Department of Health and Human Services Temporary Assistance for Needy Families (TANF), Federal Assistance Listing # 93.558 Pass Through Virginia Department of Social Services, Pass Through Entity Identifying Number BEN-21-054 Type of Finding: Significant Deficiency in Internal Control over Compliance with Federal Awards Criteria: The Organization should have processes and procedures in place to keep and maintain client records, per 2 CFR 200.303 and 2 CFR 200.334. Condition: During our audit, we noted that the Organization was unable to find supporting records for individuals that received services as part of a federal program, leading to noncompliance with the program. Context: During testing, 4 of 60 individuals tested did not have the appropriate records. The sample was not intended to be, and was not, a statistically valid sample. Cause/Effect: Internal control processes over proper maintenance of clients’ records were not operating effectively, causing eligibility documentation to not be located. Questioned Costs: N/A Identification of Repeat Finding: N/A Recommendation: We recommend procedures are implemented to ensure proper maintenance of client records. Views of Responsible Officials and Correction Action: Management’s response is reported in “Management’s Views and Corrective Action Plan” included at the end of this report.
Department of Health and Human Services Temporary Assistance for Needy Families (TANF), Federal Assistance Listing # 93.558 Pass Through Virginia Department of Social Services, Pass Through Entity Identifying Number BEN-21-054 Type of Finding: Significant Deficiency in Internal Control over Compliance with Federal Awards Criteria: The Organization should have effective internal controls in place over review of intake forms, per 2 CFR 200.303 and 2 CFR 200.334. Condition: During our audit, it was noted that there was not an effective review of intake forms. Context: During testing, 6 of 60 intake forms tested to not contain appropriate signatures by individuals or management noting approval. The sample was not intended to be, and was not, a statistically valid sample. Questioned Costs: N/A Cause/Effect: Internal control processes over intake forms were not operating effectively from July 2021 through June 2022. Identification of Repeat Finding: N/A Recommendation: We recommend that Cornerstones implements a review process to ensure that intake forms are complete and accurate as possess all appropriate signatures. Views of Responsible Officials and Correction Action: Management’s response is reported in “Management’s Views and Corrective Action Plan” included at the end of this report.
Department of Health and Human Services Temporary Assistance for Needy Families (TANF), Federal Assistance Listing # 93.558 Pass Through Virginia Department of Social Services, Pass Through Entity Identifying Number BEN-21-054 Type of Finding: Significant Deficiency in Internal Control over Compliance with Federal Awards Criteria: The Organization should have processes and procedures in place to keep and maintain client records, per 2 CFR 200.303 and 2 CFR 200.334. Condition: During our audit, we noted that the Organization was unable to find supporting records for individuals that received services as part of a federal program, leading to noncompliance with the program. Context: During testing, 4 of 60 individuals tested did not have the appropriate records. The sample was not intended to be, and was not, a statistically valid sample. Cause/Effect: Internal control processes over proper maintenance of clients’ records were not operating effectively, causing eligibility documentation to not be located. Questioned Costs: N/A Identification of Repeat Finding: N/A Recommendation: We recommend procedures are implemented to ensure proper maintenance of client records. Views of Responsible Officials and Correction Action: Management’s response is reported in “Management’s Views and Corrective Action Plan” included at the end of this report.
FINDING NO: 2022-002 - Subrecipient Monitoring (Repeated from Prior Year Findings 21-003, 20-004, 19-005, 18-004, and 17-003) Federal Program: McKinney Education for Homeless Children Project No: 21-4920-00 and 22-4920-00 Federal Assistance Listing No: 84.196A Passed Through: Illinois State Board of Education Federal Agency: U.S. Department of Education AND Federal Program: COVID-19 ARP - McKinney Education for Homeless Children Project No: 22-4998-HM Federal Assistance Listing No: 84.425W Passed Through: Illinois State Board of Education Federal Agency: U.S. Department of Education Criteria/Specific Requirement: A. The Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) require the Regional Office to ensure any subrecipient monitoring using federal funds be consistent with the standards set forth in the Uniform Guidance at 2 CFR 200.332. B. The Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) section 200.303 Internal Controls states the following: “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.” Condition: Audit procedures revealed that ROE #47 was not properly monitoring subrecipients in accordance with the Uniform Guidance standards as follows: McKinney Education for Homeless Children – for three (3) of three (3) subrecipients tested, ROE #47: • Did not evaluate the risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward. • Did not determine whether the subrecipient met the 2 CFR 200 Subpart F Audit requirements criteria for a single audit. COVID-19 ARP - McKinney Education for Homeless Children – for two (2) of two (2) subrecipients tested, ROE #47: • Did not identify the subaward and applicable requirements in the agreements. • Did not evaluate the risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward. • Did not conduct subrecipient monitoring procedures. • Did not determine whether the subrecipient met the 2 CFR 200 Subpart F Audit requirements criteria for a single audit. Questioned Costs: None Context: The Regional Office of Education #47 expended a total of $990,919 of federal awards in fiscal year 2022, of which $274,520 in McKinney Education for Homeless Children and $61,075 in COVID-19 ARP - McKinney Education for Homeless Children were passed-through to subrecipients. Effect: The Regional Office of Education #47 is not in compliance with Title 2 of the Code of Federal Regulations (CFR) Part 200.332 as it relates to subrecipient monitoring requirements. Additionally, the effect of noncompliance can result in questioned costs. Cause: Regional Office management had not been asked to distribute Federal ARP funds before. All the funds were distributed to public school districts that are subject to state audits every year themselves and we mistakenly did not follow up to get the results of their audits. Recommendation: We recommend that the Regional Office of Education #47 establish and maintain effective internal control over federal awards to ensure subrecipients are properly monitored as required by 2 CFR 200.332. This includes: a. Identifying the subaward and applicable requirements in the agreements; b. Evaluating the risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward; c. Conducting subrecipient monitoring procedures; and d. Determining whether the subrecipient met the requirement criteria of 2 CFR 200 Subpart F Audit requirements for a single audit. Management’s Response: Effective April 2024, the Regional Office will formally identify the subaward and the applicable requirements in our agreements. We will conduct subrecipient monitoring procedures. We will determine if the subrecipient met the requirement criteria of 2 CFR 200 Subpart F Audit requirements for a single audit.
FINDING NO: 2022-002 - Subrecipient Monitoring (Repeated from Prior Year Findings 21-003, 20-004, 19-005, 18-004, and 17-003) Federal Program: McKinney Education for Homeless Children Project No: 21-4920-00 and 22-4920-00 Federal Assistance Listing No: 84.196A Passed Through: Illinois State Board of Education Federal Agency: U.S. Department of Education AND Federal Program: COVID-19 ARP - McKinney Education for Homeless Children Project No: 22-4998-HM Federal Assistance Listing No: 84.425W Passed Through: Illinois State Board of Education Federal Agency: U.S. Department of Education Criteria/Specific Requirement: A. The Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) require the Regional Office to ensure any subrecipient monitoring using federal funds be consistent with the standards set forth in the Uniform Guidance at 2 CFR 200.332. B. The Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) section 200.303 Internal Controls states the following: “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.” Condition: Audit procedures revealed that ROE #47 was not properly monitoring subrecipients in accordance with the Uniform Guidance standards as follows: McKinney Education for Homeless Children – for three (3) of three (3) subrecipients tested, ROE #47: • Did not evaluate the risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward. • Did not determine whether the subrecipient met the 2 CFR 200 Subpart F Audit requirements criteria for a single audit. COVID-19 ARP - McKinney Education for Homeless Children – for two (2) of two (2) subrecipients tested, ROE #47: • Did not identify the subaward and applicable requirements in the agreements. • Did not evaluate the risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward. • Did not conduct subrecipient monitoring procedures. • Did not determine whether the subrecipient met the 2 CFR 200 Subpart F Audit requirements criteria for a single audit. Questioned Costs: None Context: The Regional Office of Education #47 expended a total of $990,919 of federal awards in fiscal year 2022, of which $274,520 in McKinney Education for Homeless Children and $61,075 in COVID-19 ARP - McKinney Education for Homeless Children were passed-through to subrecipients. Effect: The Regional Office of Education #47 is not in compliance with Title 2 of the Code of Federal Regulations (CFR) Part 200.332 as it relates to subrecipient monitoring requirements. Additionally, the effect of noncompliance can result in questioned costs. Cause: Regional Office management had not been asked to distribute Federal ARP funds before. All the funds were distributed to public school districts that are subject to state audits every year themselves and we mistakenly did not follow up to get the results of their audits. Recommendation: We recommend that the Regional Office of Education #47 establish and maintain effective internal control over federal awards to ensure subrecipients are properly monitored as required by 2 CFR 200.332. This includes: a. Identifying the subaward and applicable requirements in the agreements; b. Evaluating the risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward; c. Conducting subrecipient monitoring procedures; and d. Determining whether the subrecipient met the requirement criteria of 2 CFR 200 Subpart F Audit requirements for a single audit. Management’s Response: Effective April 2024, the Regional Office will formally identify the subaward and the applicable requirements in our agreements. We will conduct subrecipient monitoring procedures. We will determine if the subrecipient met the requirement criteria of 2 CFR 200 Subpart F Audit requirements for a single audit.
