assistance Listing Nos.: 14.267 Continuum of Care Program Condition: The organization was unable to demonstrate controls over the period of performance for five items selected for testing. Criteria: The requirements for the period of performance are contained in 2 CFR section 200.1 Definitions for “budget period,” “financial obligations,” “period of performance,” 2 CFR section 200.308 (revision of budget and program plans), 2 CFR section 200.309 (modifications to period of performance), 2 CFR section 200.344 (closeout), program legislation, federal awarding agency regulations; and the terms and conditions of the award. Questioned Costs: There were six expenses that no support could be provided to support the expense took place during grant period as such there is a question cost of $2,447. Effect: The Organization could have grant expenses outside the grant period. Cause: The Organization did not have good controls on ensuring the period of performance requirement was meet due to staff turn over and being unable to locate documentation. Recommendation: In order to prevent future occurrences of this deficiency, we recommend that management enhance a set of controls to ensure that they are able to demonstrate the period of performance. Perspective: This is a systemic issue in that controls over the requirement are not being adhered to ensure no issues arise. Repeat: This is not a repeat finding. Responsible Official’s View: The Organization agrees with the finding. See attached corrective action plan.
2021-003: Period of Performance: Federal Program: Assistance Listing Nos.: 14.267 Continuum of Care Program Condition: The organization was unable to demonstrate controls over the period of performance for five items selected for testing. Criteria: The requirements for the period of performance are contained in 2 CFR section 200.1 Definitions for “budget period,” “financial obligations,” “period of performance,” 2 CFR section 200.308 (revision of budget and program plans), 2 CFR section 200.309 (modifications to period of performance), 2 CFR section 200.344 (closeout), program legislation, federal awarding agency regulations; and the terms and conditions of the award. Questioned Costs: There were six expenses that no support could be provided to support the expense took place during grant period as such there is a question cost of $2,447. Effect: The Organization could have grant expenses outside the grant period. Cause: The Organization did not have good controls on ensuring the period of performance requirement was meet due to staff turn over and being unable to locate documentation. Recommendation: In order to prevent future occurrences of this deficiency, we recommend that management enhance a set of controls to ensure that they are able to demonstrate the period of performance. Perspective: This is a systemic issue in that controls over the requirement are not being adhered to ensure no issues arise. Repeat: This is not a repeat finding. Responsible Official’s View: The Organization agrees with the finding. See attached corrective action plan.
FINDING 2021-007 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): Revenue Loss FY 2021 Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system, which would include segregation of duties, was not in place at the County in order to ensure compliance with requirement related to the grant agreement and the reporting compliance requirement. Recipients were required to submit a one-time Interim report to the U.S. Department of the Treasury (Treasury). The respective due date was August 31, 2021, or 60 days after receiving funding if funding was received by October 15. The report was to show expenditures by category. The County submitted the required interim report during the audit period. The County's process for the completion and submission of the Interim Report was that the County Auditor prepared the Interim Report based on the County's records, without a proper oversight or review process in place prior to submission. INDIANA STATE BOARD OF ACCOUNTS 30 LA PORTE COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The Interim Report was determined to be materially misstated. The County understated the December 31, 2019 Base Year Revenues by $660,302. 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). . . ." Coronavirus State and Local Fiscal Recovery Funds Compliance and Reporting Guidance, page 10, states in part: ". . . 10. Reporting. All recipients of federal funds must complete financial, performance, and compliance reporting as required and outlined in Part 2 of this guidance. Expenditures may be reported on a cash or accrual basis, as long as the methodology is disclosed and consistently applied. Reporting must be consistent with the definition of expenditures pursuant to 2 CFR 200.1. Your organization should appropriately maintain accounting records for compiling and reporting accurate, compliant financial data, in accordance with appropriate accounting standards and principles. . . ." 31 CFR 35.4(c) states in part: "Reporting and requests for other information. During the period of performance, recipients shall provide to the Secretary periodic reports providing detailed accounting of the uses of funds, . . ." Cause A proper system of internal controls was not designed or implemented by management of the County to ensure that policies and procedures were in place related to reporting to ensure the amounts reported were accurate. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, noncompliance. Noncompliance with the provision of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of federal funding to the County. Questioned Costs There were no questioned costs identified. INDIANA STATE BOARD OF ACCOUNTS 31 LA PORTE COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Recommendation We recommended that the management of the County establish a system of internal controls and develop policies and procedures over the preparation and review of federal reports to ensure appropriate reviews, approval, and oversight are taking place. Additionally, management should develop policies and procedures to ensure that the County provides the Treasury with complete and accurate information for all reports. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