Federal Program: COVID-19 - Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Assistance Listing Number: 93.498 Federal Agency: U.S. Department of Health and Human Services Award Number: N/A Award Year: 2021 Compliance Requirements: Reporting Questioned Costs: Not determinable Criteria: Non-federal entities in receipt of federal funds must comply with the requirements of 2 CFR 200.303(a), which require an entity to establish and maintain effective internal control over the Federal award to ensure compliance with Federal statutes, regulations and the terms and conditions of the Federal award. Provider Relief Funds (PRF) payments must be used for allowable expenses and lost revenue described in the PRF terms and conditions and specified in guidance issued by the U.S. Department of Health and Human Services. Activities allowed have been defined as expense used to prevent, prepare for, and respond to coronavirus, domestically or internationally, for necessary expenses to reimburse, through grants or other mechanisms, eligible health care providers for health care related expenses or lost revenues that are attributable to coronavirus. Additionally, all recipients of PRF payments must comply with the reporting requirements described in the PRF terms and conditions and specified in directions issued by the U.S. Department of Health and Human Services. Condition and context: Monongalia County General Hospital Company dba Mon Health Medical Center did not complete the PRF reporting in accordance with the U.S. Department of Health and Human Services guidance. We noted that the facility had multiple errors in its underlying calculation of lost revenues which resulted in lost revenues being overstated $92,483. The entity reported total lost revenues of $66,955,875 on total PRF distributions that amounted to $21,763,852, as such, there were no questioned costs. Effect: The amounts reported to HRSA were not in accordance with established U.S. Department of Health and Human Services guidance. Cause: Monongalia Health System, Inc. and Subsidiaries had an insufficient control in place to identify and correct errors prior to reporting on the use of their Provider Relief Funds. Repeat Finding: 2021-005 Recommendation: We recommend that management review policies and procedures in place and update for most recent interpretation of the U.S. Department of Health and Human Services guidance. Procedures should be implemented and monitored. Unallowable cost recognized should be corrected in future reporting periods. Management's Response: Monongalia Health System, Inc. and Subsidiaries agrees with the finding.
Federal Program: COVID-19 - Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Assistance Listing Number: 93.498 Federal Agency: U.S. Department of Health and Human Services Award Number: N/A Award Year: 2021 Compliance Requirements: Reporting Questioned Costs: Not determinable Criteria: Non-federal entities in receipt of federal funds must comply with the requirements of 2 CFR 200.303(a), which require an entity to establish and maintain effective internal control over the Federal award to ensure compliance with Federal statutes, regulations and the terms and conditions of the Federal award. Provider Relief Funds (PRF) payments must be used for allowable expenses and lost revenue described in the PRF terms and conditions and specified in guidance issued by the U.S. Department of Health and Human Services. Activities allowed have been defined as expense used to prevent, prepare for, and respond to coronavirus, domestically or internationally, for necessary expenses to reimburse, through grants or other mechanisms, eligible health care providers for health care related expenses or lost revenues that are attributable to coronavirus. Additionally, all recipients of PRF payments must comply with the reporting requirements described in the PRF terms and conditions and specified in directions issued by the U.S. Department of Health and Human Services. Condition and context: Monongalia County General Hospital Company dba Mon Health Medical Center did not complete the PRF reporting in accordance with the U.S. Department of Health and Human Services guidance. We noted that the facility had multiple errors in its underlying calculation of lost revenues which resulted in lost revenues being overstated $92,483. The entity reported total lost revenues of $66,955,875 on total PRF distributions that amounted to $21,763,852, as such, there were no questioned costs. Effect: The amounts reported to HRSA were not in accordance with established U.S. Department of Health and Human Services guidance. Cause: Monongalia Health System, Inc. and Subsidiaries had an insufficient control in place to identify and correct errors prior to reporting on the use of their Provider Relief Funds. Repeat Finding: 2021-005 Recommendation: We recommend that management review policies and procedures in place and update for most recent interpretation of the U.S. Department of Health and Human Services guidance. Procedures should be implemented and monitored. Unallowable cost recognized should be corrected in future reporting periods. Management's Response: Monongalia Health System, Inc. and Subsidiaries agrees with the finding.
2022-002 Financial Management and Internal Controls Compliance Requirement Allowable Costs/Cost Principles Category Significant Deficiency in Internal Control and Noncompliance Federal Agency U.S. Department of the Treasury Pass-Through Entity Puerto Rico Fiscal Agency and Financial Advisory Authority ALN 21.027 Federal Program COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Criteria 2 CFR section 200.302 Financial management. (a) Each state must expend and account for the Federal award in accordance with state laws and procedures for expending and accounting for the state's own funds. In addition, the state's and the other non-Federal entity's financial management systems, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award. (b) ….. (1) ….. (2) ….. (3) ..... (5) ….. (6) ….. (7) Written procedures for determining the allowability of costs in accordance with subpart E of this part and the terms and conditions of the Federal award. 2 CFR section 200.303 Internal controls. 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). (b) Comply with the Federal statutes, regulations, and the terms and conditions of the Federal awards. (c) Evaluate and monitor the non-Federal entity's compliance with statutes, regulations and the terms and conditions of Federal awards. (d) Take prompt action when instances of noncompliance are identified including noncompliance identified in audit findings. Condition Written Policies The Corporation has no written policies for determining the activities allowed or unallowed and the allowability of costs as described in subpart E, Cost Principles of 2 CFR Part 200. Cause It is the first year for the Corporation to be subjected to a single audit compliance requirements. However, since the Commonwealth of Puerto Rico (the Commonwealth) filed for Title III under the PROMESA, all the instrumentalities of the Commonwealth had to reduce their staff as part of the Fiscal Plan to reduce expenditures. This has disrupted the segregation of duties, which is a key control. Effect The Corporation could incurred in unallowable costs failing to comply with 2 CFR sections 200.302 and 202.305, the Corporation could then be subjected to temporarily withholding of cash payments pending correction of the deficiency and/or withholding further federal awards for the program. Questioned Costs None Recommendations We recommend the Corporation obtain a thorough understanding of the provisions of federal statutes, regulations, or the terms and conditions of federal awards to prepare the required written policies under subpart E, Cost Principles of 2 CFR Part 200. Views of responsible officials Refer to Corrective Action Plan section.
Identification of the federal program: 14.267 – Continuum of Care Program Significant deficiency in internal controls related to special tests and provisions Criteria: 2 CFR Part 200.303 establishes internal control requirements over federal awards that provides reasonable assurance the entity is managing the federal award in compliance with Federal Statutes. Condition: The Organization has established internal control procedures over special tests and provisions specifically as they apply to reasonable rent, however, the procedures were not applied to all items tested during the audit. Eight files were selected for testing, and one did not include evidence of internal control procedures being applied. Cause: The Organization had policies in procedures in place over special tests and provisions but they were not applied consistently. Effect: Errors could be made in determining whether a unit’s rent is reasonable, and without the consistent application of internal controls, these errors may go unnoticed resulting in a unit being rented whose fair market value rent is outside of the parameters set by the Department of Housing and Urban Development. Questioned Costs: None Recommendations: We recommend the Organization consistently apply internal controls. Views of responsible officials: We agree we need to apply our internal controls as outlined in our policies and procedures consistently. Seven of the eight files tested did follow our policies and procedures. During this fiscal year, we were negatively impacted by the effects of COVID and experienced program manager turnover. Program managers are following these processes on a consistent basis moving forward.
Finding 2022-006 Internal Control and Compliance over Subrecipient Monitoring Information on the Federal Program: Assistance Listing Number(s): 17.258, 17.259, 17.278 Federal Program Name: Workforce Innovation and Opportunity Act (WIOA) Federal Agency: U.S. Department of Labor Pass-Through Entity: California Employment Development Department Federal Award Number and Award Year: AA311008 - FY21-22 Criteria: Title 2 - Grants and Agreements. Subtitle A - Office of Management and Budget Guidance for Grants and Agreements. Chapter II - Office of Management and Budget Guidance. Part 200 - Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Subpart D - Post Federal Award Requirements. Standards for Financial and Program Management. §200.303 Internal controls (2 CFR 200.303): 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). Title 2: Grants and Agreements, Subtitle A - Office of Management and Budget Guidance for Grants and Agreements, Chapter II - Office of Management and Budget Guidance, Part 200 - Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards Subpart D - Post Federal Award Requirements, Subrecipient Monitoring and Management, §200.331 Requirements for pass-through entities (2 CFR 200.331): All pass-through entities must: (a) Ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Required information includes: (1) Federal award identification. i. Subrecipient name (which must match the name associated with its unique entity identifier); ii. Subrecipient's unique entity identifier; iii. Federal Award Identification Number (FAIN); iv. Federal Award Date (see the definition of Federal award date in § 200.1 of this part) of award to the recipient by the Federal agency; v. Subaward Period of Performance Start and End Date; vi. Subaward Budget Period Start and End Date; vii. Amount of Federal Funds Obligated by this action by the pass-through entity to the subrecipient; viii. Total Amount of Federal Funds Obligated to the subrecipient by the pass-through entity including the current financial obligation; ix. Total Amount of the Federal Award committed to the subrecipient by the pass-through entity; x. Federal award project description, as required to be responsive to the Federal Funding Accountability and Transparency Act (FFATA); xi. Name of Federal awarding agency, pass-through entity, and contact information for awarding xii. Assistance Listings number and Title; the pass-through entity must identify the dollar amount made available under each Federal award and the Assistance Listings Number at time of disbursement; xiii. Identification of whether the award is R&D; and xiv. Indirect cost rate for the Federal award (including if the de minimis rate is charged) per § 200.414.; (2) All requirements imposed by the pass-through entity on the subrecipient so that the Federal award is used in accordance with Federal statutes, regulations and the terms and conditions of the Federal award; (3) Any additional requirements that the pass-through entity imposes on the subrecipient in order for the pass-through entity to meet its own responsibility to the Federal awarding agency including identification of any required financial and performance reports; Title 2: Grants and Agreements, Subtitle A - Office of Management and Budget Guidance for Grants and Agreements, Chapter II - Office of Management and Budget Guidance, Part 200 - Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards Subpart D - Post Federal Award Requirements, Subrecipient Monitoring and Management, §200.332 Requirements for pass-through entities (2 CFR 200.332): All pass-through entities must: (a) Evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section, which may include consideration of such factors as: (1) The subrecipient's prior experience with the same or similar subawards; (2) The results of previous audits including whether or not the subrecipient receives a Single Audit in accordance with Subpart F of this part, and the extent to which the same or similar subaward has been audited as a major program; (3) Whether the subrecipient has new personnel or new or substantially changed systems; and (4) The extent and results of Federal awarding agency monitoring (e.g., if the subrecipient also receives Federal awards directly from a Federal awarding agency). Condition: During our testing of the Imperial County Workforce Development Office’s (ICWDO) provisions for subrecipient monitoring under the WIOA Cluster, we noted the following instances: For one (1) of the one (1) subrecipient selected for testing, there was no review or approval over the monitoring procedures performed by ICWDO monitoring staff. The entire population of one (1) subrecipient. • The following information was not provided at the time of the subaward for one (1) of the one (1) subaward selected for testing: o Federal award identification number o Federal award date of award to recipient by the Federal agency o Name of federal awarding agency o Federal Financial Assistance Listing/CFDA Number o Identification of whether the award is research and development • The County did not document their evaluation of each subrecipient’s risk of noncompliance Cause: The County’s ICWDO department does not have a formal procedure in place for the department’s review and approval over the monitoring procedures performed by the department over its subrecipients. The ICWDO department did not ensure that the required award information and applicable requirements were communicated to the subrecipients and did not maintain documentation of their evaluation of each subrecipient’s risk of noncompliance. Effect: The County’s ICWDO department did not review and approve monitoring procedures performed over its subrecipients. Additionally, the ICWDO department did not maintain policies and procedures to align with the Subrecipient Monitoring requirements in 2 CFR 200.332 (a) and 200.332(b). Identification as a Repeat Finding, If Applicable: Yes. See Finding 2021-008. Questioned Costs: No questioned costs were identified. Recommendation: Social Services should continue to monitor compliance with its policies to ensure case workers follow the established guidelines for redetermination of the recipients of need and amount of assistance and retain acceptable documentation to support the determinations. View of Responsible Officials and Planned Corrective Action: See separate Corrective Action Plan.
Finding 2022-006 Internal Control and Compliance over Subrecipient Monitoring Information on the Federal Program: Assistance Listing Number(s): 17.258, 17.259, 17.278 Federal Program Name: Workforce Innovation and Opportunity Act (WIOA) Federal Agency: U.S. Department of Labor Pass-Through Entity: California Employment Development Department Federal Award Number and Award Year: AA311008 - FY21-22 Criteria: Title 2 - Grants and Agreements. Subtitle A - Office of Management and Budget Guidance for Grants and Agreements. Chapter II - Office of Management and Budget Guidance. Part 200 - Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Subpart D - Post Federal Award Requirements. Standards for Financial and Program Management. §200.303 Internal controls (2 CFR 200.303): 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). Title 2: Grants and Agreements, Subtitle A - Office of Management and Budget Guidance for Grants and Agreements, Chapter II - Office of Management and Budget Guidance, Part 200 - Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards Subpart D - Post Federal Award Requirements, Subrecipient Monitoring and Management, §200.331 Requirements for pass-through entities (2 CFR 200.331): All pass-through entities must: (a) Ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Required information includes: (1) Federal award identification. i. Subrecipient name (which must match the name associated with its unique entity identifier); ii. Subrecipient's unique entity identifier; iii. Federal Award Identification Number (FAIN); iv. Federal Award Date (see the definition of Federal award date in § 200.1 of this part) of award to the recipient by the Federal agency; v. Subaward Period of Performance Start and End Date; vi. Subaward Budget Period Start and End Date; vii. Amount of Federal Funds Obligated by this action by the pass-through entity to the subrecipient; viii. Total Amount of Federal Funds Obligated to the subrecipient by the pass-through entity including the current financial obligation; ix. Total Amount of the Federal Award committed to the subrecipient by the pass-through entity; x. Federal award project description, as required to be responsive to the Federal Funding Accountability and Transparency Act (FFATA); xi. Name of Federal awarding agency, pass-through entity, and contact information for awarding xii. Assistance Listings number and Title; the pass-through entity must identify the dollar amount made available under each Federal award and the Assistance Listings Number at time of disbursement; xiii. Identification of whether the award is R&D; and xiv. Indirect cost rate for the Federal award (including if the de minimis rate is charged) per § 200.414.; (2) All requirements imposed by the pass-through entity on the subrecipient so that the Federal award is used in accordance with Federal statutes, regulations and the terms and conditions of the Federal award; (3) Any additional requirements that the pass-through entity imposes on the subrecipient in order for the pass-through entity to meet its own responsibility to the Federal awarding agency including identification of any required financial and performance reports; Title 2: Grants and Agreements, Subtitle A - Office of Management and Budget Guidance for Grants and Agreements, Chapter II - Office of Management and Budget Guidance, Part 200 - Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards Subpart D - Post Federal Award Requirements, Subrecipient Monitoring and Management, §200.332 Requirements for pass-through entities (2 CFR 200.332): All pass-through entities must: (a) Evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section, which may include consideration of such factors as: (1) The subrecipient's prior experience with the same or similar subawards; (2) The results of previous audits including whether or not the subrecipient receives a Single Audit in accordance with Subpart F of this part, and the extent to which the same or similar subaward has been audited as a major program; (3) Whether the subrecipient has new personnel or new or substantially changed systems; and (4) The extent and results of Federal awarding agency monitoring (e.g., if the subrecipient also receives Federal awards directly from a Federal awarding agency). Condition: During our testing of the Imperial County Workforce Development Office’s (ICWDO) provisions for subrecipient monitoring under the WIOA Cluster, we noted the following instances: For one (1) of the one (1) subrecipient selected for testing, there was no review or approval over the monitoring procedures performed by ICWDO monitoring staff. The entire population of one (1) subrecipient. • The following information was not provided at the time of the subaward for one (1) of the one (1) subaward selected for testing: o Federal award identification number o Federal award date of award to recipient by the Federal agency o Name of federal awarding agency o Federal Financial Assistance Listing/CFDA Number o Identification of whether the award is research and development • The County did not document their evaluation of each subrecipient’s risk of noncompliance Cause: The County’s ICWDO department does not have a formal procedure in place for the department’s review and approval over the monitoring procedures performed by the department over its subrecipients. The ICWDO department did not ensure that the required award information and applicable requirements were communicated to the subrecipients and did not maintain documentation of their evaluation of each subrecipient’s risk of noncompliance. Effect: The County’s ICWDO department did not review and approve monitoring procedures performed over its subrecipients. Additionally, the ICWDO department did not maintain policies and procedures to align with the Subrecipient Monitoring requirements in 2 CFR 200.332 (a) and 200.332(b). Identification as a Repeat Finding, If Applicable: Yes. See Finding 2021-008. Questioned Costs: No questioned costs were identified. Recommendation: Social Services should continue to monitor compliance with its policies to ensure case workers follow the established guidelines for redetermination of the recipients of need and amount of assistance and retain acceptable documentation to support the determinations. View of Responsible Officials and Planned Corrective Action: See separate Corrective Action Plan.