2021-003: Period of Performance: Federal Program: Assistance Listing Nos.: 14.267 Continuum of Care Program Condition: The organization was unable to demonstrate controls over the period of performance for five items selected for testing. Criteria: The requirements for the period of performance are contained in 2 CFR section 200.1 Definitions for “budget period,” “financial obligations,” “period of performance,” 2 CFR section 200.308 (revision of budget and program plans), 2 CFR section 200.309 (modifications to period of performance), 2 CFR section 200.344 (closeout), program legislation, federal awarding agency regulations; and the terms and conditions of the award. Questioned Costs: There were six expenses that no support could be provided to support the expense took place during grant period as such there is a question cost of $2,447. Effect: The Organization could have grant expenses outside the grant period. Cause: The Organization did not have good controls on ensuring the period of performance requirement was meet due to staff turn over and being unable to locate documentation. Recommendation: In order to prevent future occurrences of this deficiency, we recommend that management enhance a set of controls to ensure that they are able to demonstrate the period of performance. Perspective: This is a systemic issue in that controls over the requirement are not being adhered to ensure no issues arise. Repeat: This is not a repeat finding. Responsible Official’s View: The Organization agrees with the finding. See attached corrective action plan.
2021-003: Period of Performance: Federal Program: Assistance Listing Nos.: 14.267 Continuum of Care Program Condition: The organization was unable to demonstrate controls over the period of performance for five items selected for testing. Criteria: The requirements for the period of performance are contained in 2 CFR section 200.1 Definitions for “budget period,” “financial obligations,” “period of performance,” 2 CFR section 200.308 (revision of budget and program plans), 2 CFR section 200.309 (modifications to period of performance), 2 CFR section 200.344 (closeout), program legislation, federal awarding agency regulations; and the terms and conditions of the award. Questioned Costs: There were six expenses that no support could be provided to support the expense took place during grant period as such there is a question cost of $2,447. Effect: The Organization could have grant expenses outside the grant period. Cause: The Organization did not have good controls on ensuring the period of performance requirement was meet due to staff turn over and being unable to locate documentation. Recommendation: In order to prevent future occurrences of this deficiency, we recommend that management enhance a set of controls to ensure that they are able to demonstrate the period of performance. Perspective: This is a systemic issue in that controls over the requirement are not being adhered to ensure no issues arise. Repeat: This is not a repeat finding. Responsible Official’s View: The Organization agrees with the finding. See attached corrective action plan.
2021-003: Period of Performance: Federal Program: Assistance Listing Nos.: 14.267 Continuum of Care Program Condition: The organization was unable to demonstrate controls over the period of performance for five items selected for testing. Criteria: The requirements for the period of performance are contained in 2 CFR section 200.1 Definitions for “budget period,” “financial obligations,” “period of performance,” 2 CFR section 200.308 (revision of budget and program plans), 2 CFR section 200.309 (modifications to period of performance), 2 CFR section 200.344 (closeout), program legislation, federal awarding agency regulations; and the terms and conditions of the award. Questioned Costs: There were six expenses that no support could be provided to support the expense took place during grant period as such there is a question cost of $2,447. Effect: The Organization could have grant expenses outside the grant period. Cause: The Organization did not have good controls on ensuring the period of performance requirement was meet due to staff turn over and being unable to locate documentation. Recommendation: In order to prevent future occurrences of this deficiency, we recommend that management enhance a set of controls to ensure that they are able to demonstrate the period of performance. Perspective: This is a systemic issue in that controls over the requirement are not being adhered to ensure no issues arise. Repeat: This is not a repeat finding. Responsible Official’s View: The Organization agrees with the finding. See attached corrective action plan.