Finding 2022-006 Internal Control and Compliance over Subrecipient Monitoring Information on the Federal Program: Assistance Listing Number(s): 17.258, 17.259, 17.278 Federal Program Name: Workforce Innovation and Opportunity Act (WIOA) Federal Agency: U.S. Department of Labor Pass-Through Entity: California Employment Development Department Federal Award Number and Award Year: AA311008 - FY21-22 Criteria: Title 2 - Grants and Agreements. Subtitle A - Office of Management and Budget Guidance for Grants and Agreements. Chapter II - Office of Management and Budget Guidance. Part 200 - Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Subpart D - Post Federal Award Requirements. Standards for Financial and Program Management. §200.303 Internal controls (2 CFR 200.303): 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). Title 2: Grants and Agreements, Subtitle A - Office of Management and Budget Guidance for Grants and Agreements, Chapter II - Office of Management and Budget Guidance, Part 200 - Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards Subpart D - Post Federal Award Requirements, Subrecipient Monitoring and Management, §200.331 Requirements for pass-through entities (2 CFR 200.331): All pass-through entities must: (a) Ensure that every subaward is clearly identified to the subrecipient as a subaward and includes the following information at the time of the subaward and if any of these data elements change, include the changes in subsequent subaward modification. When some of this information is not available, the pass-through entity must provide the best information available to describe the Federal award and subaward. Required information includes: (1) Federal award identification. i. Subrecipient name (which must match the name associated with its unique entity identifier); ii. Subrecipient's unique entity identifier; iii. Federal Award Identification Number (FAIN); iv. Federal Award Date (see the definition of Federal award date in § 200.1 of this part) of award to the recipient by the Federal agency; v. Subaward Period of Performance Start and End Date; vi. Subaward Budget Period Start and End Date; vii. Amount of Federal Funds Obligated by this action by the pass-through entity to the subrecipient; viii. Total Amount of Federal Funds Obligated to the subrecipient by the pass-through entity including the current financial obligation; ix. Total Amount of the Federal Award committed to the subrecipient by the pass-through entity; x. Federal award project description, as required to be responsive to the Federal Funding Accountability and Transparency Act (FFATA); xi. Name of Federal awarding agency, pass-through entity, and contact information for awarding xii. Assistance Listings number and Title; the pass-through entity must identify the dollar amount made available under each Federal award and the Assistance Listings Number at time of disbursement; xiii. Identification of whether the award is R&D; and xiv. Indirect cost rate for the Federal award (including if the de minimis rate is charged) per § 200.414.; (2) All requirements imposed by the pass-through entity on the subrecipient so that the Federal award is used in accordance with Federal statutes, regulations and the terms and conditions of the Federal award; (3) Any additional requirements that the pass-through entity imposes on the subrecipient in order for the pass-through entity to meet its own responsibility to the Federal awarding agency including identification of any required financial and performance reports; Title 2: Grants and Agreements, Subtitle A - Office of Management and Budget Guidance for Grants and Agreements, Chapter II - Office of Management and Budget Guidance, Part 200 - Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards Subpart D - Post Federal Award Requirements, Subrecipient Monitoring and Management, §200.332 Requirements for pass-through entities (2 CFR 200.332): All pass-through entities must: (a) Evaluate each subrecipient's risk of noncompliance with Federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring described in paragraphs (d) and (e) of this section, which may include consideration of such factors as: (1) The subrecipient's prior experience with the same or similar subawards; (2) The results of previous audits including whether or not the subrecipient receives a Single Audit in accordance with Subpart F of this part, and the extent to which the same or similar subaward has been audited as a major program; (3) Whether the subrecipient has new personnel or new or substantially changed systems; and (4) The extent and results of Federal awarding agency monitoring (e.g., if the subrecipient also receives Federal awards directly from a Federal awarding agency). Condition: During our testing of the Imperial County Workforce Development Office’s (ICWDO) provisions for subrecipient monitoring under the WIOA Cluster, we noted the following instances: For one (1) of the one (1) subrecipient selected for testing, there was no review or approval over the monitoring procedures performed by ICWDO monitoring staff. The entire population of one (1) subrecipient. • The following information was not provided at the time of the subaward for one (1) of the one (1) subaward selected for testing: o Federal award identification number o Federal award date of award to recipient by the Federal agency o Name of federal awarding agency o Federal Financial Assistance Listing/CFDA Number o Identification of whether the award is research and development • The County did not document their evaluation of each subrecipient’s risk of noncompliance Cause: The County’s ICWDO department does not have a formal procedure in place for the department’s review and approval over the monitoring procedures performed by the department over its subrecipients. The ICWDO department did not ensure that the required award information and applicable requirements were communicated to the subrecipients and did not maintain documentation of their evaluation of each subrecipient’s risk of noncompliance. Effect: The County’s ICWDO department did not review and approve monitoring procedures performed over its subrecipients. Additionally, the ICWDO department did not maintain policies and procedures to align with the Subrecipient Monitoring requirements in 2 CFR 200.332 (a) and 200.332(b). Identification as a Repeat Finding, If Applicable: Yes. See Finding 2021-008. Questioned Costs: No questioned costs were identified. Recommendation: Social Services should continue to monitor compliance with its policies to ensure case workers follow the established guidelines for redetermination of the recipients of need and amount of assistance and retain acceptable documentation to support the determinations. View of Responsible Officials and Planned Corrective Action: See separate Corrective Action Plan.
Finding 2022-007 Internal Control and Compliance over Payroll Expenditures Information on the Federal Program: Assistance Listing Number(s): 17.258, 17.259, 17.278 Federal Program Name: Workforce Innovation and Opportunity Act (WIOA) Federal Agency: U.S. Department of Labor Pass-Through Entity: California Employment Development Department Federal Award Number and Award Year: AA311008 - FY21-22 Criteria: Title 2 - Grants and Agreements. Subtitle A - Office of Management and Budget Guidance for Grants and Agreements. Chapter II - Office of Management and Budget Guidance. Part 200 - Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Subpart D - Post Federal Award Requirements. Standards for Financial and Program Management. §200.303 Internal controls (2 CFR 200.303): 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). OMB No. 1205-0461 states that all Employment and Training Administration (ETA) grantees are required to submit quarterly financial reports for each grant award they receive. Financial data is required to be reported cumulatively from grant inception through the end of each reporting period. Condition: During our testing of Imperial County Workforce Development Office’s (ICWDO) provisions for reporting requirements, we noted the following instances: • For two (2) of the two (2) quarterly reports from a nonstatistical sample, the amounts reported did not agree to the amounts recorded in the County’s general ledger and SEFA; • For four (4) of the four (4) monthly reports from a nonstatistical sample, the amounts reported did not agree to the amounts recorded in the County’s general ledger and SEFA; • For four (4) of the four (4) monthly reports from a nonstatistical sample, the reports were prepared, reviewed, and approved by the same individual • For one (1) of the one (1) closeout report consisting of the entire population, the amounts reported did not agree to the amounts recorded in the County’s general ledger and SEFA; Cause: ICWDO did not ensure the amounts reported on the quarterly financial reports agreed to the amounts recorded in the County’s general ledger and SEFA and did not ensure there was segregation of duties over the preparation and review and approval of the monthly reports. Effect: The ICWDO department’s procedures were not consistently followed, which requires reports to agree to the amounts recorded in the general ledger and SEFA and requires reports to be reviewed and approved by a separate individual. Identification as a Repeat Finding, If Applicable: Yes. See Finding 2021-010. Questioned Costs: No questioned costs were identified. Recommendation: We recommend ICWDO adhere to their policies and procedures and ensure amounts reported on the quarterly financial reports agree to the County’s general ledger and SEFA and ensure segregation of duties over the preparation and approval of monthly reports. View of Responsible Officials and Planned Corrective Action: See separate Corrective Action Plan.
Finding 2022-007 Internal Control and Compliance over Payroll Expenditures Information on the Federal Program: Assistance Listing Number(s): 17.258, 17.259, 17.278 Federal Program Name: Workforce Innovation and Opportunity Act (WIOA) Federal Agency: U.S. Department of Labor Pass-Through Entity: California Employment Development Department Federal Award Number and Award Year: AA311008 - FY21-22 Criteria: Title 2 - Grants and Agreements. Subtitle A - Office of Management and Budget Guidance for Grants and Agreements. Chapter II - Office of Management and Budget Guidance. Part 200 - Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Subpart D - Post Federal Award Requirements. Standards for Financial and Program Management. §200.303 Internal controls (2 CFR 200.303): 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). OMB No. 1205-0461 states that all Employment and Training Administration (ETA) grantees are required to submit quarterly financial reports for each grant award they receive. Financial data is required to be reported cumulatively from grant inception through the end of each reporting period. Condition: During our testing of Imperial County Workforce Development Office’s (ICWDO) provisions for reporting requirements, we noted the following instances: • For two (2) of the two (2) quarterly reports from a nonstatistical sample, the amounts reported did not agree to the amounts recorded in the County’s general ledger and SEFA; • For four (4) of the four (4) monthly reports from a nonstatistical sample, the amounts reported did not agree to the amounts recorded in the County’s general ledger and SEFA; • For four (4) of the four (4) monthly reports from a nonstatistical sample, the reports were prepared, reviewed, and approved by the same individual • For one (1) of the one (1) closeout report consisting of the entire population, the amounts reported did not agree to the amounts recorded in the County’s general ledger and SEFA; Cause: ICWDO did not ensure the amounts reported on the quarterly financial reports agreed to the amounts recorded in the County’s general ledger and SEFA and did not ensure there was segregation of duties over the preparation and review and approval of the monthly reports. Effect: The ICWDO department’s procedures were not consistently followed, which requires reports to agree to the amounts recorded in the general ledger and SEFA and requires reports to be reviewed and approved by a separate individual. Identification as a Repeat Finding, If Applicable: Yes. See Finding 2021-010. Questioned Costs: No questioned costs were identified. Recommendation: We recommend ICWDO adhere to their policies and procedures and ensure amounts reported on the quarterly financial reports agree to the County’s general ledger and SEFA and ensure segregation of duties over the preparation and approval of monthly reports. View of Responsible Officials and Planned Corrective Action: See separate Corrective Action Plan.
Finding 2022-007 Internal Control and Compliance over Payroll Expenditures Information on the Federal Program: Assistance Listing Number(s): 17.258, 17.259, 17.278 Federal Program Name: Workforce Innovation and Opportunity Act (WIOA) Federal Agency: U.S. Department of Labor Pass-Through Entity: California Employment Development Department Federal Award Number and Award Year: AA311008 - FY21-22 Criteria: Title 2 - Grants and Agreements. Subtitle A - Office of Management and Budget Guidance for Grants and Agreements. Chapter II - Office of Management and Budget Guidance. Part 200 - Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Subpart D - Post Federal Award Requirements. Standards for Financial and Program Management. §200.303 Internal controls (2 CFR 200.303): 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). OMB No. 1205-0461 states that all Employment and Training Administration (ETA) grantees are required to submit quarterly financial reports for each grant award they receive. Financial data is required to be reported cumulatively from grant inception through the end of each reporting period. Condition: During our testing of Imperial County Workforce Development Office’s (ICWDO) provisions for reporting requirements, we noted the following instances: • For two (2) of the two (2) quarterly reports from a nonstatistical sample, the amounts reported did not agree to the amounts recorded in the County’s general ledger and SEFA; • For four (4) of the four (4) monthly reports from a nonstatistical sample, the amounts reported did not agree to the amounts recorded in the County’s general ledger and SEFA; • For four (4) of the four (4) monthly reports from a nonstatistical sample, the reports were prepared, reviewed, and approved by the same individual • For one (1) of the one (1) closeout report consisting of the entire population, the amounts reported did not agree to the amounts recorded in the County’s general ledger and SEFA; Cause: ICWDO did not ensure the amounts reported on the quarterly financial reports agreed to the amounts recorded in the County’s general ledger and SEFA and did not ensure there was segregation of duties over the preparation and review and approval of the monthly reports. Effect: The ICWDO department’s procedures were not consistently followed, which requires reports to agree to the amounts recorded in the general ledger and SEFA and requires reports to be reviewed and approved by a separate individual. Identification as a Repeat Finding, If Applicable: Yes. See Finding 2021-010. Questioned Costs: No questioned costs were identified. Recommendation: We recommend ICWDO adhere to their policies and procedures and ensure amounts reported on the quarterly financial reports agree to the County’s general ledger and SEFA and ensure segregation of duties over the preparation and approval of monthly reports. View of Responsible Officials and Planned Corrective Action: See separate Corrective Action Plan.