2021-003: Period of Performance: Federal Program: Assistance Listing Nos.: 14.267 Continuum of Care Program Condition: The organization was unable to demonstrate controls over the period of performance for five items selected for testing. Criteria: The requirements for the period of performance are contained in 2 CFR section 200.1 Definitions for “budget period,” “financial obligations,” “period of performance,” 2 CFR section 200.308 (revision of budget and program plans), 2 CFR section 200.309 (modifications to period of performance), 2 CFR section 200.344 (closeout), program legislation, federal awarding agency regulations; and the terms and conditions of the award. Questioned Costs: There were six expenses that no support could be provided to support the expense took place during grant period as such there is a question cost of $2,447. Effect: The Organization could have grant expenses outside the grant period. Cause: The Organization did not have good controls on ensuring the period of performance requirement was meet due to staff turn over and being unable to locate documentation. Recommendation: In order to prevent future occurrences of this deficiency, we recommend that management enhance a set of controls to ensure that they are able to demonstrate the period of performance. Perspective: This is a systemic issue in that controls over the requirement are not being adhered to ensure no issues arise. Repeat: This is not a repeat finding. Responsible Official’s View: The Organization agrees with the finding. See attached corrective action plan.
FINDING 2021-007 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): Revenue Loss FY 2021 Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Condition and Context An effective internal control system, which would include segregation of duties, was not in place at the County in order to ensure compliance with requirement related to the grant agreement and the reporting compliance requirement. Recipients were required to submit a one-time Interim report to the U.S. Department of the Treasury (Treasury). The respective due date was August 31, 2021, or 60 days after receiving funding if funding was received by October 15. The report was to show expenditures by category. The County submitted the required interim report during the audit period. The County's process for the completion and submission of the Interim Report was that the County Auditor prepared the Interim Report based on the County's records, without a proper oversight or review process in place prior to submission. INDIANA STATE BOARD OF ACCOUNTS 30 LA PORTE COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The Interim Report was determined to be materially misstated. The County understated the December 31, 2019 Base Year Revenues by $660,302. 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). . . ." Coronavirus State and Local Fiscal Recovery Funds Compliance and Reporting Guidance, page 10, states in part: ". . . 10. Reporting. All recipients of federal funds must complete financial, performance, and compliance reporting as required and outlined in Part 2 of this guidance. Expenditures may be reported on a cash or accrual basis, as long as the methodology is disclosed and consistently applied. Reporting must be consistent with the definition of expenditures pursuant to 2 CFR 200.1. Your organization should appropriately maintain accounting records for compiling and reporting accurate, compliant financial data, in accordance with appropriate accounting standards and principles. . . ." 31 CFR 35.4(c) states in part: "Reporting and requests for other information. During the period of performance, recipients shall provide to the Secretary periodic reports providing detailed accounting of the uses of funds, . . ." Cause A proper system of internal controls was not designed or implemented by management of the County to ensure that policies and procedures were in place related to reporting to ensure the amounts reported were accurate. Effect Without the proper implementation of an effectively designed system of internal controls, the internal control system cannot be capable of effectively preventing, or detecting and correcting, noncompliance. Noncompliance with the provision of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of federal funding to the County. Questioned Costs There were no questioned costs identified. INDIANA STATE BOARD OF ACCOUNTS 31 LA PORTE COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Recommendation We recommended that the management of the County establish a system of internal controls and develop policies and procedures over the preparation and review of federal reports to ensure appropriate reviews, approval, and oversight are taking place. Additionally, management should develop policies and procedures to ensure that the County provides the Treasury with complete and accurate information for all reports. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.
2021-002 – Earmarking, Reporting (Performance Progress Reporting) Material Weakness in Internal Controls Over Compliance and Instance of Noncompliance (Scope Limitation) Assistance Listing Number: 16.589 Federal Agency/Pass-through Entity - Program Name: Department of Justice - Rural Domestic Violence, Dating Violence, Sexual Assault, Stalking Assistance Program Award Number: 2020-WR-AX-0041 Award Year(s): 2020-2023 Criteria or specific requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e. auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Grant Agreement Requirements - Earmarking Section 50 of the grant agreement requires that no more than 30% of project activities and grant funds will be dedicated to awareness and prevention activities. Grant Agreement Requirements – Performance Progress Reporting Section 35 of the grant agreement requires submission of semi-annual performance progress reports that describe activities conducted during the reporting period, including program effectiveness measures. 