Finding 2022-005 Internal Control and Compliance over Eligibility Information on the Federal Program: Assistance Listing Number: 93.558 Federal Program Name: Temporary Aid for Needy Families (TANF) Federal Agency: Health and Human Services Administration Pass-Through Entity: California Department of Social Services Federal Award Number and Award Year: 1946001347-A7 - FY21-22 Criteria: Title 2 - Grants and Agreements. Subtitle A - Office of Management and Budget Guidance for Grants and Agreements. Chapter II - Office of Management and Budget Guidance. Part 200 - Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Subpart D - Post Federal Award Requirements. Standards for Financial and Program Management. §200.303 Internal controls (2 CFR 200.303): 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). Title 45 – Public Welfare, Subtitle B—Regulations Relating to Public Welfare, Chapter II – Office of Family Assistance (Assistance Programs), Administration for Children and Families, Department of Health and Human Services, Part 233 – Coverage and Conditions of Eligibility in Financial Assistance Programs, Subchapter XXIV - HIV Health Care Services Program, § 233.20 Need and amount of assistance (45 CFR 233.20): (a) Requirements for State Plans. A State Plan for OAA, AFDC, AB, APTD or AABD must, as specified below: (1) General. (i) Provide that the determination of need and amount of assistance for all applicants and recipients will be made on an objective and equitable basis and all types of income will be taken into consideration in the same way except where otherwise specifically authorized by Federal statute and; Condition: Out of 60 program recipients reviewed, the determination of need and amount of assistance for one (1) program recipient was incorrectly calculated due to the recipient casefile not being updated for the annual statutory cost-of-living-adjustment (COLA). The recipients casefile required the caseworker to run the Eligibility Determination Budget Calculation (EDBC) module to include the manual adjustment for the annual COLA. This procedure was not completed by the recipients caseworker. The Assistance payments totaling $8,170,992 were disbursed to a population of over 250 program participants during the fiscal year ended June 30, 2022. A non-statistically valid sample of 60 program participants were selected for testing of the eligibility compliance requirement. Cause: Existing internal controls did not prevent, or detect and correct, the occurrence of benefits being miscalculated. Effect: The Imperial County Department of Social Service’s established internal oversight controls did not properly ensure that the applicant’s benefits calculation was appropriately reviewed and approved. Accordingly, there is an increased risk for benefits being miscalculated, which may not be prevented or detected in a timely manner. Identification as a Repeat Finding, If Applicable: No. Questioned Costs: No questioned costs were identified. Recommendation: Social Services should continue to monitor compliance with its policies to ensure case workers follow the established guidelines for redetermination of the recipients of need and amount of assistance and retain acceptable documentation to support the determinations. View of Responsible Officials and Planned Corrective Action: See separate Corrective Action Plan.
Finding 2022-005 Internal Control and Compliance over Eligibility Information on the Federal Program: Assistance Listing Number: 93.558 Federal Program Name: Temporary Aid for Needy Families (TANF) Federal Agency: Health and Human Services Administration Pass-Through Entity: California Department of Social Services Federal Award Number and Award Year: 1946001347-A7 - FY21-22 Criteria: Title 2 - Grants and Agreements. Subtitle A - Office of Management and Budget Guidance for Grants and Agreements. Chapter II - Office of Management and Budget Guidance. Part 200 - Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Subpart D - Post Federal Award Requirements. Standards for Financial and Program Management. §200.303 Internal controls (2 CFR 200.303): 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). Title 45 – Public Welfare, Subtitle B—Regulations Relating to Public Welfare, Chapter II – Office of Family Assistance (Assistance Programs), Administration for Children and Families, Department of Health and Human Services, Part 233 – Coverage and Conditions of Eligibility in Financial Assistance Programs, Subchapter XXIV - HIV Health Care Services Program, § 233.20 Need and amount of assistance (45 CFR 233.20): (a) Requirements for State Plans. A State Plan for OAA, AFDC, AB, APTD or AABD must, as specified below: (1) General. (i) Provide that the determination of need and amount of assistance for all applicants and recipients will be made on an objective and equitable basis and all types of income will be taken into consideration in the same way except where otherwise specifically authorized by Federal statute and; Condition: Out of 60 program recipients reviewed, the determination of need and amount of assistance for one (1) program recipient was incorrectly calculated due to the recipient casefile not being updated for the annual statutory cost-of-living-adjustment (COLA). The recipients casefile required the caseworker to run the Eligibility Determination Budget Calculation (EDBC) module to include the manual adjustment for the annual COLA. This procedure was not completed by the recipients caseworker. The Assistance payments totaling $8,170,992 were disbursed to a population of over 250 program participants during the fiscal year ended June 30, 2022. A non-statistically valid sample of 60 program participants were selected for testing of the eligibility compliance requirement. Cause: Existing internal controls did not prevent, or detect and correct, the occurrence of benefits being miscalculated. Effect: The Imperial County Department of Social Service’s established internal oversight controls did not properly ensure that the applicant’s benefits calculation was appropriately reviewed and approved. Accordingly, there is an increased risk for benefits being miscalculated, which may not be prevented or detected in a timely manner. Identification as a Repeat Finding, If Applicable: No. Questioned Costs: No questioned costs were identified. Recommendation: Social Services should continue to monitor compliance with its policies to ensure case workers follow the established guidelines for redetermination of the recipients of need and amount of assistance and retain acceptable documentation to support the determinations. View of Responsible Officials and Planned Corrective Action: See separate Corrective Action Plan.
Finding 2022-005 Internal Control and Compliance over Eligibility Information on the Federal Program: Assistance Listing Number: 93.558 Federal Program Name: Temporary Aid for Needy Families (TANF) Federal Agency: Health and Human Services Administration Pass-Through Entity: California Department of Social Services Federal Award Number and Award Year: 1946001347-A7 - FY21-22 Criteria: Title 2 - Grants and Agreements. Subtitle A - Office of Management and Budget Guidance for Grants and Agreements. Chapter II - Office of Management and Budget Guidance. Part 200 - Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Subpart D - Post Federal Award Requirements. Standards for Financial and Program Management. §200.303 Internal controls (2 CFR 200.303): 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). Title 45 – Public Welfare, Subtitle B—Regulations Relating to Public Welfare, Chapter II – Office of Family Assistance (Assistance Programs), Administration for Children and Families, Department of Health and Human Services, Part 233 – Coverage and Conditions of Eligibility in Financial Assistance Programs, Subchapter XXIV - HIV Health Care Services Program, § 233.20 Need and amount of assistance (45 CFR 233.20): (a) Requirements for State Plans. A State Plan for OAA, AFDC, AB, APTD or AABD must, as specified below: (1) General. (i) Provide that the determination of need and amount of assistance for all applicants and recipients will be made on an objective and equitable basis and all types of income will be taken into consideration in the same way except where otherwise specifically authorized by Federal statute and; Condition: Out of 60 program recipients reviewed, the determination of need and amount of assistance for one (1) program recipient was incorrectly calculated due to the recipient casefile not being updated for the annual statutory cost-of-living-adjustment (COLA). The recipients casefile required the caseworker to run the Eligibility Determination Budget Calculation (EDBC) module to include the manual adjustment for the annual COLA. This procedure was not completed by the recipients caseworker. The Assistance payments totaling $8,170,992 were disbursed to a population of over 250 program participants during the fiscal year ended June 30, 2022. A non-statistically valid sample of 60 program participants were selected for testing of the eligibility compliance requirement. Cause: Existing internal controls did not prevent, or detect and correct, the occurrence of benefits being miscalculated. Effect: The Imperial County Department of Social Service’s established internal oversight controls did not properly ensure that the applicant’s benefits calculation was appropriately reviewed and approved. Accordingly, there is an increased risk for benefits being miscalculated, which may not be prevented or detected in a timely manner. Identification as a Repeat Finding, If Applicable: No. Questioned Costs: No questioned costs were identified. Recommendation: Social Services should continue to monitor compliance with its policies to ensure case workers follow the established guidelines for redetermination of the recipients of need and amount of assistance and retain acceptable documentation to support the determinations. View of Responsible Officials and Planned Corrective Action: See separate Corrective Action Plan.
Finding 2022-005 Internal Control and Compliance over Eligibility Information on the Federal Program: Assistance Listing Number: 93.558 Federal Program Name: Temporary Aid for Needy Families (TANF) Federal Agency: Health and Human Services Administration Pass-Through Entity: California Department of Social Services Federal Award Number and Award Year: 1946001347-A7 - FY21-22 Criteria: Title 2 - Grants and Agreements. Subtitle A - Office of Management and Budget Guidance for Grants and Agreements. Chapter II - Office of Management and Budget Guidance. Part 200 - Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Subpart D - Post Federal Award Requirements. Standards for Financial and Program Management. §200.303 Internal controls (2 CFR 200.303): 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). Title 45 – Public Welfare, Subtitle B—Regulations Relating to Public Welfare, Chapter II – Office of Family Assistance (Assistance Programs), Administration for Children and Families, Department of Health and Human Services, Part 233 – Coverage and Conditions of Eligibility in Financial Assistance Programs, Subchapter XXIV - HIV Health Care Services Program, § 233.20 Need and amount of assistance (45 CFR 233.20): (a) Requirements for State Plans. A State Plan for OAA, AFDC, AB, APTD or AABD must, as specified below: (1) General. (i) Provide that the determination of need and amount of assistance for all applicants and recipients will be made on an objective and equitable basis and all types of income will be taken into consideration in the same way except where otherwise specifically authorized by Federal statute and; Condition: Out of 60 program recipients reviewed, the determination of need and amount of assistance for one (1) program recipient was incorrectly calculated due to the recipient casefile not being updated for the annual statutory cost-of-living-adjustment (COLA). The recipients casefile required the caseworker to run the Eligibility Determination Budget Calculation (EDBC) module to include the manual adjustment for the annual COLA. This procedure was not completed by the recipients caseworker. The Assistance payments totaling $8,170,992 were disbursed to a population of over 250 program participants during the fiscal year ended June 30, 2022. A non-statistically valid sample of 60 program participants were selected for testing of the eligibility compliance requirement. Cause: Existing internal controls did not prevent, or detect and correct, the occurrence of benefits being miscalculated. Effect: The Imperial County Department of Social Service’s established internal oversight controls did not properly ensure that the applicant’s benefits calculation was appropriately reviewed and approved. Accordingly, there is an increased risk for benefits being miscalculated, which may not be prevented or detected in a timely manner. Identification as a Repeat Finding, If Applicable: No. Questioned Costs: No questioned costs were identified. Recommendation: Social Services should continue to monitor compliance with its policies to ensure case workers follow the established guidelines for redetermination of the recipients of need and amount of assistance and retain acceptable documentation to support the determinations. View of Responsible Officials and Planned Corrective Action: See separate Corrective Action Plan.
2022-004Unsubstantiated methodology to allocate indirect costs charged to a federal program - (Material Weakness)Criteria:Per 2 CFR section 200.303(a), a 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 statues, regulations, and the terms and conditions of the Federal award. Condition: Expenditures were charged to the program based on different percentages applied to indirect bills that benefit the entire organization. There was not a substantiated methodology to arrive at these percentages. Cause: The CDP failed to implement consistent and reasonable methodology to allocate indirect costs. Effect: Indirect charges allocated to a program based on unsubstantiated methodology can result in federal reimbursements that are not reflective of actual costs. Indirect costs may be overcharged to the program. Questioned Cost: Undetermined Recommendation: Management needs to ensure the CDP establishes a reasonable and consistent allocation methodology. Ideally, the methodology should be statistically based. That methodology should be used entity-wide to consistently allocate indirect costs to various programs. Management's Views and Corrective Action Plan Management's response is included in "Management's View and Corrective Action Plan" at the end of this report after the schedule of findings and questioned cost
Program: Provider Relief Fund Federal Agency Name: U.S. Department of Health and Human Services Federal Award Number: N/A Federal Award Year: 2021 – 2022 Federal Assistance Listing Number: 93.498 Compliance Requirement: Other – Inaccurate Reporting on the Schedule of Expenditures of Federal Awards Criteria According to 2 CFR 200.510(b), a recipient of federal awards is required to prepare a schedule of expenditures of federal awards (Schedule) for the period covered by the entity’s financial statements, which must include the total Federal awards expended as determined in accordance with 2 CFR 200.502. Additionally, CFR 200.303 requires non-Federal entities receiving federal awards to establish and maintain internal controls designed to reasonably ensure compliance with Federal laws, regulations, and program compliance requirements. Effective internal controls should include procedures to ensure federal expenditures are accurately and completely reported on the Schedule. Conditions Found QHS did not have adequate internal controls related to the reporting of expenditures on the Schedule for the Provider Relief Fund. Specifically, QHS did not have a control to reconcile the Provider Relief Funds received and submitted on the Health Resources and Services Administration (HRSA) Provider Relief Fund reporting portal to the amounts reported on the Schedule. As a result, QHS determined that $5,000,000 of Provider Relief Fund expenditures were inadvertently omitted from the June 30, 2022 Schedule. Cause In discussing the conditions with QHS management, they stated it was caused by failure to implement a reconciliation control related to the Provider Relief Funds received and submitted on the HRSA Provider Relief Fund reporting portal to the amounts reported on the SEFA. Effect Failure to establish effective internal controls regarding the financial reporting for the preparation of the Schedule may prevent QHS from completing an audit in accordance with timelines of Uniform Guidance. Questioned Costs Not applicable.Statistical Sample Not applicable. Repeat Finding This finding is not a repeat finding in the immediately prior audit. Recommendation We recommend that QHS implement a system of internal control that is designed and operating effectively to ensure the Schedule is complete and accurate. Views of Responsible Officials QHS agrees with the finding and accepts the recommendation.
The Metcalfe County Fiscal Court Did Not Establish And Maintain Effective Internal Controls Over Compliance With Coronavirus State And Local Fiscal Recovery Fund (CSLFRF) Requirements Federal Program: Assistance Listing #21.027 Coronavirus State and Local Fiscal Recovery Fund Name of Federal Agency: U.S. Department of Treasury Pass-Through Agency: Not Applicable Award Number and Year: 2022 Amount Expended: $977,917 Compliance Requirements: Activities Allowed or Unallowed; Allowable Costs/Cost Principles Type of Finding: Material Weakness, Noncompliance Amount of Questioned Costs: $11,219 Opinion Modification (if applicable): Adverse During fiscal year 2022, the Metcalfe County Fiscal Court received funds from the Coronavirus State And Local Fiscal Recovery Fund (CSLFRF). The fiscal court failed to establish effective internal controls over compliance requirements to ensure disbursements from the CSLFRF were not already reimbursed from another source, complied with fiscal court?s administrative code, and had proper supporting documentation. The following findings were noted regarding the fiscal court?s CSLFRF disbursements: ? Fifteen of 80 disbursements tested in amount of $11,219 did not qualify to be covered by CSLFRF because $10,181 had already been reimbursed by the state and $1,038 was an overpayment to the revolving payroll account for employer?s share retirement. ? Thirty-eight of 80 disbursements tested in amount of $193,278 did not have purchase orders issued before the item was purchased or service was performed as required by the fiscal court?s administrative code. ? Nineteen of 80 disbursements tested in amount of $130,013 exceeded available line-item appropriation. Twelve of these 19 disbursements in the amount of $70,199 were paid before the budget transfer was made. ? One of 80 disbursements tested in amount of $3,237 was on a contract amendment not approved by the fiscal court as required by the fiscal court?s administrative code. ? Nine of 80 disbursements tested in amount of $90,855 did not have supporting documentation showing how amounts paid for employer?s share retirement, employer?s share social security, employer?s share health insurance, and employer?s share health reimbursement account were calculated. ? One of 80 disbursements tested in amount of $60 did not agree to supporting documentation because the contractor was underpaid by $6. Due to the above material noncompliance with the compliance requirements ?activities allowed or unallowed? and ?allowable cost/cost principles? applicable to the Metcalfe County Fiscal Court for the year ended June 30, 2022, we will issue an adverse opinion on these compliance requirements. Our total sample included 80 disbursements in the amount of $413,534 from a universe of 518 transactions in the amount of $977,917 identified by the finance officer and a third-party administrator to be covered by the CSLFRF. The audit sample was selected using a non-statistical method. We then reviewed disbursements to determine if CSLFRF funds were used for ineligible uses and to determine whether the fiscal court significantly deviated from its established practices and policies regarding disbursements. The issues noted appear to be a systemic problem. The known questioned costs are $11,219. Questioned costs were computed by comparing reimbursements received from the state to disbursements included as covered by SLFRF and identifying disbursements made for overpayments. During testing, we found the following disbursements included that had already been reimbursed: ? $1,197 employer?s share retirement was reimbursed from the Kentucky Law Enforcement Foundation Program Fund (KLEFPF) on incentive pay received by law enforcement officers ? $8,984 regular operating expenses of janitorial costs, maintenance costs, ordinary repairs, and utilities were reimbursed from the Kentucky Administrative Office of the Courts (AOC). ? $1,038 employer?s share retirement was an overpayment to the revolving payroll account. An effective internal control system was not in place in Metcalfe County to ensure compliance with requirements related to the administration of ARPA funds and the Allowable Costs/Cost Principles compliance requirements. Failure to establish and maintain effective internal controls over compliance with federal program requirements could subject the county to the risk of reporting ineligible expenditures on the SEFA and using grant funds for unallowable purposes. The fiscal court may be required to repay the questioned costs back to the granting agency. 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.? The Metcalfe County Administrative Code and Employee Policy And Procedure Handbook General Purchase Procedures section A states ?[a]ll purchases must be verified and approved by the issuance of a purchase order if the County budget has the proper appropriation for the Department?s line item. When the vendor submits an invoice the purchase order number must be indicated; invoices without a purchase order number will not be paid. Sufficient funds must also exist in the department?s particular line item from which the purchases will be paid. The County Judge/Executive, County Treasurer, and/or Finance Officer shall complete the purchase order form and signify their approval of the purchases by their signature or other appropriate method.? In addition, the administrative codes states ?[e]very contract of the County shall be authorized or approved by the Fiscal Court, by Resolution if applicable, authorizing the County Judge/Executive to execute, sign and enter into same; and every contract of the County shall be approved as to form and reality by the County Attorney.? Not a repeat finding. We recommend the fiscal court establish and maintain internal controls over compliance for all federal program expenditures to ensure expenditures are for eligible purposes and have not been reimbursed by another source and comply with its established practices and policies regarding expenditures.