2 CFR Section 200.403(g) states that for costs to be allowed under Federal awards, they must be adequately documented and there must be sufficient documentation. Lastly, according to 2 CFR 200.1, Period of Performance is defined as the total estimated time interval between the start of an initial Federal award and the planned end date, which may include one or more funded portions, or budget periods. Condition: The Coalition does not have controls in place to track actual expenditures related to the earmarking requirements in Section 50 of the grant award. The Coalition does have controls related to the review and approval of performance progress reports; however, it was noted that this control was not operating effectively to ensure proper document retention to support earmarking amounts reported. Questioned Costs: Questioned costs are not determinable. Context: We tested one semi-annual performance progress report required by Section 35 of the grant agreement. We noted that the Coalition reported 5% of grant expenditures for awareness and prevention activities, related to the earmarking requirement of Section 50. The Coalition could not provide supporting documentation for the percentage reported. While the percentage reported by the Coalition did not exceed the 30% earmarking threshold, we were unable to obtain sufficient appropriate evidence to support compliance with program earmarking. Cause: The Coalition did not maintain the supporting documentation for the percentage earmarking reported on semi-annual performance progress report due to change in personnel. Effect or potential effect: Without proper record retention, the Coalition is unable to support the amounts reported for earmarking percentages on their semi-annual performance progress report, causing potential noncompliance. Repeat Finding: Yes, 2020-003 Recommendation: We recommend that the Coalition develop policies and procedures for tracking actual expenditures related to earmarking requirements and maintain all supporting documentation for the calculation of the earmarking percentages that are reported in the semi-annual performance progress reports. Views of responsible officials: The Coalition's staff has developed policies and procedures for tracking actual expenditures related to these requirements, and maintaining all supporting documentation for the calculation of the earmarking percentages that are reported in the semi-annual progress reports. The Coalition has developed an internal control process for reviewing and approving calculations required by Section 50 of the grant agreement and has strengthened its reporting management review controls to ensure that the review is effective to ensure the completeness and accuracy of reports, and that all elements are appropriately supported, prior to submission the federal agency.
2021-002 – Earmarking, Reporting (Performance Progress Reporting) Material Weakness in Internal Controls Over Compliance and Instance of Noncompliance (Scope Limitation) Assistance Listing Number: 16.589 Federal Agency/Pass-through Entity - Program Name: Department of Justice - Rural Domestic Violence, Dating Violence, Sexual Assault, Stalking Assistance Program Award Number: 2020-WR-AX-0041 Award Year(s): 2020-2023 Criteria or specific requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e. auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Grant Agreement Requirements - Earmarking Section 50 of the grant agreement requires that no more than 30% of project activities and grant funds will be dedicated to awareness and prevention activities. Grant Agreement Requirements – Performance Progress Reporting Section 35 of the grant agreement requires submission of semi-annual performance progress reports that describe activities conducted during the reporting period, including program effectiveness measures. 2 CFR Section 200.403(g) states that for costs to be allowed under Federal awards, they must be adequately documented and there must be sufficient documentation. Lastly, according to 2 CFR 200.1, Period of Performance is defined as the total estimated time interval between the start of an initial Federal award and the planned end date, which may include one or more funded portions, or budget periods. Condition: The Coalition does not have controls in place to track actual expenditures related to the earmarking requirements in Section 50 of the grant award. The Coalition does have controls related to the review and approval of performance progress reports; however, it was noted that this control was not operating effectively to ensure proper document retention to support earmarking amounts reported. Questioned Costs: Questioned costs are not determinable. Context: We tested one semi-annual performance progress report required by Section 35 of the grant agreement. We noted that the Coalition reported 5% of grant expenditures for awareness and prevention activities, related to the earmarking requirement of Section 50. The Coalition could not provide supporting documentation for the percentage reported. While the percentage reported by the Coalition did not exceed the 30% earmarking threshold, we were unable to obtain sufficient appropriate evidence to support compliance with program earmarking. Cause: The Coalition did not maintain the supporting documentation for the percentage earmarking reported on semi-annual performance progress report due to change in personnel. Effect or potential effect: Without proper record retention, the Coalition is unable to support the amounts reported for earmarking percentages on their semi-annual performance progress report, causing potential noncompliance. Repeat Finding: Yes, 2020-003 Recommendation: We recommend that the Coalition develop policies and procedures for tracking actual expenditures related to earmarking requirements and maintain all supporting documentation for the calculation of the earmarking percentages that are reported in the semi-annual performance progress reports. Views of responsible officials: The Coalition's staff has developed policies and procedures for tracking actual expenditures related to these requirements, and maintaining all supporting documentation for the calculation of the earmarking percentages that are reported in the semi-annual progress reports. The Coalition has developed an internal control process for reviewing and approving calculations required by Section 50 of the grant agreement and has strengthened its reporting management review controls to ensure that the review is effective to ensure the completeness and accuracy of reports, and that all elements are appropriately supported, prior to submission the federal agency.