Finding 2022-001- Activities Allowed or Unallowed, Allowable Costs- Significant Deficiency Program: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No.: 21.027 Federal Agency: Department of the Treasury ? Pass-through from the State of California Award No.: WWID 4SSO10370 & CA 1910156 Award Year: Fiscal year 2021-2022 Category of Finding: Activities Allowed or Unallowed, Allowable Costs Criteria or Specific Requirement: Allowable Costs - 2 CFR Part 200.403 Factors affecting allowability of costs except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. (b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. (c) Be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity. (d) Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost. (e) Be determined in accordance with generally accepted accounting principles (GAAP), except, for state and local governments and Indian tribes only, as otherwise provided for in this part. (f) Not be included as a cost or used to meet cost sharing or matching requirements of any other federally-financed program in either the current or a prior period. See also ? 200.306(b). (g) Be adequately documented. See also ?? 200.300 through 200.309 of this part. (h) Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to ? 200.308(e)(3). Per California Water and Wastewater Arrearage Payment Program Guidelines amended on January 19, 2022, providers that accrued residential and commercial customer arrearages during the COVID-19 pandemic bill relief period (March 4, 2020 through June 15, 2021) are eligible for the water and wastewater arrearages funding. In addition, 2 CFR 200.303 requires nonfederal entities to, among other things, establish and maintain effective internal control over the federal award that provides reasonable assurance that the nonfederal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition: The City did not have an effective system of internal control in place to ensure the correct COVID-19 pandemic relief period was applied to identify eligible customers to have their bills paid with federal grant funds. Context: Crowe selected a total of 60 payment transactions, consisting of 30 water bills and 30 wastewater bills that were included in the arrearage program. We noted that one of the water bills selected for testing had a service date from June 28, 2021 in the amount $77.88. Upon further discussion with City management we noted the City applied the incorrect pandemic relief period to the program. Instead of a date of June 15, 2021, the City was using June 30, 2021 as the cutoff date. Management subsequently reviewed the entire population of the bills and quantified that there were 93 water bills with aggregate amount of $20,199 and 81 wastewater bills with aggregate amount of $15,331 ineligible for the funding. Cause: The City applied the incorrect pandemic relief period to the program. Instead of a date of June 15, 2021, the City was using June 30, 2021 as the cutoff date. Effect or Potential Effect: There were 93 water bills with totaled amount of $20,199 and 81 wastewater bills with totaled amount of $15,331 ineligible for the funding. Questioned Costs: $35,530 Identification of a repeat finding: Not a repeat finding. Recommendation: We recommend that the City implement internal controls to review the eligibility period for water and wastewater arrearages funding to identify the correct eligible applicants prior to disbursement. Views of Responsible Officials: Payments applied to the 93 water bills and 81 wastewater bills will be reversed on the customer?s accounts. A notice will be issued to customers via mail and email (where possible) of the discrepancy. The funds will be returned to the State pursuant to their outlined procedures. Moving forward, the City will ensure that there is a multi-layered approval process to review the eligibility period of any State funding to identify the correct eligible applicants prior to disbursement. For future funding related to water and/or waster bills, the list of eligible applicants will be compiled by an analyst within the department and will be reviewed by the Revenue Services Manager and Assistant Finance Director prior to disbursement.
2022-002 WIOA Cost Reimbursement Federal Program: WIOA Youth Programs CFDA Number: 17.259 Compliance Requirement: Reporting Repeat Finding: No Type of Finding: Material weakness Questioned Costs: $39,048 Criteria: According to Title 2 CFR § 200.303(a), 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. Condition: Access, Inc’ internal controls are not adequate to ensure that the cost reimbursements are accurately reported. Access, Inc. did not accurately report payroll costs on the reimbursement claim forms. Cause: The internal controls over the payroll processes were not adequately enforced to ensure accurate reporting of the cost reimbursement of federal awards. Effect: Access, Inc. did not properly report their federal expenditures. The incorrect reporting could result in improper use of federal funds and noncompliance with federal regulations. Recommendation: We recommend that Access, Inc. strengthen its internal control processes over payroll processing and cost reimbursement. Specifically, we suggest implementing the following measures: 1. Provide additional training to staff involved in payroll processing. 2. Establish procedures and implement more precise controls to ensure that expenditures are properly reviewed and approved before being charged to a federal award. Management’s Response: Access, Inc. concurs with the finding and has begun implementing corrective actions. The finance department is in the process of enhancing the internal control procedures to ensure accurate and complete reporting of federal expenditures. Additionally, training sessions are being scheduled for the relevant personnel to address the identified issues and prevent future occurrences. Access, Inc. has recently employed a CFO with extensive experience with the Department of Labor grants and contracts, to assist with the accounting process which will enhance the organizations’ ability to ensure accounting records are accurate and complete.
Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Cash Management Federal Award Identification Assistance Listing Program Title: Formula Grants for Rural Areas Assistance Listing Program Number: 20.509 Federal Award ID Number and Year: Various Federal Agency: U.S. Department of Transportation Pass-Through Entity: Nebraska Department of Transportation Criteria The Organization must establish and maintain effective internal control over the Federal award that provides reasonable assurance that they are managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal Award (2 CFR 200.303). Costs must be adequately documented. (2 CFR 200.403(g)). Costs must be paid for prior to the date of the reimbursement request. (2 CFR 200.305(b)(3)). Condition The Organization lacked adequate documentation to support: - That certain expenditures followed an approval process before being paid. - That certain expenditures were for allowable activities and in accordance with allowable cost principles. The Organization requested reimbursement for expenses that had not yet been paid. Repeat Finding No. Cause Procedures within the Organization were inadequate to ensure that expenditures follow a review and approval process prior to being paid, that costs were in accordance with Federal requirements and that only costs which had been paid for were requested for reimbursement. Effect or Potential Effect Increased potential for errors or misuse of funds. Questioned Costs Known $35,806 Statistical Sample No. Context During the fiscal year, the Organization requested a monthly reimbursement from the pass-through entity. Auditor selected three of these monthly reimbursement requests (September 2021, May 2022, and June 2022) for testing, reviewing all non-payroll-related expenses, resulting in testing approximately 90 different line items composing many more individual transactions. Within this sample, auditor noted: - Multiple instances where no documentation existed to support a system of internal control whereby expenditures were approved by a competent individual prior to their being paid. - Multiple instances where documentation provided did not include sufficient detail to determine if products and/or services provided meet the definition of allowable activity, resulting in questioned costs of $2,921. - One expenditure for which reimbursement was requested in May 2022 and again in June 2022 amounting to $1,283 (questioned cost amount included in previous point). - For June 2022, an inability to crosswalk between the Organization’s internal fuel summary report and the related vendor statements, resulting in questioned costs of $32,885. Additionally, we noted both character and line transposition errors between the fuel summary report and the reimbursement request. Similarly, auditor was unable to obtain evidence that fuel expenditures were paid prior to the Organization requesting reimbursement. - Multiple instances of expenditure misclassification in violation of the invoicing and documentation guidelines issued by the pass-through entity, resulting in no additional questioned costs. Recommendation We recommend the Organization establish a system of internal control consisting of policies and procedures whereby all expenditures are properly explained with supporting documentation and are reviewed and approved prior to payment. Additionally, that only those expenditures which have been paid for are requested for reimbursement. Views of Responsible Officials See Corrective Action Plan, below.
Activities Allowed or Unallowed; Allowable Costs/Cost Principles Federal Award Identification Assistance Listing Program Title: Formula Grants for Rural Areas Assistance Listing Program Number: 20.509 Federal Award ID Number and Year: Various Federal Agency: U.S. Department of Transportation Pass-Through Entity: Nebraska Department of Transportation Criteria Standards for documentation of personnel expenses at 2 CFR 200.430(i)(1) require that charges to federal awards for salaries and wages be based on records that accurately reflect the work performed. These records must: - Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly documented. - Reasonably reflect the total activity for which the employee is compensated. - Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. Standards for documentation of personnel expenses at 2 CFR 200.430(i)(3) require that in accordance with Department of Labor regulations implementing the Fair Labor Standards Act (FLSA) (29 CFR 516), charges for the salaries and wages of nonexempt employees must be supported by records indicating the total number of hours worked each day. The Organization must establish and maintain effective internal control over the Federal award that provides reasonable assurance that they are managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal Award (2 CFR 200.303). Condition The Organization lacked adequate documentation to support: - Hours worked by employees - Supervisory approval of time sheets - Approved rates of pay Repeat Finding No. Cause Procedures within the Organization were inadequate to ensure that personnel expenses were adequately documented. Effect or Potential Effect Increased potential for errors or misuse of funds. Questioned Costs Known $2,082 Statistical Sample No. Context Auditor haphazardly selected 60 payroll transactions covering the entire fiscal year for testing, however, auditor did not complete the testing of all 60 transactions due to the frequency of errors encountered. Of the nine transactions that were tested, there were errors regarding: - Lack of (approved) timesheets. - Personnel files lacking (approved) rates of pay. - A timesheet that did not accurately foot, resulting in questioned costs of $94. - Rates of pay documented in personnel files that did not match the actual rates of pay, resulting in questioned costs of $1,988. Recommendation We recommend the Organization establish a system of internal control consisting of policies and procedures whereby payroll transactions and related documentation contain appropriate review and approval. Views of Responsible Officials See Corrective Action Plan, below.