2020-002 – Allowable Costs & Period of Performance Material Weakness in Internal Controls Over Compliance and Instances of Noncompliance Assistance Listing Number: 59.046 Federal Agency/Pass-through Entity - Program Name: Small Business Administration - Microloan Program Award Number(s): SBAHQ19Y0115 & SBAOCAML200065-01-00 Award Year(s): 2019 & 2020 Criteria or specific requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 2 CFR Section 200.403(g) states that for costs to be allowed under Federal awards, they must be adequately documented and there must be sufficient documentation. Lastly, according to 2 CFR 200.1, Period of Performance is defined as the total estimated time interval between the start of an initial Federal award and the planned end date, which may include one or more funded portions, or budget periods. Condition: The Organization was unable to provide underlying details and/or related documentation for $5,981 in expenditures reported under the Microloan Program to support the allowability or period of performance. Questioned Costs: $5,981 Context: During our audit procedures, we were unable to obtain general ledger detail or supporting documentation for $962 for Award #SBAOCAML200065-01-00 and $4,878 for Award #SBAHQ19Y0115 to substantiate total program non-payroll expenditures or period of performance. Additionally, during testing, three (3) out of 15 non-payroll disbursements, totaling $141, did not have supporting documentation. Cause: The Organization did not have internal controls in place to ensure adequate documentation and records retention to ensure compliance with grant requirements. Effect or potential effect: The Organization is out of compliance with 2 CFR Section 200.403(g) and the awards' periods of performance. Repeat Finding: No Recommendation: The Organization should implement controls to ensure accurate recordkeeping and document retention to substantiate expenditures allocated to grants. Views of responsible officials: The Organization agrees with the finding and has implemented controls to ensure accurate recordkeeping, and to ensure that documents are retained to substantiate all expenditures allocated to grants. For additional information, see the Organization’s separate report for planned corrective actions.
2020-002 – Allowable Costs & Period of Performance Material Weakness in Internal Controls Over Compliance and Instances of Noncompliance Assistance Listing Number: 59.046 Federal Agency/Pass-through Entity - Program Name: Small Business Administration - Microloan Program Award Number(s): SBAHQ19Y0115 & SBAOCAML200065-01-00 Award Year(s): 2019 & 2020 Criteria or specific requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 2 CFR Section 200.403(g) states that for costs to be allowed under Federal awards, they must be adequately documented and there must be sufficient documentation. Lastly, according to 2 CFR 200.1, Period of Performance is defined as the total estimated time interval between the start of an initial Federal award and the planned end date, which may include one or more funded portions, or budget periods. Condition: The Organization was unable to provide underlying details and/or related documentation for $5,981 in expenditures reported under the Microloan Program to support the allowability or period of performance. Questioned Costs: $5,981 Context: During our audit procedures, we were unable to obtain general ledger detail or supporting documentation for $962 for Award #SBAOCAML200065-01-00 and $4,878 for Award #SBAHQ19Y0115 to substantiate total program non-payroll expenditures or period of performance. Additionally, during testing, three (3) out of 15 non-payroll disbursements, totaling $141, did not have supporting documentation. Cause: The Organization did not have internal controls in place to ensure adequate documentation and records retention to ensure compliance with grant requirements. Effect or potential effect: The Organization is out of compliance with 2 CFR Section 200.403(g) and the awards' periods of performance. Repeat Finding: No Recommendation: The Organization should implement controls to ensure accurate recordkeeping and document retention to substantiate expenditures allocated to grants. Views of responsible officials: The Organization agrees with the finding and has implemented controls to ensure accurate recordkeeping, and to ensure that documents are retained to substantiate all expenditures allocated to grants. For additional information, see the Organization’s separate report for planned corrective actions.
2020-003 – Period of Performance Significant Deficiency in Internal Controls Over Compliance and Instances of Noncompliance Assistance Listing Number: 59.046 Federal Agency/Pass-through Entity - Program Name: Small Business Administration - Microloan Program Award Number(s): SBAOCAML200065-01-00 Award Year(s): 2020 Criteria or specific requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. According to 2 CFR 200.1, Period of Performance is defined as the total estimated time interval between the start of an initial Federal award and the planned end date, which may include one or more funded portions, or budget periods." Condition: The Organization allocated three expenditures to Grant Award #SBA OCAML200065-01-00, which were outside the grant's period of performance. Questioned costs: $177 Context: During our audit procedures, we tested the entire population of costs associated with Award #SBAOCAML200065-01-00 and noted three rent payments were charged to the grant totaling $177 that were for months prior to the 07/01/2020-06/30/2021 period of performance. Cause: The Organization did not have internal controls in place to ensure funds were allocated to the correct grant's period of performance. Effect or potential effect: The Organization is out of compliance with Award #SBA OCAML200065-01-00's period of performance. Repeat finding: No Recommendation: The Organization should implement controls to ensure all expenditures allocated to grants are for costs incurred during the specified period of performance. Views of responsible officials: The Organization agrees with the finding and has implemented controls to ensure all expenditures allocated to grants are for costs incurred during the specified period of performance. For additional information, see the Organization’s separate report for planned corrective actions.