Federal Program: COVID-19: Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution Program Assistance Listing Number: 93.498 Federal Agency: U.S. Department of Health and Human Services Award Number: N/A Award Year: 2020 Compliance Requirement: Reporting Questioned Costs: Not determinable Criteria: Non-federal entities in receipt of federal funds must comply with the requirements of 2 CFR 200.303(a), which requires an entity to establish and maintain effective internal control over the Federal award to ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Recipients of Provider Relief Funds (PRF) payments must also comply with the reporting requirements described in the PRF terms and conditions and specified in directions issued by the U.S. Department of Health and Human Services. Condition and Context: The System did not complete the PRF Period 1 reporting in accordance with the U.S. Department of Health and Human Services guidance. The System did not enter the correct amounts from its data supporting lost revenues for all quarters; it also did not enter the correct amounts from its data supporting eligible expenditures. The adjustments needed within the PRF reports to correct the errors decreased year over year lost revenues from $21,664,944 to $11,771,346 and decreased eligible expenditures from $7,527,194 to $4,334,813, on total distributions of PRF funding of $14,972,846. In summary, the data supporting amounts for lost revenues and eligible expenses totals $16,104,159 on total distributions of PRF funding of $14,972,846 in this reporting period. Effect: The amounts reported to Health Resources & Services Administration (HRSA) were not in accordance with established U.S. Department of Health and Human Services reporting guidance. Cause: Errors in the lost revenues and eligible expenditures presented in the Period 1 report submissions were not detected by the Sytem's internal control process. Recommendation: We recommend that management implement procedures to ensure that the most recent guidance is reviewed and understood and that information used in preparation of the reports is reviewed, with errors addressed, prior to reporting. Planned Corrective Actions and View of Responsible Officials: System management agrees with the finding and has updated its lost revenue calculation. Management attempted to update lost revenue amounts with filing of its Period 4 reports; however, additional data entry errors were made.
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Criteria: 2 CFR section 200.303 requires that non-federal entities receiving federal awards establish and maintain internal control over the federal awards that provides reasonable assurance that the non-federal entity is managing the federal awards in compliance with federal statues, regulations, and the terms and conditions of the federal awards. Condition: CAC has a documented management services manual that states: "Post award procedures-after an award has been made to CAC, the following steps take place: verify the specifications of the grant or contract. The Management Services Department shall review the terms time periods, award amounts and expected expenditures with the award...All reporting requirements under the contract shall be summarized." Additionally, CAC does not have written entity wide or program specific procedures and internal controls for determining eligibility for federal award programs. Cause: The Auditor requested a copy of the summarized reporting requirements, by each Major Program, with reporting identified as a direct and material compliance requirement. Reporting summaries were not prepared as indicated in the written control procedure and available upon request. The Auditor requested a copy of the entity wide and program specific internal controls over compliance for the determination of eligibility for each Major Program with eligibility identified as a direct and material compliance requirement. CAC was not able to provide documented controls for eligibility when requested. Effect: Not having written policies or procedures detailing control activities supporting compliance with eligibility requirements or following activities prescribed for reporting, increases the risk for potential errors and indicates CAC's need to bolster and adequately document internal control. Recommendation: CAC management should ensure all reporting requirements documented in awards contracts are summarized and entity wide or program specific procedures and internal controls for determining eligibility for federal award programs are in writing and easily accessible. Views of Responsible Official(s) and Planned Corrective Actions: See the accompanying "Management's Corrective Action Plan."
Finding Number: 2022-002 Program: Research and Development Cluster Federal Agency Names: U.S. National Aeronoautics and Space Adminstration; U.S. Department of Agriculture; U.S. Department of Defense; U.S. Department of Energy; U.S. Department of Health and Human Services; U.S. Department of Transportation; U.S. Department of Commerce; U.S. Environmental Protection Agency; U.S. Department of Homeland Security; U.S. Department of Interior; and National Science Foundation Federal Award Numbers: Various – as listed on the Schedule Federal Award Years: Various Federal Assistance Listing Numbers: Various – as listed on the Schedule Compliance Requirement: Other – Inaccurate reporting of the Schedule of Expenditures of Federal Awards Criteria According to 2 CFR 200.510(b), a recipient of federal awards is required to prepare a schedule of expenditures of Federal awards (Schedule) for the period covered by the auditee’s financial statements which must include the total federal awards expended as determined in accordance with 2 CFR 200.502. Additionally, 2CFR 200.303 requires non-Federal entities receiving Federal awards to establish and maintain internal controls designed to reasonably ensure compliance with Federal laws, regulations, and program compliance requirements. Effective internal controls should include procedures to ensure federal expenditures are accurately reported on the Schedule and information provided for audit purposes is complete and accurate. Conditions Found The University did not have adequate controls relating to the reporting of expenditures on the Schedule for the Research and Development Cluster. Specifically, the University did not have documented procedures on how to query and analyze expenditure data from the Peoplesoft system and the management review controls over the preparation of the Schedule were not designed to operate at an appropriate level of precision. As a result, during 2023 the University determined that $1,552,891 related to the Research and Development Cluster were inadvertently omitted from the June 30, 2022 Schedule. Additionally, expenditures in the amount of $14,289 related to the National Endowment for the Humanities – Promotion of the Humanities Teaching and Learning Resources (ALN 45.162) had been incorrectly included as part of the Research and Development Cluster. The combination of these errors resulted in a total of $1,538,602 of Research and Development Cluster expenditures being added to the June 30, 2022 Schedule. The University also had incorrectly reported encumbrances, which represent future expenditures that have been obligated but not incurred. Cause In discussing these conditions with the University, they stated the errors were primarily due to turnover in staff responsible for preparation of the Schedule as well as a lack of documented procedures. Additionally, the management review controls in place were not operating at a sufficient level of precision to detect the errors. Effect Failure to establish effective internal controls regarding financial reporting for the preparation of the Schedule may prevent the University from completing an audit in accordance with the timelines of Uniform Guidance. Questioned Costs Not applicable. Statistical Sample Not applicable. Repeat Finding This finding is not a repeat finding in the immediately prior audit. Recommendation We recommend the University implement a system of internal control that is designed and operating at a level of precision to ensure the Schedule is complete and accurate
Finding Number: 2022-002 Program: Research and Development Cluster Federal Agency Names: U.S. National Aeronoautics and Space Adminstration; U.S. Department of Agriculture; U.S. Department of Defense; U.S. Department of Energy; U.S. Department of Health and Human Services; U.S. Department of Transportation; U.S. Department of Commerce; U.S. Environmental Protection Agency; U.S. Department of Homeland Security; U.S. Department of Interior; and National Science Foundation Federal Award Numbers: Various – as listed on the Schedule Federal Award Years: Various Federal Assistance Listing Numbers: Various – as listed on the Schedule Compliance Requirement: Other – Inaccurate reporting of the Schedule of Expenditures of Federal Awards Criteria According to 2 CFR 200.510(b), a recipient of federal awards is required to prepare a schedule of expenditures of Federal awards (Schedule) for the period covered by the auditee’s financial statements which must include the total federal awards expended as determined in accordance with 2 CFR 200.502. Additionally, 2CFR 200.303 requires non-Federal entities receiving Federal awards to establish and maintain internal controls designed to reasonably ensure compliance with Federal laws, regulations, and program compliance requirements. Effective internal controls should include procedures to ensure federal expenditures are accurately reported on the Schedule and information provided for audit purposes is complete and accurate. Conditions Found The University did not have adequate controls relating to the reporting of expenditures on the Schedule for the Research and Development Cluster. Specifically, the University did not have documented procedures on how to query and analyze expenditure data from the Peoplesoft system and the management review controls over the preparation of the Schedule were not designed to operate at an appropriate level of precision. As a result, during 2023 the University determined that $1,552,891 related to the Research and Development Cluster were inadvertently omitted from the June 30, 2022 Schedule. Additionally, expenditures in the amount of $14,289 related to the National Endowment for the Humanities – Promotion of the Humanities Teaching and Learning Resources (ALN 45.162) had been incorrectly included as part of the Research and Development Cluster. The combination of these errors resulted in a total of $1,538,602 of Research and Development Cluster expenditures being added to the June 30, 2022 Schedule. The University also had incorrectly reported encumbrances, which represent future expenditures that have been obligated but not incurred. Cause In discussing these conditions with the University, they stated the errors were primarily due to turnover in staff responsible for preparation of the Schedule as well as a lack of documented procedures. Additionally, the management review controls in place were not operating at a sufficient level of precision to detect the errors. Effect Failure to establish effective internal controls regarding financial reporting for the preparation of the Schedule may prevent the University from completing an audit in accordance with the timelines of Uniform Guidance. Questioned Costs Not applicable. Statistical Sample Not applicable. Repeat Finding This finding is not a repeat finding in the immediately prior audit. Recommendation We recommend the University implement a system of internal control that is designed and operating at a level of precision to ensure the Schedule is complete and accurate