2020-003 – Period of Performance Significant Deficiency in Internal Controls Over Compliance and Instances of Noncompliance Assistance Listing Number: 59.046 Federal Agency/Pass-through Entity - Program Name: Small Business Administration - Microloan Program Award Number(s): SBAOCAML200065-01-00 Award Year(s): 2020 Criteria or specific requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. According to 2 CFR 200.1, Period of Performance is defined as the total estimated time interval between the start of an initial Federal award and the planned end date, which may include one or more funded portions, or budget periods." Condition: The Organization allocated three expenditures to Grant Award #SBA OCAML200065-01-00, which were outside the grant's period of performance. Questioned costs: $177 Context: During our audit procedures, we tested the entire population of costs associated with Award #SBAOCAML200065-01-00 and noted three rent payments were charged to the grant totaling $177 that were for months prior to the 07/01/2020-06/30/2021 period of performance. Cause: The Organization did not have internal controls in place to ensure funds were allocated to the correct grant's period of performance. Effect or potential effect: The Organization is out of compliance with Award #SBA OCAML200065-01-00's period of performance. Repeat finding: No Recommendation: The Organization should implement controls to ensure all expenditures allocated to grants are for costs incurred during the specified period of performance. Views of responsible officials: The Organization agrees with the finding and has implemented controls to ensure all expenditures allocated to grants are for costs incurred during the specified period of performance. For additional information, see the Organization’s separate report for planned corrective actions.
2020-002 – Allowable Costs & Period of Performance Material Weakness in Internal Controls Over Compliance and Instances of Noncompliance Assistance Listing Number: 59.046 Federal Agency/Pass-through Entity - Program Name: Small Business Administration - Microloan Program Award Number(s): SBAHQ19Y0115 & SBAOCAML200065-01-00 Award Year(s): 2019 & 2020 Criteria or specific requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 2 CFR Section 200.403(g) states that for costs to be allowed under Federal awards, they must be adequately documented and there must be sufficient documentation. Lastly, according to 2 CFR 200.1, Period of Performance is defined as the total estimated time interval between the start of an initial Federal award and the planned end date, which may include one or more funded portions, or budget periods. Condition: The Organization was unable to provide underlying details and/or related documentation for $5,981 in expenditures reported under the Microloan Program to support the allowability or period of performance. Questioned Costs: $5,981 Context: During our audit procedures, we were unable to obtain general ledger detail or supporting documentation for $962 for Award #SBAOCAML200065-01-00 and $4,878 for Award #SBAHQ19Y0115 to substantiate total program non-payroll expenditures or period of performance. Additionally, during testing, three (3) out of 15 non-payroll disbursements, totaling $141, did not have supporting documentation. Cause: The Organization did not have internal controls in place to ensure adequate documentation and records retention to ensure compliance with grant requirements. Effect or potential effect: The Organization is out of compliance with 2 CFR Section 200.403(g) and the awards' periods of performance. Repeat Finding: No Recommendation: The Organization should implement controls to ensure accurate recordkeeping and document retention to substantiate expenditures allocated to grants. Views of responsible officials: The Organization agrees with the finding and has implemented controls to ensure accurate recordkeeping, and to ensure that documents are retained to substantiate all expenditures allocated to grants. For additional information, see the Organization’s separate report for planned corrective actions.
2020-002 – Allowable Costs & Period of Performance Material Weakness in Internal Controls Over Compliance and Instances of Noncompliance Assistance Listing Number: 59.046 Federal Agency/Pass-through Entity - Program Name: Small Business Administration - Microloan Program Award Number(s): SBAHQ19Y0115 & SBAOCAML200065-01-00 Award Year(s): 2019 & 2020 Criteria or specific requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 2 CFR Section 200.403(g) states that for costs to be allowed under Federal awards, they must be adequately documented and there must be sufficient documentation. Lastly, according to 2 CFR 200.1, Period of Performance is defined as the total estimated time interval between the start of an initial Federal award and the planned end date, which may include one or more funded portions, or budget periods. Condition: The Organization was unable to provide underlying details and/or related documentation for $5,981 in expenditures reported under the Microloan Program to support the allowability or period of performance. Questioned Costs: $5,981 Context: During our audit procedures, we were unable to obtain general ledger detail or supporting documentation for $962 for Award #SBAOCAML200065-01-00 and $4,878 for Award #SBAHQ19Y0115 to substantiate total program non-payroll expenditures or period of performance. Additionally, during testing, three (3) out of 15 non-payroll disbursements, totaling $141, did not have supporting documentation. Cause: The Organization did not have internal controls in place to ensure adequate documentation and records retention to ensure compliance with grant requirements. Effect or potential effect: The Organization is out of compliance with 2 CFR Section 200.403(g) and the awards' periods of performance. Repeat Finding: No Recommendation: The Organization should implement controls to ensure accurate recordkeeping and document retention to substantiate expenditures allocated to grants. Views of responsible officials: The Organization agrees with the finding and has implemented controls to ensure accurate recordkeeping, and to ensure that documents are retained to substantiate all expenditures allocated to grants. For additional information, see the Organization’s separate report for planned corrective actions.
2020-003 – Period of Performance Significant Deficiency in Internal Controls Over Compliance and Instances of Noncompliance Assistance Listing Number: 59.046 Federal Agency/Pass-through Entity - Program Name: Small Business Administration - Microloan Program Award Number(s): SBAOCAML200065-01-00 Award Year(s): 2020 Criteria or specific requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. According to 2 CFR 200.1, Period of Performance is defined as the total estimated time interval between the start of an initial Federal award and the planned end date, which may include one or more funded portions, or budget periods." Condition: The Organization allocated three expenditures to Grant Award #SBA OCAML200065-01-00, which were outside the grant's period of performance. Questioned costs: $177 Context: During our audit procedures, we tested the entire population of costs associated with Award #SBAOCAML200065-01-00 and noted three rent payments were charged to the grant totaling $177 that were for months prior to the 07/01/2020-06/30/2021 period of performance. Cause: The Organization did not have internal controls in place to ensure funds were allocated to the correct grant's period of performance. Effect or potential effect: The Organization is out of compliance with Award #SBA OCAML200065-01-00's period of performance. Repeat finding: No Recommendation: The Organization should implement controls to ensure all expenditures allocated to grants are for costs incurred during the specified period of performance. Views of responsible officials: The Organization agrees with the finding and has implemented controls to ensure all expenditures allocated to grants are for costs incurred during the specified period of performance. For additional information, see the Organization’s separate report for planned corrective actions.
2020-003 – Period of Performance Significant Deficiency in Internal Controls Over Compliance and Instances of Noncompliance Assistance Listing Number: 59.046 Federal Agency/Pass-through Entity - Program Name: Small Business Administration - Microloan Program Award Number(s): SBAOCAML200065-01-00 Award Year(s): 2020 Criteria or specific requirement: The Uniform Guidance in 2 CFR Section 200.303, Internal Controls, requires that non-Federal entities receiving Federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. According to 2 CFR 200.1, Period of Performance is defined as the total estimated time interval between the start of an initial Federal award and the planned end date, which may include one or more funded portions, or budget periods." Condition: The Organization allocated three expenditures to Grant Award #SBA OCAML200065-01-00, which were outside the grant's period of performance. Questioned costs: $177 Context: During our audit procedures, we tested the entire population of costs associated with Award #SBAOCAML200065-01-00 and noted three rent payments were charged to the grant totaling $177 that were for months prior to the 07/01/2020-06/30/2021 period of performance. Cause: The Organization did not have internal controls in place to ensure funds were allocated to the correct grant's period of performance. Effect or potential effect: The Organization is out of compliance with Award #SBA OCAML200065-01-00's period of performance. Repeat finding: No Recommendation: The Organization should implement controls to ensure all expenditures allocated to grants are for costs incurred during the specified period of performance. Views of responsible officials: The Organization agrees with the finding and has implemented controls to ensure all expenditures allocated to grants are for costs incurred during the specified period of performance. For additional information, see the Organization’s separate report for planned corrective actions.